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111. Fostering Growth in Digital Trade through Bilateral Cooperation in the Development of Trade Rules

Author:
Don Stephenson
Publication Date:
06-2020
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation (CIGI)
Abstract:
Like foreign policy, trade policy is the outward expression of domestic policy — both economic and social — and trade negotiations are to advance the national interest. Both India and Canada have important commercial interests in digital trade and both have counterbalancing social policy concerns, but they have important differences as well. Their equitable participation in digital trade must overcome an imbalanced competitive landscape through measures to facilitate access to technology and infrastructure, financing, and training in digital technology literacy and data-based business models. As yet, there is no international consensus on how trade rules should be adapted to foster digital trade. Consistent with the Track 1.5 Dialogue objectives, this paper calls on Canada and India to partner and lead in advancing the digital trade agenda. It recommends creating a bilateral process to identify common causes and areas for collaboration; convening a business-to-business conversation supported with research and analysis; and focusing on the impact of digital technology, looking at not only electronic commerce but also trade in traditional service sectors.
Topic:
International Cooperation, International Trade and Finance, Digital Economy, and Trade Policy
Political Geography:
Canada, India, Asia, and North America

112. India-Canada Energy Cooperation

Author:
Amit Bhandari
Publication Date:
07-2020
Content Type:
Working Paper
Institution:
Centre for International Governance Innovation (CIGI)
Abstract:
The energy sectors of India and Canada complement each other: India is a large and growing oil importer, while Canada is a large and growing exporter of oil and gas. However, as they invested in oil fields across the world, Indian oil companies have missed out on the Canada story. Investing in Canada’s oil sector can help India guard against the risk of spikes in oil prices and provide Canada with long-term demand security. In this paper, first presented as a backgrounder at Track 1.5 meetings in Mumbai, India, in November 2019, Gateway House outlines its findings on the feasibility of Indian investment in Canada’s petroleum sector, suggesting a path forward and best prospects for investment.
Topic:
Energy Policy, International Trade and Finance, Oil, Gas, and Investment
Political Geography:
Canada, India, Asia, and North America

113. The (Re)emergence of the BRICS and the Reorganization of Power in Contemporary Geopolitics

Author:
Charles Pennaforte and Ricardo Luigi
Publication Date:
07-2020
Content Type:
Journal Article
Journal:
AUSTRAL: Brazilian Journal of Strategy International Relations
Institution:
Postgraduate Program in International Strategic Studies, Universidade Federal do Rio Grande do Sul
Abstract:
The two first decades of the 21 st Century were marked by the recrudescence of two powerhouses, Russia and China. Given their important role on global geopolitics, these two countries took advantage of the gaps resulted from yet another crisis on the structure of global capitalism, which influenced the relative decline of the United States capacity to impose its will on the international system as they had been able to do so since the end of World War II. This article’s objective is to analyze the global geopolitical rearrangement due to a weakened United States which opened the possibility for the BRICS nations to emerge as possible sources of power. To reinforce this analysis, the world-systems perspective, (here on referred to as WSP) elaborated mainly by Immanuel Wallerstein and Giovanni Arrighi is used, as well as a geopolitical approach to provide a link to international relations theories. Therefore, this paper is divided on to four sections. The first one interrelates the geopolitical theories and those of the WSP. The second section is guided towards understanding the origins and fundamentals of the WSP. On the third section, an approach is made towards the motivations and the effects of the rearrangement of power on the world’s geopolitics. Finally, on the last section, the roles and opportunities that have arisen from the emergence of the BRICS nations on the international system are presented.
Topic:
Development, International Trade and Finance, Geopolitics, and Capitalism
Political Geography:
Africa, Russia, China, Europe, India, Asia, South Africa, Brazil, and South America

