Wednesday, February 13, 2008


The G8 and the Beijing Consensus

On the theme of talks with China on global leadership. (See post on 11 February 2008: What does China think?)

China's soft power

[Besides resources] the Chinese also want one other thing which is utterly central to all of their politics and policies: international recognition and corroboration of the one China policy.

China offers its help [to other countries] without conditions. There are no human rights complications, no promises for elections, and no pressure for free press. Countries such as Sudan and Zimbabwe appreciate China's unquestioning support in return for arms, oil, trade or whatever is on offer. These kinds of policies - unsurprisingly - draw considerable international criticism. The Chinese charge d'affairs in South Africa recently defended China's policies of engagement, trade and interactions with Sudan and Zimbabwe by saying that China was "simply protecting its own interests".

Others, notably those from the West, find China's foreign policy of interaction with pariah regimes anything from unfortunate to disgraceful. There is, strictly speaking, no right answer. While it is easy for the West to harangue China for these policies, they are not speaking from an unsullied pulpit either, both historically and presently speaking. Selling billions of dollars of arms to various countries in the Middle East, all of whom rate poorly to atrociously on the Freedom House index, does not lend the West the high ground.

Tuesday, February 12, 2008


A global energy charter

The CSIS doubts the ability of the G8 to handle the vital subject of global energy effectively. The report (see November 15, 2007) suggests instead that the next US administration takes the lead:

The next [US] administration should take the initiative on seeking a global consensus on how best to address greater resource competition and the potential perils of climate change in the years ahead. The primary objective could be to create a common charter outlining the principles of sound energy policies and practices. . .

The charter could address issues such as protection of sea lanes and critical infrastructure as well as an investment-friendly regulatory and legal framework that respects the development needs of resource holders.

But there is an Energy Charter Treaty already. Problems with Russia are a regular theme.


What is distinctive about the Energy Charter Treaty?

1. it is the first multilateral investment protection treaty that contains binding provisions on the protection of investment in relation specifically to the energy sector

2. the ECT integrates WTO rules with respect to energy trade and extends them to non-WTO countries that are members of the ECT

3. With respect to the strategically important issue of transit, the ECT lays down the principle of freedom of energy transit and non-discrimination, on the basis of origin, destination, ownership or pricing of energy materials and products.

Observations by the Secretary-General of the Energy Charter:

I would also like to mention what the ECT does not do – in order to correct some misconceptions that might exist: the ECT does not determine the structure of national energy markets, nor does it dictate national energy policies or oblige member countries to open up their energy sector to foreign investors. Each member state is free to decide how, and to what extent, its national and sovereign energy resources will be developed, and also the extent to which it will open its energy sector to foreign investments. Lastly, it does not impose mandatory third-party access to energy infrastructure.

Archive: see Energy on the G8 agenda, from three years ago.

Monday, February 11, 2008


The G8 and China

What does China think? charts the development of a new Chinese world view and identifies the following different factions battling for influence:

1. The "New Left" who want a gentler form of capitalism with a social safety net that could reduce inequality and protect the environment;

2. The "New Right" who think that freedom will only come when the public sector is dismantled and sold off, and a new, politically active "propertied class" emerges;

3. The "Neo-Comms", cousins of American neo-cons, want to use military modernisation, cultural diplomacy and international law to assert China's power in the world.

Synopsis of book

An invigorating book about the debates raging within China. We all know about the fast pace of change in this country. This book brings us the ideas being fought over in the country itself -- from democracy to the idea of a 'peaceful rise'. It challenges all of our assumptions about China. We know everything and nothing about China. We know that China is changing so fast that the maps in Shanghai need to be rewritten every two weeks. We know that China has brought 300 million people from agricultural backwardness into modernity in just 30 years (something that took 200 years in Europe). China's voracious appetite for resources is gobbling up 40% of the world's cement., 40% of its coal, 30% of its steel, and 12% of its energy. It has become so integrated into the global economy that its prospects have immediate effects on our everyday lives: simultaneously doubling the cost of the London Olympics while halving the cost of our computers; keeping the US economy afloat but sinking the Italian footwear industry. We have an image of China as a dictatorship; a nationalist empire that threatens its neighbours and global peace.But how many people know about the debates raging within China?

What do we really know about the kind of society China wants to become? What ideas are motivating its citizens? We can name America's Neo-Cons and the religious right, but cannot name Chinese writers, thinkers or journalists -- what is the future they dream of for their country, or the world it is shaping? Because China's rise -- like the fall of Rome or the British Raj -- will echo down generations to come, these are the questions we increasingly need to ask. Mark Leonard asks us to forget everything we thought we knew about China and start again. He introduces us to the thinkers that are shaping China's wide open future and opens up a hidden world of intellectual debate that is driving a new Chinese revolution and changing the face of the world.

Thursday, February 07, 2008


Can the G7/8 or the G20 solve the financial turmoil?

The G7 finance ministers meet on Friday. An editorial in the FT comments:

Dislocations in the financial system and a sharp US slowdown make it important for the G7 to show that, despite the differing interests of its members, it will be able to co-ordinate an international response if the economic need arises.

Two of the three issues likely to dominate the agenda – currencies and the US economy – are unlikely to produce much agreement. That makes some progress on the third – the lessons to be learned on financial regulation and stability – all the more important.

The US will ask its G7 partners to stimulate demand in order to offset its own slowdown. But it will be talking to the wrong people. Germany and Japan both have large current account surpluses, but Germany has barely achieved fiscal balance, while Japan’s government is still deep in the red. Neither will eagerly launch a fiscal stimulus. The elephant absent from the room is China.

China is a member of the G20, but nevertheless needs to be persuaded to take on a global leadership role.


From the European Council on Foreign Relations: What world order would China introduce?
Soon, the political struggle in the Communist Party will be seen as vital as the battle between the US presidential contenders; and protesters outside the World Bank will complain as much about the "Beijing Consensus" as they do about the "Washington Consensus".

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