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      in Elections

      Trump First now drives US foreign policy. Even if it leads to war… | Simon Tisdall

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      It’s clear Donald Trump will do almost anything to cling to office. Lie about Ruth Bader Ginsburg’s dying wish? Go for it. Label Joe Biden a radical socialist? Silly, but worth a punt. Start a war with China or Iran? Pause right there. This is not beyond the realms of possibility, given his pathological need to win.As November’s poll nears, Trump is weaponising foreign policy – not to defend US security and national interests, but to help him grab a second term. It’s not about putting “America First”. It’s all about putting “Trump First” – by any dangerous means, and at any cost.Trump has no big international successes to his name. On the contrary, he has trashed America’s global reputation and alienated its friends. His North Korea jamboree was all hot air. His Afghan policy is retreat without honour. Israel’s shabby deals with Gulf dictatorships, stitched up by the White House, undermine the quest for Middle East peace.Scornful of traditional diplomacy and lacking significant achievements, Trump chooses confrontation. He exploits visceral fears, just like he does when campaigning at home: fear of nefarious foreign foes, fear of the other, fear of difference.His China-baiting at the UN last week was typical scaremongering. He characterised the pandemic as a global war triggered by Beijing. Covid-19 was the “invisible enemy”, a “plague” and the “China virus” – terms intended to frighten and divide. Just in case Xi Jinping and the other watching Johnny Foreigners did not get the message, the US, he said, had spent $2.5tn on defence since 2016. “We have the most powerful military anywhere in the world.”Was this a threat? Maybe the entire planet should put its hands up and surrender. More

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      in World Politics

      Taking American Carnage to the Next Level

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      It is a recent tradition among occupants of the White House, as they head out of office, to play a few practical jokes on their successors. The Clinton administration jesters, for instance, removed all the Ws from White House keyboards before handing over the keys to George W. Bush’s transition team. The Obama administration left behind books authored by Barack Obama for Trump’s incoming press team.

      Donald Trump has no sense of humor. His “gift” to the next administration is dead serious. With his recent foreign policy moves, the president is trying to change the facts on the ground so that whoever follows in his footsteps will have a more difficult time restoring the previous status quo. Forget about pranks. This is a big middle-finger salute to the foreign policy establishment and the world at large.

      The Next President Needs to Learn From Past Mistakes

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      Of course, Trump is not preparing to leave office, regardless of the results of the November election. But in his policies in the Middle East and East Asia, the president is attempting to change the very rules of the game just in case he’s not around next year to personally make more mischief. The man is not going to win a Nobel Prize for his efforts — despite the recent nominations coming from a pair of right-wing Scandinavians — but he’ll do whatever he can to achieve the next best thing: putting the Trump brand on geopolitics.

      It cost about $5,000 to replace all those W-less typewriters. The bill for all the damage Trump is doing to international affairs in his attempt to make his Israel, Iran and China policies irreversible will be much, much higher.

      Israel Up, Palestine Down

      For several years, the Trump administration promised a grand plan that would resolve the Israel-Palestine stand-off. According to this “deal of the century,” Palestinians would accept some economic development funds, mostly from Gulf states, in exchange for giving up their aspirations for an authentic state.

      The hoops Palestinians would have to jump through to get even such a shrunken and impotent state — effectively giving up Jerusalem, relinquishing the right to join international organizations without Israel’s permission — are such obvious deal-breakers that Jared Kushner and company must have known from the start that their grand plan was not politically viable.

      But finding a workable solution to the Israel-Palestine conflict was not the purpose of the plan. It was all an elaborate shell game. While the administration dangled its proposal in front of world leaders and international media, it was working with Israel to create “new realities.” Trump withdrew the United States from the UN Human Rights Council for its “chronic bias against Israel.” The administration closed the PLO’s office in Washington, DC, and eliminated US funding for the UN agency that supports Palestinian refugees. And in perhaps the most consequent move, Trump broke a global convention by moving the US embassy from Tel Aviv to Jerusalem. Until recently, only one country, Guatemala, had followed suit.

