BRICS and SCO: Seizing the Eruasian moment


While the West is distracted by the Gulf region and Ukraine, moves are afoot in parts of Asia and Europe to empower emerging regions in the future

IF there is still any doubt that Russia and China are cultivating their global presence together, events in recent days come as a timely antidote.

The five emerging BRICS economies of Brazil, Russia, India, China and South Africa, spanning nearly as many continents, had their seventh summit in Ufa, south-western Russia on Thursday.

Any lingering uncertainty over Moscow-Beijing relations would also have been dispelled by the fact that the BRICS summit was held back-to-back with the 15th Shanghai Cooperation Organisation (SCO) summit on Friday.

The SCO is an association of six countries – Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan – and prime movers China and Russia, which also happen to be dominant. Its summit this time saw a growth in membership with the inclusion of India and Pakistan.

The BRICS countries have certain shared concerns and objectives, such as national development and international commerce that need not conform to the strictures of the Washington Consensus.

Strictures imposed by the Bretton Woods institutions, the World Bank and the International Monetary Fund (IMF), have bled already anaemic economies and destabilised countries in the developing world on the basis of ideological prescriptions.

At the same time, these Western-dominated financial institutions failed to give emerging economies, epitomised by China, their rightful voice according to their global economic importance. Thus a cash-rich China has had to evolve financial institutions of its own.

Such multilateral efforts are best done together with like-minded nations. So besides BRICS, SCO countries that span Eurasia – with a collective focus on Central Asia and now also South Asia – have come together to develop alternative funding agencies.

In addition to the Beijing Consensus of rapid growth that is politically conscious, defined and directed, there is now the “Shanghai Spirit” of mutual respect, trust, benefit and consultation with equality.

These values broadly mirror the Five Principles of Peaceful Coexistence adopted by China and India (Panchsheel Treaty) two generations ago.

But even as SCO membership sees steady growth, it is clear enough that its main drivers and those of BRICS are China and Russia. By dint of sheer size and capacity, particularly those of China, Beijing and Moscow have come to lead the rest.

The way Washington has managed to alienate China and Russia at the same time has helped develop their partnership. Following years of US criticism of both countries, the US navy chief lately branded Russia as the greatest threat while presidential hopeful Hillary Clinton accused China of hacking US sites.

Russia and China were thus prodded by the US to work more closely together. US foreign policy is often said to be defined by domestic interests, or perceived interests, and this is seldom more true than when a presidential election campaign approaches.

However, improving relations between China and Russia are not thanks solely to US posturing. Moscow and Beijing are not without common interests of their own.

On Thursday, Russian Foreign Minister Sergei Lavrov rallied member countries of both BRICS and the SCO to fight terrorism together. International terrorism today is a clear and present danger, a substantive threat and a common scourge requiring close cooperation particularly among neighbouring countries.

While BRICS’s terms of reference are more economic, the SCO’s are broader and more strategic. Within BRICS, member nations have formed a Business Council and formulated an Economic Partnership Strategy. Key sectors are manufacturing and infrastructure besides clean energy and agriculture.

But the star attraction at Ufa was the launch of the New Development Bank (NDB), also known as the BRICS bank, with an initial capital of US$100bil (RM378.2bil).

To be based in Shanghai with its first president in India’s K.V. Kamath, the NDB would be raising funds locally and internationally. It is set to issue its first loans next April. This is among four new financial institutions championed by China, the others being the Asian Infrastructure Investment Bank, the Silk Road Fund and the SCO’s Development Bank.

In the SCO context, member countries had made strides in the energy, telecommunications and transportation sectors. Now such gains needed to be affirmed while also developing opportunities in agriculture. Russia places a special priority on the Eurasian Economic Union (EAEU), which also covers Armenia, Belarus, Kazakhstan and Kyrgyzstan, with Russia dominant. China has prioritised its Silk Road Economic Belt initiatives linking Asia with Europe.

Working together, the EAEU and the Silk Road projects would be promoted jointly by the SCO. The proposed financial institutions, to which China would be contributing the most, would finance these and other related projects.

The fortunes of BRICS economies however have dipped in recent months. The Ufa summit did not deny the current challenges but chose to emphasise the positives.

Although numbering just five countries, the BRICS group had contributed half of the world’s economic growth over the past decade and produced 20% of total global output. No less than IMF findings show that until 2030 at least, BRICS growth would outperform developed and other emerging economies.

For Russia, the plans and initiatives have a more immediate tactical purpose – to alleviate economic pressures brought on by Western sanctions against its moves in Ukraine.

