Chindia Alert: You’ll be Living in their World Very Soon
aims to alert you to the threats and opportunities that China and India present. China and India require serious attention; case of ‘hidden dragon and crouching tiger’.
Without this attention, governments, businesses and, indeed, individuals may find themselves at a great disadvantage sooner rather than later.
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China has effectively expelled journalists from three US newspapers in retaliation for restrictions on its news outlets in the US.
Its foreign ministry ordered reporters from the New York Times, the Washington Post and the Wall Street Journal to return media passes within 10 days.
The ministry also demanded information about their operations in China.
The measures were in response to “unwarranted restrictions on Chinese media agencies” in the US, it said.
China’s action also prohibits the newspapers’ journalists from working in the semi-autonomous regions of Hong Kong and Macau, where there is greater press freedom than on the mainland.
Earlier this month, the Trump administration imposed limits on the number of Chinese citizens who could work as journalists in the US – the latest move in a tit-for-tat row over press freedoms.
“What the US has done is exclusively targeting Chinese media organisations, and hence driven by a Cold War mentality and ideological bias,” China’s foreign ministry said in a statement on Tuesday.
US Secretary of State Mike Pompeo urged Beijing to reconsider its decision, calling the move “unfortunate”.
“I regret China’s decision today to further foreclose the world’s ability to conduct the free press operations that, frankly, would be really good for the Chinese people in these incredibly challenging global times, where more information, more transparency are what will save lives,” Mr Pompeo said.
Great loss for Chinese journalism
Zhaoyin Feng, BBC Chinese
All foreign correspondents in China are required to renew their press credentials annually, which usually happens at the year end.
This means most American reporters of the three US major publications have an expiring visa and will need to leave China under the new rules. We don’t know the exact number of affected journalists yet, but it’s believed to be close to a dozen.
The expulsions will lead to a major personnel loss in these three media organisations’ China operation, especially for the Wall Street Journal, which had already seen three reporters expelled from China last month.
Critics say it’s an even greater loss for China, as the draconian measures come at a time when the country and the rest of the world need high-quality journalism on China more than ever.
It’s still unclear whether the US publications can send new correspondents, American citizens or not, to fill in the positions in China.
In the midst of a dangerous pandemic, the world’s two superpowers are locked in an escalating war with multiple fronts. By fighting over media, the origin of the coronavirus, and technology and trade, the US and China are competing to prove the superiority of their own political model.
At the beginning of March, the US state department said five media outlets, including China’s official news agency Xinhua, would be required to reduce their total number of staff to 100 from 160.
The move was seen as retaliation for China’s expulsion of two US journalists for the Wall Street Journal over a coronavirus editorial in February.
The row over media access is the latest episode in an increasingly acrimonious dispute between China and the US.
Disagreements over trade, intellectual property rights and 5G networks have damaged relations in recent years.
The coronavirus pandemic has been a source of tension too, with Washington and Beijing both accusing each other of spreading misinformation.
On Tuesday, US President Donald Trump angered China by referring to the coronavirus as “Chinese”.
A foreign ministry spokesman accused the US of stigmatising China, where the first cases of Covid-19 were recorded in the city of Wuhan in late 2019.
However, last week a Chinese foreign ministry spokesman shared a conspiracy theory, alleging the US Army had brought it to the region.
The unfounded accusation led Mr Pompeo to demand China stop spreading “disinformation” as it tried “to shift blame” for the outbreak.
China is now making more than 100 million masks a day, up from 20 million before the coronavirus outbreak, and may start to export more to other countries
Mask shortages elsewhere once more raise the debate about an over-reliance on China, with critics pointing to a lack of US industrial policy
China was producing 116 million masks per day of February 29, including a mix of disposable and high-end masks like the American-designed N95 model worn by President Xi Jinping on his trip on Tuesday to Wuhan. Photo: Xinhua
The Liu family factory has been making diapers and baby products in the Chinese city of Quanzhou for over 10 years, but in February, for the first time, it started making face masks, as demand soared spectacularly due to the coronavirus outbreak.
The business – which employs 100 people in the Southeastern Fujian province – has added two production lines to make up to 200,000 masks a day.
And while the decision was primarily commercial, “encouragement” from the Chinese government – in the form of subsidies, lower taxes, interest-free loans, fast-track approvals for expansion and help alleviating labour shortages – made the decision an obvious one, said Mr Liu who preferred only to give his family name.
“The government is advocating an expansion in production,” Liu said. “With faster approvals, producers need to prioritise the government’s needs over exports.”
WHO declares coronavirus crisis a pandemic
The factory is one of thousands of refitted pop-ups around China making masks and other protective equipment for the first time, part of a massive industrial drive to respond to the spread of the coronavirus.
Before the outbreak, China already made about half the world’s supply of masks, at a rate of 20 million units a day. That rose to 116 million as of February 29, according to China’s state planning agency, a mix of disposable and high-end masks like the American-designed N95 model worn by President Xi Jinping on his trip on Tuesday to Wuhan, the epicentre of the outbreak.