      But then came a flurry of diplomatic activity this fall as both the United Arab Emirates and Bahrain extended diplomatic recognition to Israel. The Trump administration also pushed Serbia and Kosovo, as part of a new economic deal, to include clauses about Israel: Serbia will move its embassy to Jerusalem and Kosovo will establish one there after establishing diplomatic relations with Israel.

      Astonishingly, the Trump administration has promoted this diplomatic activity as restraining Israel. In May, Netanyahu announced that he was moving forward with absorbing sections of the West Bank that already featured large Israeli settlements. He subsequently stepped back from that announcement to conclude the new diplomatic deals with the Gulf states. But it was only reculer pour mieux sauter, as the French say — stepping back to better leap forward. Netanyahu had no intention of taking annexation off the table.

      “There is no change to my plan to extend sovereignty, our sovereignty in Judea and Samaria, in full coordination with the United States,” Netanyahu said in mid-August. Some further to the right of Netanyahu — alas, they do exist — want to annex the entire West Bank. But that’s de jure. As writer Peter Beinart points out, Israel has been annexing the West Bank settlement by settlement for some time.

      Where does this leave Palestinians? Up a creek without a state. The Trump administration has used its much-vaunted “deal of the century” to make any future deal well-nigh impossible. In collaboration with Netanyahu, Trump has strangled the two-state solution in favor of a single Israeli state with a permanent Palestinian underclass. The cost to Palestinians: incalculable.

      Permanent War With Iran

      Strengthening Israel was a major part of Trump’s maneuverings in the Middle East. A second goal was to boost arms sales to Gulf countries, which will only accelerate the arms race in the region. The third ambition has been to weaken Iran. Toward that end, Israel, Bahrain and the UAE now form — along with Saudi Arabia — a more unified anti-Iran bloc.

      But the Trump crowd has never been content to contain Iran. It wants nothing less than regime change. From the get-go, the Trump administration nixed the Iran nuclear deal, tightened sanctions against Tehran and put pressure on all other countries not to engage Iran economically. In January, it assassinated a leading Iranian figure, Major General Qassem Soleimani of the Iranian Revolutionary Guard Corps. And this summer it tried, unsuccessfully, to trigger “snap-back” sanctions against Iran that would kill the nuclear deal once and for all.

      Even as the Trump administration was celebrating the diplomatic deal between the UAE and Israel, it was going after several UAE firms for brokering deals with Iran. Trump recently castigated the Iranian government for going through with the execution of wrestler Navid Afkari for allegedly killing a security guard during a 2018 demonstration.

      And US intelligence agencies have just leaked a rather outlandish suggestion that Iran has been thinking about assassinating the US ambassador to South Africa. According to Politico, “News of the plot comes as Iran continues to seek ways to retaliate for President Donald Trump’s decision to kill a powerful Iranian general earlier this year, the officials said. If carried out, it could dramatically ratchet up already serious tensions between the U.S. and Iran and create enormous pressure on Trump to strike back — possibly in the middle of a tense election season.”

      Hmm, sounds mighty suspicious. Sure, Iran might be itching for revenge. But why risk war with a president who might just be voted out of office in a couple of months and replaced with someone who favors returning to some level of cooperation? And why would the unnamed US government officials leak the information right now? Is it a way to discourage Iran from making such a move? Or perhaps it’s to provoke one side or the other to take the fight to the next level — and take off the table any future effort to repair the breach between the two countries?

      Cutting Ties With China

      At a press conference earlier this month, Trump laid out his vision of US relations with China. Gone were the confident predictions of beautiful new trade deals with Beijing. After all, Trump had canceled trade negotiations last month, largely because the Phase 1 agreement hasn’t produced the kind of results the president had predicted (in terms of Chinese purchases of US goods). Nor did Trump talk about what a good idea it was for China to build “reeducation camps” for Uighurs in Xinjiang (he reserves such frank conversation for tête-à-têtes with Xi Jinping, according to John Bolton).

