What’s worse than the US-China trade war? A grand peace bargain


Giovanni Di Lieto, Monash University

It’s hard to tell if Donald Trump’s trumpeting of “substantial progress” in trade talks, leading to a cosy weekend at Mar-a-Lago to sign a deal with Chinese president Xi Jingping, represents reality.

Most observers, though, will be relieved by his decision to again defer his threat to escalate the US-China trade war and hike up tariffs from 10% to 25% on US$200 billion worth of Chinese imports. (The total value of US imports from China in 2018 was US$493 billion.)




Read more:
WTO offers Trump a solution to enforcing a trade deal with a China that breaks promises


Trade wars are generally considered bad for everyone. KPMG has calculated a full escalation of the trade war – with a 25% tariff applying to all goods traded (worth US$604.5 billion in 2018) – would cost Australia A$58 billion over the next decade.

But far worse for Australia, and its Asia-Pacific neighbours, could be a deal to end the trade war, especially if it involves a grand geopolitical bargain between the US and China.

Bilateral world order

Considering the US administration’s hard-line approach, for a truly comprehensive deal to occur China would have to subscribe to a serious restructuring of its industrial system. This would ultimately mean phasing out covert state subsidies, liberalising its financial markets and giving up on meaningful technological competition in security-sensitive sectors.

But out of fear an ongoing trade war will harm its export-driven economic progress, and also as an expedient step for advancing its regional hegemony, China might eventually agree to all this as part of a grand bargain.

Essentially, a grand bargain with an “America First” US administration makes sense on the mutually beneficial assumption it would lay the foundations for a bilateral world order.

As part of the deal the US would dramatically reduce its strategic footprint from the Middle East through to the Korean peninsula. The advantage would be it could focus resources on limiting China’s naval role across Indo-Pacific trading routes.

Retreating to a more sustainable role as the indispensable maritime power across the Pacific and Indian oceans would leave China free rein to exert its weight on land in Eurasia.

The US might see that as advantage. Chinese regional hegemony inland would give Russia more to think about on its south-eastern border, rather than causing problems for US allies in eastern Europe. It would also put extreme pressure on India to finally evolve into a subsidiary power to the US maritime empire, one of the wildest strategic dreams in Washington.




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The collapse of the US-Russia INF Treaty makes arms control a global priority


The downside would be that Russia might end up as a subservient commodity supplier to China’s regional empire. Russia’s geo-economic downgrade would strengthen European resolve to run independently of the US, one of the worst nightmares in Washington.

For China, the prize would be achieving the main strategic ambitions of its Belt and Road Initiative, ultimately controlling land trading routes from Beijing to Venice. The strategic cost would be abandoning its maritime ambitions.

Where this leaves Australia

Where would this bilateral world system vision leave Australia?

Certainly worse off than the current situation. With interlocking spheres of influence across the Indo-Pacific rim (US) and the Eurasian landmass (China), at best Australia would become a marginal economic and security appendage of the two hegemons.

Relegated to the role of a price- and rule-taking commodity supplier to China, Australia would remain only nominally a US ally. It would be a rather disposable buffer state at the frontier of two empires, caught between the economic and security crossfire of proxy conflicts.

Weaknesses and opportunities

Compared to this scenario, a protracted US-China trade war may well serve Australia’s national interests much better.

Though tariffs will weaken the global economy, it will hurt the US and China the most. It might even weaken their respective commercial and military grips on the Asia-Pacific region to the point that patterns of more distributed power relations could emerge.




Read more:
Why there will be no winners from the US-China trade war


Economic analysis suggests many Asian economies are already relative winners, as tariffs motivate US and Chinese businesses to “decouple”.

Malaysia, Japan, Pakistan, Thailand and the Philippines lead the nations gaining from US and Chinese companies buying goods elsewhere. Vietnam, Malaysia, Singapore and India are the top beneficiaries from US companies shifting production away from China.

Several Asian countries have also seized the opportunity to play the US and China against each other.

The Philippines has revitalised relations with China to manage the South China Sea dispute more independently from the US. This has not stopped it remaining by far the largest recipient of US military aid in Asia.

South Korea has signed bilateral free-trade agreements with both China and the US, positioning itself as an intermediary that will allow American and Chinese companies to trade in a way that circumvents the tariffs.

Malaysia’s government has affirmed strategic neutrality by pulling back from deals that would put it in debt to Chinese investors.

This is arguably an unprecedented opportunity for Australia to start carving a more independent foreign policy.

Our interests lie in taking an active role in promoting a world system truly based on multilateral rules rather than great power relations.

The worst-case scenario for an ongoing US-China trade war is that it turns into real war. But that’s unlikely.

So long as it remains a manageable trade dispute, it is better for Australia, and much of the rest of the world, than trade peace leading to a bilateral world system.The Conversation

Giovanni Di Lieto, Senior Lecturer of international trade law, Monash Business School, Monash University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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Chasing the denuclearisation fantasy: The US-North Korea summit ends abruptly in Hanoi



File 20190228 106347 1483acs.jpg?ixlib=rb 1.1
As the US-North Korea summit comes to an abrupt end, denuclearisation is a fantasy that is leaving Washington as the odd man out on the Korean Peninsula.
AAP/KCNA

Benjamin Habib, La Trobe University

Korea-watchers around the world are scrambling to tease out the meaning of the abruptly concluded US-DPRK summit in Hanoi. I want to cast a critical eye on denuclearisation itself as the framing objective of the summit negotiations.

If we step back for a moment to look at the extraordinary developments in Korean Peninsula diplomacy over the past year, we see three parties who want different things.

