Archive for ‘Russia’

17/06/2019

Oil tanker attacks: did Iran’s ties with China just go up in smoke?

  • Washington has blamed Tehran for an attack on two oil tankers near the Strait of Hormuz, putting pressure on Iran’s allies like China
  • Beijing usually backs its trade partner – but experts say the trade war with the US and problems with Huawei may have changed the equation
A tanker burns in the Gulf of Oman after a mystery attack that the United States has blamed on Iran. Photo: AFP
A tanker burns in the Gulf of Oman after a mystery attack that the United States has blamed on Iran. Photo: AFP
When 
Shinzo Abe

headed to Tehran this week for the first visit by a sitting Japanese prime minister in four decades, some in the diplomatic world imagined he could be the man to bring

Iran

back to the negotiating table with the

United States

.

Those hopes were torpedoed on Thursday when, on the same day Abe was meeting Iran’s supreme leader Ayatollah Khamenei, explosions ripped through two oil tankers, one Japanese and one Norwegian, near the Strait of Hormuz, a strategically significant shipping lane.
The attack immediately overshadowed an earlier success for Abe, who had met President Hassan Rowhani a day before and was assured Iran would stick to the terms of a 2015 agreement limiting its nuclear activities.
Washington accused Iran of being behind the attack on the tankers, releasing a video on Friday that it said showed Iran’s revolutionary guard removing an unexploded mine from one of the ships, and warning that it would “defend its interests”.
Iranian President Hassan Rowhani and Japanese Prime Minister Shinzo Abe meet Iran’s Supreme Leader Ayatollah Ali Khamenei in Tehran. Photo: Reuters
Iranian President Hassan Rowhani and Japanese Prime Minister Shinzo Abe meet Iran’s Supreme Leader Ayatollah Ali Khamenei in Tehran. Photo: Reuters

Tehran, for its part, claimed to have been set up, with its foreign minister Mohammad Javad Zarif saying “suspicious doesn’t begin to describe” the incident. So much, then, for hopes of mediation.

US President

Donald Trump

, who had encouraged the Japanese leader’s visit, admitted on Twitter soon afterwards that when it came to negotiating, “they are not ready, and neither are we!”

Still, the incident exposed more than just the naivety of those hoping for an Abe-led breakthrough. In raising the stakes in Washington’s confrontation with Tehran, it also threw the spotlight on Iran’s dwindling number of allies – and perhaps most significantly on its largest trading partner, China – which face mounting pressure to rethink the relationship.

Tanker attacks: world divided over Iran role as Saudi prince breaks silence
The day after the attack, China’s President

Xi Jinping

said Beijing would promote its ties with Iran “however the situation changes” – a comment made during a meeting with Iranian President Hassan Rowhani on the sidelines of the Shanghai Cooperation Organisation summit in Kyrgyzstan – but diplomatic observers question just how far China can go in accommodating its controversial trading partner.

BEST FRIENDS FOREVER?

Iran has long been able to count on support from China, which accounts for 30 per cent of the Islamic republic’s exports and imports, and its willingness to defy US pressure is a gamble at least partly based on an assumption it can continue to count on Beijing’s support.

As Iran’s largest economic partner – Chinese direct investment in Iran hit a record high of nearly US$4 billion last year, according to data analysis project ChinaMed – Beijing already plays a key role in relieving US pressure on Iran, said Mohsen Shariatinia, assistant professor of regional studies at Shahid Beheshti University in Tehran.

But experts warn that reliance will come into question as China becomes increasingly hamstrung by its own problems.

China has enough problems of its own, starting with US pressure on Huawei. Photo: EPA
China has enough problems of its own, starting with US pressure on Huawei. Photo: EPA
Chief among Beijing’s headaches are its

trade war

with Washington and the related assault on its

5G

giant

Huawei

– which, as analysts point out, originally ignited over allegations it was defying US sanctions on Iran. Beijing will also be well aware of the need to keep

Saudi Arabia

, its second-biggest oil supplier and Tehran’s critic-in-chief, happy.

On the other hand, analysts say, China will be wary of being seen to abandon its old friend, as doing so would send a message to other nations at odds with Washington that they could no longer look to China as a diversification strategy.
“This could mean Chinese investment is vulnerable to US interference,” said Esfandyar Batmanghelidj, founder of Bourse Bazaar, a media company that supports business diplomacy between Europe and Iran.
Sanctions drive Iranian students away from US towards Asia
Doing so, Batmanghelidj said, would put a question mark over one of China’s most significant foreign policies of recent years – President Xi’s signature

Belt and Road Initiative

to fund infrastructure across Eurasia.

THE BELT AND ROAD QUESTION
Tensions between Iran and the US have reached boiling point in recent weeks, after the Trump administration last month ended waivers on sanctions for nations importing Iranian oil – a move the US says is aimed at making the republic “radioactive to the international community” and which Rowhani has described as an “economic war against Iran”.
So far, China has largely stuck by the Islamic Republic, continuing to buy fuel from it despite the latest wave of US sanctions on Iranian oil that followed Trump’s decision last year to withdraw the US from the landmark 2015 agreement curbing Tehran’s nuclear development.
The deal had been widely lauded as a triumph of multilateralism and the dawning of a new economic era for Iran.
US releases video of ‘Iranian forces removing unexploded mine’ from ship
Part of its eagerness to support Iran has stemmed from the Islamic Republic’s key position in the Belt and Road plan. In 2017 alone, China signed deals for more than US$15 billion in Iranian infrastructure investment, according to the

Chinese Communist Party

mouthpiece China Daily.

Planned projects include high-speed rail lines, upgrades to the nation’s electrical grid, and natural gas pipelines. The two nations have also vowed to boost bilateral trade to US$600 billion in the next seven years.
“China sees Iran as its Western gateway, where not only is it a big market in itself, but it will also be the gateway to the rest of the 
Middle East

and ultimately to Europe for China,” said Anoush Ehteshami, professor of international relations at Durham University in Britain.

