Smoke and Mirrors
Australia all at sea, Lavrov and Lula, Sudan suffers interference, G7 narcissism, ASEAN feeds China, China feeds global economy
UPDATE: In facing the great challenge of our time, a super-state resident in continental Asia and an itinerant naval power seeking to maintain primacy – the foreign minister was unable to nominate a single piece of strategic statecraft by Australia that would attempt a solution for both powers.
In the wake of Brazilian President Luiz Inacio Lula da Silva’s recent meeting with China’s president Xi Jinping, Russian Foreign Minister Sergey Lavrov is set to meet Lula, whose stance on Moscow’s invasion of Ukraine has been met with ire by the United States and other Western nations.
Experts believe that as the country has been embroiled in frequent political turmoil since the 2019 coup, Sudan is more exposed to foreign interference during each social conflict. However, certain Western forces should refrain from interfering with domestic affairs of the country, as deepened political fissures will not only damage Sudanese people's lives, but also risk other countries' investments in the Horn of Africa.
Japan hopes that the G7 can shape Chinese behaviour for the better, keep a distracted United States locked into a productive role in the international economy and engage the emerging market economies. If the agenda keeps international markets open and strengthens the multilateral system, it will curb the worst of zero-sum and protectionist instincts coming out of Washington.
Whether it be durian from Thailand, bananas from the Philippines, passion fruit from Vietnam, longan from Cambodia or coffee from Malaysia, more and more agricultural products from ASEAN countries are being well-received by Chinese households, thanks to better China-ASEAN cooperation in agriculture.
China is the biggest driver of global growth over next five years and contribute double what the US adds, according to the International Monetary Fund. Based on Bloomberg calculations from data in the IMF's World Economic Outlook released last week, China's slice of global gross domestic product expansion will be at 22.6%, India's will be 12.9%, and the US will add 11.3%.
Australia is Lost at Sea
Paul Keating’s response to Foreign Minister Penny Wong’s speech at the National Press Club, 17 April 2023.
In facing the great challenge of our time, a super-state resident in continental Asia and an itinerant naval power seeking to maintain primacy – the foreign minister was unable to nominate a single piece of strategic statecraft by Australia that would attempt a solution for both powers.
Instead, Penny Wong actually went out of her way to turn her back on what she disparaged as ‘black and white’ binary choices, speaking platitudinally about keeping ‘the balance of power’, but having not a jot of an idea as to how this might be achieved.
During the address she said she was ‘steadfast’ in refusing to talk about regional flashpoints; that is, refusing to talk about the very power issue which threatens the region’s viability.
She told us she will turn her back on reality, speaking only in terms of ‘lowering the heat’ and the ‘benefit from a strategic equilibrium’, without providing one clue, let alone a policy, as to how that might be achieved.
Never before has a Labor government been so bereft of policy or policy ambition.
Wong went on to eschew ‘black and white’ binary choices but then proceeded to make a choice herself – extolling the virtues of the United States, of it remaining ‘the central power’ – of ‘balancing the region’, while disparaging China as ‘intent on being China’, going on to say ‘countries don’t want to live in a closed, hierarchical region, where the rules are dictated by a single major power to suit its own interests’. Nothing too subtle about that. She means China and is happy to mean China.
This is the person claiming she does not wish to make binary choices. Yet tells us ‘we have to press for the management of great power competition’, while saying, ‘we want partners and not patriarchs’ but articulating not a jot of an idea of how that great power competition can be settled without war.
The foreign minister went on about diplomacy needing to be backed up by military capability – capability she nominates as AUKUS, as if three nuclear submarines at sea in twenty years’ time would provide any additional effective capability.
The minister says the advent of this AUKUS capability will ‘change the calculus for any aggressor’ – of course, meaning China.
As a middle power, Australia is now straddling a strategic divide, a divide rapidly becoming every bit as rigid as that which obtained in Europe in 1914. Australia’s major foreign policy task is to soften that rigidity by encouraging both the United States and China to find common cause and benefit in a peaceful and prosperous Pacific.
Nothing Penny Wong said today, on Australia’s behalf, adds one iota of substance to that urgent task.
Read full article here.
Lavrov meets Lula as US fumes
In the wake of Brazilian President Luiz Inacio Lula da Silva’s recent meeting with China’s president Xi Jinping, Russian Foreign Minister Sergey Lavrov is set to meet Lula, whose stance on Moscow’s invasion of Ukraine has been met with ire by the United States and other Western nations. Lavrov arrived in the capital Brasilia on Monday, where he discussed issues such as trade and Russia’s war in Ukraine with members of Lula’s administration.
