Exclusion Act II
Biden: India, China and Japan Xenophobia, Prof. Wu Xinbo on Blinken's Visit to China, China should bail on US bonds, Cambodia’s Outreach to the West and Chinese Centrality.
Biden’s Racial Hypocrisy
President Biden says India, China and Japan are Xenophobic
“Why is China stalling so badly economically, why is Japan having trouble, why is Russia, why is India, because they are xenophobic. They don’t want immigrants. Immigrants are what makes us strong,” Biden remarked.
The US President was speaking at a Washington fundraising event for his 2024 re-election campaign, which also marked the start of Asian American, Native Hawaiian and Pacific Islander Heritage Month. “One of the reasons why our economy is growing is because of you and many others. Why? Because we welcome immigrants,” Biden said.
Biden, who is up against Republican candidate and former president Donald Trump in the presidential race, has often criticised his rival for his “anti-immigrant” rhetoric. Trump has promised to curb illegal immigration and restrict legal migration if elected to office. During his campaigning, he has blamed immigrants for the rise of violence in the country.
Biden, meanwhile, has advocated for a more humane-stance on the issue of migrants. Since coming to power, Biden has eased the Trump-era crackdown on migrants and introduced new “parole” policies, which allow certain migrants to enter legally for humanitarian reasons.
However, research shows that Biden is facing criticism from voters over unemployment and immigration. A poll from the AP-NORC Center for Public Affairs Research found that over half of US adults think that “Biden’s presidency has hurt the country on cost of living and immigration”.
Read more here.
China should bail on US bonds
Chinese scholar says “China should bail on US bonds” as bilateral tensions and anxieties mount.
China’s investment in US government bonds is fraught with risks, tepid returns and other vulnerabilities – all of which should motivate Beijing to unwind its holdings further and avoid being held “hostage” by Washington’s “exorbitant privileges”, a prominent scholar has said.
Di Dongsheng, vice-dean of Renmin University’s School of International Studies, warned the enormous sums of Chinese assets and capital parked in the US could be “taken hostage” by Washington if Beijing were to step up the defence of its sovereignty and territorial integrity.
“There’s no reason to load up on US Treasuries,” Di said in an article for the April issue of Contemporary International Relations, the journal of state think tank the China Institutes of Contemporary International Relations.
“We have seen how Washington treated Russia’s overseas assets, and its sequestration of German and Japanese assets during World War I and World War II.”
He also said the prevalence of US Treasuries and the US dollar as a medium of international exchange exemplify the country’s “exorbitant privilege”, creating an entrenched global dominance that allows Washington to binge on debt and make gains at the expense of others.
The manufacturing prowess of the world’s second-largest economy makes it easier to reduce its holdings, argued Di, also a researcher with Renmin University’s International Monetary Institute.
Beijing has been steadily dumping US Treasury bills while diversifying its foreign assets, offloading US$22.7 billion in February alone. Its total holdings were US$775 billion at the end of that month according to the US Treasury Department, a far cry from the all-time high of US$1.316 trillion in November 2013.
That reduction is occurring as bilateral ties wane, with the two superpowers engaged in parallel struggles over trade and tech and the West taking steps to disentangle itselffrom China’s economy.
Beijing has also grown wary of the US weaponising its financial power, and is making its own pivot to reduce exposure.
He said Beijing’s active promotion of the yuan’s use overseas – especially in emerging economies – as well as the creation of the Asia Infrastructure Investment Bank, New Development Bank and Cross-Border Interbank Payment System, have all created new channels for China to withdraw trillions in foreign reserves that would otherwise be controlled by Washington and its allies.
Under an earlier export-oriented model, China was a prolific buyer of Treasuries, taking pains to prevent the yuan from appreciating and keep its goods competitive.
But maintaining over a trillion US dollars’ worth of Treasuries also led to years of losses through overseas investment, Di said, especially compared to what American investors were raking in from the Chinese market.
“Part of the Chinese people’s hard-won US dollars flows back to the US through capital circulation.”
The analyst also called for more confidence in managing the yuan as China’s exports grow more competitive, questioning the necessity of suppressing the currency’s appreciation through large foreign exchange purchases.
“There’s no need, since China has progressed up the value chain and upgraded products from cheap goods to tech-intensive ones, whose export is less sensitive to prices,” Di said.
“A more competitive export sector means the impact from a relatively volatile yuan is manageable, and the yuan can hold up even amid shorting attacks.”
Citing views from other authorities, including former central bank adviser Yu Yongding, Di concluded that the key to fending off external risks and short seller attacks is decisive control over capital accounts rather than a bulging foreign reserve fund.
Read more here.
Cambodia’s Outreach to the West
By Lye Liang Fook, Fulcrum Singapore
There is a view that Hun Manet is moving away from the pro-China tilt of his father Hun Sen, towards a more diversified foreign policy since becoming Cambodia’s prime minister in August 2023, as evidenced by his interactions with American and European business and political leaders at the World Economic Forum and his meeting with the French president during a visit in January 2024. However, Cambodia’s efforts to make new friends, especially the West, does not necessarily mean that Phnom Penh is rethinking its enduring relationship with China.
