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Offline Altair

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Re: US VS G7
« Reply #375 on: July 23, 2018, 14:32:58 »
Interesting statements in Bloomberg coming out of Japan about bilateral versus multi lateral trade:

Top Japanese Official Has No Interest in Trade Deal With Just the U.S.

One of Japan’s top policy makers indicated the government will continue to resist U.S. efforts to create a bilateral free trade agreement between the two nations.

"Japan is not going to do anything with any country that harms the national interest," said Chief Cabinet Secretary Yoshihide Suga. "With FTA negotiations too, we’ll handle them in that way."

During a wide-ranging interview in Tokyo on Saturday, Suga also said he expects Prime Minister Shinzo Abe to stand for re-election in September as leader of the ruling Liberal Democratic Party. If he wins that contest, which appears likely, Abe could remain PM until 2021, making him the nation’s longest serving post-war premier.

Suga’s comments came as officials from the Group of 20 countries meeting in Argentina pushed back against the Trump administration, which has shunned multilateral agreements and embraced tariffs.

At the G-20, Finance Minister Taro Aso pressed U.S. Treasury Secretary Steven Mnuchin to alleviate Japan’s concerns over trade, discussing U.S. tariffs on steel and aluminum, as well as possible levies on car and auto part imports.

Economy Minister Toshimitsu Motegi and U.S. Trade Representative Robert Lighthizer are expected to sit down for bilateral trade discussions later this month.

Suga said he knows the U.S. side is keenly interested in a bilateral trade deal, but Japan will continue to insist that the U.S. returning to the Trans-Pacific Partnership trade agreement is in the best interests of both countries. President Donald Trump pulled the U.S. out of the agreement during his first week in office.
America might need to realize that it isn't the overwhelming superpower of the global economy,  and that there are a lot of powerful trade blocs other that them around these days.
Someday I'll care about milpoints.

Online PPCLI Guy

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Re: US VS G7
« Reply #376 on: July 23, 2018, 14:43:23 »
America might need to realize that it isn't the overwhelming superpower of the global economy,  and that there are a lot of powerful trade blocs other that them around these days.

Like, say, China?


A Chinese world order
 by Jonathan Hillman
July 23 at 10:51 AM
BUDAPEST — Earlier this month, 16 Central and Eastern European heads of state assembled around a single foreign power in Sofia, Bulgaria. The convening force was not the European Union, Russia or the United States, which historically have the deepest cultural, political and security ties in this region. Instead, China was at the center — as it increasingly is around the world.

Now in its seventh year, the “16+1” summit perfectly captures China’s deceptive brand of multilateralism. Bringing together many countries, it gives the outward appearance of inclusivity and consensus-building. Official statements at the summit affirmed support for the World Trade Organization and the United Nations, two genuine pillars of multilateralism that are increasingly under strain. “We need to uphold multilateralism,” Chinese Premier Li Keqiang told attendees.

But beneath the surface, China’s 16+1 format is fundamentally different from the multilateral practices and institutions it claims to uphold. China and its partners do not subscribe to a common set of rules that has any significant impact on their behavior. Nor is anything of consequence done by consensus. China’s multilateralism lacks depth, and it relies on stroking egos and dangling bilateral deals. Call it “flatteralism.”

Where this approach has benefits, they mostly accrue to China. Under the guise of broader participation, China favors governments where investment rules are less strict, ensuring Chinese companies are hired to build large projects. For example, Bosnia’s economy is roughly one-third the size of Croatia’s, but it is not subject to E.U. procurement rules that require open bidding. Last year, it received ten times as much Chinese investment, according to data collected by the Center for Strategic and International Studies.

There are practical and political advantages as well. These annual gatherings allow Chinese officials to efficiently lavish high-level attention on smaller economies. And when China comes to town, its summits are less board meetings than auditions. The 16 countries essentially compete for the attention of the one. China uses variations of this model elsewhere, positioning itself at the center of summits in Africa and Latin America. This is adept diplomacy, but it is not multilateralism.