The Moon Jae-in administration in South Korea remembers all too well the chaos of 2017 that brought Korea to the brink of war, and sees a permanent peace regime as the most important objective of its engagement efforts.




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For their part, the North Koreans want to neutralise the military threat from the US, see sanctions lifted, and obtain economic assistance to accelerate the development of their economy. The Trump administration, and much of the broader US foreign policy establishment, remains attached to the denuclearisation of North Korea as the end game of this process.

But denuclearisation is a fantasy that is leaving Washington as the odd man out on the Korean Peninsula. The goalposts on the Korean Peninsula are changing as the momentum for inter-Korean engagement grows, while the importance of the US as the indispensable security guarantor is diminishing.

Who walked out on whom?

Like everyone else, I will be watching closely over the coming days as details begin to emerge about the sticking points that led to the abrupt conclusion of the summit.

In the lead-up to the Hanoi summit, the Trump administration did signal some flexibility on verification measures for full, independent accounting of North Korea’s nuclear program as a condition for further negotiation.

It is ironic that Trump’s apparent willingness to befriend authoritarian leaders has opened the door for negotiations for a permanent peace regime in Korea, which previous US administrations had kept quarantined behind the demand for “complete, verifiable and irreversible denuclearisation” (CVID).

However, in his final press conference in Hanoi, the US president indicated that the North Korean delegation asked for too much in requesting the lifting of all economic sanctions in exchange for the shutdown of the Yongbyon nuclear facilities.

Considering the enormous pressure Trump has come under from domestic quarters not to sell out the denuclearisation agenda, there was no way the US delegation could accept those terms.

But there is another possibility. The Congressional testimony of Michael Cohen from Washington may have created fresh doubts in the minds of the North Korean delegation about Trump’s ability to deliver on a deal. It is possible that Kim Jong-un presented terms they knew the Americans could not accept, to avoid the possibility of a lame-duck deal negotiated by a compromised president.

It is important to recognise that the US and North Korea run at different political speeds. Since 1945, North Korea’s three Kims have presided through 13 US presidents. US presidents are confined to term limits and captive to the political demands of relatively short election cycles. The now extreme polarisation of American politics ensures that promises made by Trump may not be honoured by an incoming administration.

With a US presidential election looming in 2020 and widespread criticism within the American foreign policy establishment of Trump’s negotiating position, and with recurring allegations of criminality fuelling calls for his impeachment, it is understandable that the North Koreans might be cautious about making concessions.

They will remember the failure of the US Congress to ratify the Agreed Framework when President Bill Clinton was facing impeachment during the 1990s.

The denuclearisation of North Korea is a fantasy

Regardless of who blinked first, the failure to reach agreement in Hanoi further demonstrates that North Korea will never willingly denuclearise. This is not a secret. It has been obvious for more than a decade, since the failure of the Six-Party Talks. Beyond the economic sanctions regime, there is very little the US can do about it.

It bears repeating why this is the case:

  1. successive US administrations have considered and rejected the use of military force against North Korea on the grounds that it poses an unacceptable risk to its ally in South Korea

  2. because of the longstanding sanctions regime, the US lacks sufficient economic leverage over the DPRK to bring it to heel, even with the expansive list of goods banned from export to the North, and the expansive powers of the Financial Action Task Force (FATF) to restrict financial flows in and out of the DPRK

  3. North Korea is adept at sanctions-busting, in spite of the squeeze being placed on the country by existing measures.




Read more:
As the shaky US-North Korea summit is set to begin, the parties must search for common interest


Holding out for denuclearisation as an end game is an exercise in futility. It is bad policy. It unnecessarily backs the US into a corner of weakness where it cannot bring its obvious strategic and economic advantages to bear.

Denuclearisation has been the obstacle that has kept the US and North Korea at the stage of talking about talking, halting progress on other confidence-building measures that could improve the relationship and take some of the heat out of the Korean Peninsula security dilemma.

Missed opportunity for a peace settlement

The dominant school of thought in disarmament circles is that states that acquire nuclear weapons are a threat to international peace and security, and so must be prevented from doing so. This is the denuclearisation perspective that has dominated the discourse on North Korea in the US and informed the longstanding CVID policy.

There is an clear logic here that stems from the terrible and awesome destructiveness of nuclear weapons, with which few could argue. From this perspective, any negotiations with North Korea that do not result in full nuclear relinquishment will be interpreted as a sell-out.

However, there is also an obvious hypocrisy in this position (and in the nuclear non-proliferation regime more generally) given the size of the US nuclear arsenal and the deliberate ambiguity of its doctrine around nuclear first-strike. It is this hypocrisy that the DPRK exploits in its official interpretation of denuclearisation as meaning the universal relinquishment of nuclear weapons by all countries.

There is another school of thought that it is not nuclear weapons per se that represent a threat to international peace and security. Rather, it is an international environment teeming with existential threats in which states feel compelled to acquire nuclear weapons to protect themselves.

From this perspective, a peace declaration could diminish the level of insecurity that feeds the desire for nuclear proliferation. If the perception of imminent threat lessens, then the probability of nuclear weapons use in the event of conflict is also reduced.

There is space within this perspective to work towards nuclear disarmament. But that goal is one element of a bigger picture. This is the essence of the South Korean position on inter-Korean summit diplomacy, and the fading shadow of a missed opportunity in Hanoi.

These summits are part of a long-term peace-building process. Clearly, Donald Trump and Kim Jong-un are not on the same page in their negotiating objectives.