“We are grateful to our Brazilian friends for their clear understanding of the genesis of the situation [in Ukraine]. We are grateful for their desire to contribute to finding ways of settling this situation,” Lavrov said after meeting with Brazilian Foreign Minister Mauro Vieira.
In recent weeks, Lula has angered Western countries by stating that several parties are at fault for the war in Ukraine and that the US has “encouraged” the war by sending weapons to the administration of Ukrainian President Volodymyr Zelenskyy.
Lula’s stance has underscored a schism between Ukraine’s Western allies and non-Western countries who do not want to distance themselves from Moscow. States like Brazil have also baulked at calls to provide Ukraine with military assistance or cut off trade with Russia. In 2022, Brazil marked a record US$9.8 billion in bilateral trade with Russia. On Monday, Lavrov and Vieira discussed plans to increase Brazilian meat exports to Russia and fertiliser imports for Brazilian farmers.
Last week, Lula travelled to China to meet with President Xi Jinping in a bid to bolster economic relations. China has likewise offered support to Russia during its war in Ukraine.
In remarks to journalists as he returned from his trip, Lula said Brazil was “trying to build a group of countries without any involvement in the war, that don’t want the war and defend world peace to have a discussion with both Russia and Ukraine”.
Western countries have been irked by such comments, which they see as a refusal to condemn Russia.
Read more here.
Khartoum in Flames
The Chinese Foreign Ministry on Sunday urged the two sides of the Sudan conflict to stop the fighting as soon as possible and work to move forward the political transition process together, as the African country is once again engulfed in conflict that has so far caused dozens of deaths and hundreds of casualties.
“Certain countries should refrain from overly interfering with Sudan's internal affairs, further escalating conflict”
Experts believe that as the country has been embroiled in frequent political turmoil since the 2019 coup, Sudan is more exposed to foreign interference during each social conflict. However, certain Western forces should refrain from interfering with domestic affairs of the country, as deepened political fissures will not only damage Sudanese people's lives, but also risk other countries' investments in the Horn of Africa.
Clashes erupted on Saturday morning in Sudan between the Sudanese Armed Forces and Rapid Support Forces (RSF) and Sudanese Armed Forces in many parts of the capital Khartoum and areas outside the capital, according to media reports.
The Sudan Doctors' Syndicate said at least 56 civilians were killed and that it believes there were dozens of additional deaths among the rival forces. The doctors' group said close to 600 people were wounded, including civilians and fighters, the Associate Press reported. One of the flashpoints was the Khartoum International Airport. There was no formal announcement that the airport was closed, the agency reported.
The scene in Khartoum is chaotic, according to a Global Times reporter on the ground. Traffic in the Sudanese capital is gridlocked, and both sides have been engaging in armed battle at several important sites in the city. Many civilians are trapped in public places such as the airport, banks and campuses. On the streets, civilians have been injured or killed by stray bullets. Since Saturday, power, water supply and the internet have been cut in the capital. Currently, all markets in Khartoum are closed, and the government ordered people to stay at home.
The Chinese Embassy in Sudan said it has not received reports of Chinese nationals being killed or injured, and reminded Chinese nationals in the country to stay safe and avoid going out, China Central Television reported Sunday, citing Zhang Xianghua, charge d' affaires of the Chinese Embassy in Sudan.
In a press statement issued on Saturday, members of the UN Security Council urged the parties to immediately cease hostilities, restore calm and called on all actors to return to dialogue to resolve the current crisis. A spokesperson from the Chinese Ministry of Foreign Affairs called on the two sides to stop fighting as soon as possible and prevent the escalation of tensions. We hope parties in Sudan will increase dialogue and jointly move forward the political transition process, the ministry said.
The tensions were triggered by disagreement over how the RSF, headed by Mohamed Hamdan Dagalo, should be integrated into the armed forces and what authority should oversee the process. The merger is a key condition of Sudan's unsigned transition agreement with political groups. Sudan began its halting transition toward democracy after military generals ousted long-term ruler Omar al-Bashir in an uprising in April 2019.
Sudan's social contract is based on tribal bonds and ethnic kinship, which makes conflicts between military groups and political parties very difficult to reconcile.