This exponential jump is the result of a wartime-like shift in industrial policy, with Beijing directing its powerful state-owned enterprises to lead the nationwide mask-making effort, and the country’s sprawling manufacturing engine following their lead.
For me, this is the big advantage of China, the speed Thomas Schmitz
“For me, this is the big advantage of China, the speed,” said Thomas Schmitz, president of the China branch of Austrian engineering giant Andritz, which has seen a big uptick in demand for its wet wipe-making machines in recent weeks, also due to the virus. “When you need to run, people know how to run, and this is something which has been lost in other countries since their industrial heydays.”
Chinese oil and gas major Sinopec upped production of mask raw materials such as polypropylene and polyvinyl chloride in January. This week, it set up two production lines in Beijing to produce melt-blown non-woven fabric, intended to make four tonnes of the fabric each day, which can then be used to produce 1.2 million N95 respirators or six million surgical masks a day.
The maker of China’s new J-20 stealth fighter jet, Chengdu Aircraft Industry Group, repurposed part of its factory to design a mask production line, according to local media reports. The SichuanDaily said 258 of the company’s engineers spent three days fast-tracking development of an assembly line with more than 1,200 components.
Coronavirus: From mysterious origins to a global threat
More than 2,500 companies in China have reportedly started making masks, among them 700 technology companies including iPhone assembler Foxconn and smartphone makers Xiaomi and Oppo, in an extraordinary mobilisation of resources.
The result resembles “the war effort” in the middle of the last century in the United States and western Europe, but arguably no other nation could undergo such a transformation so quickly today.
It is a reminder of what can happen in a centrally-planned economy with a strong manufacturing base, but also brings into sharp focus some of the geopolitical issues which have characterised China’s at-times difficult relationship with the rest of the world, particularly the European Union and US, over the past couple of years.
China’s dominance in manufacturing has become all the more evident as the rest of the world scrambles to shore up their own dwindling medical supplies, leading many to wonder why the world is so dependent on it for vital supplies.
The lesson for Washington is not that we need to emulate the Chinese economic model, but rather that we need to better steward the industrial base in key sectors Rush Doshi
The Italian government, which is dealing with the highest number of coronavirus cases and deaths after China, is to take shipment of 1,000 ventilators, 2 million masks, 100,000 respirators, 200,000 protective suits and 50,000 testing kits from China.
Italian foreign minister Luigi Di Maio said after a phone call with Chinese counterpart Wang Yi, they had agreed the export deal in the same week that European neighbours France and Germany banned masks from being exported because of low domestic supplies.
The Italy export deal showed that “China is emerging as a global public goods provider as the US proves unable and unwilling to lead,” said Rush Doshi, the director of the China Strategy Initiative at the Washington-based Brookings Institute think tank.
“China’s ability to produce what is needed to fight coronavirus is not simply a product of its economic model – it’s also a product of its industrial capacity,” Doshi said. “The US once had this capacity too, but it has lost important parts of it. The lesson for Washington is not that we need to emulate the Chinese economic model, but rather that we need to better steward the industrial base in key sectors.”
The frustration is felt acutely by Michael Einhorn, president of medical equipment distributor Dealmed-Park Surgical in New York, who has been trying to source stock from China for weeks, “but cannot get straight answers” from vendors.
Einhorn said he placed an order with a private seller in China’s virus-stricken city last week, but that the goods had not been shipped.
“Everyone is running out here, people are panicking in hospitals and we want to be able to help our most important customers,” Einhorn said. “We are dealing with hospitals that do not have products, how in the United States of America in 2020 did this happen?”
With the number of confirmed coronavirus cases in China falling daily, it is not inconceivable that the sort of export deal struck with Italian leaders becomes commonplace, although for now, it deal can be chalked up as a significant public relations coup for Beijing.
The World Medical Association is unable to specify how many masks are required to supply frontline medical staff in virus-hit areas, but said that “this crisis should be a wake up call for politicians and societies to make the necessary investment in emergency preparedness and to look into the vulnerability of our supply chains”.
Australian-listed manufacturer Eagle Health announced on Friday that it had installed production lines at its Xiamen factory in southern China to make 300 million masks a year and said it had already received orders from China and would be securing further larger orders internationally.
The group, which normally makes products including amino acids, protein supplements and lozenges in China, said it would prioritise meeting the large domestic demand, but was aware of an impending global shortage.
Eagle Health has already commenced production of its first order of 3.2 million medical masks for the Yiling Hospital Management Group in China, a process which will take 10 days. It has other smaller orders from Chinese government agencies and expects to receive more orders outside China.
The decision to make more masks came from increased demand. These are opportunities. The global demand for high quality masks will be significant Xu Gang
“The decision to make more masks came from increased demand. These are opportunities,” said chief executive Xu Gang. “The global demand for high quality masks will be significant. Imagine when the schools open. The situation will take some time to peak.”