If US-DPRK bilateral negotiations are to continue, they are going to have to find a lowest common denominator on which they can build. Regardless of how we feel about Kim Jong-un, the political system he presides over, and the abuses of his regime, denuclearisation is never going to be the lowest common denominator upon which the US-DPRK relationship can evolve.The Conversation

Benjamin Habib, Lecturer in International Relations, Department of Politics and Philosophy, La Trobe University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Why proposals to sell nuclear reactors to Saudi Arabia raise red flags



File 20190222 195861 1fyoxnd.jpg?ixlib=rb 1.1
Saudi Arabia has many possible motives for pursuing nuclear power.
TTstudio/Shutterstock.com

Chen Kane, Middlebury

According to a congressional report, a group that includes former senior U.S. government officials is lobbying to sell nuclear power plants to Saudi Arabia. As an expert focusing on the Middle East and the spread of nuclear weapons, I believe these efforts raise important legal, economic and strategic concerns.

It is understandable that the Trump administration might want to support the U.S. nuclear industry, which is shrinking at home. However, the congressional report raised concerns that the group seeking to make the sale may have have sought to carry it out without going through the process required under U.S. law. Doing so could give Saudi Arabia U.S. nuclear technology without appropriate guarantees that it would not be used for nuclear weapons in the future.

A competitive global market

Exporting nuclear technology is lucrative, and many U.S. policymakers have long believed that it promotes U.S. foreign policy interests. However, the international market is shrinking, and competition between suppliers is stiff.

Private U.S. nuclear companies have trouble competing against state-supported international suppliers in Russia and China. These companies offer complete construction and operation packages with attractive financing options. Russia, for example, is willing to accept spent fuel from the reactor it supplies, relieving host countries of the need to manage nuclear waste. And China can offer lower construction costs.

Saudi Arabia declared in 2011 that it planned to spend over US$80 billion to construct 16 reactors, and U.S. companies want to provide them. Many U.S. officials see the decadeslong relationships involved in a nuclear sale as an opportunity to influence Riyadh’s nuclear future and preserve U.S. influence in the Saudi kingdom.

Of the 56 new reactors under construction worldwide, 39 are in Asia.
IAEA, CC BY-ND

Why does Saudi Arabia want nuclear power?

With the world’s second-largest known petroleum reserves, abundant untapped supplies of natural gas and high potential for solar energy, why is Saudi Arabia shopping for nuclear power? Some of its motives are benign, but others are worrisome.

First, nuclear energy would allow the Saudis to increase their fossil fuel exports. About one-third of the kingdom’s daily oil production is consumed domestically at subsidized prices; substituting nuclear energy domestically would free up this petroleum for export at market prices.

Saudi Arabia is also the largest producer of desalinated water in the world. Ninety percent of its drinking water is desalinated, a process that burns approximately 15 percent of the 9.8 million barrels of oil it produces daily. Nuclear power could meet some of this demand.

Saudi leaders have also expressed clear interest in establishing parity with Iran’s nuclear program. In a March 2018 interview, Saudi Crown Prince Mohammed bin Salman warned, “Without a doubt, if Iran developed a nuclear bomb, we will follow suit as soon as possible.”

As a member in good standing of the Treaty on the Non-Proliferation of Nuclear Weapons, Saudi Arabia has pledged not to develop or acquire nuclear weapons, and is entitled to engage in peaceful nuclear trade. Such commerce could include acquiring technology to enrich uranium or separate plutonium from spent nuclear fuel. These systems can be used both to produce fuel for civilian nuclear reactors and to make key materials for nuclear weapons.

Adel Al-Jubeir, Saudi Arabia’s ambassador to the U.S., discusses his government’s concern about Iran’s nuclear program.

US nuclear trade regulations

Under the U.S. Atomic Energy Act, before American companies can compete to export nuclear reactors to Saudi Arabia, Washington and Riyadh must conclude a nuclear cooperation agreement, and the U.S. government must submit it to Congress. Unless Congress adopts a joint resolution within 90 days disapproving the agreement, it is approved. The United States currently has 23 nuclear cooperation agreements in force, including Middle Eastern countries such as Egypt (approved in 1981), Turkey (2008) and the United Arab Emirates (2009).

The Atomic Energy Act requires countries seeking to purchase U.S. nuclear technology to make legally binding commitments that they will not use those materials and equipment for nuclear weapons, and to place them under International Atomic Energy Agency safeguards. It also mandates that the United States must approve any uranium enrichment or plutonium separation activities involving U.S. technologies and materials, in order to prevent countries from diverting them to weapons use.

American nuclear suppliers claim that these strict conditions and time-consuming legal requirements put them at a competitive disadvantage. But those conditions exist to prevent countries from misusing U.S. technology for nuclear weapons. I find it alarming that according to the House report, White House officials may have attempted to bypass or sidestep these conditions – potentially enriching themselves in the process.

According to the congressional report, within days of President Trump’s inauguration, senior U.S. officials were promoting an initiative to transfer nuclear technology to Saudi Arabia, without either concluding a nuclear cooperation agreement and submitting it to Congress or involving key government agencies, such as the Department of Energy or the Nuclear Regulatory Commission. One key advocate for this so-called “Marshall Plan” for nuclear reactors in the Middle East was then-national security adviser Michael Flynn, who reportedly served as an adviser to a subsidiary of IP3, the firm that devised this plan, while he was advising Trump’s presidential campaign.

President Donald Trump, accompanied by national security adviser Michael Flynn and senior adviser Jared Kushner, speaks on the phone with King of Saudi Arabia Salman bin Abd al-Aziz Al Saud shortly after taking office, Jan. 29, 2017.
AP Photo/Manuel Balce Ceneta

The promoters of the plan also reportedly proposed to sidestep U.S. sanctions against Russia by partnering with Russian companies – which impose less stringent restrictions on nuclear exports – to sell reactors to Saudi Arabia.