Cambodia-China relations are currently on a strong footing. China is Cambodia’s largest investor, trading partner, and aid donor. Numerous Chinese infrastructure projects such as roads, expressways, bridges, buildings, ports, dams and airports, and most recently, a controversial 180 km-long Funan Techo Canal, dot the country’s landscape despite concerns of corruption, adverse environmental impacts, debt burden, and vice and criminal activities.
Why have Chinese projects remained so pervasive?
Chinese companies enjoy direct access to the Cambodian political elite, according to a Cambodian source interviewed by this author. Companies from other countries usually approach the relevant ministries/agencies to pitch a project idea. This by-the-book, bottom-up mode takes time as the project invariably gets mired in the bureaucratic process and may not even be approved at the end. In contrast, Chinese companies bypass this cumbersome process by going straight to the Cambodian People’s Party (CPP) political elites, who can immediately green-light proposed projects and then instruct the relevant ministries/agencies to implement them. The Cambodian elites and officials involved are rewarded for their support by receiving a cut from the investment project. In this way, the Chinese projects help to reinforce the existing entrenched political system and shore up the legitimacy of the CPP. Moreover, Chinese investments do not come with strings attached, making them much more attractive than investments from other countries.
Another reason for the enduring nature of China-Cambodia relations is the strong political ties between the two countries — often described as iron-clad, a term reserved for China’s closest friends. Hun Manet chose China to be the first foreign country to visit in September 2023, soon after he was appointed prime minister. He visited China again in October 2023 to attend the 3rd Belt and Road Forum hosted by Chinese President Xi Jinping. Hun Manet’s two consecutive trips to China within a short span of time underscored the importance that Phnom Penh accords to the relationship with China. And even though Hun Sen is no longer prime minister, China has maintained “strategic communication” with him, a recognition of his influence in Cambodia. Beijing invited Hun Sen to attend the annual Boao Forum in March 2024 where he met China’s third-ranked Political Bureau Standing Committee Member and Chairman of the Standing Committee of the National People’s Congress Zhao Leji. When Foreign Minister Wang Yi visited Cambodia in April 2024, he called on Hun Sen, apart from meeting Hun Manet and Cambodian King Sihamoni. During his visit, Wang Yi affirmed that China will always be Cambodia’s most trustworthy partner and strongest supporter. From China’s perspective, Hun Sen, his son Hun Manet and King Sihamoni (who travels frequently to China for vacation and medical treatment) will ensure that their country sustains the special relationship with China.
Hun Sen’s 2021 refrain “If I don’t rely on China, who will I rely on?” remains relevant today under Prime Minister Hun Manet. Given the entrenched political system in Cambodia, its lack of Western friends, and Cambodia’s wariness of its immediate neighbours, Phnom Penh looks set to continue to rely heavily on China for its development and security.
There is a limit to how much attention the Cambodian leadership can devote to foreign policy, much less engineer a shift away from China, as Hun Manet’s foremost priority is to consolidate power. There are currently 11 deputy prime ministers (one more than when Hun Sen was prime minister), reflecting a delicate balancing act among different political groupings with ties to Hun Sen and the ruling CPP. Apart from managing younger deputy prime ministers like Sar Sakho (aged 43), Tea Seiha (44), Keut Rith (45) and Say Sam AI (44), Hun Manet (47) has to win over the trust of more senior individuals like Aun Pornmoniroth (59), Vongsey Vissoth (59), Hangchuon Naron (62), Sok Chenda Sophea (68), Neth Savoeun (68) and Sun Chanthol (68), some of whom are loyal to Hun Sen.
To protect Hun Manet and afford him time to consolidate power, Hun Sen assumed the position of senate president in February 2024, which affords him an official platform to influence the course of domestic politics in favour of his son. Moreover, as senate president, Hun Sen will assume the ceremonial role of acting president when the king is overseas. Furthermore, Hun Many, Hun Sen’s youngest son, was also appointed the 11th deputy prime minister in February 2024, further buttressing the Hun Sen family’s presence in Cambodian politics.
China is the country that Cambodia turns to when it encounters problems in its relations with its immediate neighbours, Thailand and Vietnam.
Historically, Cambodia has had a difficult relationship with these two bigger and stronger neighbours. Today, it still views Thailand and more so Vietnam with a certain degree of wariness. From Cambodia’s perspective, ASEAN’s ineffectiveness in addressing the Preah Vihear dispute between Cambodia and Thailand from 2008-2011 convinced Phnom Penh that it needed China to check the ambitions of its immediate neighbours. More recently, Vietnam has expressed concerns over China’s presence at Cambodia’s Ream Naval Base as well as Cambodia’s resolve to build the Funan Techo Canal, which some speculate could bring Chinese military presence closer to Vietnam’s southern border. A Cambodian source said that because of these concerns, Hanoi may deliberately make things difficult for Cambodia going forward. Hence, it is even more important for Cambodia to fall back on China for support.
Hun Sen’s 2021 refrain “If I don’t rely on China, who will I rely on?” remains relevant today under Prime Minister Hun Manet. Given the entrenched political system in Cambodia, its lack of Western friends, and Cambodia’s wariness of its immediate neighbours, Phnom Penh looks set to continue to rely heavily on China for its development and security. The centrality of China in Cambodia’s foreign policy will therefore remain more of the same.
Read more here.