In recent years, Western countries, especially the US, have upped the ante on interfering with African countries' internal affairs, and imposed on them a model that rich countries have designed for African countries. Social conflicts in African countries were further fuelled by their maladjustment to the West-designed model, as well as the West's conflicts of interest on the continent.
US interference in Sudanese affairs, including in its support of the country's division and the 2019 coup, has been widely criticized by many countries. During the 2021 coup in Sudan, the Russia Foreign Ministry said that "large-scale foreign interference in the internal affairs of the republic in practice led to the loss of confidence in the transitional authorities by Sudanese citizens… which repeatedly resulted in numerous protests and provoked general instability in the country."
Sudan has not been stable since the 2019 coup and now there is another attempted coup while the country is still in the transition process. The situation will exert a wider impact in the Horn of Africa, where many big countries, including China, have huge investments. The Western powers involved should refrain from becoming deeply engaged in the current conflict, and to push for a peaceful resolution.
Read more here.
G7 Smoke and Mirrors
China was a top topic of discussion Monday as the foreign ministers of the Group of Seven (G7) major economies gathered in Japan for a second day of talks. Japanese Foreign Minister Yoshimasa Hayashi opened the meeting by saying the international community was "at history's turning point." The diplomats are meeting in the mountain resort town of Karuizawa in central Japan and holding talks ahead of a May 2023 summit of G7 leaders in Hiroshima.
Japan hopes that the G7 can shape Chinese behaviour for the better, keep a distracted United States locked into a productive role in the international economy and engage the emerging market economies. If the agenda keeps international markets open and strengthens the multilateral system, it will curb the worst of zero-sum and protectionist instincts coming out of Washington.
As the world’s third largest economy with a deep strategic reliance on imported energy and raw materials externally and is critically reliant on keeping markets open for its technology, goods and capital, Japan cannot afford a deep fracture in the current system such as the United States transition from enforcer-in-chief to spoiler-in-chief of the international trade regime.
Japan will look to balance the agenda on supply chain resilience and dealing with non-market practices. Some G7 leaders may think that this means supply chain resilience from China. But, with China’s central role in global value chains only growing, including through the continued growth of Japanese direct investment in China, supply chain resilience will have to be framed with China.
Dealing with non-market practices is aimed at Chinese state-owned subsidies and industrial subsidies, but the United States has emulated Chinese-style industrial subsidies including through the CHIPS and Science Act and the Inflation Reduction Act that the rest of the G7 is now trying to negotiate around.
As the United States pursues economic intervention and draconian restrictions on the free flow of information as it deals with TikTok, getting the principles right for economic rules of engagement will be crucial for Japan and could make a significant contribution to global governance.
When Japan hosted the G7 in Ise-jima in 2016, it pushed principles for promoting quality infrastructure investment. Cross-border infrastructure investment was another area where a global governance deficit to set standards and rules was causing geopolitical friction, with the launch of China’s Belt and Road Initiative (BRI). That agenda was carried through to the G20 Osaka summit, where China signed on to the G20 Principles for Quality Infrastructure Investment, alongside joint infrastructure projects between China and Japan announced earlier in 2018. China’s second BRI Forum in 2019 also espoused the principles articulated in Ise-jima.
Economic, environmental, energy and food security are central to Japan’s G7 agenda as it aims to be relevant for the ‘Global South’. Global inflation and contractionary monetary policies, uneven recovery from the COVID-19 pandemic, food and energy crises, as well as the fallout from the US proxy war on Russia, are challenges that are not unique to advanced economies. The BRICS grouping, consisting of major Global South countries, is now larger than the G7 in economic scale and more dynamic, making the G20 more central to global economic governance than the G7.
The response to these new circumstances in Japan has seen the introduction of protection from Chinese practices and an attempt to avoid collateral damage from Washington forcing countries to choose sides in a zero-sum competition. Retreating to trade only with ‘trusted partners’, friend-shoring of production or even an ‘economic NATO’ as the United States is pushing would make the world much smaller economically and reduce options for trade, making economies less, not more, resilient.
Compiled from Reports
China-ASEAN agriculture trade grows
Whether it be durian from Thailand, bananas from the Philippines, passion fruit from Vietnam, longan from Cambodia or coffee from Malaysia, more and more agricultural products from ASEAN countries are being well-received by Chinese households, thanks to better China-ASEAN cooperation in agriculture.
