Tag: China

Washington Must Start Persuading Beijing about North Korea

Secretary John Kerry went to Beijing to again lecture his hosts about the need for China to pressure North Korea over the latter’s nuclear program. As expected, his mission failed. The Xi government again proved unwilling to threaten the survival of the Kim dynasty.

Immediately after Pyongyang’s fourth nuclear test Kerry attacked Beijing’s policy: it “has not worked and we cannot continue business as usual.” Even before Kerry arrived the PRC made clear it disagreed. “The origin and crux of the nuclear issue on the Korean Peninsula has never been China,” said a Ministry of Foreign Affairs spokeswoman: “The key to solving the problem is not China.”

While he was in Beijing she cited the behavior of other parties as “one major reason why the denuclearization process on the peninsula has run into difficulties.” Beijing officialdom has shown plenty of irritation with the Democratic People’s Republic of Korea, but China has demonstrated it has yet to be convinced to destroy its own ally and strengthen America’s position in Northeast Asia.

Kerry made the best of an embarrassing situation when he announced that the two sides agreed to an “accelerated effort” by the UN Security Council to approve a “strong resolution that introduces significant new measures” against the DPRK. No one should hold their breath as to the nature of those “measures,” however.

Persuading China to Cooperate against North Korea

Another North Korean nuclear test, another round of demands that China bring Pyongyang to heel. Said Secretary of State John Kerry: Beijing’s policy “has not worked and we cannot continue business as usual.” Alas, his approach will encourage the PRC to dismiss Washington’s wishes.

The People’s Republic of China joined Washington in criticizing the latest blast. The PRC is the most important investor in and provides substantial energy and food assistance to the North. Beijing also has protected the Democratic People’s Republic of Korea by weakening past UN sanctions and enforcing those imposed with less than due diligence. If only China would get tough, runs the argument, the Kim Jong-un regime in Pyongyang would have to give way.

Alas, Chinese intervention is not the panacea many appear to believe. Contra common belief in Washington, the U.S. cannot dictate to the PRC. Threats are only likely to make the Chinese leadership more recalcitrant.

In fact, Beijing’s reluctance to wreck the North Korean state is understandable. If the administration wants to enlist China’s aid, it must convince Beijing that acting is in China’s, not America’s, best interest.

While unpredictable, obstinate, and irritating, so far the DPRK is not a major problem for China. The North disrupts American regional dominance and forces Seoul and Washington to beg for assistance in dealing with the DPRK. Even Pyongyang’s growing nuclear arsenal poses no obvious threat to China.

Why, then, should the PRC sacrifice its political influence and economic interests? A Chinese cut-off of energy and food would cause great hardship in the North. But a half million or more people died of starvation during the late 1990s without any change in DPRK policy.

Thus, the DPRK leadership may refuse to bend. The result might be a return to the 1990s, with a horrific collapse in living conditions but regime survival—and continued development of nuclear weapons.

Will China Accept Taiwan’s Political Revolution?

In one of the least surprising election results in Taiwanese history, Tsai Ing-wen has won the presidency in a landslide. Even more dramatically, the Democratic Progressive Party will take control of the legislature for the first time. Tsai’s victory is a devastating judgment on the presidency of Ma Ying-jeou.

With the imminent triumph of the Chinese Communist Party, Chiang Kai-shek moved his government to the island in 1949. For a quarter century Washington backed Chiang. Finally, Richard Nixon opened a dialogue with the mainland and Jimmy Carter switched official recognition to Beijing. Nevertheless, the U.S. maintained semi-official ties with Taiwan.

As China began to reform economically it also developed a commercial relationship with Taipei. While the ruling Kuomintang agrees with the mainland that there is but one China, the DPP remains formally committed to independence.

Beijing realizes that Tsai’s victory is not just a rejection of Ma but of China. Support even for economic cooperation has dropped significantly over the last decade.

Thus, China’s strategy toward Taiwan is in ruins. In desperation in November Chinese President Xi Jinping met Ma in Singapore, the first summit between the two Chinese leaders. Beijing may have hoped to promote the KMT campaign or set a model for the incoming DPP to follow.

Xi warned that backing away from the 1992 consensus of one China could cause cross-strait relations to “encounter surging waves, or even completely capsize.” While Tsai apparently plans no formal move toward independence, she also rejects the 1992 consensus of “one China, separate interpretations.”

