10/26/15 10/26/15

2015 at Dawn.com)

President Xi Jinping’s recent trip to the United States grabbed global headlines. By going to Britain, the Chinese leader has sent an equally important signal of his interests and determination in deepening and expanding China’s ties with Britain — but also with Europe.Beijing and Washington certainly need to talk to each other on a range of bilateral and international issues. And the Sino-American agreements reached on cybersecurity and climate change will help ease relations between the world’s two leading political and economic actors.But President Xi and Prime Minister Li Keqiang’s many visits to Brussels, Paris and Berlin this year — and now Xi’s high-profile trip to Britain — underline that China and Europe have also made a strategic choice to further develop and expand relations.China’s focus on Europe and on Britain is important for several reasons. Tackling challenges in a multipolar and multi-complex world requires more than cooperation between China and the US. It also demands working in tandem with the European Union and its 28 member states.Britain, given its global role and influence is, of course, especially important. President Xi’s visit, including his high-level meetings, underline to a watching world — and to the rest of Europe — that China still views Britain as a key international player.Significantly, Xi’s visit follows a trip to China by UK Chancellor George Osborne last month, during which he said Britain should be China’s “best partner in the West”.It’s not just Britain that wants closer ties with China, however. Germany remains a strong contender for the title of Beijing’s ‘best friend’ in Europe. And more generally while relations between China and individual EU states are important, ties with the EU are also improving, with the launch of the connectivity platform and the agreement to cooperate on developing 5G networks.Europe certainly has the markets China needs for its exports — and trade is still booming. European expertise and know-how is critically important to help meet China’s urbanisation, climate, innovation and other developmental challenges. Most recently, there is a focus on synergies between the ‘One Belt, One Road’ project and Europe’s own investment blueprint for transport, digital and technology networks. Britain and British companies have a key role to play in such cooperation, both on a bilateral level but also through the EU.True, the EU’s many recent crises have eroded much of its lustre. Last year has been especially difficult as EU leaders have grappled with continuing troubles in the Eurozone, struggled to tackle the influx of refugees fleeing war and conflict in Syria and Africa while also dealing with longer-term problems of low growth and high unemployment.For the next few months, the focus in London, Brussels and in other EU capitals will be on Britain and the country’s upcoming referendum on its membership of the EU.The EU is hoping that Britain will opt to stay in. And while no EU leader would say so in public, many are clearly hoping that President Xi gives a clear but subtle message to British citizens to vote in favour of EU membership. As such, it is especially significant that the Chinese president has met leaders of the opposition parties and parliamentary leaders.But that’s not the only reason that the EU kept a close watch on President Xi’s speeches and meetings in Britain. China-watchers in Brussels and elsewhere in the EU wanted to learn more about the state of the Chinese economy after the market volatility over the summer and what to expect as China’s development priorities in the upcoming 13th Five-Year Plan.Meanwhile, Xi’s speech in London provided further insight into China’s hopes for the internationalisation of the renminbi and also information on China’s priorities as it prepares to take over as chair of the G20.Certainly as in other EU capitals, the focus was on business, with Britain looking for Chinese investments in key projects such as a high speed rail line in the north of the country and a deal on Chinese investments in the Hinkley Point C nuclear plant. The UK is now China’s largest investment destination country in Europe.More investment opportunities for Chinese companies opened up in the railway, energy, aviation and telecommunications industries. Significantly, leading the way for other European countries, Britain joined the Chinese-led Asian Infrastructure Investment Bank (AIIB), despite opposition from Washington, earlier this year. Within the EU, Britain’s opinion is important as the EU and China negotiate their Bilateral Investment Treaty and will be even more important if and when the two sides start discussions on a Free Trade Agreement.There used to be a time not so long ago when China’s friendships with individual EU member states were viewed with suspicion by Brussels. This was especially the case as regards China’s ‘special relationship’ with Germany and the burgeoning ties between Beijing and the Central and Eastern European states. Fortunately, such unease is now mostly over, with many policymakers agreeing that stronger bilateral ties between China and the individual EU member states — including Britain — help to consolidate and deepen the wider EU-China relationship.

9/14/15 9/14/15

View from abroad: It’s official: the EU is in a mess (Originally published 12/09/2015 at Dawn.com)