China has been ASEAN's largest trading partner for the past 13 years, and trade in agricultural products plays a vital role, said Kao Kim Hourn, ASEAN secretary-general at the Boao Forum for Asia annual conference late last month. Kao said China and ASEAN have launched many trade deals in agricultural products such as grains, meats, vegetables and fruits, and conducted personnel and technical exchanges.
Representatives at the forum from China and ASEAN countries widely recognize that the two sides have deepened their agricultural cooperation in a comprehensive manner. Fruitful achievements have been made by China and ASEAN in terms of investment and trade, scientific and technological exchanges and cooperation, food security, green and sustainable development of agriculture, and intergovernmental policy coordination, which makes a significant contribution to fostering a closer China-ASEAN community with a shared future.
China's agricultural investment in ASEAN countries accounts for 40 percent of its total overseas investment in the sector. The trade volume of agricultural products between China and ASEAN reached $61 billion in 2022, topping other countries and regions worldwide, according to Sui Pengfei, director-general of the international cooperation department under China's Ministry of Agriculture and Rural Affairs.
China's General Administration of Customs said nearly 1,500 kinds of agricultural and food products from ASEAN have been exported to China. High-quality agricultural varieties and technologies from China have also boosted the development of agricultural industries in ASEAN countries.
The Chinese Academy of Tropical Agricultural Sciences has cooperated with ASEAN countries to carry out projects such as new variety breeding, green and efficient cultivation technology demonstration, and intensive processing of tropical agriculture products, said Xie Jianghui, deputy director of CATAS. The academy has signed cooperation agreements with 25 scientific and educational institutions in ASEAN countries, such as Kasetsart University in Thailand and Royal University of Agriculture in Cambodia.
A total of 50 agricultural technology training courses have been held in ASEAN countries by CATAS. Eight cassava varieties cultivated by the academy have been promoted in Southeast Asia, with a total planting area of more than 10 million mu (67,000 hectares).
South China's Hainan province is building several cold chain logistics and trading centers to process and store tropical agricultural products for ASEAN to strengthen connections between the two tropical-product markets.
In recent years, Hainan and ASEAN countries have jointly carried out research and development and utilization of excellent tropical fruit and vegetable resources while deepening cooperation in the planting and processing trade, seeing a steady increase in imports and exports of tropical agricultural products.
Hainan will make good use of the free trade port system and the Regional Comprehensive Economic Partnership to promote deep integration of industrial chains, supply chains and value chains between China and ASEAN countries, said Xie Jing, vice-governor of Hainan province.
China mainly exports fish, garlic, citrus, apples, condiments and other products to ASEAN and imports fruits, vegetable oils, aquatic products, grains and other primary agricultural products from ASEAN. Sui Pengfei said if the two sides keep improving their trade level, the related trade volume in agricultural products may reach $100 billion in the next five to seven years.
Representatives to the forum also said China and ASEAN should cooperate in setting standards for planting and processing tropical agricultural products and enhancing food security.
Read more here.
IMF: China drives global growth
China is the biggest driver of global growth over next five years and contribute double what the US adds, according to the International Monetary Fund. Based on Bloomberg calculations from data in the IMF's World Economic Outlook released last week, China's slice of global gross domestic product expansion will be at 22.6%, India's will be 12.9%, and the US will add 11.3%.
IMF said China is largest driver of global economic growth for next five years.
China to contribute 22.6% of total world growth, while the US will contribute 11.3%.
Half of global growth will be concentrated in China, the US, India, and Indonesia. They are followed by Indonesia, Germany, Turkey, and Japan, each with a less than 3.6% contribution.
Three-quarters of global growth will stem from 20 countries, and over 50% will come from just China, India, the US, and Indonesia. The IMF expects growth contributions from Brazil, Russia, India, and China to outpace Group of Seven nations.
Overall, the IMF anticipates global growth to expand about 3% over the next five years in a higher-interest-rate environment. It's the weakest outlook in over 30 years.
The group's report highlighted that recent bank turmoil and sticky inflation have heightened recession risks. March brought the collapse of Silicon Valley Bank and Signature, in addition to trouble with Silvergate, Credit Suisse, and other names.
"Risks to the outlook are squarely to the downside," the IMF said. "Much uncertainty clouds the short- and medium-term outlook as the global economy adjusts to the shocks of 2020–22 and the recent financial sector turmoil. Recession concerns have gained prominence, while worries about stubbornly high inflation persist."