Nisha Mary Mathew, at the Middle East Institute in Singapore, said that China’s relationship with Iran was not just economic – but primarily strategic, with both nations envisioning an international order that was no longer dominated by the US and its Western allies.
DEFIANCE, FOR NOW
If the belt and road gives China good reason to stick with Iran, there are plenty of voices urging just that action. As Andrea Ghiselli at Shanghai’s Fudan University pointed out, US sanctions until now have only strengthened the hardline factions in Iran’s government.
The combination of the US withdrawal from the nuclear deal – which had the support of the international community – along with Europe’s tepid efforts to rescue it, may have emboldened those favouring resistance over negotiation.
Xi’s supportive comments in Kyrgyzstan were only the latest in a string of remarks from China that could encourage such factions.
If Trump kills off Huawei, do Asia’s 5G dreams die?
After China’s Foreign Minister Wang Yi met Iranian Foreign Minister Mohammad Javad Zarif in Beijing last month, the ministry’s spokesman Lu Kang said China’s economic relationship with Iran was “reasonable and lawful”.
Two months prior to that, China’s Minister of Commerce Zhong Shan, while hosting his Iranian counterpart Farhad Dejpasand, had claimed China’s “determination to maintain and develop the China-Iran comprehensive strategic partnership is unshakeable”.
Chinese President Xi Jinping with Iranian President Hassan Rowhani. Photo: AFP
Chinese President Xi Jinping with Iranian President Hassan Rowhani. Photo: AFP

Even so, the pressure is getting to some. In February, Foreign Minister Zarif temporarily resigned, in what Andrea Ghiselli at Fudan University in Shanghai called a clear sign of the “changing and precarious power balance with Iran’s foreign policy establishment”.

And nowhere is the pressure felt more keenly than the economy and China’s ability to serve as a lifeline.

“The real anxiety in Iran right now is about market share,” said Bourse and Bazaar’s Batmanghelidj. “If you’re exporting zero oil and your customers are buying oil elsewhere, you lose market share.

“The government wants to know if it agreed to go back to the negotiating table and the US promised sanctions relief, that there are people who are going to buy in significant volume.”

TURNING POINT: HUAWEI

For many analysts, the event most likely to have changed the equation in Beijing’s eyes is the arrest by the Canadian authorities of 

Meng Wanzhou

, the chief financial officer of Chinese telecom giant Huawei.

Meng’s arrest came at the request of the US government, which claimed her company had violated sanctions by selling equipment to Iran.
Many observers saw the action as Washington’s way of signalling to Chinese companies that they would face repercussions if they eased the pressure on Iran by continuing to trade.
Huawei’s chief financial officer Meng Wanzhou. Photo: Reuters
Huawei’s chief financial officer Meng Wanzhou. Photo: Reuters

“Going after Huawei was about going after Chinese enterprises – signalling that they can no longer trade with Iran with impunity,” Batmanghelidj said.

Since then, Chinese firms have shown increased skittishness towards trading with Iran. According to China’s General Customs Administration, Chinese exports to Iran declined by more than half between October 2018 and February 2019, from over US$1 billion to just under US$500 million.

Mohammad Ali Shabani, a researcher at the School of Oriental and African Studies in London, said other countries in the region were now watching to see if China would blink in the face of US pressure. “This could have dire consequences for China’s image as a reliable partner,” he said.

NOT JUST ABOUT AMERICA

There are reasons beyond US pressure that may factor into Beijing’s thinking. It has long stated its opposition to Iranian nuclear weapons development, and Chinese Foreign Minister Wang Yi has said that China is “ready” to take on “its due responsibilities and make a greater contribution to world peace and common development”.

Trade war: here are Beijing’s options – and none look any good

Zhao Hong, at the Research School of Southeast Asian Studies at Xiamen University, said that in stepping up as a responsible world power Beijing faced a dilemma over its approach to Iran.
“Chinese leaders have to painfully balance an impulse towards economic cooperation with Iran against other vital interests, including convincing Washington that China is a responsible stakeholder,” he wrote in the Journal of Contemporary China.
Saudi Aramco's Ras Tanura oil refinery. The country is China’s second-largest oil supplier after Russia. Photo: Reuters
Saudi Aramco’s Ras Tanura oil refinery. The country is China’s second-largest oil supplier after Russia. Photo: Reuters

Then there is China’s relationship with Iran’s chief adversary, Saudi Arabia, to consider. Riyadh is China’s second-largest oil supplier, behind Russia, and it plays a central role in Beijing’s energy strategy.

According to International Trade Centre data, more than 12 per cent of China’s imported oil came from Saudi Arabia last year, compared with just 6 per cent from Iran. Last year, Saudi Arabia shipped 56.73 million tonnes of oil to China, or 1.135 million barrels per day.

Why would Kim Jong-un trust Trump, now that he’s ripped up Iran’s nuclear deal?

This April, China imported 6.3 million tonnes of oil from Saudi Arabia, nearly twice the 3.24 million tonnes it imported from Iran, according to China’s General Administration of Customs.

Iran’s comparatively small share of China’s oil imports market and its heavy reliance on China as a trading partner add up to a deeply uneven relationship, experts say, and it is this imbalance that will encourage the US that China may be open to rethinking its ties.

As Jon Alterman, director of the Middle East programme at Washington DC think tank the Centre for Strategic and International Studies, pointed out, while China was Iran’s largest trading partner, Iran represented less than 1 per cent of China’s international trade.

“Iran needs China,” Alterman said. “But to China, Iran is expendable.”

Source: SCMP

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17/06/2019

China rockets to forefront of global space race with sea launch success

  • China has become the first nation to fully own and operate a floating launch platform for its space missions
China has successfully launched a rocket into space from the Yellow Sea, making it the first nation to fully own and operate a floating sea launch platform. Photo: China National Space Administration
China has successfully launched a rocket into space from the Yellow Sea, making it the first nation to fully own and operate a floating sea launch platform. Photo: China National Space Administration
China successfully launched a rocket into space from a civilian cargo ship at sea on Wednesday, becoming the first nation to fully own and operate a floating sea launch platform, a technology expected to significantly reduce the cost and risk of space missions.
A Long March 11WEY rocket blasted off from the ship in the Yellow Sea at noon Beijing time, according to the China National Space Administration.
About six minutes later, five commercial satellites and a pair of “technical experiment” probes – called Bufeng, or Wind Catchers – reached their designated orbits.

The Wind Catchers will work together to detect winds on the surface of the world’s oceans. They will boost China’s ability to monitor and forecast typhoons and other extreme weather events, according to the administration.