Last week, the Australian Dental Association said supplies of masks at many practices were expected to run out within four weeks. The Australian government has since arranged a supply of 54 million masks for both the dental and medical industries.
At the same time, the US only has 1 per cent of the 3.5 billion masks it would need to counter a serious outbreak, Bloomberg reported.
While China has no quota on the volume of masks that had to be hived off for local consumption, the government has said domestic demand needs to be prioritised.
Businesses are free to export but overseas demand has yet to explode like it has in China, said Fujian factory owner Liu.
Wendy Min, sales director of Pluscare, a manufacturer based near the virus’ epicentre in Hubei province, said her company is making 200,000 masks per day, much of which are sold to the government, with exports still restricted by partial lockdown of workers and cargo transport.
“We previously exported to Europe, South America and other parts of Asia,” Min said. “But at the moment we can’t export. We are trying to discuss this with the government, but we cannot wait any more – we have to export soon.”
Min said that while she was receiving countless cold calls up until last week from people in China looking for masks, these have stopped, perhaps unsurprising given the abundance in supplies becoming available.
An influx of Chinese-made masks, though, is likely to be welcomed in other virus-stricken parts of the world.
Self-quarantine of all international travellers to Beijing as China fights import of coronavirus
Miguel Luiz Gricheno, CEO of Brazilian mask manufacturer Destra, said that his company is making 30,000 masks a day, but cannot meet local demand due to a lack of supplies, including the non-woven fabric from which masks are made.
“In disposable masks, most Brazilian companies are paralysed due to the lack of raw materials,” Gricheno said. “With the arrival of the coronavirus in Brazil, the demand has increased a lot but the main raw material comes from abroad.”
However, a short-term supply fix will not answer underlying questions about how so many countries found themselves in such dire straits,meaning the geopolitical fallout of the coronavirus will be extensive.
Decades of weak industrial policy helped elect US President Donald Trump, who said he would bring manufacturing jobs back to America at China’s expense. While he has waged a bruising two-year trade war with China in response, the current situation shows just how difficult it will be to change the global manufacturing processes, which are so heavily controlled by China.
One of the great flaws of globalisation is that everyone wanted things cheaper, but did you compromise your health care infrastructure in the process? Stephen Roach
“In the guise of trying to improve efficiency and create value for price-sensitive consumers, we’ve created a global production network that is very difficult to unwind,” said Stephen Roach, a professor of economics at Yale University and a veteran China watcher. “One of the great flaws of globalisation is that everyone wanted things cheaper, but did you compromise your health care infrastructure in the process.
Reuters reported that Trump is considering invoking the emergency provisions of the Defence Production Act, which would allow the government to instruct companies to alter production to help address the domestic shortage of medical supplies like masks. If a company is producing 20 per cent N95 masks and 80 per cent standard masks, the White House could order them to rejig the ratio, an unnamed official said.
The New York Times reported on Wednesday that the White House is preparing an executive order that would allow the government to buy medical supplies from overseas in the hope that it will incentivise companies to make them within the US.
But these changes still do not give Trump the sort of sweeping powers enjoyed by Chinese counterpart Xi.
“When you have a pluralistic, democratic situation that Trump is overseeing, it becomes more unwieldy” to take the steps necessary to address a crisis situation, said Harry Broadman, chair of the emerging markets practise at the Berkeley Research Group and a senior US government official in the 1980s and 1990s.
“That is why I think Trump looks at Xi with envy, because he doesn’t have to deal with a disparity of views or democratic interests,” Broadman said. “I think Trump is at heart a bilateral guy, as you saw with the phase one [US-China] trade deal and the state-to-state purchases. That is why he likes dealing with [Russian President Vladimir] Putin and Xi, because each of them can move mountains. I think Trump is very envious of that ability.”
Image copyright GETTY IMAGESImage caption Mr Trump is making his first official visit to India
US President Donald Trump is expecting a raucous welcome on his first official state visit to India on Monday and Tuesday.
He follows a long line of leaders who have made the journey. Some of his predecessors were greeted enthusiastically; others stumbled through diplomatic gaffes; one even had a village named after him.
Can history be a guide to how this diplomatic tryst might go? Here’s a brief look at past visits, ranked in order of how they went.
The good: President Eisenhower
Let’s begin at the beginning.
Dwight D Eisenhower, the first US president to visit India, was greeted with a 21-gun salute when he landed in the national capital, Delhi, in December 1959. Huge crowds lined the streets to catch a glimpse of the World War Two hero in his open-top car – Mr Trump is expecting a similar reception in Ahmedabad city, where he will be doing a road show.
Image copyright US EMBASSY ARCHIVESImage caption Dwight D Eisenhower, pictured with Prime Minister Jawaharlal Nehru, was the first US president to make the trip
The warmth between President Eisenhower and Indian Prime Minister Jawaharlal Nehru helped during what was a rocky phase in US-India ties. This was early in the Cold war, when the US and Pakistan had become become close allies, and India insisted on staying neutral or “non-aligned”. Like today, relations with China were at the core of the India-US equation, with Washington pressuring Delhi to take an aggressive stance with Beijing on the issue of Tibet.