114. Pakistan and CPEC Are Drawn Into the U.S.-China Rivalry

Author:
Adnan Aamir
Publication Date:
01-2020
Content Type:
Journal Article
Journal:
China Brief
Institution:
The Jamestown Foundation
Abstract:
Leaders in the People’s Republic of China (PRC) and the Islamic Republic of Pakistan were stunned in late November when a senior U.S. government official issued a strong verbal attack on the China-Pakistan Economic Corridor (CPEC). On November 21 in Washington, D.C., U.S. Assistant Secretary of State for the Bureau of South and Central Asia Affairs Alice Wells spoke at length about the CPEC at a public event, criticizing multiple elements of the $62 billion flagship component of China’s Belt and Road Initiative (BRI). Ambassador Wells cast doubt upon claims that CPEC will generate sustainable economic development in Pakistan and criticized the project’s cost escalations and non-transparent processes of awarding CPEC contracts to Chinese firms. She appealed to Pakistan’s citizens to ask tough questions of the PRC regarding the CPEC and China’s related projects in Pakistan (U.S. State Department, November 21, 2019). In the past, the U.S. government had raised concerns over CPEC and China’s “debt-trap diplomacy,” but it had never presented such a direct and detailed set of criticisms. Ambassador Wells crossed that line—bringing the notoriously stalled out CPEC back under international scrutiny just after Chinese and Pakistani leaders had brokered a cautiously optimistic set of funding deals to jumpstart progress a month before (Ministry of Foreign Affairs (PRC), October 9, 2019). Chinese representatives were quick to respond to Ambassador Wells’s criticisms. The next day, PRC Ambassador to Islamabad Yao Jing(姚敬) said that he had been “shocked and surprised to see the remarks of Alice,” and that Ambassador Wells lacked accurate knowledge and had relied on “Western media ‘propaganda’” for her accusations. He called on the U.S. to “show your evidence, give me evidence” of specific cases of corruption related to the CPEC, and questioned whether Wells was taking potshots at the CPEC to score political points. Ambassador Yao challenged the U.S. to suit its actions to its words: “If there is any sincerity… [the U.S. should] come forward to invest in Pakistan. We [China] welcome U.S. investment in Pakistan.” (INP (Pakistan), November 22, 2019; VOA, November 22, 2019). In addition to refocusing negative attention on the CPEC, Assistant Secretary of State Wells’ speech drew a reluctant Pakistan further into the tumultuous U.S.-China political rivalry. Pakistan faces a balance of payments crisis and a severely weakened currency, which has led it to grow increasingly dependent on economic ties with China. At the same time, the Pakistani leadership has navigated a complex and multifaceted historic security and political partnership with the U.S. If, as Ambassador Wells’ statement seems to imply, Pakistan’s engagement with China is seen to come at the expense of its bilateral relationship with the U.S. – or vice-versa – then Pakistan’s delicate power balancing diplomacy will soon become even more tenuous.
Topic:
Diplomacy, International Cooperation, International Trade and Finance, Leadership, and Conflict
Political Geography:
Pakistan, China, Middle East, Asia, North America, and United States of America

115. The Future of Chinese Foreign Economic Policy Will Challenge U.S. Interests, Part 1: The Belt-and-Road Initiative and the Middle Income Trap

Author:
Sagatom Saha
Publication Date:
01-2020
Content Type:
Journal Article
Journal:
China Brief
Institution:
The Jamestown Foundation
Abstract:
Chinese Communist Party (CCP) General Secretary Xi Jinping and other senior CCP leaders have prudently planned for the slowing economic growth that China now faces. CCP officials plan to transition China from its current export-led growth model to one driven by indigenous innovation, and one in which China’s rising global prominence confers to it many of the same advantages traditionally enjoyed by the United States (such as low borrowing costs and influence within international institutions). Although U.S.-China relations have become further fraught amid the trade war, many prominent China hands nevertheless assert that Beijing’s long-term economic plans do not run counter to U.S. strategic interests. [1] However, many of China’s planned foreign economic initiatives—to include the Belt and Road Initiative (BRI), global value chain advancement, and renminbi (RMB) internationalization—will come at U.S. expense. Policymakers in both Washington and Beijing should accordingly expect U.S.-China tensions to persist beyond the Trump administration. China’s need for new growth vehicles is twofold: its economic size has not translated into global influence, and its current economic model is losing steam. First, China’s transformation into the world’s second-largest economy has yet to yield equivalent influence in the international system. Beijing’s sway in the World Bank and the International Monetary Fund (IMF), for example, lag behind China’s status as the largest trade partner and foreign investor for much of the world. The United States, by contrast, has leveraged its economic status to maintain effective control of the Bretton-Woods institutions, to obtain low borrowing costs, and to exercise punishing sanctions programs against unfriendly governments. Second, Chinese growth has seen a secular decline over the last decade (see figure 1). The official projected GDP growth rate for 2020 is 6.1 percent (Xinhua, November 30, 2019), but some Chinese officials have hinted that they expect lower sub-6 percent growth in 2020 (South China Morning Post, November 14, 2019). This is a noteworthy signal, for CCP discourse has previously identified the benchmark of 6 percent GDP growth as necessary to avoid social unrest (China Brief, March 22, 2019).
Topic:
Foreign Policy, Economics, International Cooperation, International Trade and Finance, Hegemony, Conflict, and Rivalry
Political Geography:
China, Middle East, Asia, North America, and United States of America

116. The Future of Chinese Foreign Economic Policy Will Challenge U.S. Interests, Part 2: Renminbi Internationalization and International Economic Institutions