“Launching a rocket from the sea has the advantages of high flexibility, good adaptability for specific tasks, and excellent launch economy,” said a statement on the administration’s website.

“It can flexibly select the launch point and touchdown area to meet the needs of various payloads for different orbits, and provide better aerospace commercial launch services for countries along the belt and road,” it added, referring to the Belt and Road Initiative, China’s plan to grow global trade.

The Long March 11 is a four-stage, solid fuel rocket with a design similar to a ballistic missile. It can carry a payload of about 700kg to the Earth’s lower orbit.

The first two stages of the rocket dropped in open waters in the northern Pacific Ocean, according to the administration. The rocket was equipped with a flight suspension system in case of any abnormal situation, but none occurred.

“The rocket debris will not cause damage to surrounding waters,” the administration said.

The world’s first ocean rocket launch platform, the Sea Launch, was jointly built by companies from Russia, the United States, Norway and Ukraine in the late 1990s. Its operation was halted in 2014 after military conflicts broke out between Russia and Ukraine.

Li Hong, president of the China Academy of Launch Vehicle Technology, told state media in March that the Chinese rocket and launch platform were designed and owned entirely by China, so it would not have similar problems caused by international disputes as the Sea Launch.

The launch was expected to encounter many technical and engineering challenges, including simplified procedures for pre-launch testing, the rocking motion of the ship and heat dissipation in a confined space.

But Chinese space authorities have argued the inconvenience would be offset by numerous advantages. For instance, the technology would allow China to move its launch site to as far away as Hawaii for quicker, cheaper satellite insertion to certain orbits, according to Xinhua.

Preparations get under way for Wednesday’s successful Chinese space launch from the northern Pacific ocean. Photo: China National Space Administration
Preparations get under way for Wednesday’s successful Chinese space launch from the northern Pacific ocean. Photo: China National Space Administration

A maritime launch is also expected to reduce the risk of rocket debris falling into densely populated areas.

Chinese space launch sites are typically located inland for defence purposes.

China has built its sea launch capability mainly to bolster the commercial space sector, according to Chinese space authorities.

In this mission, the rocket was sponsored and named after WEY, a young luxury car brand by Chinese sports utility vehicle manufacturer Great Wall Motor.

Chang’e 4 landing marks start of new China-US space race
Some cutting-edge car technology, such as new paint materials, will go into space for testing in the most extreme environments, according to state media reports.
The payloads include the Jilin 03A, the latest addition to a high-definition Earth observation satellite network, according to Changguang Satellite Technology Corporation, the satellite’s owner.
The company said the constellation, which will eventually comprise more than 20 satellites, would achieve global coverage for commercial applications.
One of the satellites launched on Wednesday belongs to Shanghai-based LinkSure Network, which has ambitious plans to provide free Wi-fi to everyone on the planet. The company has said it plans to eventually launch more than 200 satellites as part of the project.
Source: SCMP
06/06/2019

Russia and China sign deals worth US$20 billion as Xi Jinping and Vladimir Putin’s growing friendship bears fruit

  • Agreements to boost cooperation in spheres such as energy and technology highlight closer partnership in face of tensions with US
Xi Jinping and Vladimir Putin agreed to deepen their unprecedented partnership. Photo: Xinhua
Xi Jinping and Vladimir Putin agreed to deepen their unprecedented partnership. Photo: Xinhua

China and Russia have signed more than US$20 billion of deals to boost economic ties in areas such as technology and energy following Xi Jinping’s summit with his “best friend” Vladimir Putin.

Wednesday’s meeting between the two presidents, who have spoken of their desire to boost practical cooperation in the face of increasing rivalry with the United States, marked the start of Xi’s three-day visit to Russia to commemorate the 70th anniversary of the establishment of diplomatic relations between Moscow and Beijing.

On Thursday the Chinese commerce ministry said that the two sides aimed to increase the volume of trade between the two countries to US$200 billion a year following last year’s 24.5 per cent rise to a record level of US$108 billion.

Gao Feng, a spokesman for the ministry, said the deals covered areas such as nuclear power, natural gas, automobiles, hi-tech development, e-commerce and 5G communications.

The deals were the first concrete results of the warm words exchanged between the leaders, who agreed to deepen their “unprecedented” strategic partnership for “mutual advantage”.

“We discussed the current state of, and prospects for, bilateral cooperation in a businesslike and constructive manner, and reviewed, in substance, important international issues while paying close attention to Russia-China cooperation in areas that are truly important for both countries,” Putin said in a joint press statement with Xi on Wednesday.

Xi – who had previously told Russian media that he “treasured” the relationship with Putin, whom he described as “my best friend” – said the two countries would work to “build mutual support and assistance in issues that concern our key interests in the spirit of innovation, cooperation for the sake of mutual advantage, and promote our relations in the new era for the benefit of our two nations and the peoples of the world”.

Russia is already China’s biggest oil exporter, and has agreed to further joint ventures. Photo: Reuters
Russia is already China’s biggest oil exporter, and has agreed to further joint ventures. Photo: Reuters

Putin also highlighted the energy cooperation between the two countries, adding that Russia was China’s leading oil exporter and the eastern route of a gas pipeline between Russia and China will enter service in December.

China and Russia seek closer economic ties to counter US pressure

Novatek and Sinopec, Russian and China’s leading natural gas companies, signed a preliminary deal with Russian state-owned bank Gazprombank on Wednesday to set up a joint venture to market gas in China.

The Russian natural gas company is also forming a partnership with China Natural Petroleum Corporation and China National Offshore Oil Corporation to develop an Arctic natural gas facility, with both Chinese companies holding a 10 per cent stake in the project, according to S&P Global Platts, an energy information provider.

A general contract was also signed to build extra units of the Xudabao Nuclear Power Plant, located on the coast of the northeastern Chinese province of Liaoning.

Chinese tech giant Huawei has agreed a deal with Russian telecoms firm MTS. Photo: Xinhua
Chinese tech giant Huawei has agreed a deal with Russian telecoms firm MTS. Photo: Xinhua

The Chinese commerce ministry also said that Moscow had agreed to increase its soybean exports after imports from America declined sharply due to the ongoing trade war.

Andrey Denisov, Russia’s ambassador to China, was quoted by Chinese media as saying that the country should “double” its soybean exports to China, which currently make up a tiny proportion of the overall quantities bought by China.