But, on the whole, Eisenhower’s four-day trip was billed a success. And nearly every US president on a state visit to India has emulated his itinerary: he laid flowers at Mahatma Gandhi’s memorial, took in the splendour of the Taj Mahal, addressed parliament and spoke at Delhi’s iconic Ramlila grounds, which, according to one news report, attracted one million people.
When he left, Nehru said he had taken with him “a piece of our heart”.
Image copyright US EMBASSY ARCHIVESImage caption President Eisenhower was greeted by large crowdsThe game-changer: Bill Clinton
If there was a game-changing visit, it would be Bill Clinton’s in March 2000 with Prime Minister Atal Bihari Vajpayee. Mr Clinton’s arrival came after a two-decade lull – neither Ronald Reagan nor George Bush Snr made the journey East. It came at a tricky time as Washington had imposed sanctions on Delhi following its 1999 test of a nuclear bomb.
But, according to Navtej Sarna, a former Indian Ambassador to the US, the five-day trip was “a joyous visit”. It included stops in Hyderabad, a southern city that was emerging as a tech hub, and Mumbai, India’s financial capital. “He came and saw the economic and cyber potential of India, and democracy in action,” says Mr Sarna.
Image copyright GETTY IMAGESImage caption Bill Clinton’s visit was described as “joyous”Mr Clinton also danced with villagers, took a tiger safari and sampled Delhi’s famously creamy black dal (lentils) at a luxury hotel that has since been associated with the president.
The country’s reaction is perhaps best expressed in this New York Times headline: “Clinton fever – a delighted India has all the symptoms.”
The nuclear deal: George W Bush
George W Bush, as Forbes magazine once put it, was the “best US president India’s ever had”. His three-day visit in March 2006 was a highlight in the two countries’ strategic relationship – especially in matters of trade and nuclear technology, subjects they have long wrangled over. His strong personal dynamic with Prime Minister Manmohan Singh was hard to miss – after he left office, Mr Bush, a keen artist, even painted a portrait of Mr Singh.
The two leaders are credited for a historic but controversial nuclear deal, which was signed during Mr Bush’s visit. It brought India, which had for decades refused to sign the Nuclear Non-Proliferation Treaty (NPT), out of isolation. Energy-hungry India got access to US civil nuclear technology in exchange for opening its nuclear facilities to inspection.
Image copyright US EMBASSY ARCHIVESImage caption George W Bush and Manmohan Singh had a very good relationshipHowever, while the visit was substantive, it was not as spectacular as others – there was no trip to the Taj, nor an address to parliament. But the timing was important. Anti-US sentiment over the invasion of Iraq was running high – left-wing MPs had staged a protest against Mr Bush’s visit, and there were demonstrations in other parts of India.
Double visit: Barack Obama
Barack Obama was the only president to make two official visits. First, in 2010 with Prime Minister Manmohan Singh, and then in 2015 with Prime Minister Narendra Modi.
On his first visit – in a break from the past – he landed in Mumbai, instead of Delhi, with a large trade delegation. This was not just about economic ties but a show of solidarity following the Mumbai terror attacks of 2008, which killed 166 people. Mr and Mrs Obama even stayed at the Taj Mahal hotel, one of the main targets.
It was significant that the US president declared support for India to join a reformed and expanded UN Security Council, says Alyssa Ayres, a former US deputy assistant secretary of state for South Asia. “That all these years later nothing has changed in the UN system is another matter, but that was a major policy shift for the United States.”
Image copyright US EMBASSY ARCHIVESImage caption Barack Obama visited India twiceMr Obama returned in 2015 as chief guest at India’s Republic Day celebrations, at PM Modi’s invitation. Trade, defence and climate change were at the heart of the talks. The trip also emphasised an Indo-Pacific strategy, where both leaders expressed unease over Beijing’s provocations in the South China Sea.
The not-so-good: Jimmy Carter
Although Jimmy Carter’s two-day visit in 1978 was a thaw in India-US relations, it was not free of hiccups.
With some 500 reporters in tow, Carter followed a packed itinerary: he met Prime Minister Morarji Desai, addressed a joint session of parliament, went to the Taj Mahal, and dropped by a village just outside Delhi.
The village, Chuma Kheragaon, had a personal connection: Carter’s mother, Lillian, had visited here when she was in India as a member of the Peace Corps in the late 1960s. So when Carter and his wife, Rosalynn, made the trip, they gave the village money and its first television set. It was even renamed “Carterpuri”, a moniker it still holds.
Image copyright US EMBASSY ARCHIVESImage caption Jimmy Carter being greeted by villagers of ‘Carterpuri’But beyond the photo-ops, India and the US were sparring. India was building its nuclear programme, and had conducted its first test in 1974. The US wanted India to sign the NPF, which sought to stop the spread of nuclear weapons. But India refused, saying the agreement discriminated against developing countries.