For China, the longer-term strategic purpose covers efforts to facilitate more trade, expedite internationalisation of the renminbi and generally build and solidify China’s global stature.

In investing massively in the new financial institutions however, Beijing will be competing against the IMF, the World Bank and the Asian Development Bank.

In doing so it will have to be more borrower-friendly, minus the strictures so synonymous with the Western-run rivals. The official word is that these new lending agencies are not going to challenge the Bretton Woods institutions, but the practical effect is nonetheless to offer borrowers more choice.

To substantiate the claim that the new institutions will neither rival nor replace the older ones, China is also calling for more open international accountability of the IMF and the World Bank. Somehow that may still not come as comforting news to Western power brokers.

But after all the platitudes and hurrah in Ufa, there are now the realities to contend with.

Strategic analysts prefer to gauge the viability of regional institutions based on the common interests shared among member states. In this respect, the future of BRICS may seem less promising than the SCO’s. Precisely because of the broad spread of the BRICS countries, there is little they have in common besides an affinity with alternative modes of development.

Their economic growth has been significant, but achieved independently of other BRICS nations and – except for China – with little support from (integration with) other countries in their respective regions.

The obvious question arises as to how sustainable can BRICS as an entity be. The fortunes of international associations depend on more than goodwill and bravado.

The SCO by comparison holds more prospects for success. By comprising a contiguous region that includes Eurasia and a substantial chunk of the Asian land mass, cross-border concerns are shared and can be attended to jointly.

Furthermore, practical projects like the Silk Road Economic Belt and the EAEU require constant attention, commitment and contributions from the 60 countries and regions that are involved.

This may mean more obligations to begin with, but consistent maintenance will ensure better management and success.

Bunn Nagara
By Bunn Nagara Behind the headlines

> Bunn Nagara is a Senior Fellow at the Institute of Strategic and International Studies (ISIS) Malaysia.

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US: an engine or a threat to the world economy? Unwise to write shortsighted rules!


WEF_improving

Is the US an engine or a threat to the world economy?

According to the World Economic Outlook published by the World Bank, the international economy is forecast to grow by 3 percent in 2015 and 3.3 percent in 2016. The US and the UK will maintain their economy recovery while Japan and the eurozone will remain sluggish, with growth forecast at no more than 1.1 percent. The World Bank also predicted that the US economy will grow by 3.2 percent in 2015. Developing countries are facing lots of challenges in its economic development.

The US seems to be the only engine of the world economy. But the US Federal Reserve is likely to raise its interest rate from 0 to 0.25 percent. The World Bank worries that any such move will make it more difficult for emerging economies to raise money. The US has emerged from its financial crisis while other countries are still trapped in economic troubles. From this perspective it is hard to assess whether the US is an engine or a threat to the world economy.

There is still a worry that Greece will exit the eurozone. If this happens, the eurozone will be thrown into turmoil. In Japan, so-called “Abenomics” have failed to generate the anticipated results. Russia and Venezuela are each facing their own troubles and threats.

The US economy is closely linked to the whole. Only when other economies achieve sound development, can the US economy maintain sustainable development. The US can’t just focus on its own development.

This article was edited and translated from 《美国是引擎还是威胁?》, source: People’s Daily Overseas Edition, Author: Zhang Hong

It is unwise for the U.S. to write shortsighted rules

In the latest State of the Union Address, President Barack Obama mentioned China many times. He claimed that China wants to write the rules for the world’s fastest-growing region (Asia-Pacific) but the U.S. should write those rules. He went on to urge Congress to give him the authority to promote trade with this region.

Obama is setting considerable store by the Trans-Pacific Strategic Economic Partnership (TPP) Agreement (TPP) and Transatlantic Trade and Investment Partnership (TTIP). These trans-regional trade and investment agreements are designed to increase America’s competitiveness and encourage its exports. Although Obama’s government has tried hard to promote these agreements and to make his mark on presidential history in the U.S., parts of the bills of the two agreements are opposed by some of the negotiation partners, and it is not clear whether Congress will support the agreements.

The U.S. is avoiding queries over its strategic rebalancing toward the Asia-Pacific. The American government cannot give a clear answer to whether TPP targets any specific country. However Obama has now made his position clear: “We should write those rules. We should level the playing field. That’s why I’m asking both parties to give me trade promotion authority to protect American workers, with strong new trade deals from Asia to Europe that aren’t just free, but fair.”