Flatteralism also runs through Chinese President Xi Jinping’s signature foreign policy vision. Unveiled in 2013, China’s Belt and Road initiative aims to move Beijing close to the center of everything through new hard infrastructure projects, trade deals, cultural exchanges and a multitude of other connections. “Together, we can build a broad community of shared interests,” Xi told an audience of nearly 30 heads of state and representatives from more than 130 countries and 70 international organizations in Beijing last year.

The Belt and Road is a masterstroke in geopolitical advertising. Wrapping the effort in Silk Road mythology, Xi is effectively selling a Sino-centric order to the world. Rather than cringing at maps that depict all roads leading to Beijing, roughly 70 countries have signed onto the effort. The United Nations, WTO and other traditional standard-bearers of multilateralism have all expressed varying degrees of support for an effort that could further erode their effectiveness.

In practice, the Belt and Road is a sea of bilateral deals between China and participating countries, including many markets where few others dare to go. More than half of the countries participating in the Belt and Road have sovereign debt ratings that are either junk or not graded. China’s emphasis on building big-ticket infrastructure projects resonates with foreign leaders looking to impress at home and establish a legacy.

Ribbon cutting ceremonies are difficult for leaders to resist, and as the deals pile up, development can give way to dependency. In a former Sri Lankan president’s home district, major projects — including an international airport, a cricket stadium and a port — had three things in common: they used Chinese financing, Chinese contractors and his name. Now they are barely used, Sri Lanka has crushing debt, and China has control of the port.

Praise flows freely along the Belt and Road. China touts an “all-weather strategic” partnership with Pakistan, a “comprehensive strategic partnership” with Russia, a “comprehensive strategic cooperative partnership” with Vietnam and “strategic cooperative” relationships with a long list of neighbors. It has become the Baskin-Robbins of partnerships, offering flavors for everyone.

But what China has yet to offer is deep multilateralism at scale. Its closest attempt, the Asian Infrastructure Investment Bank, has attracted broad participation and adopted rules similar to those of the World Bank. But having lent only $5 billion to date, the AIIB is easily overshadowed by Beijing’s bilateral lending mechanisms. Over the next five years, the China Development Bank has committed to invest $250 billion in countries along the Belt and Road.

Less than a week after China’s 16+1 summit, NATO heads of state gathered in Belgium. Normally, a meeting of the world’s most powerful collective security alliance would provide a stark contrast to Beijing’s shallow summitry. But in the absence of strong U.S. support for authentic multilateralism, it is becoming more difficult to spot imposters.
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Offline daftandbarmy

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Re: US VS G7
« Reply #377 on: July 28, 2018, 12:23:58 »
Like, say, China?

Welcome to Planet China:

China’s belt-and-road plans are to be welcomed—and worried about

The “project of the century” may help some economies, but at a political cost

SHUNNING all false modesty, China’s leader, Xi Jinping, calls his idea the “project of the century”. The country’s fawning media hail it as a gift of “Chinese wisdom” to the world’s development. As for the real meaning of the clumsy metaphor to describe it—the Belt and Road Initiative (BRI)—debate rages.

The term itself is confusing. The “road” refers mostly to a sea route; the “belt” is on land. Countries eager for China’s financing welcome it as a source of investment in infrastructure between China and Europe via the Middle East and Africa. Those who fear China see it instead as a sinister project to create a new world order in which China is the pre-eminent power.

One cause of confusion is that the BRI is not a single plan at all. A visitor to its website would click in vain to find a detailed explanation of its aims. There is no blueprint of the kind that China’s leaders love: so many billions of dollars to be spent, so many kilometres of track to be laid or so much new port capacity to be built by such-and-such a date.

Chinese maps show the belt and road as lines that trace the routes of ancient “silk roads” that traversed Eurasia and the seas between China and Africa (see Briefing). That was the original conceit, but these days China talks about BRI as if it were a global project. The rhetoric has expanded to include a “Pacific Silk Road”, a “Silk Road on Ice” that crosses the Arctic Ocean and a “Digital Silk Road” through cyberspace.

