21st April Highlights

Two great interviews and two excellent think tank reports, Jin Liqun, the Maritime Silk Road, and China-EU investment.

Credit: Bloomberg Markets

From the think tank people: Working towards reciprocity  

What are the chances? Two fantastic reports published on the same day.

The first – a MERICS paper on China-EU FDI and reciprocity. This is an extended update to a previous paper, but it’s about more than just new data. As the paper notes, ‘reciprocity’ (China being restricted to European companies but not vice versa) is something of a buzzword in China-EU relations. Like most buzzwords, it is often ill defined and improperly explored.

The paper sets about correcting this state of affairs by considering what ‘reciprocity’ means (in the context of China-EU relations, conceptually, and in economic terms). It ends with some very solid recommendations, emphasising the need to avoid extreme Trumpian abandonment of free trade values and downward convergence, as well as the need to set reasonable expectations. Not exactly a silver bullet for tackling Chinese mercantilism, but there are no easy solutions, and MERICS does well to venture beyond hand-wringing or scare mongering.

 

From the think tank people: Strategic intent in the Indo-Pacific

This C4ADS report on the Maritime Silk Road and the Indo-Pacific is fairly long. If it’s not your day job, I can see why you might not want to slog through it, but I’d really recommend doing so – the real shining glory of this paper is in the detail (it’s also easy reading).

Ironically, I hadn’t heard about this paper until Xinhua published a Foreign Ministry spokesperson’s (negative, obviously) reactions to it. So, thanks to the Deputy Director of the Foreign Ministry Information Department, Hua Chunying, for alerting me to the existence of this definitive outline of Beijing’s “strategic motivations” in the Indian Ocean.

Just a brief thought on controlling the narrative: Xinhua actually does a great job at countering this paper. That’s because the FM’s comments woefully fail to address any of the issues brought up by C4ADS. The FM response is your typical “sunshine initiative”, “win-win”, mantra, leading one to kind of mentally peg the talked about paper at the same intellectual level.

I sometimes fall into the trap of thinking the “win-win” crap constitutes pretty shoddy PR tactics. But it’s much cleverer than it appears. If the FM had gone into any detail at all, it would have only served to highlight the opposition’s fairly substantiated argument. There must be a proper set of terminology for this, but it’s basically the reiteration ad nauseum of a comparatively simple (and thus easy and attractive) narrative in the face of logic. It’s brutish – not quite as brutish in flavour as Moscow’s approach to (dis)information, but powerful and simple nonetheless.

Anyway – a lot of stuff about China in the Indian Ocean often strikes my ears as fear mongering, especially when it attempts to make judgements about strategic intent in Beijing. This paper is different – it’s clear-headed, well researched, and the slightly alarmist statements contained in the Exec summary/intro actually have some solid methodology behind them. This paper raises some clear challenges, but you wouldn’t recognise that fact in the FM statement.

In response to accusations that Beijing seeks to expand its influence and military presence through the Maritime Silk Road, Hua Chunying basically says, ‘well, if it was about expanding Beijing’s influence, why would so many countries have signed up to it?’ Based on the report, I’m sure C4ADS would reply ‘because Rajapaksa likes having airports named after him’.

 

Expert View: Interview with Jin Liqun

A fascinating interview with the man behind the upstart Beijing-led multilateral development bank – the Asian Infrastructure Investment Bank (AIIB). A little bit old now (8th April), but definitely worth checking out if you haven’t seen it.

There’s more in here about Jin Liqun’s upbringing than there is about politics, but that’s not necessarily a bad thing. At the end of the day, people are the cogs and engines of these institutions, and insight into the psychology of a leader like Jin Liqun is worthwhile.

 

Expert View: Wade Shepard

Another fantastic interview from those great people at The China Road. But seriously, I thought it worth plugging my interview with Wade Shepard – since we’re doing two think tank papers this week, we might as well make it two interviews. Wade is a really interesting character and an hour talking to him is worth a hundred dry academic papers on the Belt and Road – so reading the transcript is time well spent.

Field research is important, and Wade spends all his time “in the field”, as it were. Field research is especially important when it comes to the Belt and Road. You can have all the credentials in the world, but with something as opaque as Chinese investment, the info simply isn’t there to analyse… you need to go out and collect it, and, as Wade says, just have a beer with the people in suits who give the PR sermons that are published.

Wade is the sort of person I imagine having a beer with would be intensely interesting, but, as a stop gap measure, I’d recommend a read of the interview!

 

 

 

 

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