It is readily apparent that America is not satisfied with international trade rules set by the World Trade Organization (WTO). Some countries are trying to break rules while China is attempting to set rules for the world’s fastest-growing region. However, China’s efforts could undermine American interests. Obama hold the view that China is taking advantages of existing free trade rules and it is not fair to the U.S.

It is not wrong for America to benefit from reform of international trade rules. But from a country good at promoting global rules in the past to one now busy promoting trans-regional rules between Asia and Europe, America’s leadership in international system gradually fades out. The U.S. thinks that it has suffered losses from past world trade rules and therefore wants to establish new trans-regional institutions that exclude China and other counties.

America is no longer a country positively promoting global financial trade rules. It now seems to be focused on short-term rules to suit itself and a few allies. Although these agreements will co-exist with the WTO, world trade may become more fragmentized due to trans-regional agreements. A conflict of interests is slowly developing between a group of developed countries, including America, and the developing countries. Trade interests between developing countries might also be damaged. In view of this situation, it is hard to say that the world will be freer or fairer.

Are the trade rules established by WTO really unfair? The U.S. thinks that the standards involving environmental protection, intellectual property protection, and markets are too low. However, America should always bear in mind that it too encountered these problems during its industrialization. Progress was achieved only after a long period. If America remains reluctant to cooperate with other countries to define international rules, it might lose international respect and miss out on new opportunities for development.

The article is edited and translated from 《美国切莫制定短视规则(望海楼)》, source: People’s Daily Overseas Edition, author: Shen Dingli, Vice Dean and professor of Institute of International Studies, Fudan University

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West should end its hypocrisy on anti-terror war!


Anti_terrorists_China-RussiaChinese and Russian policemen attend a joint anti-terror drill in Manzhouli City, north China’s Inner Mongolia Autonomous Region, Oct 20, 2014. [Photo/Xinhua]

Senior US leaders invited sharp criticism at home for not attending last week’s solidarity rally in Paris against the terrorist attack on French satirical magazine Charlie Hebdo in which 12 people were killed. As a result, US Secretary of State John Kerry was in Paris this week to make up for the mistake.

However, terrorist attacks on innocent civilians in Nigeria, where Boko Haram fighters killed hundreds of, if not more, ordinary people early this month, have not received the same attention in the US and the Western world as the Paris attack. Yet such double standards and hypocrisy of the Western world is nothing new.

Over the past few years, the US and some Western countries have not responded to the terrorist attacks against innocent civilians in Beijing, Kunming and the Xinjiang Uygur autonomous region the way they reacted to the Paris attack.

On several occasions, US State Department spokespersons have used the excuse that they need more information and investigation into the incidents in China to condemn them as terrorist attacks. But they did not ask any such question after the Paris attack.

Some Western news organizations have refused to describe the perpetrators at Kunming railway station in Yunnan province as terrorists, insisting on calling them “knife-wielding attackers”. And on the rare occasions that they have used the word terrorist, they put it within quotation marks as if the ruthless killers in China were any different from those in Paris or elsewhere in the Western world. One CNN report even posed the question, “Terrorism or Cry of Desperation?”, as if killing innocent civilians in China can be somehow justified.

Even though China and the US have common interests in fighting terrorism, some Americans still seem to believe that only those setting off bombs in New York are terrorists while those doing the same in Beijing or any other Chinese city demand a different description.

The West’s double standards are not restricted to China and Nigeria. The decade-old wars in Iraq and Afghanistan have cost the lives of hundreds of thousands of civilians, but the mainstream media outlets in the US have largely ignored the tragedies and focused on the loss of their own troops.

If the number of civilian casualties is a measure of the intensity of a terrorist attack, tragedies like the Sept 11, 2001, attacks have occurred multiple times in Iraq and Afghanistan. But the Western media don’t seem to care much about them.

Some Western observers have even found excuses for West’s inadequate response to the terrorist attacks in Kunming on March 1 last year in which 31 were killed and 141 injured. But by failing to immediately condemn the attacks against innocent civilians in Kunming and Xinjiang, these people have by default condoned the action of the perpetrators.

It is true that terrorists in the eyes of some could be freedom fighters in the eyes of others. That is why Osama bin Laden was a freedom fighter to the US in the 1980s but a top terrorist in the 21st century. And Nobel Peace Prize winner Nelson Mandela was still on the US terrorism watch list as late as 2008, years after stepping down as South Africa’s president.

There is no doubt that the US and its allies have failed miserably in their “war on terror” despite the more than 1,000 air strikes launched against the Islamic State group. In spite of the heavy bombardments, we have seen terrorists gaining strength and spreading their tentacles to more areas across the world.