Flynn resigned soon afterward and now is cooperating with the investigation into Russian interference in the 2016 campaign. But IP3 access to the White House persists: According to press reports, President Trump met with representatives of U.S. industry, a meeting organized by IP3 to discuss nuclear exports to Saudi Arabia as recently as mid-February 2019.

Rules for a Saudi nuclear deal

Saudi leaders have scaled back their planned purchases and now only expect to build two reactors. If the Trump administration continues to pursue nuclear exports to Riyadh, I believe it should negotiate a nuclear cooperation agreement with the Kingdom as required by U.S. law, and also take extra steps to reduce nuclear proliferation risks.

This should include requiring the Saudis to adopt the International Atomic Energy Agency’s Additional Protocol, a safeguards agreement that give the agency additional tools to verify that all nuclear materials in the kingdom are being used peacefully. The agreement should also require Saudi Arabia to acquire nuclear fuel from foreign suppliers, and export the reactor spent fuel for storage abroad. These conditions would diminish justification for uranium enrichment or opportunities for plutonium reprocessing for weapons.

The United States has played a leadership role in preventing nuclear proliferation in the Middle East, one of the world’s most volatile regions. There is much more at stake here than profit, and legal tools exist to ensure that nuclear exports do not add fuel to the Middle East fire.The Conversation

Chen Kane, Director, Middle East Nonproliferation Program, Middlebury

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Frydenberg is wrong to support Ivanka and Donald Trump on the World Bank. It’d be better to let it die


Mark Crosby, Monash University

Treasurer Josh Frydenberg has offered support to Donald Trump’s pick for the World Bank Presidency.

David Malpass is currently Under Secretary of the United States Treasury with responsibility for International Affairs, and his previous experience includes being chief economist at Bear Stearns prior to their collapse.

Our Treasurers support is wrong headed.

No matter what the strengths of David Malpass, the next World Bank President should not be American.

After World War Two the victors designed many of our global institutions, including the World Bank, and the International Monetary Fund. Major global institutions were headquartered in Europe or the United States, and there was an agreement that the World Bank President would be a US citizen, while the IMF would be headed by a European.

This cosy arrangement was fine for most of the 20th century, but is at odds with our 21st century world.

Trump’s unspoken ultimatum

It has been suggested that Trump would follow his usual negotiating tactics and withdraw support from the World Bank if the next chief is not American, which is presumably why some countries including Australia are likely to support Malpass.

The search for the US nomination was headed by Steven Mnuchin and Ivanka Trump, with Invanka Trump herself mentioned as a possible nomination.

Malpass may be a better candidate than the President’s daughter, but I doubt it.

Malpass has been a critic of World Bank lending to China and at Bear Stearns he ignored warning signs of crisis in 2007.

But it’s not so much Malpass’ dubious credibility that is the problem, but the idea that the President should always be American.

The American might not be the best candidate

Important global institutions should be led by the best candidate. The views and expertise of emerging market candidates, particularly from larger economies such as China, India, Brazil, Nigeria and Indonesia should be taken more seriously.

In recent years the IMF would have been much better led by a non-European. The decision to bail out French and German banks at the expense of the Greek economy in 2012 was a poor decision made by the French head of the IMF.

The IMF rightly supported restructuring of banks and financial markets after the Asian Financial Crisis in 1997, but did not push for the same for European or US banks after 2008.

So what if Australia and other middle powers did not support Malpass’ nomination?

Better off withoug the World Bank?

A US withdrawal from the World Bank would probably see its demise. But so what?

The World Bank has become relatively toothless.

Last year China lent more money to emerging market economies than the World Bank.

And this is the point. China needs to be brought into the World Bank and other institutions more fully, not sidelined.




Read more:
A Trump-aligned World Bank may be bad for climate action and trade, but good for Chinese ambitions


Problems with governance and other issues with China’s Belt and Road initiative would be much better handled by a multilateral agency, whether that is a properly renewed World Bank or a new institution.The Conversation

Mark Crosby, Professor, Monash University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The Syrian war is not over, it’s just on a new trajectory: here’s what you need to know


File 20190205 86224 ksozds.jpg?ixlib=rb 1.1
Russia, Turkey, Iran and Israel will keep vying for power in Syria long after the US is gone.
from shutterstock.com

Mehmet Ozalp, Charles Sturt University

December 2018 marked a significant shift in the Syrian conflict. The end-of-year events put the country on a new trajectory, one in which President Bashar al-Assad looks towards consolidating his power and Islamic State (IS) sees a chance to perpetuate its existence.

Turkey’s role

Kick-starting the development was Turkish President Recep Tayyip Erdogan’s announcement he would start a military operation east of the Euphrates River – an area controlled by the US supported and Kurdish-led Syrian Democratic Forces.

The US and Kurdish-led Syrian Democratic Forces control the area to the east of the Euphrates River.
Wikimedia Commons

Throughout the eight-year conflict, Assad and his main backer, Russia, have not militarily engaged with the Kurds. Assad and Russia didn’t see the Kurds as terrorists or insurgents, but as protectors of their territory against IS and other jihadist forces.

But Turkey sees the Kurdish zone as an existential threat. Turkey has legitimate fears: if the Kurdish region in Syria becomes independent, it can unite with the Kurdish region in northern Iraq and eventually claim the largely Kurdish southeast of Turkey.