In a leaked conversation that made headlines and threatened to derail the visit, Mr Carter promised his Secretary of State, Cyrus Vance, a “very cold and very blunt” letter to Desai. The two leaders signed a declaration, promising greater global co-operation, but Carter left India without the assurances he had hoped for.
The ugly: Richard Nixon
Richard Nixon was no stranger to India when he arrived in August 1969 for a day-long state visit. He had been here as vice-president in 1953, and before that on personal trips. But, by all accounts, he wasn’t a fan.
“Nixon disliked Indians in general and despised [Prime Minister] Indira Gandhi,” according to Gary Bass, author of Blood Telegram: Nixon, Kissinger and a Forgotten Genocide. And, he adds, the feeling was said to be mutual.
This was also at the height of the Cold War, and India’s non-alignment policy “appalled” American presidents. Mr Bass says that under Gandhi, India’s neutrality had turned into a “noticeably pro-Soviet foreign policy”.
Image copyright GETTY IMAGESImage caption Richard Nixon waves to the crowds alongside Mohammad Hidyatullah, India’s acting presidentThe relationship only turned frostier after the trip as India backed Bangladesh (then East Pakistan) in its fight for independence from Pakistan, a close American ally. The differences were laid bare when Gandhi visited the White House in 1971. Declassified state department cables later revealed that Nixon referred to her as an “old witch”.
And the future: Donald Trump
The US and India have certainly had their ups and downs, but during the last official visit in 2015, Mr Obama and Mr Modi signed a declaration of friendship: “Chalein saath saath (Let’s move forward together)…” it began.
President Trump’s visit will take the relationship forward, but it’s unclear how.
Image copyright AFP
His arrival in Ahmedabad, the main city in PM Modi’s home state of Gujarat, followed by a big arena event, is expected to draw a massive crowd. It will echo President Eisenhower’s rally in Delhi years ago, perhaps cementing the personal ties between the two leaders.
But while Mr Trump’s trip will be packed with pageantry, it could be light on policy. Unlike other presidential visits, this one is not expected to yield concrete agreements, with the trade deal Mr Trump so badly wants looking unlikely.
As US financial support expires in 2023, Beijing could ‘loosen the screws’ on regional alliance with lucrative development deals
Independence vote in Micronesia’s Chuuk state in March could raise the stakes, potentially allowing China access to strategically vital waters
President of the Federated States of Micronesia David Panuelo shakes hands with Chinese Premier Li Keqiang at the Great Hall of the People in Beijing. Photo: Xinhua
In China earlier this month, David Panuelo, the president of the Federated States of Micronesia, climbed the Badaling section of the Great Wall. And, according to Huang Zheng, Beijing’s ambassador to the Pacific nation, the countries’ “great friendship rose to even greater heights” during Panuelo’s visit.
Chinese investment in Micronesia reached similarly lofty levels in conjunction with Panuelo’s trip, which marked three decades of diplomatic ties and included meetings with President Xi Jinping and Premier Li Keqiang. Beijing has committed US$72 million in economic development deals, almost as much as its total investment of the previous three decades.
Micronesia is one of three Pacific nations with agreements with Washington, known as the Compact of Free Association (COFA), which allows their citizens to live and work in the US. In exchange, Micronesia, neighbouring Palau and the Marshall Islands grant the US exclusive military and defence access to their territorial waters – more than 2 million square miles of the Pacific that have been an essential element of Washington’s power projection in the region since World War II.
Much of China’s funding has been directed to Micronesia’s Chuuk state, which will in March vote in an independence referendum.
Although Chuuk is home to fewer than 50,000 people, its waters include one of the region’s deepest and most strategically appealing lagoons, creating extra incentive for Beijing and potential concern for Washington as the two countries
With a population of just 113,000 people, Micronesia relies on remittances sent home by citizens working in the US as well as the financial support from Washington under COFA. That assistance is scheduled to expire in 2023, creating uncertainty about the future of the relationship and making Chinese investment even more influential.
“Panuelo’s visit to China is a perfect example of how [the Chinese side] just needs to do a little to get a lot,” said Derek Grossman, senior analyst at Rand Corporation, a Washington think tank. “US$100 million is not very much for them and they can essentially loosen the screws [on COFA] with that.”
Micronesian President David Panuelo (second on left) and Chinese Premier Li Keqiang (right) during their talks in Beijing. Photo: EPA-EFE
The value of Micronesia’s bilateral trade with China has increased by nearly 30 per cent annually for the past five years, according to Micronesia’s Foreign Ministry. In 2017, the island nation signed onto President Xi’s signature Belt and Road Initiative which aims to build a vast network of strategic investment, trade routes and infrastructure projects across more than 150 countries.
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In recent years Chinese funding in Micronesia has built office and residential complexes for government officials, a showpiece new convention centre in the capital city Palikir, transport infrastructure and student exchanges, according to a recent report by Rand.
Jian Zhang, associate professor at UNSW Canberra at the Australian Defence Force Academy, said Beijing’s investment reflected a decision to cultivate broader, deeper ties.