As I point out in Forbes: “Washington is in a difficult position. The U.S. has a historic commitment to Taiwan, whose people have built a liberal society. Yet America has much at stake with its relationship with the PRC. Everyone would lose from a battle over what Beijing views as a ‘renegade province’.”

Washington should congratulate President-elect Tsai, but counsel Taipei to step carefully. Taiwan’s new government shouldn’t give the PRC any reason (or excuse) to react forcefully.

The U.S. should accelerate efforts to expand economic ties with Taiwan. Doing so would affirm America’s commitment to a free (if not exactly independent) Taiwan by other than military means.

America should continue to provide Taipei with weapons to enable it to deter if not defeat the PRC. At the same time, the new government should make good on the DPP’s pledge to make “large investments” in the military. It makes little sense for the U.S. to anger Beijing with new arms sales if Taipei is unwilling to spend enough to make a difference.

Washington should press friendly states throughout Asia, Europe, and elsewhere to communicate a consistent message to China: military action against Taiwan would trigger a costly reaction around the world. The mainland would pay a particularly high economic and political price in East Asia, where any remaining illusions of a “peaceful rise” would be laid to rest.

Finally, American officials should explore ideas for a peaceful modus vivendi. One possibility is for Washington to repeat its acceptance of “one China” and eschew any military commitment to Taiwan.

Taipei would accept its ambiguous national status and announce its neutrality in any conflicts which might arise in East Asia, including involving America and Japan. The PRC would forswear military means to resolve Taiwan’s status and reduce the number of missiles in Fujian targeting the island.

The objective would be to make it easier for both China and Taiwan to “kick the can down the road.” A final resolution of their relationship would be put off well into the future.

 The ROC’s people have modeled democracy with Chinese characteristics. Hopefully someday the PRC’s people will be able to do the same.

In the meantime, President-elect Tsai is set to govern a nation which has decisively voted for change. However, if the PRC’s leaders fear they are about to “lose” the island—and perhaps even power at home—they may feel forced to act decisively and coercively. International ambiguity remains a small price to pay to avoid a cross-strait war.

Reduce Expectations and Withdraw Troops in Dealing with North Korea

Kim Jong-un’s gift to the world is North Korea’s fourth nuclear test. Washington should respond by backing away from a potential conflict that is not its own.

Although Western intelligence widely disbelieves the DPRK’s claim to have tested a thermonuclear device, or H-bomb, Kim Jong-un has clearly demonstrated that nothing will dissuade the regime from expanding and improving its nuclear arsenal.

The North’s action has led to widespread demands for action. Alas, no one has good ideas about what to do.

Pyongyang again ignored “the international community” because “the international community” has no cost-effective means to restrain the DPRK. Although as assistant secretary of defense Ashton Carter advocated military strikes against North Korean nuclear facilities, most people on and off the Korean peninsula don’t believe the answer to a potential war is to start an almost certain war.

Sanctions long have been the West’s go-to answer. Congress already was considering three different enhanced sanctions bills and the UN Security Council is planning new economic penalties.

But the North has never let public hardship get in the way of its political objectives. So far the People’s Republic of China has refused to encourage regime collapse by cutting economic ties and eliminating energy and food support. Moreover, Russia, with a newly revived relationship with the DPRK, insisted that any response be “appropriate” and “proportionate.”

Whether there ever was a chance to negotiate away the North’s nascent nuclear program may be impossible to know. But virtually no one believes the Kim regime is willing to eliminate existing weapons developed at high cost.

So what to do?

  1. Recognize that not every problem is America’s problem. North Korea matters a lot more to its neighbors than to the U.S. Indeed, Pyongyang wouldn’t be constantly tossing imprecations and threats toward Washington, if the U.S. didn’t have troops on its border and abundant air and naval forces pointed the DPRK’s way.
  2. Withdraw American conventional forces from the peninsula. The Republic of Korea, with twice the population and upwards of 40 times the economic strength, of the North, is well able to provide for its own defense. U.S. troops act as nuclear hostages, unnecessarily put in harm’s way without constraining North Korean nuclear activities.
  3. Seek to persuade Beijing to pressure the North out of the former’s own interest. Washington’s only chance of enlisting China’s help is by addressing its concerns—impact of potentially violent implosion spurring conflict and refugees across the Yalu, loss of economically advantageous position in the North, creation of united Korea allied with America aiding Washington efforts at containment. This requires negotiating with the PRC.
  4. Offer to establish diplomatic relations with North Korea. Engagement might not change anything, but then, we can be certain that nothing will change if we maintain the same policy toward the North.
  5. Indicate that continuing expansion of Pyongyang’s nuclear arsenal would force Washington to reconsider its position on proliferation. After all, the U.S. does not want to be left extending a nuclear umbrella over South Korea, Japan, Taiwan, Australia, and who knows else against nuclear-armed North Korea, China, and Russia. Better to extricate America from such a miasma and allow its allies to create their own nuclear deterrents. If that prospect bothers the PRC, then it should do more to prevent the DPRK from continuing its present course.