And the Western world responds to this deadly threat with double standards.

By Chen Weihua China Daily/Asia News Network

The author, based in Washington, is deputy editor of China Daily USA. chenweihua@chinadailyusa.com

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The Wealthy get wealthier


The richest people on Earth got richer in 2014, adding $92 billion to their collective fortune in the face of falling energy prices and geopolitical turmoil incited by Russian President Vladimir Putin.

Video: http://www.bloomberg.com/video/popout/4PRJi7eqTcWSR0cwVL05iA/10.938/

The net worth of the world’s 400 wealthiest billionaires on Dec. 29 stood at $4.1 trillion, according to the Bloomberg Billionaires Index, a daily ranking of the planet’s richest.

The biggest gainer was Jack Ma, the co-founder of Alibaba Group Holding Ltd., China’s largest e-commerce company. Ma, a former English teacher who started the Hangzhou-based company in his apartment in 1999, added $25.1 billion to his fortune, riding a 56 percent surge in the company’s shares since its September initial public offering.

Ma, 50, with a $28.7 billion fortune, briefly passed Li Ka-shing as Asia’s richest person.

“I am nothing but happy when young people from China do well,” Li, 86, said through his spokeswoman in Hong Kong.

Global stocks rose in 2014, with the MSCI World Index advancing 4.3 percent during the year to close at 1,731.71 on Dec. 29. The Standard and Poor’s 500 Index rose 13 percent to close at 2,090.57. The Stoxx Europe 600 gained 4.9 percent to close at 344.27.

Two of the year’s other biggest gainers were Warren Buffett and Mark Zuckerberg of the U.S. Buffett, the chairman of Berkshire Hathaway Inc., added $13.7 billion to his net worth after the Omaha, Nebraska-based company soared 28 percent as the dozens of operating businesses the 84-year-old chairman bought over the past five decades churned out record profit.

Gates, Slim

Buffett passed Mexican telecommunications billionaire Carlos Slim on Dec. 5 to become the world’s second-richest person. Bill Gates, the co-founder of Microsoft Corp., was up $9.1 billion during the year. The 59-year-old remains the world’s richest person with a $87.6 billion fortune.

Zuckerberg, the hoodie-wearing chief executive officer of the world’s largest social-networking company, gained $10.6 billion as the Menlo Park, California-based business rose to a record on Dec. 22.

Bloomberg Billionaires Gainers of 2014

Bloomberg Billionaires Gainers of 2014

This year Facebook made headway in mobile, a business that has flourished as mobile advertising increased and marketing initiatives expanded with applications and video. Facebook’s acquisition of Instagram in 2012 for $1 billion has also been paying off: A Citigroup Inc. analyst said on Dec. 19 the photo-sharing app is worth $35 billion.

Russia Woes

Zuckerberg’s company faced a challenge in Russia, where the blocking of a Facebook page promoting a Russian opposition rally highlighted the challenges the social network faces as Putin cracks down on the Internet amid a looming economic downturn. The European Union and U.S. limited Russian companies’ access to financing to punish Putin after he annexed Crimea in March. Russia’s troubles have been worsened by the corresponding plunge in the price of oil, a bedrock of the country’s economy.

Nobody was hit harder than Vladimir Evtushenkov. Once Russia’s 14th-richest person, the 66-year-old lost 80 percent of his wealth, dropping him from the Bloomberg ranking. He was sentenced to house arrest by a Moscow court in September after a money-laundering investigation connected to the $2.5 billion purchase of shares in oil producer OAO Bashneft.

The court also ruled in favor of nationalizing his stake in Bashneft, which he controlled through publicly traded AFK Sistema. Evtushenkov’s fortune has fallen $8.1 billion, the most of any Russian in 2014.

Leonid Mikhelson has been the biggest loser in dollar terms among those remaining in the country’s 20 richest, dropping $7.8 billion since the start of the year. The 59-year-old is the chief executive officer of OAO Novatek, Russia’s second-largest natural gas producer, which fell 44 percent during the year. He has a $10.1 billion fortune, according to the Bloomberg ranking.

Western Sanctions

Viktor Vekselberg surpassed Alisher Usmanov as Russia’s richest person after Usmanov’s MegaFon OAO lost almost half its value since June. Vekselberg is worth $14.1 billion, while Usmanov fell 32 percent to $13.8 billion.

One of only a few Russians among the world’s 400 richest who gained in 2014 was aluminum billionaire Oleg Deripaska, who added $1.6 billion as his Hong Kong-based United Co. Rusal rose 122 percent. Deripaska has increased his fortune to $8.2 billion. He’s the world’s 154th-richest person.