Author:
Sagatom Saha
Publication Date:
02-2020
Content Type:
Journal Article
Journal:
China Brief
Institution:
The Jamestown Foundation
Abstract:
Complications surrounding the Belt and Road Initiative (BRI), and the dangers of the “middle-income trap,” are not the only factors impacting the international economic policies of the People’s Republic of China (PRC). Furthermore, poor capital efficiency is not the only feature of the Chinese economy that frustrates the country’s policymakers. China’s gross domestic product (GDP) has roughly doubled in the last decade, but Beijing’s pull in the international monetary and financial system remains lackluster. This lack of progress stems in part from the dollar’s centrality around the world, as well as U.S. dominance in international economic institutions. Beijing’s economic planners have long advocated against the dollar while attempting to increase the global role of the PRC’s own renminbi (RMB) currency. While past efforts stumbled, RMB internationalization and increased Chinese influence will directly confront U.S. economic and geopolitical interests.
Topic:
Economics, International Cooperation, International Trade and Finance, Hegemony, Conflict, and Rivalry
Political Geography:
China, Asia, North America, and United States of America

117. Limited Payoffs: What Have BRI Investments Delivered for China Amid the Coronavirus Outbreak?

Author:
Johan Van de Ven
Publication Date:
03-2020
Content Type:
Journal Article
Journal:
China Brief
Institution:
The Jamestown Foundation
Abstract:
The coronavirus outbreak, now declared to be a pandemic by the World Health Organization (WHO, March 11), offers a prism through which to assess how China interacts with the rest of the world in a time of crisis—one that was at first confined to China’s borders, but has since become a global emergency. Some commentaries on the connection between the COVID-19 coronavirus outbreak and the Belt and Road Initiative (BRI) have portrayed Xi Jinping’s centerpiece foreign policy program as a dangerous vector enabling the pandemic—even though China was engaged in international trade and transportation prior to the commencement of the BRI in 2013 (Foreign Policy, January 24). For its part, state media in the People’s Republic of China (PRC) has linked BRI relationships to support for China amid the initial stages of the crisis, citing positive examples of support from media outlets in South Africa, Russia, and Pakistan (People’s Daily, February 20). More recently, as the spread of the disease has abated in China and increased elsewhere, Chinese authorities have sought to illustrate their support, via the “warmth” of the Belt and Road, for current hotspots such as Italy and Iran—while also criticizing the U.S. response to the crisis (Zhejiang News, March 12). Such developments in China’s foreign relations amid the coronavirus outbreak offer a window to assess the effectiveness of the BRI in one of its central goals: namely, expanding the soft power available to the PRC. Applying an understanding of soft power as a state’s ability to induce other states to take actions favorable to its own interests, available evidence across domains related to the initial phases of the COVID-19 pandemic—such as the issuance of evacuation orders, and restrictions on public transportation—indicates that BRI investments have had only modest success in building China’s soft power. International support for China was piecemeal and rhetorical, leaving China economically and politically isolated. Demonstrating the lack of soft power available to Chinese authorities, the state tabloid Global Times demanded on February 12 that countries that “have completely cut off traffic communications with China” should “reconsider and revoke these practices” (Global Times, February 12).
Topic:
International Trade and Finance, Infrastructure, Belt and Road Initiative (BRI), Public Health, Pandemic, and COVID-19
Political Geography:
China and Asia