Turkey’s intended military operation east of the Euphrates is yet to eventuate. But the announcement was a bold move, made more real by the large military build-up on the Turkish-Syrian border. It put pressure on the US administration and US President Donald Trump to make a call on Syria: either stand firm against Turkey and further stretch already tense relations, or pull out of Syria to abrogate responsibility.

Trump chose the second option. He swiftly declared the US would pull out from Syria altogether – and sell Patriot surface-to-air missiles to Turkey to prevent its attempt to purchase the Russian S-400 missile defence system.

The removal of US troops came with a Trump-style announcement on Twitter: “After historic victories against ISIS, it’s time to bring our great young people home!”

US policy

Since April 2018, Trump had made clear his desire to leave Syria. Ten days after declaring his intention, an episode of chemical attacks forced Trump’s hand into staying in Syria and retaliating. This time, though, either the pressure from Turkey worked or Trump saw it as a perfect time to execute his intent to leave.

Under the Obama administration, US foreign policy with regards to Syria was to remain there until IS was destroyed completely, Iran and its associated entities removed and a political solution achieved in line with the UN-led Geneva peace talks. Trump claimed the first goal was complete and saw it as sufficient grounds to pull out.




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Then, on December 21 2018, Trump announced Defence Secretary James Mattis would retire at the end of February 2019. The Washington Post reported Mattis vehemently objected to, and clashed with Trump over, the Syrian withdrawal. In his resignation letter, Mattis wrote: “you have the right to have a Secretary of Defence whose views are better aligned with yours”.

Differences have marked US policy on Syria since the beginning of the conflict in 2011. Trump further added to the confusion, and his erratic decision-making also demonstrates his frustration with his own administration.

Russia’s game

The global fear, of course, is that the US withdrawal will leave Russia as the region’s military and political kingpin, with Iran and Turkey as its partners.




Read more:
Stakes are high as Turkey, Russia and the US tussle over the future of Syria


Russia’s President Vladimir Putin has publicly stated that Russia respects Turkey’s national interests in Syria. He added Turkey was willing to compromise and work together to improve the situation and fight against terrorism. Turkey appears to have accepted Russian objectives in Syria in return for Russia’s green light to do what Turkey deems best for its national interests in the Kurdish region.

One Russian objective is to ensure Assad remains Syria’s president. Russia may allow Turkey to host limited operations in the Kurdish region, not only to hold a compromise with Turkey, but also to eventually pressure Kurdish forces into cooperating with Russia and accepting the Assad regime.

Russia is playing out a careful strategy – pleasing Turkey, but not at the expense of Assad’s sovereignty in Syria. Erdogan was a staunch adversary of Assad in the early years of the conflict. Russia counts on Erdogan’s recognition of Assad to influence other Sunni majority states to cross over to the Russian-Assad camp.

Russia’s strategy is to please Turkey, but only to the extent that it doesn’t threaten Assad’s hold on power in Syria.
from shutterstock.com

The Turkish foreign minister has said Turkey may consider working with Assad if Syria holds democratic elections. Of course, Assad will only agree to elections if he is assured of a win.

The United Arab Emirates announced a reopening of its embassy in Damascus, which was followed by Bahrain stating it had never cut its diplomatic ties with the Syrian administration. Although Saudi Arabia denied it, there are media reports that the Saudi foreign ministry is establishing diplomatic ties with the Syrian administration.

These are indications the main players in the region are preparing to recognise and work with the Assad government.

An important step in Turkey’s recognition of Assad came in a meeting on January 23 between Putin and Erdogan. Putin reminded Erdogan of the 1998 Adana Pact between Turkey and Syria. The pact began a period of previously unprecedented bilateral links between Turkey and Syria until 2011, when the current conflict flared.

Erdogan acknowledged the 1998 pact was still in operation, meaning Turkey and the Assad administration could work together against terrorism.

Trump may also see no problem with the eventuality. There was no mention of Assad when he claimed victory in Syria, indicating he does not care whether Assad remains in power or not.

Islamic State

The overarching concern is that the US pulling out of Syria would bring back IS. The group has lost large territories and the major cities of Mosul in Iraq and Raqqa in Syria. The last town under IS control, Hajin, fell to coalition forces in December 2018. Despite these wins, it’s too soon to claim the end for IS.

Trump has a solution to this too: outsourcing. In a Tweet on December 24, he announced Turkish President Erdogan will “eradicate whatever is left of ISIS in Syria”. This is highly unlikely as Turkey’s main concern is the Kurdish region in northern Syria where IS is not likely to pose any threat.

Given Russia and Assad will be the main forces in Syria, their policies will determine the future of IS.

Assad would not want IS to jeopardise his own government. At the same time, Assad’s claim for legitimacy throughout the civil war was his fight against terrorism, embodied by IS. If IS were to exist in some shape and form, it would benefit Assad in the crucial years of consolidating his power. This may lead to Assad appearing to crack down on IS while not entirely eradicating them.




Read more:
James Mattis: what defence secretary’s resignation means for Syria, Afghanistan and NATO, as Trump leans in to Putin


IS will also try hard to survive. It still has a large number of seasoned commanders and fighters who can unleash guerrilla warfare. IS also has operatives peppered throughout Syria to launch suicide bombing attacks in Syrian cities, similar to what they have been doing in Iraq.

Israel, meanwhile, has been quietly hitting Iranian targets in Syria since May 2018. Israeli air strikes intensified in January 2019 and occurred in broad daylight. In acknowledging the strikes, Israeli Prime Minister Benjamin Netanyahu said Israel’s “permanent policy” was to strike at the Iranian entrenchment in Syria.

We could see more altercations between Israel and Iran in 2019, now that the US has abandoned the objective of countering Iran’s presence in Syria.