“The reputation of Russian business in the west has become worse, and will continue to get worse,” said Stanislav Belkovsky, a Kremlin adviser during Putin’s first term who now consults for Moscow’s Institute for National Strategy, a research firm. “That means that the capabilities for Russia’s billionaires to run businesses abroad are going to decrease.”

Adelson Falls

Belkovsky says Putin will try to compensate the country’s sanctioned businessmen by giving them access to different state resources.

“The competition for resources will increase, as will the redistribution of ownership,” he said.

Russian billionaires weren’t the only ones to suffer losses. Sheldon Adelson, the gambling mogul who controls Las Vegas Sands Corp., the world’s largest casino company, fell $8.7 billion as the Las Vegas-based company dropped 25 percent.

Macau’s casinos are looking at their first down year in revenue since the market was opened to foreign operators in 2002, after China’s President Xi Jinping cracked down on corruption on the mainland and high-rollers shunned the gambling enclave. More than half of the company’s 2013 $13.8 billion in revenue comes from Macau.

Bezos, Musk

Adelson’s decline was followed by Jeffrey Bezos, the chairman of Amazon.com Inc. The 50-year-old had $7.2 billion trimmed from his fortune as the Seattle-based company lost ground in the cloud computing market to crosstown competitor Microsoft Corp.

Bezos, whose Blue Origin LLC space company won a contract in November to deploy rockets from NASA launchpads in Florida, is ranked 21st in the world with a $28.7 billion fortune. Blue Origin will develop a space vehicle that isn’t scheduled to be ready until after 2020.

Elon Musk’s space-exploration company is close to winning the certification it needs to begin deploying satellites for the U.S. military, according to an Air Force official. A contract win by Hawthorne,
California-based SpaceX would be the first since the Pentagon opened the program in late 2012 to as many as 14 competitive missions.

Musk added $2.9 billion to his net worth, most of which was the result of a 50 percent gain by Tesla Motors Inc., the world’s largest electric-car manufacturer.

Chinese Gains

China’s 10 richest people have added almost $48 billion combined year-to-date. Following Ma’s $25.1 billion gain, technology entrepreneurs Richard Liu of online retailer JD.com and Robin Li of Baidu Inc. added a combined $8 billion.

The title of Asia’s richest person could be challenged by Wang Jianlin, whose Dalian Wanda Group Co. staged an initial public offering of its commercial properties division this month. An IPO for Wanda Cinema Line Co. is planned for early 2015. Wang has a net worth of $25.3 billion, gaining $12.8 billion during the year.

Alibaba’s surge minted at least three new billionaires this year, including Simon Xie, an Alibaba co-founder and the second-biggest shareholder of the finance affiliate that owns Alipay. Xie, 44, owns 9.7 percent of Zhejiang Ant Small & Micro Financial Services Group Co., the parent of Alipay, according to company filings obtained by Bloomberg News.

Hidden Billionaires

Small & Micro CEO Lucy Peng and Jonathan Lu, CEO of Alibaba, each controls almost 4 percent in Small & Micro Financial, according to filings submitted by the company in Hangzhou. They also both own less than 1 percent of Alibaba, which made them new 2014 billionaires.

Bloomberg News uncovered 86 new or hidden billionaires who had never appeared on an international wealth ranking. Among them were the six heirs to a $13 billion Monaco fortune that were unveiled after the family’s matriarch, Helene Pastor, was gunned down in a parking lot in Nice, France, in May. The fortune spans two branches of the Pastor family, which built much of Monaco’s skyline and owns thousands of apartments in the city-state.

Carlos Pellas became Nicaragua’s first billionaire rebuilding his family sugar mill and parlaying the proceeds into a new bank, BAC-Credomatic, which, by 2005, was one of the largest financial institutions in Central America. He sold it to General Electric Co. in a deal completed between 2005 and 2010 for about $1.7 billion.

Latin America

His rise to riches was almost interrupted by a violent 1989 plane crash that killed more than 130 people and left his wife with 62 bone fractures and skin melting off her face.

Other Latin America fortunes that emerged include five billionaires from Brazil — Joesley, Wesley, Valere, Vanessa and Vivianne Batista — who created the world’s biggest beef producer after making more than $17 billion in acquisitions. Their company, JBS SA, rode the biggest stock rally on Brazil’s Bovespa index this year, jumping 30 percent year-to-date, fueled by surging beef prices and Russia’s lifting of a ban on Brazil meat-processing plants.