The two sides are also discussing a US$153.3 million investment to create a joint agricultural holding company in Primorsky in Russia’s far east.

Russia’s Putin calls time on UK spy scandal: ‘it’s your agent, not ours’

Meanwhile, Chinese telecoms giant Huawei, which has been targeted by US sanctions after it was accused of spying and undermining national security, signed a deal with Russian telecoms company MTS to develop a 5G network.

China Investment Corporation and RDIF, a Russian sovereign wealth fund, were also reported to have agreed to set up a US$1 billion joint technology research fund, according the US-based analysts Sovereign Wealth Fund Institute.

Shi Yinhong, an international relations professor at Renmin University of China, said the two sides were boosting their strategic and diplomatic collaboration at a time of “extraordinary” tensions between Washington and Beijing.

“Though concrete cooperation in hi-tech areas [between Beijing and Moscow] is necessarily limited, in the purely military field it is assured,” Shi, an adviser to China’s State Council, said.

China’s Huawei signs deal to develop 5G in Russia

Last September, 300,000 soldiers from the two countries took part in

Vostok 20
18

a joint military exercise in eastern Siberia, the largest such drill in Russia in nearly four decades.

While Xi is highlighting his rapport with his “best friend” Putin, the professor added, “the romance has gone out of the personal relationship between Xi and [Donald] Trump”.
Source: SCMP
05/06/2019

Chinese president arrives in Moscow for state visit to Russia

RUSSIA-MOSCOW-XI JINPING-ARRIVAL

Chinese President Xi Jinping inspects the guard of honor during a welcoming ceremony upon his arrival at the airport in Moscow, Russia, June 5, 2019. Xi arrived here on Wednesday for a state visit to Russia. (Xinhua/Li Xueren)

MOSCOW, June 5 (Xinhua) — Chinese President Xi Jinping arrived here on Wednesday for a state visit to Russia as the two countries are expected to bring their comprehensive strategic partnership of coordination to a new era.

Upon arrival, Xi said he would exchange views with Russian President Vladimir Putin on how to deepen bilateral ties and promote practical cooperation, and over major international and regional issues of common concerns.

The two heads of state would plan for the future development of bilateral relationship so as to push forward the China-Russia comprehensive strategic partnership of coordination to a new era of greater development at a higher level, Xi said.

Xi’s visit to Russia, the eighth since 2013 when he was elected Chinese president, comes as the two countries are embracing the historic moment of the 70th anniversary of the establishment of diplomatic ties.

Thanks to the joint efforts from both sides, China-Russia comprehensive strategic partnership of coordination is now at its best in history, serving as a model of living in harmony and win-win cooperation between major countries and neighboring countries, Xi said.

China and Russia enjoy strong political trust, maintain sound mechanisms of high-level exchanges and cooperation in various fields, and keep close coordination in global affairs, playing a positive and constructive role in safeguarding peace and stability of the region and the world as well as international fairness and justice, Xi said.

After standing the test of changing circumstances over the past 70 years, the bilateral relations are increasingly mature, stable and resilient, Xi said, noting the ties is at a new historical starting point with a new historic opportunity.

During the visit, Xi and Putin are expected to sign or witness the signing of important cooperation documents, and attend a gathering celebrating the 70 anniversary of bilateral diplomatic ties.

Xi will also attend the 23rd St. Petersburg International Economic Forum. He will address a plenary session to expound China’s ideas on sustainable development and call for concerted efforts to safeguard multilateralism and improve global governance for the common development and prosperity of the world.

Xi and Putin, maintaining close friendship, have met nearly 30 times on bilateral and multilateral occasions since 2013. In a meeting with Putin in April, Xi said the bilateral relationship has become a major-country relationship featuring the highest degree of mutual trust, the highest level of coordination and the highest strategic value.

Source: Xinhua

31/05/2019

China, Russia see sound military exchanges in 2019: spokesperson

BEIJING, May 30 (Xinhua) — Chinese and Russian military forces have maintained in-depth exchanges in 2019 to mark the 70th anniversary of the establishment of diplomatic ties between the two countries, the Ministry of National Defense said Thursday.

They have engaged in cooperation in high-level exchanges, real-combat training and military competitions, and had sound interaction and collaboration on international multilateral occasions, the ministry’s spokesperson Wu Qian said at a press conference.

Armies of the two countries have provided positive energy for safeguarding world peace and regional stability, Wu added.

Speaking of the joint naval exercise earlier this month in Qingdao, east China’s Shandong Province, Wu said the drill achieved a new high in making China-Russia joint naval exercises more real combat-oriented, information-based and standardized.

The two navies have also strengthened their capabilities of joint command and addressing maritime security threats, Wu said.

Source: Xinhua

29/05/2019

China looks to Russia, Central Asia for support amid tensions with US

  • President Xi Jinping will meet Russian counterpart Vladimir Putin next month and address economic summit in St Petersburg
  • Diplomatic flurry will also include regional security forums in Kyrgyzstan and Tajikistan
Xi Jinping has met Vladimir Putin more times than any other foreign leader since he took power in 2013. Photo: AFP
Xi Jinping has met Vladimir Putin more times than any other foreign leader since he took power in 2013. Photo: AFP
Beijing is stepping up efforts to seek support from regional and global players such as Russia and Central Asian nations as its geostrategic rivalry with Washington heats up.

President Xi Jinping is expected to meet his Russian counterpart Vladimir Putin next month, when he will also address the St Petersburg International Economic Summit,

Russian presidential aide Yuri Ushakov told state-run TASS news agency earlier.

The Chinese president will also visit the Kyrgyzstan capital Bishkek for the Shanghai Cooperation Organisation (SCO) summit in June, as well as another regional security forum in Dushanbe, Tajikistan.

Meanwhile, Vice-President Wang Qishan is visiting Pakistan before he heads to the Netherlands and Germany, according to the Chinese foreign ministry.
Pakistani Prime Minister Imran Khan meets Chinese Vice-President Wang Qishan in Islamabad on Sunday. Photo: AFP
Pakistani Prime Minister Imran Khan meets Chinese Vice-President Wang Qishan in Islamabad on Sunday. Photo: AFP
The latest flurry of diplomatic activity comes as competition between China and the US intensifies on several fronts including trade and technology, the South China Sea and the Arctic, where Beijing’s partnership with Moscow –

funding and building ports, berths and icebreakers off Russia’s shores

– has drawn criticism from Washington.