The Syrian conflict is not over. It’s just on a new trajectory. The US withdrawal is sure to leave a power vacuum, which will quickly be filled by other regional powers like Turkey, Iran and Israel under the watchful eye of Russia.The Conversation

Mehmet Ozalp, Associate Professor in Islamic Studies, Director of The Centre for Islamic Studies and Civilisation and Executive Member of Public and Contextual Theology, Charles Sturt University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

The collapse of the US-Russia INF Treaty makes arms control a global priority


Ramesh Thakur, Australian National University

On October 20 2018, US President Donald Trump announced he intends to withdraw from the Intermediate-Range Nuclear Forces Treaty (INF) – an arms control treaty with Russia that contributed to the end of the Cold War.

Secretary of State Mike Pompeo confirmed this decision last week, while Trump reiterated his commitment to withdrawing from the treaty in his State of the Union address yesterday.

Russia followed suit and reports say it is aiming to create new land-based missiles within the next two years. Reports also say the US is allocating funds for the research and development of such missiles.

So, what is the INF Treaty? And will its collapse lead to an increase of global nuclear tensions that marked the Cold War?

What is the INF?

The INF Treaty took seven years to negotiate, contributed to the end of the Cold War and ushered in three decades of strategic stability.

US President Ronald Reagan and Soviet General Secretary Mikhail Gorbachev signed the treaty on December 8 1987 to give effect to their declaration that “a nuclear war cannot be won and must never be fought”.

The treaty prohibited the development, testing and possession of ground-launched cruise and ballistic missiles with a range of 500km to 5,500km, whether armed with nuclear or conventional warheads.

A joint statement from Reagan and Gorbachev noted:

This treaty is historic both for its objective – the complete elimination of an entire class of US and Soviet nuclear arms – and for the innovative character and scope of its verification provisions.

It entered into force on June 1 1988. By its implementation deadline of June 1 1991, 859 US and 1,752 Soviet missiles had been destroyed.

Reflecting the dominant Cold War architecture of nuclear arms control, the INF Treaty was bilateral. US National Security Adviser John Bolton, writing in 2011 as a private citizen, conceded the treaty had successfully “addressed a significant threat to US interests”. The threat was a surprise Soviet/Russian nuclear attack in Europe using missiles in the 500-5,500km range.

But the arms control architecture began fraying when US President George W. Bush pulled out of the Anti-Ballistic Missile (ABM) Treaty in 2001. Signed in 1972, the ABM controlled systems designed to counter “strategic” ballistic missiles, such as intercontinental ballistic missiles (ICBMs).

With the INF Treaty now dead and another arms control treaty, New Start, set to expire in 2021, the world will be left without any limits on the two major nuclear arsenals for the first time since 1972.

What now, for Europe?

Since 2014, under the Obama administration, Washington has accused Russia of deploying nuclear-capable ground-launched missiles with a 2,000km range (the SSC-8) in Europe that are non-compliant with INF Treaty obligations.




Read more:
Obama’s Nobel-winning vision of ‘world without nuclear weapons’ is still distant


The US decision to pull out of the treaty will deepen the strains in the North Atlantic Treaty Organisation (NATO). Baltic countries insist Russia’s violations of the INF Treaty demand robust diplomatic and military counter-measures. The UK has lined up firmly behind Washington, blaming Russia for the breakdown.

But Germany’s foreign minister, Heiko Maas, urged Washington to consider the consequences of withdrawal for Europe and for the future of nuclear disarmament. And the EU foreign policy chief, Federica Mogherini, said:

The INF contributed to the end of the Cold War and constitutes a pillar of European security architecture.

NATO stands to lose more from the INF Treaty collapse than Russia. Russia will be able to move ahead rapidly with the development and deployment of short and medium-range ground-launched nuclear-capable missiles. But, unlike in the 1980s, the US would face difficulty in finding allies in Europe prepared to station such missiles on their territory.

Also, would the host countries have a voice or veto on launching them and in choosing targets?

What about the Asia-Pacific?

In addition to alleged Russian violations, the US exit is motivated by China’s growing challenge to US dominance in the Pacific. China and North Korea have been developing missile-delivery capabilities.




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“To reduce the threat from INF-range missiles,” Bolton concluded back in 2011, “we must either expand the INF Treaty’s membership or abrogate it entirely so that we can rebuild our own deterrent capabilities.” Trump has done the latter.

As a non-signatory, China is unconstrained by INF Treaty limits. About 95% of its missiles are in the prohibited range. This enables it to target US ships and bases from the mainland by relatively inexpensive conventional means.

Without INF restrictions, the US could develop and station ground-launched intermediate-range cruise missiles across the Asia–Pacific, which would force Beijing to divert significant military resources to defend its homeland.

China’s nuclear stockpile has remained relatively stable over many years despite the fluctuations in the Russian and US numbers. It is below 300, compared to nearly 7,000 and 6,500 Russian and US warheads, respectively.

This signifies a policy of deliberate restraint in China despite substantial growth in economic and technological capability since its first nuclear test 55 years ago.

The collapse of the INF Treaty and deployment of China-specific US missiles could compel China to institute counter-measures – such as rapidly expanding its warhead numbers and missile-delivery systems – to protect vital security interests, including nuclear assets deep in its interior.

China’s response in turn may trigger re-adjustments to India’s doctrine of credible minimum deterrence and could produce matching re-adjustments by Pakistan. The nuclear arsenals of both these countries is presently limited to under 150 each.

In a worst-case scenario, China, India and Pakistan could engage in a sprint to parity with the US with a rapid expansion of warhead numbers and missile-delivery capabilities, and perhaps even move to keeping a stock of nuclear weapons on high alert just like Russia and the US.