A surge in real estate and corporate valuations elevated the fortunes of at least five Blackstone Group LP billionaires. Co-founder and chairman Stephen Schwarzman added $926 million as the company rose 7.6 percent. The performance, along with surging art values, made James Tomilson Hill, Blackstone’s vice chairman who runs the company’s $64 billion hedge fund business, a billionaire. Jonathan Gray, who runs the firm’s real estate division, is worth $1.5 billion.

Strong Dollar

Real estate is seen as one way the wealthy could make further gains in 2015.
“The fact that interest rates are going to remain low, there might be some opportunities, especially with residential real estate in Europe,” Efrat Peled, the chairman of Arison Investments, said in a phone interview from her office in Tel Aviv.

Peled, who manages more than $2.5 billion in assets for Shari Arison, says a strong U.S. dollar should give some foreign markets a boost.

“Exports are better when the dollar is strong,” she said.

Whether interest rates stay low remains a looming question moving into 2015. Federal Reserve Chair Janet Yellen appears poised to raise interest rates for the first time in almost a decade, and prognosticators are convinced Treasury yields have nowhere to go except up. Their calls for higher yields next year are the most aggressive since 2009, when U.S. debt securities suffered record losses, according to data compiled by Bloomberg.

Photographer: Scott Eells/Bloomberg

Billionaire Jack Ma, chairman of Alibaba Group Holding Ltd. in 2014.

Evaluate enemies and friends


Friends_Enemies

Illustration: Liu Rui/GTChina must evaluate friends and enemies

Since 2013, China has been engaging in “major power” diplomacy. In the past, the term “major powers” referred to countries such as the US, Japan, Russia, the UK and Brazil, while now the major power is China itself.

The shift in China’s diplomatic status means the country’s diplomatic approaches face a new challenge: Does diplomacy have to distinguish between enemies and friends?

Before China’s non-alignment policy was raised in the report to the 12th CPC National Congress in 1982, China’s diplomacy distinguished between enemies and friends.

In the 1950s, based on the different social systems, China categorized other countries into imperialist states, capitalist states, nationalist states and socialist ones.

In the following two decades, these countries were divided into the superpowers, developed countries and developing ones, given the international status of different countries.

These two categorizations differ in standards, but reflected the then diplomatic notion of distinguishing between enemies and friends.

The report to the 12th CPC National Congress also said that “the Five Principles of Peaceful Coexistence are applicable to our relations with all countries, including socialist countries.”

From then, China began to discard the “enemies-or-friends” concept and focus on economic cooperation with all the countries based on an equal footing.

There have been some variations in China’s diplomacy, particularly in relation to how it categorized other countries after the Tiananmen incident in 1989.

One means adopted in 1997 classified the countries into neighboring, developing and developed ones. In 2002, the sequence was changed into developed, neighboring and developing countries.

Such categorization adds flexibility to diplomatic principles and, as some believed, fits the globalization era and discards the Cold War mentality that stuck to the old way of distinguishing between enemies and friends.

However, such categorization and sequence also have their flaws. When a principle is too flexible, its guiding role is weakened.

For instance, both Cambodia and the Philippines are China’s neighboring countries and belong to developing countries, but the latter can sometimes pose diplomatic trouble for China.

Similarly, Russia and Japan belong to the same category, but we can enhance strategic cooperation with Russia while isolating Japan politically.

In the following decade, the overall national strength of China will remain greater than that of all the other countries except the US. China has to shoulder more international responsibilities and maintain international order by providing public benefit, so as to maintain its own interests.

But if China doesn’t distinguish between enemies and friends, it will find it difficult to do so.

Only when China is clear about which country it can hold responsible on certain occasions, or which country can enjoy more public benefits, can it make the right decision.

Any big country, when helping shape international order, will protect its friends rather than enemy countries. It will raise proposals beneficial for its partners rather than competitors, and provide public benefit for those playing by the rules rather than breaking the rules.

If we don’t distinguish between enemies and friends, it will also be difficult for us to adopt the diplomatic principle of amity, sincerity, mutual benefit and inclusiveness.

For example, politically we can get close to Russia and Cambodia but not Japan’s Abe government or the Philippines’ Aquino III government, because otherwise the latter two may dare to adopt even more hostile policies toward China.

Diplomatically, we can stick to the principle of credibility only with countries that we have established diplomatic ties with, but not with those who don’t admit China’s sovereignty or support the so-called “Taiwan independence.” Economically, China can take the initiative to help developing countries rather than the US which has already entered the developed phase.

