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141. The US–China trade–tech stand-off and the need for EU action on export control

Author:
Brigitte Dekker and Maaike Okano-Heijmans
Publication Date:
08-2019
Content Type:
Special Report
Institution:
Clingendael Netherlands Institute of International Relations
Abstract:
As the great power rivalry and (technological) trade conflict between the United States (US) and China intensifies, calls for an export control regime tailored to so-called emerging technologies are growing. In August 2018 the US government announced the Export Control Reform Act (ECRA), seeking to limit the release of emerging technologies to end uses, end users and destinations of concern. The contest is on for the leader in the development and use of emerging technologies, but also for shaping norms and writing the rules for their use. This requires the Netherlands and other EU member states – in coordination with key stakeholders from business and academia – also to redouble their efforts to recraft their own approach to export controls of so-called ‘omni-use’ emerging technologies. This Clingendael Report outlines four levels of action in the field of export control for the Dutch government to pursue in parallel: bilaterally with the US; European Union cooperation; ‘Wassenaar’ and beyond; and trusted communities.
Topic:
Development, Science and Technology, Power Politics, Exports, and Trade
Political Geography:
China, Europe, Asia, North America, and United States of America

142. Global Energy in Transition: How the EU Should Navigate New Realities and Risks

Author:
Andreas Goldthau
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
German Council on Foreign Relations (DGAP)
Abstract:
Global energy demand is shifting to Southeast Asia. This new trade flow is altering market power because it not only follows natural economic development, but also results from strategic trade and investment policies that promote national interests. In this context, the EU needs to account for the geo-economic side effects of the new European Green Deal.
Topic:
Climate Change, Economics, Energy Policy, European Union, Risk, and Trade
Political Geography:
Europe, Asia, and Southeast Asia

143. US-Southeast Asia Trade is Increasing, but so are Deficits

Author:
Malcolm Cook
Publication Date:
10-2019
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
Conventional narratives are either supported by facts or overcome them. Recent increased trade flows between the US and the ten economies of Southeast Asia suggest that the predominant narrative of the commercial displacement of the United States by China in Southeast Asia is incorrect. However, the United States’s growing trade deficits and shrinking surpluses with Southeast Asia do bolster an American mercantilist narrative that bilateral deficits are an economic loss for the US caused by Southeast Asian governments’ unfair trade policies.
Topic:
Global Markets, Economy, Trade, and Deficit
Political Geography:
Asia, Southeast Asia, and United States of America

144. Domestic Politics Force India's Withdrawal from RCEP and Broader Trade Disengagement

Author:
Amitendu Palit
Publication Date:
11-2019
Content Type:
Working Paper
Institution:
East-West Center
Abstract:
The Regional Comprehensive Economic Partnership (RCEP) negotiations concluded at the ASEAN Summit in Bangkok on November 4, 2019. Fifteen RCEP members, including the ten-ASEAN countries, and Australia, China, Japan, Korea and New Zealand, agreed to commence preparation of the legal text of the agreement for signing in 2020. India was the only member to opt out, citing significant unresolved outstanding issues. India’s decision was surprising as it actively participated in the negotiations that lasted for 29 rounds and went on for more than six years since beginning in 2013. Domestic pressures forced Prime Minister Modi to withdraw India from RCEP at the last minute. It also points to disengagement becoming the prominent character of India’s trade policy as domestic protectionist interests successfully undermine outward-oriented economic visions.
Topic:
Politics, Treaties and Agreements, Economy, Trade, and ASEAN
Political Geography:
China, India, and Asia