However, economic and technological limitations will constrain India and Pakistan’s ability to engage in an open-ended nuclear arms race.

Expanding arms control

The sensible alternative would be to begin urgently multilateralising the Cold War bilateral structure of nuclear arms control regimes. This means involving more countries than just Russia and the US in arms control treaties, and in particular involving China. Chinese nuclear expert Tong Zhao’s conclusion holds for the whole world, not just China:

… the era of relying on the US-Russia bilateral arms control structure is at its end.

Multilateralising the arms control negotiating process and resulting structure will avoid a free-for-all nuclear arms race and instead anchor strategic stability in arms control agreements.

Meanwhile, thanks to Donald Trump and John Bolton, we shall continue to live in interesting times.The Conversation

Ramesh Thakur, Professor of International Relations, Australian National University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

A Trump-aligned World Bank may be bad for climate action and trade, but good for Chinese ambitions


File 20190130 108355 11qgq1d.jpg?ixlib=rb 1.1
A World Bank in sync with Donald Trump’s views about climate change and multilateralism would probably help to increase Chin’s role in international development and finance.
Shutterstock

Usman W. Chohan, UNSW

The seat of World Bank president is becoming vacant. Its president, Jim Yong Kim, will step down on January 31, three years earlier than his term formally ends.

His move – described as “sudden” and a “shock,” particularly since the World Bank has been going through significant internal restructuring – gives US president Donald Trump the chance to appoint a replacement more aligned with his outlook.




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This is because, since the World Bank’s establishment in 1945, the United States has had outsized influence as its largest shareholder. Its president has always been an American citizen nominated by the US government. Kim was chosen by the Obama administration in 2012.

Rumours circulated early on that Trump was considering his daughter Ivanka for the job. Even though that has since been denied, it’s likely he will choose a candidate sympathetic to his worldview.

This may mean a substantial change in the World Bank’s priorities. In particular, in two areas the bank has played an important and positive role: funding sustainable projects to deal with climate change (“climate resilience”); and encouraging robust international connectivity through trade.

Focus on climate resilience

The World Bank has put substantial emphasis on funding projects in developing countries that address climate change. Last financial year 32% of its financing – a total of US$20.5 billion – was climate-related.

Recently approved World Bank projects included climate resilient transport in the Oceania region (such as in Tonga and Samoa), and solar projects across Sub-Saharan Africa. This is all part of a detailed five-year Climate Change Action Plan underway since 2016.

This concern about the consequences of climate change stands in marked contrast to the Trump administration’s record.

Trump’s disregard of climate science is reflected in the defunding or reorganisation of climate-related research projects and institutions. His appointee to head the US Environmental Protection Agency, Scott Pruitt, played a key role in the US withdrawing from the Paris Climate Agreement and energetically worked to gut pollution protection regulations.

So there’s good reason to believe the Trump administration’s pick for the World Bank will reflect its hostility to climate security, and that the bank’s priority towards funding climate resilience will change as a result.

Antipathy towards multilateralism

The Trump administration has already sought to curb salary growth among World Bank staff. More severely, Trump’s National Security advisor, John Bolton, has argued the World Bank should be privatised or simply shut down.

This is part of a wider “antipathy towards multilateralism” that includes institutions such as the United Nations and the World Trade Organisation.




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Trump’s belief that free trade has hurt the US is at odds with the World Bank’s long history of facilitating reforms designed to promote international trade.

Part of the original logic for the World Bank was that trade was seen as a means to create interdependence, and thus reduce economic conflict that might lead to war.

The Trump administration has shown it is more than willing to revert to an old-fashioned trade war.

Its tariff contest with China (which joined the WTO in 2001 with the World Bank’s help) is already hurting global manufacturing, with the International Monetary Fund downgrading its global economic growth forecasts as a result.

Though a Trump appointee might not upend the World Bank’s commitment to free trade in principle, the result might be an organisation less active in promoting multilateralism in practice.

Playing to China’s strengths

Ironically a Trump-compliant World Bank might result in promoting its sidelining to the advantage of China.

In its first six decades of existence the World Bank was an immensely powerful international institution. But its relevance to international development and finance is now being overshadowed by alternative funding mechanisms such as private-sector lending and particularly institutions related to Chinese international development initiatives.

China is planning through its Belt and Road Initiative to spend US$1 trillion on international infrastructure projects over the coming decade. Much of these are focused on Eurasian and African regions where the World Bank has struggled most to promote sustainable prosperity.

China has also has built a rival to the World Bank in the form of the Asian Investment Infrastructure Bank (AIIB), which has a sizeable balance sheet and a proactive approach to funding projects, including those in sustainable development.




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But in climate resilience and global economic integration, the World Bank still retains the mantle of global leader. Thus far it has welcomed cooperation with the AIIB, signing a memorandum of understanding in 2017.

Blunt its work in these two areas and the World Bank becomes more irrelevant. Combined with the organisation’s serious governance problems, which are most unlikely to be addressed by a Trump appointee, the future for the World Bank is not bright.The Conversation

Usman W. Chohan, Economist, UNSW

This article is republished from The Conversation under a Creative Commons license. Read the original article.

G20 summit bring a truce in US-China trade relations – but it’s likely to be temporary


Tony Walker, La Trobe University

The United States and China have arrived at a temporary truce in a trade conflict that was threatening to further destabilise world equity markets, entrench a global slowdown and cause more damage to a rules-based international order.

Agreement by US President Donald Trump and his Chinese counterpart, Xi Jinping, to allow further negotiations before threatened tariff increases on Chinese imports come into effect is a welcome development.