Micronesian President David Panuelo during his meeting with Chinese officials in Beijing. Photo: EPA-EFE
“China’s interest in building the relationship with Micronesia is not just about its diplomatic rivalry with Taiwan or economic interests,” he said. “It has elevated the relationship to a comprehensive strategic partnership which encompasses all areas.”
During his recent visit, Panuelo described China as Micronesia’s top economic partner and the US as its top security partner. Pompeo’s visit to Micronesia highlights US anxiety about rising Chinese influence in Pacific 5 Aug 2019
Gerard Finin, professor of regional planning at Cornell University, who previously worked with the US Department of State in the Pacific, said: “China’s leadership consistently accords large ocean states the full protocol that is expected when a head of state visits.
“In contrast, Washington has only had a limited number of meetings and never hosted an official state visit to Washington for the leader of a Pacific Island nation,” said Finin.
US President Donald Trump in May hosted the leaders of Micronesia, Palau and the Marshall Islands together at the White House. When Mike Pompeo visited Micronesia
in August, he became the only sitting US secretary of state to have done so.
Pompeo said negotiations to update COFA had begun but no details have been made public. Micronesia has assembled a team to conduct the negotiations but the US has not, the Honolulu Civil Beat website reported.
US Secretary of State Mike Pompeo visited Micronesia in August. Photo: AFP
Breakaway vote could raise the stakes
Panuelo’s team met Micronesian students studying in China and representatives of state-owned China Railway Construction Corporation, which will build the roads in Chuuk, funded in part by US$50 million from Beijing. Construction of the Chuuk government complex was also funded by Beijing and the state’s governor joined Panuelo for his visit.
Should Chuuk vote to separate from Micronesia in March, it could also mean breaking from COFA, jeopardising the US work privileges of thousands of Chuukese and opening the state’s waters to other partners, particularly China.
Chuuk is home to one of the deepest lagoons in the Pacific, a geographic rarity of particular value in strategic military operations and submarine navigation.
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Zhang said Beijing would explore any opportunity to build a port with potential military capability.
“China has a long-term need to gain a strategic foothold in the region,” Zhang said. “That is a key part of the Belt and Road Initiative. At the general level it’s an economic initiative but an important aspect of the maritime Silk Road is to develop a network of strategically located port facilities.”
Sabino Asor, chair of the public education committee for the Chuuk Political Status Commission, told Civil Beat seceding from Micronesia would be the best option for Chuuk’s future.
“There is no encouraging prospect if Chuuk remains within the Federation,” he said.
However, Patrick Buchan, at Washington think tank Centre for Strategic and International Studies, said Chuuk’s dependence on remittances from the US made breaking from COFA unlikely.
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In the meantime, uncertainty over COFA negotiations persists, although there is a chance it will be renewed with few changes.
“There is circulation with people easily coming and going that provides a level of understanding and friendship that does not exist between too many other countries,” Finin said.
However, China’s most attractive feature may be its willingness to at least discuss the most pressing concern of Pacific Island nations: climate change.
“When the Trump administration talks about how it doesn’t believe in climate change, or can’t even say the words – that is really offensive for Pacific nations,” Grossman said. “China knows that, and is taking full advantage of it.”
In June, the US first lady joined US President Donald Trump and his children on a trip to Buckingham Palace, but this year she and Trump went alone
Queen Elizabeth with first lady Melania Trump during a reception at Buckingham Palace. Photo: Yui Mok/EPA-EFE
Away from the developing impeachment inquiry at home, US president Donald Trump flew to Britain for the 70th Nato summit. In the middle of a series of meetings with senior leaders from the world, Trump attended an anniversary event at Buckingham Palace on December 3 hosted by Queen Elizabeth.
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Compared to his last royal visit in June when he was accompanied by his wife, first lady Melania, and children, Donald Jr, Eric, Ivanka and Tiffany, this time, the US president was only joined by the first lady.
US President Donald Trump and first lady Melania Trump arrive at 10 Downing Street in central London to attend a reception hosted by Britain’s Prime Minister Boris Johnson ahead of the Nato alliance summit. Photo: Niklas Halle’n/AFP
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Turning up at the reception, the first lady, a former model, was dressed in a striking yellow coat with a dropping cape from Italian fashion house Valentino, matched with a long-sleeve magenta-pink dress underneath. She paired the sleek outfit with a pair of suede Christian Louboutin So Kate pumps that matched the hue of her dress.
Kremlin says project highlights the growing closeness between the two countries
Military observers argue cooperation between the two sides helps provide counterbalance to American military might
Vladimir Putin disclosed the project at a forum in Sochi. Photo: Sputnik/AFP
Russia is helping China to build an early warning system to counter missile attacks, Vladimir Putin said on Thursday.
Speaking at an international affairs conference in the resort town of Sochi, he said Moscow was helping China increase its missile defence capability, Russian state-owned news agency Sputnik reported.