      Rather, Trump talked about severing the economic relationship between the two countries. “Under my administration, we will make America into the manufacturing superpower of the world, and we’ll end our reliance on China once and for all,” he said. “Whether it’s decoupling or putting in massive tariffs like I’ve been doing already, we’re going to end our reliance on China because we can’t rely on China.”

      Embed from Getty Images

      As with virtually all things, Trump doesn’t know what he’s talking about. China has been largely unaffected by all of Trump’s threats and posturing. As economist Nicholas Lardy explains, “for all the fireworks over tariffs and investment restrictions, China’s integration into global financial markets continues apace. Indeed, that integration appears on most metrics to have accelerated over the past year. And U.S.-based financial institutions are actively participating in this process, making financial decoupling between the United States and China increasingly unlikely.”

      In fact, decoupling is just another way of saying “self-inflicted wound.” On the non-financial side of the ledger, the United States has already paid a steep price for its trade war with China, which is only a small part of what decoupling would ultimately cost. Before the pandemic hit, the United States was already losing 300,000 jobs and $40 billion in lost exports annually. That’s like a Category 3 hurricane. A full decoupling would tear through the US economy like a Category 6 storm.

      Geopolitical Carnage

      American presidents want to leave behind a geopolitical legacy. Bill Clinton was proud of both the Dayton agreement and the Oslo Accords. George W. Bush touted his response to the September 11 attacks. Barack Obama could point to the Iran nuclear deal and the détente with Cuba. Donald Trump, like the aforementioned twisters, has left destruction in his path. He tore up agreements, initiated trade wars, pulled out of international organizations and escalated America’s air wars.

      But perhaps his most pernicious legacy is his scorched-earth policy. Like armies in retreat that destroy the fields and the livestock to rob their advancing adversaries of food sources, Trump is doing whatever he can to make it impossible for his successor to resolve some of the world’s most intractable problems.

      His diplomatic “achievements” in the Middle East are designed to disempower and further disenfranchise Palestinians. His aggressive policy toward China is designed to disrupt an economic relationship that sustains millions of US farmers and manufacturers. His bellicose approach to Iran is designed not only to destroy the current nuclear accord but make future ones impossible as well.

      If he wins a second term, Trump will bring his scorched-earth doctrine to every corner of the globe. What he is doing to Iran, China and the Palestinians, he will do to the whole planet. The nearly 200,000 pandemic deaths and the wildfires destroying the West Coast are just the beginning. Donald Trump can’t wait to take his brand of American carnage to the next level.

      *[This article was originally published by Foreign Policy in Focus.]

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      in World Politics

      Can the India-China Confrontation Play Out in East Africa?

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      China and India have never been friendly neighbors. The laws of geopolitics set the two Asian giants against one another. In recent years, Chinese President Xi Jinping’s confrontation with the US and Indian Prime Minister Narendra Modi’s ambitions for a powerful and global India have inflamed nationalism on both sides of the Himalayan border. Bilateral tensions peaked in June, when a border clash in the Himalayan Galwan Valley resulted in the death of 20 Indian soldiers and an unspecified number of Chinese troops.

      Han and Hindu Nationalism Come Face to Face

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      Now, the competition between China and India is moving to Africa, and to East Africa in particular. Since 2000, the continent has witnessed China’s deep and ubiquitous penetration through trade, investments, infrastructures, energy, budget support and security cooperation. In 2008, New Delhi showed a newfound interest in Africa.

      Despite China’s head start, India is trying to catch up to counter Beijing’s predominance over the continent. East Africa is the region where the two Asian powerhouses share vital interests and where their competition will likely play out more seriously.