It will be Xi’s second time at the St Petersburg forum, and observers expect the Chinese leader will reaffirm Beijing’s commitment to multilateralism and promote the nation as a champion of openness and cooperation.
China-Russia ties unrivalled, Beijing warns before Pompeo meets Putin
It will also be his second meeting with Putin in two months, after talks on the sidelines of the Belt and Road Forum in Beijing in late April, when the Russian president

offered his support

for the controversial China-led infrastructure and investment initiative.

With China and Russia edging closer, the latest meeting is likely to see efforts to coordinate their strategies on a range of issues – including Venezuela, North Korea, nuclear weapons and arms control, according to observers. Xi has met Putin more times than any other foreign leader since he took power in 2013.

“This time it is very likely that the latest anti-China moves by the US, such as new tariffs and the Huawei ban, will feature prominently in their conversations,” said Artyom Lukin, an associate professor at Far Eastern Federal University in Vladivostok.

Lukin said Russia’s stagnating economy and sanctions imposed by the West limited its role as a substitute for the foreign markets and technologies China could lose access to because of the US crusade. But he said Putin would “provide political and moral support to Xi”.

“That is also significant as Russia has been withstanding intense US-led sanctions pressure for more than five years already,” Lukin said, referring to sanctions imposed after Russia’s annexation of Crimea in 2014.

Xi and Putin are also expected to talk about Venezuela, where US-backed opposition leader Juan Guaido is attempting to oust socialist President Nicolas Maduro, who has the support of China and Russia.

Venezuelan President Nicolas Maduro has the backing of China and Russia. Photo: AP
Venezuelan President Nicolas Maduro has the backing of China and Russia. Photo: AP

“Moscow and Beijing are not able to seriously hurt Washington by raising tariffs or denying access to high technology. However, there are plenty of areas where coordinated Sino-Russian policies can damage US interests in the short term or in the long run,” Lukin said. “For example, Moscow and Beijing could intensify their joint support for the Venezuelan government of Nicolas Maduro, frustrating Washington’s efforts to dislodge him.”

China and Russia would also be seeking to boost economic ties. Bilateral trade, dominated by Chinese imports of gas and oil, reached US$108 billion last year – falling far short of the target set in 2011 by Xi’s predecessor, Hu Jintao, of US$200 billion by 2020.

China and Russia to forge stronger Eurasian economic ties

Li Lifan, an associate research professor at the Shanghai Academy of Social Sciences, said bilateral trade was a sticking point. “This is one of the potential hindrances in China-Russia relations and Beijing is hoping to [address this] … in the face of a possible global economic slowdown,” Li said.

Given the escalating trade war with Washington, he said China would seek to diversify its investments and markets to other parts of the world, particularly Russia and Europe.

“China will step up its investment cooperation with Europe and Russia and focus more on multilateral investment,” Li said.

But Beijing was not expected to do anything to worsen tensions with Washington.

“China is currently taking a very cautious approach towards the US, trying to avoid heating up the confrontation and further aggravation of the situation,” said Danil Bochkov, a contributing author with the Russian International Affairs Council. “For China it is important to demonstrate that it has a reliable friend – Russia – but that should not be done in an openly provocative manner.”

Stephen Blank, a senior fellow at the American Foreign Policy Council in Washington, said Beijing and Moscow would also seek to contain US influence “as far as possible” from Central Asia, where China has increased its engagement through infrastructure building under the “Belt and Road Initiative”.

Leaders from the region will gather in Bishkek next month for the SCO summit, a security bloc set up in 2001 that now comprises China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan, India and Pakistan. Those members account for about 23 per cent of the world’s land mass, 45 per cent of its population, and 25 per cent of global GDP.

Newly re-elected Indian Prime Minister Narendra Modi could meet the Chinese president for talks in Bishkek next month. Photo: EPA-EFE
Newly re-elected Indian Prime Minister Narendra Modi could meet the Chinese president for talks in Bishkek next month. Photo: EPA-EFE

There is growing speculation that Xi will meet newly re-elected Indian Prime Minister Narendra Modi on the sidelines of that summit.

Independent analyst and author Namrata Goswami said India would be seeking a commitment to a WTO-led and rules-based multilateral trading system during the SCO talks.

“This is interesting and significant given the current US tendencies under President Donald Trump focused on ‘America first’ and the US-China trade war,” Goswami said.

Counterterrorism will again be a top priority at the SCO summit, amid concerns among member states about the rising number of Islamic State fighters returning from Syria and Iraq. Chinese scholars estimated last year that around 30,000 jihadists who had fought in Syria had gone back to their home countries, including China.

Alexander Bortnikov, chief of the main Russian intelligence agency FSB, said earlier that 5,000 fighters from a group affiliated with Isis had gathered in areas bordering former Soviet states in Central Asia, saying most of them had fought alongside Isis in Syria.

War-torn Afghanistan, which shares a border with four SCO member states – China, Pakistan, Tajikistan and Uzbekistan – is also likely to be high on the agenda at the Bishkek summit.

“With the Trump administration drafting plans to withdraw troops from Afghanistan, the SCO will assess the security situation there and decide whether to provide training for Afghan troops,” Li said.

Eva Seiwert, a doctoral candidate at the Free University of Berlin, expected the security bloc would also discuss Iran after the US withdrew from the 2015 nuclear deal and ordered new sanctions against the country.

Iran, which has observer status with the SCO, was blocked from becoming a full member in 2008 because it was subject to UN sanctions at the time. But its membership application could again be up for discussion.

Iran presses China and Russia to save nuclear deal

“The Trump administration’s unilateral withdrawal from the Iran nuclear deal in 2018 made it easy for China and Russia to present themselves as the proponents of peaceful settlement of conflicts,” Seiwert said. “Discussing the possibility of admitting Iran as a full member state would help the SCO members demonstrate their support of multilateral and peaceful cooperation.

“This would be a strong signal to the US and enhance the SCO’s standing in the international community,” she said.