To build up an international environment that best works for China’s rejuvenation, China’s categorization of foreign countries can be based on interests.

We can classify all the countries into friendly, cooperative, ordinary or conflicting ones.

To friendly countries, China should lend a helping hand; to cooperative ones, it can offer some preferential policies. We should work on an equal footing with ordinary countries, while taking countermeasures to conflicting ones.

The US is the only country that is more powerful than China. We may consider listing China’s relationship with it in a single category as “a new type of major power relationship.”

It is a relationship between a rising country and a dominant one, and as the US is more powerful than China, the two should stay equal and be mutually beneficial, which is more favorable to the US. Therefore, this also reflects tolerance of China’s foreign policies.

Since the Opium Wars in the 19th century, China has accumulated rich diplomatic experience to counter countries stronger than itself. But in modern times, it lacks the experience of dealing with countries weaker than itself. It tests China’s diplomatic wisdom as whether or not to distinguish between enemies and friends.

By Yan Xuetong Viewpoint, Source: Global Times Published: 2014-8-27 18:58:02
The author is director of the Institute of Modern International Relations, Tsinghua University. opinion@globaltimes.com.cn

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Contradiction blots Obama’s legacy with outdated Cold War mindset


Obama insurance conference call providers Russia and the U.S. are sending rather contradictory signals about their relationship.

US President Barack Obama belittled Russia as a nation that “doesn’t make anything” in an interview with the Economist on Sunday. He also said that the West must be “pretty firm” with China, as the latter will “push as hard as they can until they meet resistance.”

Obama downplayed Russia’s role in the international community by saying Moscow is unable to attract quality immigrants and Russia’s population is shrinking and aging. He described US tensions with China as “manageable,” but stressed that the West should be tough with China when China “breaches international norms,” and show China “the potential benefits over the long term.”

Condescending to China and Russia, Obama treats both nations separately. He wants to draw more Western attention to China, so there could be more efforts to contain China. Obama paying close attention to China resulted in his “rebalancing to Asia” strategy.

He hasn’t shown much belligerence to China and Russia since he took office, but apparently, he lacks strategic insight and the power to control his government and be a good decision-maker. His advocacy is always ambiguous and easily misguided by some emergency issues. Diplomacy will not be a proud part of his legacy.

In the Middle East, the US withdrawal from Iraq under his leadership has not helped sort out the mess in the region. He won’t be given a medal for the current situation.

In its relationship with Russia, the US wrongfully kept its momentum to squeeze Russia’s strategic space and caused Moscow’s intense countermeasures.

Washington and Moscow are now engaged in Cold-War-level tensions, and they will cost the US much resource and attention.

In US-China relations, Obama has also found it hard to fully achieve his “rebalancing to Asia” goals. When the new Chinese leadership proposed the concept of a new type of major power relationship, the Obama administration accepted the general idea, but hasn’t accepted the connotations.

Obama has not made constructive contributions to China-US relationships. He cannot make landmark progress if he still clings to an outdated Cold War mindset.

In the next two years before his last term ends, Obama could make himself remembered by making breakthroughs in the Sino-US relationship.

He could work with his Chinese counterparts to work out a framework for both countries, which would influence the entire picture of international relations.

In the early years of Obama’s administration, people were impressed by his less strident posture toward international affairs, and this is also why he was awarded the Nobel Peace Prize. But now he has become more self-contradictory.

Perhaps that’s how the most powerful man plays his role, held back by many different forces. It seems that only recklessness and strident talk can make the US presidency function well, while forward thinking won’t get anywhere.

Source: Global Times

Who stands to gain from MH17, USA?


The general public should always ask this question to prevent ourselves from being deceived by ‘false flags’

THE Russian military has released military monitoring data which challenge allegations circulating in the media pertaining to the MH17 crash in the Donetsk Region of Eastern Ukraine on July 17, 2014. Questions have been raised about Kiev military jets tracking MH17, Ukrainian air traffic controllers and the deployment of Buk missile systems. Kiev should also release military data on the circumstances leading to the crash. So should the Pentagon which reportedly has relevant intelligence and satellite data.

Since military data is hardcore information, Kiev and Washington should be persuaded to be transparent and accountable. The UN Secretary-General can play a role in this since there is a specialised agency within the UN, the ICAO, dedicated to international civil aviation.

Military data from Moscow, Kiev and Washington should be scrutinised by the independent international panel that is supposed to probe the MH17 catastrophe.