      India’s Africa Policy

      India–Africa relations are rooted in history. The Indian Ocean constituted a channel of trade and population exchange for centuries. Consequently, East Africa has always enjoyed close ties with India, and around 3 million people of Indian descent live between the Horn and South Africa. After independence from British rule in 1947, India was politically active in Africa as a champion of decolonization and South-South cooperation. The period that followed saw India–Africa relations phase out until New Delhi brought the continent back into the picture from the mid-2000s.

      In economic terms, trade augmented eightfold between 2001 and 2017, making India Africa’s third-largest trading partner with a total exchange worth $62.6 billion. While Chinese trade with the continent largely outnumbers it, India has kept up the pace and investments grew alongside trade, jumping to $54 billion in 2016.

      Embed from Getty Images

      As a fast-growing manufacturing power, India places strategic relevance to raw materials for the stability of its supply chain and energy sector. Indeed, New Delhi’s exchange with Africa, like Beijing’s, is driven by natural resources — with oil and gas accounting for approximately two-thirds of the total — followed by gold and other ores.

      Political ties have also strengthened over the years. In 2008, the first India–Africa Forum Summit was launched in New Delhi and took place again in 2011 and 2015, with 41 African heads of state attending; the next conference was scheduled in September 2020. These summits allowed African leaders, on the one hand, to set out their cooperation priorities and India, on the other, to respond accordingly. As a result, India–Africa cooperation pivoted around capacity building, technology transfer and infrastructural investments. Lastly, India has sought support on UN reform, which would be unrealistic without the votes of African countries in the General Assembly.

      Security issues have been on the agenda as well. New Delhi is particularly active in the realm of anti-piracy. After the kidnapping of several Indian citizens by Somali pirates, the Indian navy stepped up its efforts after 2008 and escorted over 1,000 vessels across the Gulf of Aden, sometimes in cooperation with the European Union’s Mission Atalanta.

      Another domain that saw India at the forefront is UN peacekeeping missions. The Indian subcontinent has always been one of the leading suppliers of peacekeepers to UN missions, with 80% of them deployed in Africa. On top of that, Indian defense academies have provided training to the Nigerian, Ethiopian and Tanzanian military.

      Modi and the Challenge to China

      Modi has given further impetus to India–Africa relations. In July 2018, he outlined the 10 guiding principles of India’s engagement with Africa during a visit to Rwanda and Uganda. On that occasion, the prime minister leveraged India’s role in South-South cooperation to advance his credentials as leader of the developing world. Besides rhetoric, Modi moved from words to action by signing a defense agreement with President Paul Kagame of Rwanda and by extending two credit lines worth nearly $200 million to the Ugandan government. He also announced the opening of 18 new diplomatic missions in Africa by 2021, bringing the total to 47.

      The prime minister has placed a keen eye on East Africa, which is set to become the epicenter of the India–China confrontation. The Red Sea and the Gulf of Aden are essential maritime routes for India’s export-oriented economy. China is heavily investing along these two waterways through the “Belt and Road Initiative” (BRI), especially in the port of Djibouti and the Suez Canal.

      Djibouti is indeed becoming yet another element of the Chinese maritime network in the Indian Ocean, along with Pakistan, the Maldives, Sri Lanka, Bangladesh and Myanmar. This network, the so-called “String of Pearls,” geographically surrounds India and is perceived as a strategic nightmare in New Delhi. Therefore, the Chinese expansion in the western Indian Ocean urges India to intervene.

      To counter the BRI in the Indian Ocean, New Delhi launched a similar initiative for East Africa: the Asia-Africa Growth Corridor (AAGC). Conceived in 2016 and still at an early stage, this Indo-Japanese project will attract investments on development, quality infrastructure, institutional connectivity, capacity building and people-to-people cooperation to the region. Due to its anti-Chinese nature, the AAGC primarily targets contested countries like Djibouti and Ethiopia.