North Korea has become a seemingly insoluble problem for Washington. Nothing the U.S. can do, at least at reasonable cost, is likely to create a democratic, friendly, non-nuclear DPRK.

But as I point out on National Interest: “Washington can share the nightmare, turning South Korea’s defense over to Seoul and nuclear proliferation over to the North’s neighbors, particularly China. Moreover, Washington can diminish North Korean fear and hostility by establishing diplomatic ties, just as America had official relations with the Soviet Union and its Eastern European allies during the Cold War.”

The geopolitics still would be messy. But no longer would it be America’s responsibility to clean up.

China Has Chosen Instability

The plunging Shanghai Stock Exchange and the sudden reversal in the yuan’s appreciation have caused fears to spread beyond China’s borders. Is something wrong with the world’s growth locomotive? In a word, yes.

Indeed, China’s leadership has chosen instability. They have forgotten my golden rule: stability might not be everything, but everything is nothing without stability.

How did China arrive at this point — a point of high uncertainty and potential economic instability? A look at China’s exchange-rate regimes provides a window into these troubled waters. Since China embraced Deng Xiaoping’s reforms on 22 December 1978, China has experimented with different exchange-rate regimes. Until 1994, the yuan was in an ever-depreciating phase against the U.S. dollar. Relative volatile readings for China’s GDP growth and inflation rate were encountered during this phase.

After the maxi yuan depreciation of 1994 and until 2005, exchange-rate fixity was the order of the day, with little movement in the CNY/USD rate. In consequence, the volatility of China’s GDP and inflation rate declined, and with the yuan firmly anchored to the U.S. dollar, China’s inflation rates began to shadow those in America (see the accompanying exchange-rate table). Then, China entered a gradual yuan appreciation phase (when the CNY/ USD rate declined in the 2005-14 period). In 2015, the yuan began to experience weakness. In terms of volatility, economic growth and inflation rates, China’s performance has deteriorated ever since it dropped exchange-rate fixity.

 

So, why did China drop exchange-rate fixity in 2005? After all, China’s fixed-rate regime had performed very well. Pressure from the U.S. and many nonsensical mercantilist’s arguments, emanating from Washington, D.C., caused China to abandon fixity. Little did Beijing realize that it had chosen instability.

North Korea’s Nuclear Challenge to the West and China

North Korea has grabbed international headlines. Again. Pyongyang staged its 4th nuclear test, supposedly a thermonuclear device.

Proposals for more sanctions and further isolation likely will grow. However, the test dramatically demonstrated that the U.S. attempt to build a cordon sanitaire around the Democratic People’s Republic of Korea has failed.

Washington instead should develop a new policy focused on engagement, not denuclearization. The latter should remain an objective, but even if it remains out of reach the U.S. might be able to reduce military threats on the peninsula.

As always, North Korean foreign policy reflects domestic politics. The test also gives Pyongyang greater leverage in its attempt to engage both South Korea and the U.S.

Talks with the Republic of Korea recently ended without result. The North also long has sought to draw the U.S. into bilateral discussions. However, the Obama administration set as a precondition for any talks that Pyongyang take steps toward dismantling its nuclear program, a non-starter.

In dealing with the North there are only second-best options which might ameliorate the threat otherwise posed by a famously enigmatic, persistently paranoid, and potentially unstable nuclear-armed state viewing itself in a perpetual state of war with America and its allies, South Korea and Japan.

Winning in Africa Might Not Be Worth the Cost to China

Nowhere is China’s growing reach more obvious than in Africa. President Xi Jinping just returned from a trip during which he promised African officials $60 billion in new investment. Beijing also has grown more active culturally, educationally, and even militarily.

The PRC’s increasing role has created unease in Washington. But China has run into many of the same sort of problems which faced America in the past.

The U.S. obviously fears losing business: African trade with China surpassed that with America in 2009. Beijing undermines Western pressure to improve democracy and human rights.

Yet the ultimate results of President Xi’s visit remain to be seen. The photo ops were impressive, but both the pictures and promises may fade over time.

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