145. Addressing China's Rising Influence in Africa

Author:
Michael Tiboris
Publication Date:
05-2019
Content Type:
Special Report
Institution:
Chicago Council on Global Affairs
Abstract:
Addressing China's Rising Influence in Africa MAY 21, 2019 By: Michael Tiboris, Nonresident Fellow, Global Water Key facts and figures China is now the largest trading partner for the African continent, and China’s Export-Import Bank aims to invest more than $1 trillion in the continent by 2025. In addition, China has now surpassed the United States government in total agriculture R&D funding. China has increased its presence in African development—a trend that will persist because its model is extremely attractive to both China and many African nations. China’s growing contributions to African development should not automatically be feared, but their increased presence should create a recalibration in US approaches to development. Current US National Security Advisor and former Ambassador John Bolton in his announcement of the administration’s Prosper Africa initiative cast China’s presence in Africa as a strategic challenge for the United States. The market opportunities on the African continent are enormous. Consumer expenditure is expected to reach $2.1 trillion by 2025 and $2.5 trillion by 2030. The World Bank estimates that the African food market alone could be worth $1 trillion by 2030, more than tripling the current $300 million market. China’s ability to directly finance and construct infrastructure projects with fewer conditions is unique and has raised worries in some quarters about the expropriation of natural resources, environmental hazards, labor displacement, unstable debt burdens, and land grabs. In addition, China’s investment strategy leaves notable gaps that the United States, leaning on its expertise, can fill. The most direct and sustainable mechanism for moving people out of poverty is investment in agriculture—in particular, smallholder agriculture. US leadership on global water, food, and nutrition security is essential to catalyze the innovations and development necessary to achieve US foreign policy and development goals on the continent. To maintain its global leadership in this strategically important continent, the United States should consider prioritizing technical assistance for water sustainability and thereby support sanitation and agricultural growth. The United States must also continue to find ways to deepen its relationships with African partners to demonstrate US commitment to building resilience and self-reliance in these communities for the long term. Simultaneously, the United States and its allies should work through international institutions to encourage China to adopt policies that achieve shared global objectives in economic development, security, human welfare, and sustainability.
Topic:
Infrastructure, Banks, Trade, and Strategic Competition
Political Geography:
Africa, China, Asia, North America, and United States of America

146. China’s great game in the Middle East

Author:
Camille Lons, Jonathan Fulton, Degang Sun, and Naser Al-Tamimi
Publication Date:
10-2019
Content Type:
Policy Brief
Institution:
European Council On Foreign Relations
Abstract:
China has significantly increased its economic, political, and – to a lesser extent – security footprint in the Middle East in the past decade, becoming the biggest trade partner and external investor for many countries in the region. China still has a limited appetite for challenging the US-led security architecture in the Middle East or playing a significant role in regional politics. Yet the country’s growing economic presence is likely to pull it into wider engagement with the region in ways that could significantly affect European interests. Europeans should monitor China’s growing influence on regional stability and political dynamics, especially in relation to sensitive issues such as surveillance technology and arms sales. Europeans should increase their engagement with China in the Middle East, aiming to refocus its economic role on constructive initiatives.
Topic:
Security, Power Politics, Geopolitics, and Trade
Political Geography:
China, Middle East, Asia, and United States of America

147. An Arduous Path: Are Bulgaria, Croatia and Romania Ready to Join the Area?

Author:
Žiga Faktor
Publication Date:
12-2019
Content Type:
Special Report
Institution:
Europeum Institute for European Policy
Abstract:
The concept of free movement between European countries anchored in the Schengen Agreement, manifested in the creation of the borderless Schengen Area, is arguably one of the great achievements of European integration. By facilitating conditions for trade, services and movement of citizens, the Schengen Area acts as one of the converging economic factors for Member States. Decision on the dissolution of state borders is generally seen as a positive step for economic development, regional integration and a sign of trust between the countries. Nevertheless, it also raises many questions and challenges, especially on the topic of security and compliance of national laws with rules and conditions set in the Agreement. This article will focus on the accession of Croatia, Bulgaria and Romania to the Schengen Area and discuss the main difficulties and obstacles for each country.
Topic:
European Union, Economy, Trade, and Schengen
Political Geography:
Europe, Bulgaria, Romania, and Croatia

148. Petro Dollar. Petro Yuan. Petro Rupee?

Author:
Amit Bhandari
Publication Date:
08-2019
Content Type:
Working Paper
Institution:
Gateway House: Indian Council on Global Relations
Abstract:
Over the last two decades, every component of the global energy scenario has changed: demand, supply and energy-type. The only constant has been the U.S. Dollar as the currency of energy trade. Lately, the Chinese Yuan has emerged to challenge the Dollar. Can the Indian Rupee be a third player? India is now the world’s third-largest consumer and second-largest importer of energy. Its open market, transparent regulation and growing demand give it an opportunity to become the hub of a vibrant new oil market, simultaneously ensuring its energy security and raising the international profile of the Rupee. This paper explores the possibility the Rupee could be the third currency in which energy is traded, and the challenges and opportunities it presents.
Topic:
Security, Energy Policy, Markets, Oil, Currency, and Trade
Political Geography:
China, South Asia, India, Asia, North America, and United States of America