To the extent that this is all about building infrastructure, the idea is welcome. Trillions of dollars’ worth of roads, railways, ports and power stations are needed in countries across Asia, Africa and Europe. China’s money and expertise could be a big help in spreading wealth and prosperity.

China says anyone can join in. Countries such as Azerbaijan and Georgia, which stand to benefit immensely from better connections to the world, are wildly enthusiastic. One of China’s motives is to strengthen security on its western flank by helping Central Asian countries prosper—thereby, it hopes, preventing them from becoming hotbeds of Islamist terrorism. Everyone would benefit from that, too.

But there are worries. The BRI is bound up with the growing cult around Mr Xi. State media call it “the path of Xi Jinping”. It has become shorthand for China’s overseas aid, state-led investment abroad and for Mr Xi’s much-ballyhooed “great-power diplomacy with Chinese characteristics”. China urges other countries to praise the BRI, so that their words can be relayed back home as propaganda. Few Chinese dare offer open criticism; that makes mistakes more likely.

The citizens of countries hosting BRI projects may come to regret their governments’ enthusiasm. Like all Chinese cash, the BRI billions come without pesky questions about human rights or corruption. Indeed, the terms are often shrouded in secrecy, raising fears that local politicians may benefit more than their people. Projects tend to require the use of lots of Chinese labour. BRI countries risk piling up dangerous amounts of debt, which some fear is designed to give China a strategic hold over them. Pakistan, one of the most important BRI countries, has just held an election in which candidates vied to take credit for Chinese investment; yet the debts are so large that, before long, Pakistan is likely to need an IMF bail-out.

Then there are possible security risks. In his metaphorical flights, Mr Xi sometimes speaks of his belt and road as a single thoroughfare, a “road of peace”. But what if the Chinese navy were to take advantage of ports such as Hambantota? This was repossessed by a Chinese state-owned firm after the Sri Lankan government struggled to repay the debts it had amassed to build it. Military planners worry that China could develop a string of such berths that its ships could use to extend their reach far beyond China’s shores.

Analysts in Asia and the West believe that China wants to displace America as the Asian hegemon. The BRI could end up furthering that plan, even if it is not its focus. China’s crude maps show the belt and road running through disputed territory, including the bitterly contested waters of the South China Sea where China has been busy building fortresses on reefs.

Some Asian countries, including India and Vietnam, are wary and most Western countries share their unease. Last year America’s defence secretary, James Mattis, said that: “No one nation should put itself into a position of dictating [BRI]”. In January France’s president, Emmanuel Macron, warned that the BRI “cannot be the roads of a new hegemony that will make the countries they traverse into vassal states.” He added: “The ancient silk roads were never purely Chinese…These roads are to be shared and they cannot be one-way.”

What should the world do about the BRI? For a start, it needs to keep some perspective. Even if China does hope to use it as a political tool to beat back Western influence, Beijing is bound to face difficulties, as projects go awry, debts go bad and people grow hostile to China’s presence. History suggests that simply doling out money will not, on its own, usher in a Pax Sinica.

The world can also use its influence to make the BRI more beneficial. Even China’s billions cannot finance everything on offer. Money coming from the West, from the European Union and from institutions such as the World Bank and the IMF should be lent according to international standards—including on such things as transparency, environmental safeguards, public procurement and debt sustainability. So long as they are good projects, let China include them in the BRI if it wants to.

Last is security. The way to assuage fears about the BRI’s threat to the balance of power is not by trying to frustrate China’s efforts, let alone by starting a trade war or by pulling America’s armed forces out of Asia, as President Donald Trump sometimes seems to contemplate. On the contrary, the balance of risks and benefits of the BRI is related to America’s commitment to Asia. If the United States is engaged, the world can mitigate the dangers of BRI and reap its rewards. If not, the risks will outweigh the benefits. The BRI is yet one more argument for America to stay in Asia.
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