Such data carries much more weight than videos purportedly revealing the role of the pro-Russian rebels and the Russian government in the crash. One such video showing a Buk system being moved from Ukraine to Russia is a fabrication. The billboard in the background establishes that it was shot in a town – Krasnoarmeisk – that has been under the control of the Ukrainian military since May 11. Similarly, a YouTube video showing a Russian General and Ukrainian rebels discussing their role in mistakenly downing a civilian aircraft was, from various tell-tale signs, produced before the event.

The public should be wary of fabricated “evidence” of this sort, after what we have witnessed in the last so many years. Have we forgotten the monstrous lies and massive distortions that accompanied the reckless allegation that Iraq had weapons of mass destruction (WMD) which led eventually to the invasion of that country in 2003 and the death of more than a million people? What about the Gulf of Tonkin episode of 1964 which again was a fabrication that paved the way for US aggression against Vietnam that resulted in the death of more than three million Vietnamese?

MH17-coffins

The “babies in incubators” incident in Kuwait in 1990 was yet another manufactured lie that aroused the anger of the people and served to justify the US assault on Iraq. Just last year we saw how an attempt was made by some parties to pin the blame for a sarin gas attack in Ghouta, Syria upon the Assad government when subsequent investigations have revealed that it was the work of some rebel group.

From Tonkin to Ghouta there is a discernible pattern when it comes to the fabrication of evidence to justify some nefarious agenda or other. As soon as the event occurs before any proper investigation has begun, blame is apportioned upon the targeted party. This is done wilfully to divert attention from the real culprit whose act of evil remains concealed and camouflaged.

The colluding media then begins to spin the “correct” version with the help of its reporters and columnists who concoct “fact” out of fiction. Any other explanation or interpretation of the event is discredited and dismissed derisively to ensure that the “credibility” of the dominant narrative remains intact.

As the narrative unfolds, the target often embodied in a certain personality is demonised to such a degree that he arouses the ire of the public and becomes an object of venom.

The pattern described here is typical of what is known as a “false flag” operation in which blame for some dastardly deed is consciously transferred to one’s adversary. It has happened right through history and many contemporary nation-states – and not just the United States – are guilty of flying false flags.

To protect ourselves from being deceived by such operations, the general public should always ask: who stands to gain from a particular episode? Cui Bono is in fact an important principle in the investigation of a crime. In the case of the MH17 carnage, the pro-Russian rebels do not benefit in any way from downing a civilian airliner. Their goal is independence from the Kiev government which is why they are fighting Kiev through sometimes violent means including shooting down its military planes. Massacring 298 passengers in a flight from Amsterdam to Kuala Lumpur does not serve their cause. Moscow which backs the rebels to an extent also gains nothing from involving itself in such a diabolical carnage.

10 days after the carnage, it is now clear who is trying to reap benefits from that terrible tragedy in the skies. The demonisation of the Russian President, Vladimir Putin, orchestrated from various Western capitals, including Kiev, after Crimea voted to join the Russian Federation, thus thwarting one of the primary strategic goals of Nato’s eastward expansion, has now reached its pinnacle.

MH17 has helped the elite in Washington in yet another sense. It has strengthened its push for tougher sanctions against Russia which began after the Crimea vote.

It is obvious that those who seek to punish Russia and the pro-Russian rebels, namely, the elite in Washington and Kiev, are poised to gain the most from the MH17 episode. Does it imply that they would have had a role in the episode itself? Only a truly independent and impartial international inquiry would be able to provide the answer.

In this regard, we must admit that while elites in Kiev and Washington may stand to gain from MH17, those who actually pulled the trigger may be some other group or individual with links to the powerful in the two capitals. It is quite conceivable that a certain well-heeled individual equipped with the appropriate military apparatus and with access to air-control authorities in the region may have executed the act of evil itself.

MH17 down

Because of who he is, and where his loyalties lie, that individual may have also decided to target Malaysia. Was he giving vent to his anger over our principled stand on the question of justice for the Palestinians? Was he also attempting to divert public attention from Israel’s ground offensive against Gaza which time-wise coincided with the downing of the Malaysian airliner?

As we explore MH17 from this angle, would we be able to connect the dots between MH17 and MH370, between July 17 and March 8, 2014? We should not rest till the whole truth is known and the evil behind these two colossal catastrophes punished severely.

We owe this to every soul who perished on those fateful flights.

This article is dedicated to the cherished memory of all those on MH17 – especially the 80 children who were on board.

By comment: Dr Chandra Muzaffar

Dr Chandra Muzaffar is the President of the International Movement for a Just World (JUST).

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