      In 2017, Indian President Ram Nath Kovind clustered both countries for his first official visit. At the time, Ethiopia was already the largest beneficiary of India’s scholarship scheme and lines of credit for Africa with $1.1 billion, besides being the scene of the 2011 India-Africa Forum Summit. Djibouti was a relatively new target for New Delhi. In the year of the visit, China opened its first overseas military base in Djibouti. Consequently, Kovind not only signed some cooperation agreements, but he also reportedly expressed India’s interest in a military base on Djiboutian soil, a project still under discussion.

      The geopolitical confrontation between India and China looms on the horizon. Africa — particularly the east — is set to become an arena of such a global, momentous challenge. India has economic, energetic and security reasons to deepen its relations with the continent. Furthermore, China’s ubiquitous presence in Africa and the Indian Ocean is a direct menace to Modi’s global ambitions. Although China is still out of reach, New Delhi’s engagement has been steadily expanding in all fields, and its approach based on soft power looks promising. The concepts of building Africa’s capacities and unleashing its potential, along with the employment of African workers instead of foreign labor like China, have resonated across the continent.

      On the one hand, East Africa is under India’s radar more than any other region of the continent for its strategic position. On the other, East African governments have a long track record of balancing off the influence of external actors. East Africa is also the region where India can rely on a robust diaspora community. Hence, India presents itself as a useful ally to balance China’s growing influence in the region.

      Finally, yet importantly, the US and the European powers might prefer New Delhi’s penetration into the continent at the detriment of China’s, which is perceived as a growing geopolitical threat to the West. East Africa, in sum, might soon become the new battleground of the economic and security confrontation between the two Asian giants.

      *[Fair Observer is a media partner of Gulf State Analytics.]

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      in World Politics

      The Solution to India’s China Problem: A Free Tibet

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      India has had a wound around its Himalayan neck ever since it suffered a humiliating defeat to China in 1962. The recent clash between Indian and China soldiers in Galwan Valley on June 15 has only rubbed salt into that wound.

      It has come to this because when China invaded neighboring Tibet in 1950, India was in thrall to the newly-established communist regime under Mao Zedong after a bloody revolution. Ignoring its civilizational relationship with Tibet, India hoped to gain from the emerging power of the People’s Republic of China and thus celebrated “Hindi-Chini bhai bhai,” a popular slogan of the time that translates to “Indians and Chinese are brothers.”

      Han and Hindu Nationalism Come Face to Face

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      After 1962, the Chinese military stood on the doorstep of India across thousands of kilometers in the Himalayas. Proverbially, this border was guarded by only 60 Indian policemen before China’s conquest of Tibet. Pertinently, India never had a border with China before 1950.

      Refuge in India

      If Tibet had remained a free and independent country, today it would have been the 10th largest nation with 2.5 million square kilometers of land. The Tibetan Plateau hosts 46,000 glaciers, nearly one-fourth of the world’s total number. It is a source of numerous rivers, including some of the most mighty ones such as the Indus, Brahmaputra, Mekong and Yangtze. It is shocking that such a vast reservoir of water and natural resources in Asia has been occupied by China and it is even more shocking that it barely gets a mention today.

      Ancient Buddhist culture has been preserved in Tibet over many centuries. In the Indian public psyche, Kailash Mansarovar was part of India. Tibetans used to visit Buddhist pilgrimage sites in India at Sarnath, Bodhgaya, Nalanda and Amravati. The India–Tibet border was irrelevant and people used to cross it freely. Today, that border has two armies facing each other and people no longer cross it.

      After the Dalai Lama took refuge in India in 1959, around 100,000 Tibetans have come to India. Most of them live in the Himalayan regions and the state of Karnataka. The Tibetan seat of power is in Dharamshala, Himachal Pradesh, where the Dalai Lama has set up abode. The Tibetan parliament and government are also based there. Although many Tibetans still dream of a free Tibet, India‘s desire for closer ties with China in the past has led New Delhi to shy away from supporting Tibetan independence. As a refugee in India, the Dalai Lama has spoken of autonomy and adhered to India‘s “One-China” policy.