149. Wild Growth: An Assessment of Erdenes Mongol

Author:
Andrew Bauer and Dorjdari Namkhaijantsan
Publication Date:
06-2019
Content Type:
Special Report
Institution:
Natural Resource Governance Institute
Abstract:
Erdenes Mongol is Mongolia's most influential state-owned mining enterprise. It was established in 2006 to represent the government of Mongolia's interests in strategic mines, manage mineral licenses and promote the mining sector. In recent years Erdenes Mongol has evolved into a complex conglomerate with interests in many sectors, including unconventional oil and gas, roads, hospitality, power generation, steel, and asset management. The company's expansion represents an implicit government choice to invest in specific sectors rather than others, such as education, healthcare or renewable energy. Erdenes Mongol does not publish financial information on most of its subsidiaries and joint ventures. However, many are unprofitable. Those that are profitable, such as the Tavan Tolgoi coal project, have yet to pay any dividends to the state treasury. The Government of Mongolia may wish to consider several reforms, such as: (1) Enacting a new state-owned enterprise or Erdenes Mongol-specific law; (2) Clarifying the company's financial and governance relationship with subsidiaries; (3) Performing project-by-project market assessments in order to determine which assets to purchase and sell; (4) Developing clear criteria and an open process for appointment and dismissal of board members and managers; and, (5) Requiring greater public disclosures and audits, especially of subsidiaries and joint ventures.
Topic:
Natural Resources, Business, Mining, and Trade
Political Geography:
Mongolia and Asia

150. The Importance of WTO Reform from a Transatlantic Perspective

Author:
Thomas J. Duesterberg
Publication Date:
02-2019
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
Trade is at the forefront of international tensions in 2019. Political developments in the United States and Europe, and the rise of China as a peer competitor to the transatlantic economies, have led many to question the fundamental assumptions and operations supporting the World Trade Organization (WTO). Chinese mercantilism, the Trump administration’s aggressive use of unilateral tariff measures, and the inability of WTO members to reach consensus on expanding its disciplines to important new sectors and forms of commerce in the modern economy reinforce the critique of the WTO. Expansion in global trade, one of the great engines of growth and progress in bringing billions of people out of poverty since 1945, has slowed considerably in the last two decades. In 2018, however, several constructive efforts to craft reforms for this successor institution of the Bretton Woods system are engendering some hope that the WTO can be adapted to meet the needs of the contemporary economy. The first basket of problems revolves around a lack of WTO disciplines for newer sectors like services, including those associated with the emerging digital economy; for state-owned enterprises; for intellectual property protection; and for cross-border investments. The other main issues concern the sometimes ineffective and bounded operations of the WTO itself. Questions have been raised, notably by the United States, over the slow and inconsistent enforcement of existing WTO rules, and over rulings by judges in the Appellate Body which overstep the limits of existing WTO rules, undertake interpretations of domestic laws, and reinterpret facts established by earlier dispute panel decisions. This is the biggest issue now dividing U.S. and EU thinking on the reform of the WTO. The EU, Canada, Japan, the United States and other members have begun offering concrete proposals for addressing these problems, and the G20 political leaders gave a strong endorsement to their efforts in the December 2018 communique of the Buenos Aires summit. Ideas for new rules are being tested in sub-global trade agreements like the new North American and Trans-Pacific pacts and EU free trade agreements with Canada and Japan. Incorporation of new rules into the global WTO is extremely difficult; full consensus among its 164 members is required for the adoption of any new disciplines or internal operations. To overcome that impediment, this paper suggests that plurilateral agreements, like the Information Technology Agreement of 1997, be employed to establish and test new rules needed for the 21st-century economy. Some use of supermajority decision making instead of the consensus rule may also help advance the creation of new rules and redress weaknesses in WTO operations. The role of transatlantic leadership, finally, is emphasized as a key to building broad political support needed to achieve substantive reform.
Topic:
International Relations, World Trade Organization, Reform, Trade, and Transatlantic Relations
Political Geography:
Europe, North America, and United States of America