China or the USA? It looks like countries like NZ, Australia and even the UK that are juggling alliances with the two major superpowers will soon have s to start making some tough choices. First let’s take a look at the Chinese Belt And Road global “silk road”:
Mon, 29 Apr 2019 00:00 UTC
The Beijing leadership seems to be aware that transparency is key for the global success of BRI, which is now supported by over 120 states and territories.
The Belt and Road Forum in Beijing was a graphic demonstration of how tactical adjustments are essential to enhance the appeal of a complex overall strategy. Talk about a turbo-charged 4.0 version of the legendary Deng Xiaoping maxim “crossing the river while feeling the stones.”
For all the somewhat straitjacket approach of Chinese official pronouncements, President Xi Jinping stressed a sort of “three musts” for the advance of the New Silk Roads, or Belt and Road Initiative (BRI) – debt sustainability, protection of the environment (or “green growth”), and no tolerance for corruption.
Add to that a growing battle against trade protectionism, more bilateral free-trade deals, more financing or investments, cooperation on third-party markets, and even a plan to sell Silk Road bonds.
In his keynote speech, Xi stressed how multilateral cooperation on “six corridors and six channels serving multiple countries and ports” is all go. He was referring to BRI’s six major connectivity corridors spanning Eurasia – and the fact that BRI is still in its planning stage; implementation actually starts in 2021.
The devil, of course, is in the details on multiple Chinese promises – further opening-up of the Chinese market to foreign investment; the possibility of majority equity in more industrial sectors; no more imposed technology transfers; more protection of intellectual property rights; and last but not least, no devaluation of the yuan.
And yet Beijing is learning fast. The final joint communique, emphasizing governance as much as economic development, was signed by Xi and 37 heads of state – from Italy, Greece and Portugal to Singapore and Thailand, not to mention new members such as Luxembourg, Peru, Cyprus and Yemen.
BRI is now supported by no less than 126 states and territories, plus a host of international organizations. This is the new, truthful, realistic face of the “international community” – way bigger, diversified and more representative than the G20.
The Beijing leadership seems to be aware that transparency is key for the global success of BRI. On the opening day of the forum, Finance Minister Liu Kun presented a 15-page debt sustainability framework based on similar standards applied by the Bretton Woods system – the IMF and the World Bank.
And the governor of the People’s Bank of China (PBOC), Yi Gang, stressed how long-term debt sustainability should be evaluated in relation to better infrastructure, better productivity, raising standards of living and reducing poverty. The PBOC has financed as much as $440 billion in BRI projects so far.
It’s all about Russia-China
Supported by vast infrastructure-building know-how and cutting-edge technology, Beijing is willing to renegotiate virtually everything BRI-related, from bank loans to overall project costs, from Malaysia and Thailand high-speed rail to the finer points of the flagship China-Pakistan Economic Corridor (CPEC), from physical infrastructure to the Digital Silk Road.
So much for US media hysteria over toxic “debt-trap diplomacy”.
Moreover, the West, as usual, ignored what was the absolutely key takeaway of the BRI forum: the deepening, on all fronts, of the Russia-China strategic partnership. It’s all here, in President Putin’s speech.
Putin emphasized “harmonious and sustainable economic development and economic growth throughout the Eurasian space.” He noted how BRI
“rhymes with Russia’s idea to establish a Greater Eurasian Partnership, a project designed to ‘integrate integration frameworks’, and therefore to promote a closer alignment of various bilateral and multilateral integration processes that are currently underway in Eurasia.”
I have reported extensively on the crucial BRI-Greater Eurasia symbiosis. And this was exactly the focus of the discussion when Putin met Xi on the sidelines of the forum. The Chinese Foreign Ministry vigorously stressed how Xi asked Putin to merge Eurasian Economic Union’s (EAEU) infrastructure projects with BRI.
What should be expected from the in-progress BRI-EAEU merger, which also includes the economic arm of the Shanghai Cooperation Organization (SCO) as well as ASEAN, is a massive, concerted Eurasian integration push.
Putin could not have been more specific.
“The Eurasian Union…has already signed a free-trade agreement with Vietnam and a provisional agreement with Iran, paving the way to the creation of a free-trade area. The preparation of similar instruments with Singapore and Serbia is nearing completion, and talks are underway with Israel, Egypt and India. We cooperate actively with the Shanghai Cooperation Organization and the Association of Southeast Asian Nations.”
All the pieces fall into place
Addressing the forum, Putin added another enticing dimension, with the China-driven Maritime Silk Road possibly joining the Russia-driven Northern Sea Route, “a global and competitive route connecting northeastern, eastern and southeastern Asia with Europe” will emerge. Once again, Eurasia integration in practice.
And then there are the other key Eurasian hubs, Iran and Pakistan.
After Tehran and Islamabad clinched a deal for joint border patrol on both sides of Balochistan, the next logical step would be closer BRI-related integration from Southwest Asia to South Asia.
Pakistan’s Prime Minister Imran Khan was a key participant in the forum, explaining the expansion that will transform Gwadar from a tiny fishing village to a global port and CPEC terminal that will link the Pacific via the Indian Ocean to the Mediterranean. Imran confirmed that Turkey had also been invited to be part of CPEC.
Many pieces are slowly falling into place across the immensely complex Eurasian integration chessboard. A key vector now depends on China being able to develop, refine and project soft power.