      In 70 years of Chinese occupation, more than 1 million Tibetans have been killed, 6,000 monasteries destroyed and Tibet’s cultural identity attacked. The Chinese have also proceeded to exploit Tibet’s natural resources. They have cleared forests, bombed mountains and practice strip mining for gold, copper, lithium and other rare earth elements.

      Long Ignored

      The international community has ignored the genocide and exploitation Tibet has experienced over the last seven decades. Powerful nations have made their peace with China for geopolitical and economic reasons. In the process, Tibetans have suffered a lot.

      Embed from Getty Images

      Globalization has led over 160 countries trading with China. Western “liberal democrats” blindly accept the “One-China” policy and recognize Tibet as a part of China. Freed of any external pressure, China has become more oppressive in Tibet. Even possessing the Dalai Lama’s photo could land a Tibetan in jail on charges of separatism. Although Tibetan youth do not retaliate like their counterparts in Palestine or Kashmir, they have resorted to self-immolation as a form of protest against Chinese occupation.

      Tibetans still believe that freedom is possible. Until six decades ago, Confucianism and Buddhism were the strongest influences on Chinese society. Communism attacked these twin pillars. Capitalism has shaken them further. Today, the only religion consumerist China worships is money. Yet, as the Chinese are discovering, life is more than money. Tibetans are convinced that China will never be able to conquer their spirit and that they are free until their spirit is free.

      During visits of Chinese leaders, Indian police customarily arrest all Tibetan activists to appease China. Yet young Tibetans take their inspiration from India’s struggle for independence from British rule. Few remember that until 1942, most Indians did not believe they would see freedom in their lifetime. Mahatma Gandhi’s Quit India Movement struggled to gain mass support. Within five years, India became independent because the British Empire collapsed under its own weight. Tibetans believe the same will happen to the modern Chinese empire.

      Chinese Domination

      China has not only occupied Tibet but also Uighur East Turkestan, a Muslim-majority region covering 1.8 million square kilometers now known as Xinjiang. It also occupies 1.2 million square kilometers of southern Mongolia and 84,000 square kilometers of Manchuria. By some calculations, 60% of China’s 9.6 million square kilometers is occupied territory. China’s expansionist designs continue. The “Belt and Road Initiative” is China’s plan to dominate world trade.

      The Chinese Communist Party (CCP) controls all aspects of life in the country. The administration, the judiciary, the legislature, the media and the military are all controlled by the CCP. The party fosters a personality cult around Mao despite his responsibility for the death of millions of people. His portrait still adorns Tiananmen Square, a place made immemorable by the brutal slaughter of unarmed students by armed tanks. That 1989 massacre still stands obliterated from history textbooks and even the internet in China.

      Territorial encroachments and China’s support for Pakistan demonstrate that Beijing has no respect for India’s territorial integrity. There is no reason for India to respect China’s territorial integrity. Beijing is facing international isolation because of the COVID-19 outbreak. From Japan to Bhutan, China’s neighbors are nervous about its expansionism. The time has come for India to stand up to China. It must scrap the “One-China” policy and support Tibet’s nonviolent movement for independence.

      *[An earlier version of this article was published by The Indian Express.]

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More

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      in US Politics

      Joe Biden if president will push allies like Australia to do more on climate, adviser says