However, this is a temporary respite, a short-term fix, not a long-term solution to myriad trade and other tensions that have put the US and China at odds with each other.

For their own purposes and in their own interests, Trump and Xi have come away from the Argentine capital with a deal that papers over differences that extend from China’s activities in the South China Sea to its mercantilist trade policies.




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As far as we know, China’s ruthless assertion of its sovereignty over disputed waters in the South China Sea was not a material subject for discussion in Buenos Aires except, possibly, in passing.

China’s rise and America’s relative decline ensure these global economic superpowers will continue to bump up against each other.

So, what was achieved and what are the prospects for an accord reached on the sidelines of the G20?

In their efforts to lower trade tensions and prevent a further erosion of global confidence, Trump and Xi agreed to a 90-day extension on the imposition of additional US tariffs on some US$200 billion of Chinese imports.

Trump had threatened to increase tariffs from 10% to 25% on an initial batch of Chinese imports from January 1. He had also flagged his intention to impose levies on another US$267 billion worth of imports if progress was not made in resolving broad-based trade differences.

A joint statement laid out a timeline for continuing negotiations. It reads:

Both parties agree that they will endeavour to have this transaction completed within the next 90 days. If, at the end of this period of time, the parties are unable to reach an agreement, the 10 percent tariffs will be raised to 25 percent.

In return for these temporary concessions, China agreed to:

… purchase a not yet agreed upon, but very substantial, amount of agricultural, energy, industrial, and other product from the United States to reduce the trade imbalance between the two countries. China has agreed to start purchasing agricultural product immediately.

China also agreed to crack down on sales of Fentanyl by making it a controlled substance. The US is battling an opioid crisis in which Fentanyl is a lethal component.

In retaliation for US trade actions, China had imposed duties on US$110 billion of imports. A principal component of this is soybeans, effectively killing one of America’s more lucrative export markets.

Trump has been under huge pressure from his Mid-Western rural heartland over a collapse in the Chinese market for American agricultural products.

The two sides also agreed to address structural problems in the trading relationship. These extend to five areas – forced technology transfer, intellectual property protection, non-tariff barriers, cyber intrusions and cyber theft.

These are highly complex issues and unlikely to be resolved in the short term, if at all.

In the wash-up of the Xi-Trump discussions it appears China has got more out of the deal than the US – at least for now. It has secured a stay of execution for the implementation of tariff increases and forestalled, for the time being, tariffs on an additional bloc of Chinese exports.

In return, it has agreed to buy unspecified quantities of US products and to talk about differences.

Trump’s willingness to compromise after months of bombast reflects pressures from a shellshocked grain-producing constituency and alarm on Wall Street at prospects of a full-blown trade war.

From Beijing’s perspective, China has demonstrated that its growing economic heft has enabled it to avoid the appearance of yielding to US pressure.

If not a “win-win” for China – as Chinese officials are fond of saying – it is certainly not a “lose-lose”.

In a statement at odds with months of fire-breathing rhetoric over China’s allegedly perfidious trade practices, Trump hailed his understanding with Xi. He said:

This was an amazing and productive meeting with unlimited possibilities for both the US and China.

For their part, Chinese officials were more circumspect.

Foreign Minister Wang Yi said the talks were conducted in a “friendly and candid atmosphere”. The presidents:

agreed that the two sides can and must get bilateral relations right… China is willing to increase imports in accordance with the needs of its domestic market and the people’s needs.

Impetus for a face-saving deal in Buenos Aires has been prompted by growing concerns about the global economy. The signs of a slowdown are clear. Trade volumes had begun to moderate in the third quarter, heightening worries of a global retrenchment.

International Monetary Fund managing director Christine Lagarde at the G20 summit.
AAP/EPA/G20 handout

On the sidelines of the G20, the International Monetary Fund’s managing director, Christine Lagarde, noted:

Pressures on emerging markets have been rising and trade tensions have begun to have a negative impact, increasing downside risks.

In its October Outlook statement, the IMF warned about threats to global growth due to trade disturbances.

In their final communique, G20 leaders danced around contentious issues on trade to accommodate American objections to having the word “protectionism” inserted in the document.

In the end, participants settled on the need for reform of the World Trade Organisation to describe a world trading system that is falling short of its objectives. Washington has been agitating for a review of the WTO to strengthen its dispute resolution and appeal procedures.

The US has also objected to a continuing description of China as a developing country, with concessions that enable it to take advantage of less developed country status in its access to global markets.




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On climate change, Washington separated itself from the other G20 members. All, except the US, reaffirmed their commitment to the Paris Agreement. The US announced in 2017 it was pulling out of Paris.

Foreign policy specialists will be sceptical about a de-escalation of trade hostilities given the range of issues bedevilling the US-China relationship.

Reflecting a hardening of US attitudes towards China, and in contrast to the optimism that had prevailed for much of the past two decades, Ely Ratner in Foreign Affairs notes:

Even if tariffs are put on hold, the United States will continue to restructure the US-China economic relationship through investment restrictions, export controls, and sustained law enforcement actions against Chinese industrial and cyber-espionage.

At the same time, there are no serious prospects for Washington and Beijing to resolve other important areas of dispute, including the South China Sea, human rights and the larger contest over the norms, rules and institutions that govern relations in Asia.

A stiffening view in the US towards China is shared more or less across the board. In those circumstances, a temporary ceasefire in Buenos Aires is unlikely to be sustained.The Conversation

Tony Walker, Adjunct Professor, School of Communications, La Trobe University

This article is republished from The Conversation under a Creative Commons license. Read the original article.