“This is a very serious endeavour that will fundamentally and radically increase the defence capability of the People’s Republic of China because only the United States and Russia have such a system at present,” the Russian leader said.
Kremlin spokesman Dmitry Peskov declined to say when the system would be operational, but told reporters on a conference call that the move highlighted Russia’s close ties with China.
“Russia has special relations with China of advanced partnership … including the most sensitive [areas] linked to military-technical cooperation and security and defence capabilities,” Peskov said.
Macau-based military observer Antony Wong Dong said Putin’s remarks indicated that military cooperation between Beijing and Moscow may have evolved from the previous “model alliance” to a “real alliance” with the US as their common target.
“Such changes will likely further fuel the strategic arms race, which is already evident from the missile tests [that we have witnessed] and the recent military parade,” said Wong in a reference to the grand parade held in Beijing on Tuesday when China celebrated the 70th anniversary of the founding of the People’s Republic.
Russian President Vladimir Putin welcomes China’s defence minister Wei Fenghe (right) to a base in Orenburg at the start of a joint exercise. Photo: Handout
Hong Kong-based military analyst Song Zhongping said the system would help Beijing and Moscow set up a joint early ballistic missile network to counter “American global hegemony”.
“If the US wants to attack China [with its ICBMs], their missiles are likely to be launched from the Arctic, and that will be covered by Russia’s early warning system, and that means Moscow will have the capability to alert Beijing,” said Song who added that the Chinese military could provide reciprocal help to Russia.
Beijing-based military expert Zhou Chenming said Putin’s remarks served as a veiled warning to US President Donald Trump who has taken the unilateral step of withdrawing from the Intermediate Range Nuclear Forces Treaty, a cold war-era pact signed between the US and Russia in 1987.
“Joint cooperation will help both Russia and China to save costs because early warning ballistic missile systems are very expensive,” Zhou said,
However, he said Moscow was unlikely to share its most advanced technologies with China.
“For example, Russia’s missile defence system just covers Moscow and St Petersburg, so China’s network will properly just cover Beijing, Tianjin, Hebei province, the Yangtze River Delta area, the Greater Bay Area in South China, as well as a number of key cities in the centre.”
Putin also told the forum that the two countries would continue to work together on space exploration.
Last month, the Ministry of Defence of the Russian Federation announced that Moscow and Beijing have developed a plan for cooperation between military departments for next year and 2021.
Last month 1,600 members of the Chinese military arrived at a Russian training base in the Orenburg oblast for a large-scale joint training exercise.
Vice-ministerial meeting was last held in 2014 as Seoul agreed to the deployment of a US anti-missile system
China and South Korea are expected to resume their vice-ministerial strategic defence dialogue after a five-year break. Photo: Reuters
China and South Korea are set to hold high-level defence talks on Monday for the first time since 2014, when tensions emerged over Seoul’s plans to allow deployment of a US anti-missile system.
Lieutenant General Shao Yuanming, deputy chief of the Joint Staff Department of the Central Military Commission, is expected to meet South Korean defence vice-minister Park Jae-min in Beijing, according to Yonhap News Agency.
They will talk on the sidelines at the Xiangshan Forum, a three-day gathering on Asia-Pacific security and defence which started on Sunday.
The defence ministry in Seoul said the officials were expected to “have in-depth discussions on the Korean peninsula security conditions and issues of mutual concern”, Yonhap reported.
Lieutenant General Shao Yuenming is expected to resume China’s part in a high-level defence dialogue with South Korea. Photo: Minnie Chan
Relations between China and South Korea were strained by Seoul’s decision to host American Terminal High-Altitude Area Defence system (THAAD) but ties have warmed as both countries have pushed back against pressure from the US.
Washington and Seoul are at odds over a cost-sharing agreement for the US military, with US President Donald Trump demanding South Korea contribute more for the presence of US forces.
Hwang Jae-ho, director of the Global Security Cooperation Centre at Hankuk University of Foreign Studies in Seoul, said the meetings, formally known as the China-South Korea vice-ministerial strategic defence dialogue, resumed mainly because the countries now had more mutual interests.
Seoul fears US is delaying envoy’s approval in retaliation for scrapping of security pact, sources say
“Now China has to make more friends in the international community as its ties with the United States have gone bad, and South Korea is looking for China to help rein in Pyongyang. At a time like this, it’s inevitable for the two countries to want to move closer,” Hwang said.
The deployment of THAAD, a proposed military hotline, and South Korea’s air defence identification zone are expected to be high on the agenda.
First held in 2011, the defence dialogue was hosted alternately by Seoul and Beijing. It was suspended in 2015 when South Korea, then under president Park Geun-hye, said it was considering THAAD as a deterrent against North Korea’s nuclear ambitions.
Beijing disapproved and said China was the real target. Each country then placed unofficial economic and cultural bans on the other. These included Chinese sanctions against South Korea’s Lotte supermarket chain and a ban on TV airtime for South Korean bands.
Tensions began to slowly ease after November 2017, when the two countries said they had decided to set aside their differences and advance their strategic partnership. Seoul also promised not to host additional THAAD missiles nor join a US-led missile defence system that involved Japan.