BRI, apart from its status of being the one and only 21st-century global development project, is also a global PR exercise. Compared to childish US geopolitical demonization, Beijing’s game is not that hard – just learn how to appropriately sell the ultimate geoeconomic paradigm shift to International Community 2.0. SOURCE
“Geoeconomic paradigm shift”? My goodness, that’s an elaborate euphemeism for The New World Order. I am personally disinclined to share The Saker’s optimism and enthusiasm: Social Credit, “re-education” (brainwashing), mass surveillance, austerity measures and other oppressive Police-State baggage come hand in hand with the Socialist ideology of the Chinese-governed NWO/BRI agenda.
Meanwhile, the US is beginning to push back at the dual-loyalty of it’s traditional allies. Trump recently made a big deal of the US based 5G rollout. Meanwhile, despite concerns from NZ’s GCSB intelligence agency, it looks like controversial Chinese communications giant Huawei will get it’s foot in the door with 5G contracts, both in the UK and Australasia. America has expressed deep concern:
As Western predominance winds down, technological innovation is speeding up. One possible consequence of this “geotechnological” shift is a split in the 5G telecom ecosystem. As former Google head Kai-Fu Lee points out, China’s growing heft is driving a kind of global economic duopoly between the West and the Rest that will inevitably force countries around the world to take sides. A bifurcated 5G ecosystem could mean two (or more) separate and politically divided technological spheres of influence.
Even as President Trump’s America turns inward, a global system-shift is under way. Standards-setting and spectrum allocation for 5G networks are now critical to the growing geopolitical rivalry between the world’s most powerful countries. Competition in the field of standard-setting will determine not only the design of 5G networks, but also the flows of capital between participants within the 5G ecosystem. Companies whose technology becomes the industry standard will receive royalty payments for decades to come.https://www.forbes.com/sites/danielaraya/2019/04/05/huaweis-5g-dominance-in-the-post-american-world/#641e5d3b48f7
The British government has released a scathing assessment of the security risks posed by the Chinese telecom company Huawei to Britain’s telecom networks, as London weighs whether to heed US calls to bar the firm from the next-generation 5G network over fears it will enable spying by the Chinese government and potential cyberattacks.
This is the second consecutive year the Government Communications Headquarters, or GCHQ – the British spy agency – has identified serious problems. This year, officials said they have found “further significant technical issues” in the firm’s engineering processes, as well as continued “concerning issues” in Huawei software, “leading to new risks” in Britain’s 4G telecom networks.
Most ominously, the spy agency, which oversees a centre that vets Huawei hardware and software for bugs and security vulnerabilities, said it can provide “only limited assurance” that the long-term national security risks can be managed in the Huawei equipment deployed in Britain, and that “it will be difficult” to manage the risk of future products until the current defects are fixed.
The United States has mounted a full-court press to urge partners worldwide to refrain from including Huawei in their 5G networks in coming years. National security officials say Huawei’s ties to the Chinese government, along with recent laws in China that require Chinese firms, if directed, to assist the government in intelligence collection, and allegations that it has engaged in intellectual property theft, make it an untrustworthy vendor – one whose access to telecommunications networks could open the door to espionage or perhaps, even worse, disruptive operations..(Read More At Source in Header)
During the National People’s Congress in Beijing in early March, Chinese Foreign Minister Wang Yi declared that “China would take all measures to protect Chinese businesses”, a pointed remark given recent battles between Huawei and Western governments.
– The US has led a campaign to convince countries that utilising Huawei equipment for 5G networks carries a significant security threat due to Chinese national intelligence laws
– The US is seeking to stifle China’s effort to climb up the technological supply chain, in which Huawei is a seeking to become a major player
– There are emerging signs of a rivalry between US and Chinese-led 5G networks; forcing countries to pick sides will feed into a “Cold War” mentality SOURCE
The U.S. firmly believes that Huawei constitutes a severe threat to the FVEY partnership if any member decides to rely on the tech giant’s infrastructure. Washington argues that the risks of systemic intelligence penetration and spying far outweigh any potential cost savings or convenience. Australia has already denied the possibility of Huawei in its 5G systems, while New Zealand has blocked the use of Huawei products by a local company building the infrastructure, while not completely ruling out the possibility. Canada also remains undecided and is in the midst of a politically sensitive extradition process involving the arrest of a senior Huawei official (and daughter of the company’s founder) in a case related to U.S. sanctions. The U.K. has not joined with the U.S. to date—Britain feels that it might be able to work out sufficient safeguards with Huawei that address security concerns. On this issue, the U.K. is more closely aligned with Germany – who is not a member of the ‘Five Eyes,’ but nevertheless a close ally – especially in terms of sharing valuable intelligence on emerging threats to national security.
It remains to be seen what will happen if the U.K. and other FVEY members choose Huawei as a close partner in their 5G infrastructure. Since the U.S. believes that Huawei would use its infrastructure to spy on users, it will inevitably limit the sharing of intelligence to the group. After all, the mandate of the FVEY consortium is to share intelligence with a tight-knit group of close allies. Excluding even one of these members could lead to a cascading effect that might encourage certain countries to begin stove-piping critical intelligence. If FVEY was no longer seen as relevant, it could begin to fray, with members deciding to pursue bilateral relationships to share intelligence. The end result would be that Huawei could very well spell the end of what has been one of the most important and long-standing intelligence sharing partnerships since it was established in 1941.
The Belt And Road becomes “operational” in 2021. The next couple of years could be rather volatile !
Martin Harris 1/5/19