Kyrgyz President Sooronbay Jeenbekov (right) meets Chinese Foreign Minister Wang Yi in Bishkek on Tuesday last week. Photo: Xinhua
Kyrgyz President Sooronbay Jeenbekov (right) meets Chinese Foreign Minister Wang Yi in Bishkek on Tuesday last week. Photo: Xinhua

As well as security, Xi’s visit to Central Asia is also likely to focus on economic ties. Meeting Kyrgyz President Sooronbay Jeenbekov in Bishkek last week, Chinese Foreign Minister Wang Yi said Beijing would continue to “provide support and help national development and construction in Kyrgyzstan”.

Li said China may increase investment in the Central Asian region, especially in greenfield projects.

“China will continue to buy agriculture products from Central Asia, such as cherries from Uzbekistan, and build hydropower projects to meet local energy demand,” Li said. “Investment in solar and wind energy projects is also expected to increase too.”

Source: SCMP

29/05/2019

Short of war, US can’t help but lose to China’s rise in Asia, says think tank Lowy Institute

  • Lowy Institute’s 2019 Asia Power Index puts Washington behind both Beijing and Tokyo for diplomatic influence
  • Trump’s assault on trade has done little to stop Washington’s decline in regional influence, compared to Beijing, say experts
Chinese and US flags at an international school in Beijing. Photo: AFP
Chinese and US flags at an international school in Beijing. Photo: AFP
The 
United States

may be a dominant military force in Asia for now but short of going to war, it will be unable to stop its economic and diplomatic clout from declining relative to China’s power.

That’s the view of Australian think tank the Lowy Institute, which on Tuesday evening released its 2019 index on the distribution of power in Asia.

However, the institute also said China faced its own obstacles in the region, and that its ambitions would be constrained by a lack of trust from its neighbours.

The index scored China 75.9 out of 100, just behind the US, on 84.5. The gap was less than America’s 10 point lead last year, when the index was released for the first time.
“Current US foreign policy may be accelerating this trend,” said the institute, which contended that “under most scenarios, short of war, the United States is unlikely to halt the narrowing power differential between itself and China”.
The Lowy Institute’s Asia Power Index. Click to enlarge.
The Lowy Institute’s Asia Power Index. Click to enlarge.
Since July, US President

Donald Trump

has slapped tariffs on Chinese imports to reduce his country’s

trade deficit with China

. He most recently hiked a 10 per cent levy on US$200 billion worth of Chinese goods to 25 per cent and has also threatened to impose tariffs on other trading partners such as the European Union and Japan.

Herve Lemahieu, the director of the Lowy Institute’s Asian Power and Diplomacy programme, said: “The Trump administration’s focus on trade wars and balancing trade flows one country at a time has done little to reverse the relative decline of the United States, and carries significant collateral risk for third countries, including key allies of the United States.”

The index rates a nation’s power – which it defines as the ability to direct or influence choices of both state and non-state actors – using eight criteria. These include a country’s defence networks, economic relationships, future resources and military capability.

It ranked Washington behind both Beijing and Tokyo in terms of diplomatic influence in Asia, due in part to “contradictions” between its recent economic agenda and its traditional role of offering consensus-based leadership.

The spoils of trade war: Asia’s winners and losers in US-China clash

Toshihiro Nakayama, a fellow at the Wilson Centre in Washington, said the US had become its own enemy in terms of influence.

“I don’t see the US being overwhelmed by China in terms of sheer power,” said Nakayama. “It’s whether America is willing to maintain its internationalist outlook.”

But John Lee, a senior fellow at the Hudson Institute, said the Trump administration’s willingness to challenge the status quo on issues like trade could ultimately boost US standing in Asia.

“The current administration is disruptive but has earned respect for taking on difficult challenges which are of high regional concern but were largely ignored by the Obama administration – 

North Korea’s

illegal weapons and China’s predatory economic policies to name two,” said Lee.

“One’s diplomatic standing is not just about being ‘liked’ or ‘uncontroversial’ but being seen as a constructive presence.”
CHINA’S RISE
China’s move up the index overall – from 74.5 last year to 75.9 this year – was partly due to it overtaking the US on the criteria of “economic resources”, which encompasses GDP size, international leverage and technology.
China’s economy grew by more than the size of Australia’s GDP in 2018, the report noted, arguing that its growing base of upper-middle class consumers would blunt the impact of US efforts to restrict Chinese tech firms in Western markets.
US President Donald Trump with Chinese counterpart Xi Jinping. Photo: Reuters
US President Donald Trump with Chinese counterpart Xi Jinping. Photo: Reuters

“In midstream products such as smartphones and with regard to developing country markets, Chinese tech companies can still be competitive and profitable due to their economies of scale and price competitiveness,” said Jingdong Yuan, an associate professor at the China Studies Centre at the University of Sydney.

“However, to become a true superpower in the tech sector and dominate the global market remains a steep climb for China, and the Trump administration is making it all the more difficult.”

The future competitiveness of Beijing’s military, currently a distant second to Washington’s, will depend on long-term political will, according to the report, which noted that China already spends over 50 per cent more on defence than the 10 

Asean

economies,

India

and

Japan

combined.

TRUST ISSUE
However, 
distrust of China

stands in the way of its primacy in Asia, according to the index, which noted Beijing’s unresolved territorial and historical disputes with 11 neighbouring countries and “growing degrees of opposition” to its signature

Belt and Road Initiative

.

Beijing is locked in disputes in the

South China Sea

with a raft of countries including Vietnam, the Philippines and Brunei, and has been forced to renegotiate infrastructure projects in

Malaysia

and Myanmar due to concerns over feasibility and cost.

If Trump kills off Huawei, do Asia’s 5G dreams die?
Xin Qiang, a professor at the Centre for American Studies at Fudan University in Shanghai, said Beijing still needed to persuade its neighbours it could be a “constructive, instead of a detrimental, force for the region”.
“There are still many challenges for [China to increase its] power and influence in the Asia-Pacific,” Xin said.
Wu Xinbo, also at Fudan University’s Centre for American Studies, said Beijing was having mixed success in terms of winning regional friends and allies.
“For China, the key challenge is how to manage the maritime disputes with its neighbours,” said Wu. “I don’t think there is growing opposition to the Belt and Road Initiative from the region, actually more and more countries are jumping aboard. It is the US that is intensifying its opposition to the project as Washington worries it may promote China’s geopolitical influence.”
Yuan said the rivalry between the

US and China

would persist and shape the global order into the distant future.