Beijing joins global condemnation of attack launched by Ankara on Kurdish fighters after US President Donald Trump decided to pull out troops
Foreign ministry spokesman says issue should be resolved with ‘political solutions’ and the operation may result in a revival of Islamic State
Turkey launched the attack on Kurdish fighters in northeastern Syria last week. Photo: Xinhua
China has urged Turkey to stop the military offensive it began in northeastern Syria last week and “return to the right track”.
Beijing is the latest to join global condemnation of the cross-border attack launched by Ankara on Kurdish fighters last Wednesday following US President Donald Trump’s decision to withdraw US troops from the region.
Foreign ministry spokesman Geng Shuang on Tuesday called for a ceasefire.
“The Chinese side has always opposed the use of force in international relations and has advocated for adherence to the Charter of the United Nations, and to resolve problems through political and diplomatic channels,” Geng said during a regular press briefing, when asked about Beijing’s position on the situation.
“Sovereignty, independence, unification and territorial integrity should be respected and protected,” he said. “We urge Turkey to halt military action and to return to the right track, resolving the issue with political solutions.”
Chinese foreign ministry spokesman Geng Shuang called on Turkey to “work with the international community in fighting against terrorism”. Photo: AP
Geng also said the “anti-terrorism situation in Syria is still severe”, and the military operation could result in a comeback by Islamic State.
“We urge Turkey to take responsibility and work with the international community in fighting against terrorism,” he said.
Explained: why are Syria’s Kurds accusing the US of betrayal?
Trump’s move has drawn sharp criticism from around the world. Critics say he has abandoned the allies that helped fight against Isis, and that withdrawing troops could pave the way for a resurgence of the jihadist group whose violent takeover of Syrian and Iraqi land five years ago was the reason US forces went in.
The US president said about 1,000 US troops who had been partnering with local Kurdish fighters to battle Islamic State in northern Syria were leaving the country. He said they would remain in the Middle East to “monitor the situation” and to prevent a revival of Isis – a goal that even Trump’s allies say has become much more difficult as a result of the US pull-out.
Turkey says the offensive aims to remove the Kurdish-led Syrian Democratic Forces from the border area and create what it calls a “safe zone” to relocate 1 million Syrian refugees.
on Turkey, halted bilateral trade negotiations and called for an immediate ceasefire.
Vice-President Mike Pence also said Trump was sending him to the Middle East because the president was concerned about instability in the region.
Beijing has long worried that conflict in the region could spill over to Chinese soil after thousands of Uygurs – the Turkic-speaking Muslim minority from far western China – travelled to Syria to train and fight as jihadists.
Competition from China is not the primary reason for regional job losses in rich countries, new IMF research finds
Study finds technological advancement is bigger driver of unemployment, undermining populist argument China is stealing manufacturing jobs
The IMF said automation displaced more jobs in rich countries than China’s growing productivity. Photo: SCMP
Automation rather than market competition from China can be blamed for regional job losses suffered in developed countries, including American rust belt states, according to new research by the International Monetary Fund released on Wednesday.
“Increases in import competition in external markets associated with the rise of China’s productivity do not have marked effects on regional unemployment,” the Washington-based fund said in an academic paper. “Only technology shocks tend to have lasting effects, with even larger unemployment rises for vulnerable lagging regions.”
The paper, which looked at regional disparities within advanced countries, undermines a key argument pushed by US President Donald Trump in the ongoing trade war
between Washington and Beijing – that China has been stealing American technology and jobs.
Although the research did not mention Trump, the IMF said the argument that market competition displaced jobs was flawed as imports from China could only cause job losses in the near term and such impact “quickly abates”.
The US goods trade deficit with China hit a record of US$419.2 billion in 2018, which the Trump administration has blamed for a decline in US manufacturing jobs.
In the paper, the IMF classified a region as “lagging” if two conditions were met – initial real gross domestic product (GDP) per capita was below the country’s median in 2000, and the region’s average growth between 2000 to 2017 was below average.
Labour productivity tended to be lower and employment in the agriculture sector higher in lagging regions, the IMF said. Within the United States, per capita GDP in the state of New York is 100 per cent higher than in Mississippi, parts of which are considered within the rust belt.
While increases in import competition tended to reduce labour force participation after one year, this impact faded quickly and did not have significant effects on regional unemployment on average, IMF analyst Weicheng Lian said.
The impact of technology was more far-reaching, however, with researchers pinpointing it as the main driver of rising unemployment in lagging regions.
translate into a decline in the cost of machinery and equipment, leading to more persistent rises in unemployment and declines in labour force participation in lagging regions, compared with less vulnerable regions, the study said.
Lian said that poorer regions tend to specialise in agriculture and manufacturing industries rather than high productivity service sectors such as information technology, communications and finance.
“We find that a negative technology shock … raises unemployment in all regions that are more vulnerable to automation, but lagging regions are particularly hurt,” she said.
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