118. Global Supply Chains, Economic Decoupling, and U.S.-China Relations, Part 1: The View from the United States

Author:
Sagatom Saha and Ashley Feng
Publication Date:
04-2020
Content Type:
Journal Article
Journal:
China Brief
Institution:
The Jamestown Foundation
Abstract:
The trade war has defined the current adversarial relationship between the United States and the People’s Republic of China (PRC). While President Donald J. Trump has at times openly expressed admiration for Chinese Communist Party (CCP) General Secretary Xi Jinping, his administration has pursued policies consistent with economic and technological decoupling. These policies include reforms that strengthen the Committee on Foreign Investment in the United States (CFIUS); greater usage of the export control system, especially the Entity List; and threatening the use of the International Emergency Economic Powers Act (IEEPA) to force U.S. companies back to the United States. These policies, taken to their logical end, would see the secular decoupling of the U.S. and Chinese economies and the rerouting of the global supply chains that bind them. The interim trade deal has done seemingly little to change the structural economic conflict between Beijing and Washington. If economic decoupling came to pass, it would portend a sweeping reorientation of the global economy that many analysts regard as lying outside the bounds of conventional analysis. Yet some Trump administration officials, such as Director of Trade and Manufacturing Policy Peter Navarro, have promoted economic decoupling as their desired aim (SCMP, June 20, 2018; Forbes, December 3, 2019). President Trump himself has “ordered” American companies to look for alternative suppliers outside of China, or to return production to the United States (Twitter, August 23, 2019). The Trump Administration’s trade and investment restrictions have not been limited to U.S. companies—they also include pressuring third-party countries and foreign companies to abide by U.S. restrictions. Chinese companies are also relocating their manufacturing capabilities abroad—in part because of secular economic trends, but U.S. actions are accelerating the process. Simply put, sustained U.S. policies on China can encourage economic decoupling, but only if global economic trends continue to cooperate. Those policies are nascent, but could likely become a structural feature of the U.S.-China economic relationship—especially since a harder stance towards China has gained traction among both major parties. This has been demonstrated by widespread criticism of Chinese trade practices in both parties, and in bipartisan votes on legislation antagonistic to Beijing, such as the Hong Kong Democracy and Human Rights Act or the UIGHUR Act (see further below). The Trump Administration has pursued a three-pronged approach in breaking down economic supply-chain links: 1) escalating tariffs, which discourages bilateral trade; 2) imposing investment restrictions and export controls that punish tech transfers; and 3) issuing threats to U.S. firms that do business in China under the IEEPA. These current policies preview what could become a new orientation in U.S. policy towards China, regardless of who leads the United States at the beginning of next year.
Topic:
International Trade and Finance, Hegemony, Conflict, Trade Wars, and Supply Chains
Political Geography:
China, Asia, North America, and United States of America

119. The China-Myanmar Economic Corridor: Delays Ahead

Author:
Sudha Ramachandran
Publication Date:
04-2020
Content Type:
Journal Article
Journal:
China Brief
Institution:
The Jamestown Foundation
Abstract:
Although no new deals were struck during People’s Republic of China (PRC) President Xi Jinping’s trip to Myanmar on January 17 and 18, the visit was significant for several reasons. The visit was the first by a PRC president to Myanmar in 19 years, and the first by Xi to this country in his role as president. The visit was widely touted as marking the 70th anniversary of the establishment of relations between the PRC and Myanmar. However, Xi’s first trip abroad this year was aimed at expediting implementation of the China-Myanmar Economic Corridor (CMEC), a key component of China’s Belt and Road Initiative (BRI) (CGTN, January 17). During the visit, the two governments signed 33 agreements, memorandums of understanding, protocols and letters of exchange relating to railways, industrial and power projects, and trade. Several of these agreements firm up Myanmar’s commitment to the CMEC’s three central components: the Kyaukphyu Special Economic Zone (SEZ), which includes a deep-sea port, an industrial park and other projects; the China-Myanmar Border Economic Cooperation Zone; and an urban development plan for Yangon (The Irrawaddy, January 18). However, just weeks after Xi’s visit saw the two sides take steps to expedite CMEC projects, Beijing’s plans have run into new problems. CMEC projects are running late, and in an op-ed piece published on the eve of his Myanmar visit, Xi stressed the need for CMEC projects to be moved from “the conceptual stage to concrete planning and implementation” (New Light of Myanmar, January 16). The coronavirus pandemic has emerged as the latest challenge in the long list of obstacles that have slowed CMEC projects over the years. According to Khriezo Yhome, a New Delhi-based analyst of developments in Myanmar, it “may be too early to assess the impact of the coronavirus crisis on CMEC projects,” given that the pandemic is still only at an “initial phase” in Myanmar; however, there is “no doubt” that it “will slow down the implementation of CMEC projects in the short-term.” [1]
Topic:
Diplomacy, Economics, International Cooperation, International Trade and Finance, and Bilateral Relations
Political Geography:
China, Asia, Burma, and Myanmar

120. Public and Opinion Leaders' Views on US-China Trade War

Author:
Craig Kafura
Publication Date:
06-2019
Content Type:
Special Report
Institution:
Chicago Council on Global Affairs
Abstract:
The Trump Administration has taken an aggressive line on US-China trade issues. Starting with steel and aluminum tariffs in March 2018, the United States has gradually imposed a number of tariffs on various Chinese goods. China responded in turn to each round. Recent negotiations, though initially fruitful, foundered on issues of Chinese subsidies and what US trade representative Robert Lighthizer described as “an erosion in commitments by China.” Now the escalation cycle has resumed. According to surveys conducted in 2018 among foreign policy opinion leaders by the Chicago Council on Global Affairs and the University of Texas, and the results of the 2018 Chicago Council Survey of the general US public, concerns about a potential trade war between the United States and China were already widespread before this most recent escalation.
Topic:
Foreign Policy, International Trade and Finance, Public Opinion, and Trade Wars
Political Geography:
China, Asia, North America, and United States of America