“They can still and do wish to cooperate where both find it mutually beneficial, but I think the more important task for now and for some time to come, is to manage their disputes in ways that do not escalate to a dangerous level,” Yuan said. “These differences probably cannot be resolved given their divergent interests, perspectives, etc, but they can and should be managed, simply because their issues are not confined to the bilateral [relationship] but have enormous regional and global implications.”
Elsewhere in Asia, the report spotlighted Japan, ranked third in the index, as the leader of the liberal order in Asia, and fourth-placed India as an “underachiever relative to both its size and potential”.
China’s wrong, the US can kill off Huawei. But here’s why it won’t
Lee said the index supported a growing perception that Tokyo had emerged as a “political and strategic leader among democracies in Asia” under

Shinzo Abe

.

“This is important because Prime Minister Abe wants Japan to emerge as a constructive strategic player in the Indo-Pacific and high diplomatic standing is important to that end,” Lee said.

Russia

, South Korea, Australia,

Singapore

, Malaysia and Thailand rounded out the top-10 most powerful countries, in that order. Among the pack, Russia, Malaysia and Thailand stood out as nations that improved their standing from the previous year.

Taiwan

, ranked 14th, was the only place to record an overall decline in score, reflecting its waning diplomatic influence

after losing three of its few remaining diplomatic allies

during the past year.

Source: SCMP
24/05/2019

China, Russia vow to strengthen cooperation along Yangtze, Volga rivers

RUSSIA-CHEBOKSARY-WANG YONG-VOLGA-YANGTZE-COOPERATION-MEETING

Chinese State Councilor Wang Yong (L) and Igor Komarov, Russia’s Presidential Plenipotentiary Envoy to the Volga Federal District, co-chair the third meeting of the Council of Cooperation between the upper and middle reaches of the Yangtze River and the Volga Federal District in Cheboksary, Russia, May 23, 2019. (Xinhua/Bai Xueqi)

CHEBOKSARY, Russia, May 23 (Xinhua) — China and Russia pledged to strengthen cooperation along the Yangtze and Volga rivers as local governments from these areas on Thursday signed an array of cooperation deals.

The third meeting of the Council of Cooperation between the upper and middle reaches of the Yangtze River and the Volga Federal District was co-chaired by Chinese State Councilor Wang Yong and Igor Komarov, Russia’s Presidential Plenipotentiary Envoy to the Volga Federal District, in the Russian city of Cheboksary.

Wang said that both sides should work to achieve more outcomes from local governments cooperation and make such partnership a new growth area for China-Russia relations.

Komarov said the unique “Volga-Yangtze” mechanism has been fruitful in trade and investment cooperation as well as people-to-people exchanges, and Russia is ready to work with China for more achievements.

Source: Xinhua

19/05/2019

Shanghai Bund’s historic buildings saved from demolition … for now

  • Experts win reprieve for two out of three heritage houses but fear their success is only temporary
  • Authorities plan public cultural facilities for the site
The historic buildings on Shanghai’s Bund in the 1930s. One of the three structures has already been demolished but authorities have temporarily suspended plans to knock down the other two. Photo: Handout
The historic buildings on Shanghai’s Bund in the 1930s. One of the three structures has already been demolished but authorities have temporarily suspended plans to knock down the other two. Photo: Handout
Two historic buildings on Shanghai’s famous Bund have temporarily escaped demolition after a group of experts appealed to the government to conserve the heritage sites, but the intervention was too late to save a third.
About 15 architecture, history and culture experts based in Shanghai banded together to write an article on social media app WeChat last month, calling on the city’s government to “protect the city’s memories” by preserving three houses on Huangpu Road.
A few days after the article was published one of the buildings was demolished as part of a plan to build public cultural facilities on the site. But authorities suspended work on the other two and are considering removing only the interior structure while preserving the external walls, according to the group.
The houses, which date back to 1902, witnessed the city’s boom in the first half of the 20th century when it became one of the world’s most important, and famous, ports, the experts said.
The demolition project on The Bund, Shanghai has been suspended, but not before one of the three historic buildings was demolished. Photo: Urban China magazine
The demolition project on The Bund, Shanghai has been suspended, but not before one of the three historic buildings was demolished. Photo: Urban China magazine

All three of the properties originally belonged to Japanese shipping company Nippon Yusen Kaisha Group and were later used as storage facilities for Japan’s military forces during the second world war, according to Yu Hai, a sociologist from Shanghai’s Fudan University.

“These buildings, along with the nearby Yangzijiang port on the Huangpu River, represented Shanghai’s wharf culture and port culture,” Yu said. “They are historically significant as they witnessed Shanghai grow prosperous through shipping and trade industries about a century ago.”

Although the two remaining buildings are safe for now, the experts argue their interiors are also worth preserving.

Liu Gang, an architecture professor at Shanghai’s Tongji University, said the properties featured big wooden beams supported by black iron pillars, which were prominent architectural features of industrial buildings dating back to the 19th century.

“We guess it was hard to move these giant beams with vehicles at the beginning of the 20th century. Quite possibly they were transported on the river. We guess that the wood was chopped down and processed in places across the Pacific [from North America] and shipped to Shanghai.”

In the WeChat article, Liu called for the protection of the interior structure of the buildings. “Without solid research, we cannot simply take them down to be replaced by new ones.”

Yu agreed, saying: “The building with a new inside structure would be a fake and this plan will destroy historical heritage.”

Experts say the interiors of the historic buildings are also worth preserving. Photo: Urban China magazine
Experts say the interiors of the historic buildings are also worth preserving. Photo: Urban China magazine

Huangpu Road, where these houses sit, is rich with history. It features the Garden Bridge of Shanghai – the city’s first steel bridge, built in 1907 – and was once home to the consulates of the United States, Russia, Japan, Germany, Denmark and the Austro-Hungarian empire.

Other notable landmarks on the road include the Astor House Hotel, built in 1846, where Charlie Chaplin, Albert Einstein and George Bernard Shaw stayed in the 1920s and 1930s. The hotel is still there.

“History happened here,” Yu said. “But it’s a pity that most of the old buildings in this area no longer exist.”

Despite their success in winning a stay of execution for the two buildings, the experts are cautious in their expectations.

“The demolition work was suspended, but that does not mean they have accepted our proposals. We are not optimistic,” Yu said.