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      Joe Biden will not pull any punches with allies including Australia in seeking to build international momentum for stronger action on the climate crisis, an adviser to the US presidential candidate has said.If elected in November, Biden will hold heavy emitters such as China accountable for doing more “but he’s also going to push our friends to do more as well”, according to Jake Sullivan, who was the national security adviser to Biden when he was vice-president and is now in the candidate’s inner circle.In a wide-ranging podcast interview with the Sydney-based Lowy Institute, Sullivan also signalled that Biden would work closely with Australia and other regional allies in responding to the challenges posed by the rise of China.While Australia’s prime minister, Scott Morrison, is likely to welcome the pledge of US coordination with allies on regional security issues, there may be unease in government ranks about the potential for tough conversations about Australia’s climate policies.The Coalition government has resisted calls to embrace a target of net-zero emissions by 2050 and it proposes to use Kyoto carryover credits to meet Australia’s 2030 emission reductions pledge. Some Coalition backbenchers still openly dispute climate science.Sullivan said climate change would be a big priority for Biden, both in domestic policy – with climate and clean energy issues placed at the heart of his economic recovery visions – and in foreign policy, where he would do more than just reverse Donald Trump’s decision to abandon the Paris agreement.“He has said right out of the gate, we’re not just rejoining Paris – we are going to rally the nations of the world to get everyone to up their game, to elevate their ambition, to do more,” Sullivan told the Lowy Institute.“And in that regard he will hold countries like China accountable for doing more but he’s also going to push our friends to do more as well and to step up and fulfil their responsibilities to what is fundamentally a global problem, that every country needs to be participating in and contributing to.”Sullivan said there was “no reason it has to get awkward” for countries like Australia.“The vice-president is not going to come to play games around that issue if he’s fortunate enough to be elected. He’ll lay it out in the way only Joe Biden can do – just plain and straight, down the line, respectful – but he’s not going to pull any punches on it.”Sullivan made the remarks in an interview with Michael Fullilove, the executive director of the Lowy Institute, who told Guardian Australia last month that climate was likely to “come roaring back as an issue in US foreign policy under a Biden administration” and that it “may be harder to say no to a Biden administration”.Biden has vowed to put the US on “an irreversible path to achieve net-zero emissions, economy-wide” by 2050, and to rally the rest of the world to meet the climate threat – indicating that he would “fully integrate climate change” into US foreign policy and national security strategies, as well as its approach to trade.The economist Ross Garnaut has also speculated that a Biden win could lead to Australia being placed “in the naughty corner” on climate policy.More broadly, Sullivan said Biden would be “eager to develop a really strong relationship” with Morrison – who has formed close working ties with Trump, even though the Australian government has emphasised points of difference from time to time.Sullivan said Biden had a deep respect for Australia and its contributions to US security and the history of the alliance between the two countries.Biden and Morrison were likely to “get off to a strong start” because the former vice-president saw Australia as the kind of partner that was central to a finding successful strategies when faced with a range of issues in a fast-changing world.Sullivan said Biden put like-minded democratic allies at the heart of his foreign policy, because he believed that was the platform upon which the US could most effectively deal with great power competition and transnational challenges.“Allies are going to have pride of place in the hierarchy of priorities in a Biden administration foreign policy,” Sullivan said. He said allies including Australia, Japan, South Korea and Nato were important not just on regional issues but more broadly.“And yes, the rise of China is at or near the top of the list of big global challenges that we all have to be working effectively together on.” More

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      in World Politics

      The Unintended Economic Impacts of China’s Belt and Road Initiative

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      China’s footprint in global foreign direct investment (FDI) has increased notably since the launch of the Belt and Road Initiative (BRI) in 2013. That served to bring Chinese overseas FDI closer to a level that one would expect, based on the country’s weight in the global economy. China accounted for about 12% of global cross-border mergers and acquisitions and 9% of announced greenfield FDI projects between 2013 and 2018. Chinese overseas FDI rose from $10 billion in 2005 (0.5% of Chinese GDP) to nearly $180 billion in 2017 (1.5% of GDP). Likewise, annual construction contracts awarded to Chinese companies increased from $10 billion in 2005 to more than $100 billion in 2017.

      Interestingly, however, the American Enterprise Institute’s China Global Investment tracker recorded $420 billion worth of investment and construction in BRI countries versus $655 billion in other countries between 2013 and 2018. So China actually invested more in countries outside the BRI during the period, given that Chinese investment in developed countries tends to have larger market values, particularly for mergers and acquisitions.