About two weeks ago as part of their effort to save the buildings, Yu and three other scholars approached officials from Shanghai’s Planning and Natural Resources Bureau, the government body behind the demolition project.

“Officials emphasised the difficulties of keeping the completeness of the old buildings and we just pointed out the damage to their historical values,” Yu said.

The Shanghai bureau did not immediately reply to a request for comment.

Shanghai nightclub king opens new art space – in disused oil tanks
Appeals by the public to conserve historical buildings have generally not been successful. Shenyuli, a typical Shanghai residential community built in the 1930s, was included in the city’s protected list of historical buildings in 2004.
The listing was not enough to prevent its demolition eight years later to make way for a public green land space.
Three years ago, the Shanghai government announced it was suspending the planned demolition of a former sex slavery station used by Japanese soldiers during the second world war, following media reports and a public outcry.
However, the building was later demolished, according to Su Zhiliang, history professor from Shanghai Normal University and a researcher on sex slavery, who predicts a similar outcome for this latest conservation effort.
“I think the government is just using the same tactic to postpone their plan. After the public’s attention is over, they will continue demolishing,” Su said.
Source: SCMP
19/05/2019

Brazil’s vice-president Hamilton Mourao heads to China to mend relations

  • General will spend five days meeting top Chinese leaders including President Xi Jinping
  • Mission seeks to patch up wounds caused by Brazilian President Jair Bolsonaro’s anti-China rhetoric
Hamilton Mourao favours maximising engagement with China. Photo: EPA-EFE
Hamilton Mourao favours maximising engagement with China. Photo: EPA-EFE
Brazil’s vice-president is expected to land in Beijing on Sunday on a mission to patch up wounds caused by President Jair Bolsonaro’s lacerating anti-China rhetoric.
General Hamilton Mourao will spend five days in China rubbing shoulders with some of the country’s most powerful leaders, culminating in an audience with President Xi Jinping, in an effort to shore up the relationship between the two emerging market giants. Bolsonaro himself is due to visit later this year, while Xi is due to visit Brasilia in November for the BRICS summit.
China – Brazil’s most important trading partner for the past decade – remains a sensitive subject in the Bolsonaro administration. While Mourao and the other business-oriented members of government favour maximising engagement with the Asian giant, Bolsonaro and his more radical appointees view China with a high degree of suspicion, as a predatory economy that wishes not merely to invest in Brazil, but to own it.

“The Chinese can buy in Brazil, but they can’t buy Brazil,” the president said at a breakfast with journalists last month.

Brazilian President Jair Bolsonaro said last month that the “Chinese can buy in Brazil, but they can’t buy Brazil”. Photo: AFP
Brazilian President Jair Bolsonaro said last month that the “Chinese can buy in Brazil, but they can’t buy Brazil”. Photo: AFP

Still, in comparison with his pre-election criticism of China as “heartless”, Bolsonaro in office has dialled down his anti-Beijing sentiment. Mourao’s visit is part of an effort to reset that relationship.

“The Chinese understand that Mourao plays a central role in toning down Bolsonaro’s rhetoric,” said Oliver Stuenkel, a specialist on BRICS – an association of five major emerging economies, namely Brazil, Russia, India, China and South Africa – at the FGV business school. “They know that the Mourao-China relationship will be fundamental.”

Should China be worried about Bolsonaro’s bromance with Trump?

Speaking to reporters recently, Mourao recognised the need to balance the Bolsonaro administration’s desire to pivot towards the United States with practical considerations of China’s economic significance.

“The US are the champions of democracy and freedom and our government has left it very clear what this represents,” the vice-president said. “But on the other side we have to be sufficiently pragmatic to understand the importance of China for Brazil’s economic development.”

Chinese investment in Brazil reached almost US$134 billion between 2003 and 2018, Brazilian government figures showed.

Chinese President Xi Jinping is expected to meet the visiting Brazilain vice-president. Photo: AP
Chinese President Xi Jinping is expected to meet the visiting Brazilain vice-president. Photo: AP

While the trade war between the US and China may offer Brazil some short-term gains, particularly for its agricultural sector, the downsides outweigh the benefits, according to Renata Amaral, a foreign trade analyst at Barral MJorge consultancy.

“In truth this war is no good for anyone,” she said.

Mourao said that Brazil was monitoring the situation “critically and cautiously”.

Why US-China trade war could be good for Brazil
From the Chinese perspective, Beijing is looking for Brazil’s formal support for its “Belt and Road Initiative” – Chinese President Xi Jinping’s signature global infrastructure megaproject. Asked whether Brazil might sign up to the programme, Mourao said that any agreement would have to be approved by Bolsonaro in the second half of the year.
After trips to the Great Wall of China and the Shanghai Stock Exchange, Mourao will meet Xi, in a clear sign of Brazil’s importance to China. “The visit of vice-president Mourao will reinforce mutual political confidence, deepen our friendly cooperation and add new dimensions to our strategic partnership,” according to Chinese foreign ministry spokesman Geng Shuang.
With Beijing both uncertain about the direction of Brazilian foreign policy under Bolsonaro and eager to strike deals on infrastructure and food security, it makes sense for the Chinese to roll out the red-carpet for Mourao, according to Hussein Kalout, a specialist in foreign policy and a researcher at Harvard.
China trade vs economic growth: the dilemma for Brazil’s president
While the federal government remains ambivalent about its relationship with China, some of Brazil’s powerful state governors are seeking to develop their own relationship with the Asian country. One of them is Carlos Massa Ratinho Junior, the governor of the southern state of Parana, who travelled to China recently to discuss agriculture and railroad projects.
“We’re open to talk with any country that wants to and understands that the state of Parana is the best to place to invest in Brazil,” the governor said in an interview, adding that his actions did not conflict with the federal government’s stance towards Beijing.

But in a sign of the domestic pressure Bolsonaro is under not to abandon entirely his sceptical attitude to China, Luiz Philippe de Orleans e Braganca, the vice-president of the lower house’s foreign affairs committee and a lawmaker from Bolsonaro’s own party, said the government should set limits to the partnership.

“It’s good to talk to China, but it depends what is being discussed,” he said. “For example, the 5G network set up by China is dangerous because it will give the Chinese more information about Brazilian citizens than the Brazilian government.”

Source: SCMP

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