      Additional Pain

      Based on other measures, however, Chinese investment in BRI nations was much larger as a percentage of its total investment for the period. For example, greenfield investment represented almost half of all investment in BRI countries, but only 13% in other markets. Chinese firms were awarded $268 billion worth of construction contracts in BRI countries versus $166 billion elsewhere. Greenfield investment and construction in BRI countries amounted to $340 billion versus $230 billion in non-BRI countries.

      The subsidies that Beijing contributes to its state-owned enterprises implies that many of the BRI projects actually cost it far more than the face value of the construction and investment, meaning that loan defaults — a common occurrence — add that much more additional pain to Beijing’s coffers.

      The BRI: Keeping the Plates Spinning on China’s Economy

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      Asia attracted the majority of BRI-related investment and construction contracts between 2013 and 2018, receiving just over half of such activity, with Southeast Asia taking 46% of that amount. Africa received 23%, followed by the Middle East at 13%. Overall, approximately 38% of total investments and construction contracts were targeted at the energy sector in host nations, with 27% ending up in transport and 10% in real estate.

      The largest BRI project as of 2018 was the China-Pakistan Economic Corridor, which links Kashgar in China’s Xinjiang province with the port of Gwadar in Pakistan. Investments and construction contracts worth nearly $40 billion had been devoted to the project, with total spending likely to reach in excess of $60 billion by the time it is finished, equivalent to about 20% of Pakistan’s nominal GDP. The country endured a large increase in imports of materials and capital as a result, which aggravated its trade imbalance. By 2018, its current account deficit had expanded to more than 6% of GDP from less than 2% in 2016.

      Expensive Membership

      While Pakistan’s economic challenges were not and are not entirely attributable to the BRI, the strains added to it by the BRI became highly problematic. That turned out to be a common byproduct of the initiative among the countries receiving the largest amounts of investment. Large debts in countries with limited financial resources and means of generating revenue often undermine governments’ ability to successfully manage their economies. Rather than benefiting from the infrastructure investments made by China, they sometimes end up perpetually treading water.

      Rising debt service often increases a country’s borrowing costs, can raise doubt about its solvency, contribute to a depreciating currency and increase the local currency value of the external debt burden. Consequently, the macroeconomic fallout of being a recipient member of the BRI “club” can be severe, particularly for the smallest and poorest countries.

      A 2018 study from the Center for Global Development has noted, for example, that in the case of Djibouti, home to China’s only overseas military base, public external debt had increased from 50% to 85% of GDP in just two years — the highest of any low-income country. Much of that debt consists of government-guaranteed public enterprise debt owed to China’s Export-Import Bank (EXIM).

      In Laos, the $6-billion cost of the China-Laos railway represents almost half the country’s GDP. Debt to China, Tajikistan’s single largest creditor, accounted for almost 80% of the total increase in Tajikistan’s external debt between 2007 and 2016 period. And in Kyrgyzstan, China EXIM is the largest single creditor, with loans of $1.5 billion, or about 40% of the country’s total external debt.

      It certainly does not appear that Beijing put sufficient effort into contemplating the likely economic impact of the BRI prior to commencing it, either upon host nations or upon itself, for all concerned have borne the consequences of excessive and imprudent lending. Could it be that that Communist Party of China did not care, and that all that mattered was rolling the Initiative out as quickly as possible once it decided to do so?

      It is truly surprising that Beijing did not do a better job of envisioning the multiplicity of potential outcomes. That is undoubtedly the overriding reason why the Chinese government decided to pivot in 2018 and adopt a seemingly more rational, moderate and achievable approach to unleashing the remainder of the BRI upon the world. It now realizes that its reputation and legacy are at stake, never mind the hardship it has placed on scores of developing countries around the world in the process.

      *[Daniel Wagner is the author of “The Chinese Vortex: The Belt and Road Initiative and its Impact on the World.”

      The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy. More