The 28-member bloc is in disarray, beset by crises, member governments are squabbling, people are angry and disenchanted, leaders are mostly querulous and hesitant — and sometimes outrageously odious.This isn’t just the opinion of just any EU watcher or EU insider; it’s the point of view of Jean-Claude Juncker, the president of the European Commission, the EU’s executive body.“The European Union is not in a good state,” Juncker told the European Parliament in his first-ever “State of Europe” address this week. “There is not enough Europe in this Union. And there is not enough union in this Union.”Unusually for a politician, Juncker did not mince his words during his hour-long speech to the 700 plus EU parliamentarians. It was time, he said for honesty.And he was certainly honest, refreshingly so. In fact, frighteningly so. Like most people, I’ve become used to untruthful politicians, men and women to whom lying comes naturally, automatically.This is especially true for anyone in an official position who is asked to comment on his/her country’s political future, economic prospects or social challenges.Market turmoil, economy in danger? China’s leaders don’t seem to think so. At a conference in Dalian last week, Chinese Premier Li Keqiang was adamant that Chinese markets were stable and potential systemic financial risks have been forestalled. Recent troubles were just due to “rumour mongers” and other nasties.India, meanwhile, is talking up its shining economic future and readiness to overtake China despite evidence that the economy is in desperate need of reform and growth.Politicians in the US still brag that their country is a “superpower” despite evidence that no one believes it any more.And at a recent seminar in Brussels, a Pakistani diplomat waxed lyrical about the country’s respectful treatment of women and efforts to empower them while people looked on in disbelief.Of course everybody takes such blatant hyperbole with a huge chunk of salt. We roll our eyes, shut off the TV, shout obscenities at the liars.Which is why Juncker’s speech took many by surprise. Yes, there were some hecklers from the Far Right in the European assembly but mostly the intervention — long and rambling at times — prompted respect for its brutal assessment of 21st century Europe — and Juncker’s recipe for changing things.The Commission chief was especially honest in his references to Europe’s refugee crisis and governments’ response to it.At a time when many EU leaders continue to waiver on Europe’s responsibilities towards the hundreds of thousands of refugees seeking shelter in Europe, Juncker made clear that Europe had a moral obligation to help those fleeing war, terror and oppression.“We Europeans should remember that Europe is a continent where nearly everyone has at one time been a refugee. Our common history has been marked by millions of Europeans fleeing from religious or political persecution from war, dictatorship or oppression,” Juncker underlined.It is a theme that German Chancellor Angela Merkel has dwelt on repeatedly over the last few weeks. Germany’s welcome of refugees may be rooted in its history but it certainly puts other EU leaders — especially in Britain and in Central and Eastern European countries — to shame.And it looks likely that while many countries have more or less grudgingly accepted more newcomers on their territories, Juncker and Merkel’s calls for compulsory quotas for the resettlement of refugees in the 28 countries will continue to run into opposition from Britain, Hungary, the Czech Republic and others.Meanwhile, following a moment of unusual silence, Europe’s Far Right groups have once again found their poisonous voice. The Netherlands’ leading Muslim-hater Geert Wilder has warned that the refugees represent an “Islamic invasion” of Europe.In France, Wilder’s counterpart Marine Le Pen has decided that “99 per cent” of the refugees coming to Europe are men who are making the journey for economic reasons. She made the statement as television images should pictures of joyful children arriving in Germany.Juncker — like Merkel — has warned against distinguishing between Jews, Christians and Muslims, saying there is “no religion, no belief, no philosophy when it comes to refugees”.There were also tough words on Greece and the need for economic reform to bring back confidence in the economy and among Greeks.And he voiced support for a “fair deal for Britain” as the country prepares to hold its referendum on EU membership before the end of 2017.Finally, Juncker urged EU states to be united in trying to shore up Ukraine while also engaging with Russia.EU governments’ response to Euro troubles in Greece and the refugee crisis has indeed spotlighted a disunited, squabbling Europe. Yes, the EU is the world’s most successful — and inspirational — example of deep regional integration, with a single currency shared by 19 countries, and 26 nations agreeing to scrap their national borders through the “Schengen” agreement.But Greece almost brought about the unraveling of the Eurozone. And the mass cross-border movement of refugees is threatening the Schengen pact. On foreign and security policy, divisions among the 28 countries are ever-visible.While the world watches closely and with concern, the EU will have to tread carefully in the coming months to preserve its many achievements and strive for more.

6/29/15 6/29/15

Shada Islam quoted in 'Upcoming EU-China summit to take relationship to new level' (Xinhua 27/6/2015)

At the first official meeting between the European Union and China since the new EU leadership in December 2014, scheduled for later this month, director of policy at Friends of Europe, Shada Islam, said the summit would take the relationship to a new level.In a recent interview with Xinhua, Islam said there were possible synergies between the EU and China on building a digital economy and cooperation in EU-China connectivity, which would provide opportunities for both sides to work together on the "Belt and Road" transportation initiative.Moreover, she said the European side was "expecting China to confirm its participation in the EU's investment plan for creating jobs and growth.""These two developments will really inject more energy and more stability into the relationship, taking it to a new level," said Islam.She said both China and Europe have two key imperatives: jobs and growth. They need to create jobs for new entrants in the labor market and they need growth to ensure continued prosperity. In politics and security, they both need to build a more stable and prosperous world, and especially a more prosperous neighborhood. In trade, both want further trade liberalization, and know how important it is to keep away from protectionism."These are signs that the relationship is becoming more diverse and also more focused on practical questions where both sides can work together and learn from each other," she said.Noting that discord over trade questions would crop up from time to time, Islam said what was important was that these questions could be resolved in a "timely and non-confrontational" manner.Concerning global issues, Islam said the world needed to work together to ensure peace and that meant working with China."If there is a good chemistry, the upcoming summit will set the tone for EU-China relations for the next few years," she said.Chinese Premier Li Keqiang will attend the 17th China-EU leaders' meeting here. Apart from the meeting, Li will also visit Belgium and pay an official visit to France, including a visit to the headquarters of the Organization of Economic Cooperation and Development (OECD) in Paris.

10/27/14 10/27/14

View from Abroad: A 21st century Silk Road (Originally published 25/10/2014 at dawn.com)

I have been in China for five days and my brain is on fire. Perceptions, discussions, confrontations crowd my mind, jostling for space, demanding attention. My Chinese colleagues have so much to tell me about their country’s new priorities and they want to know so much about the future of Europe. We discuss. We argue.

The debates go on and on at the round-table meeting in Changsha in Hunan province that we are attending. As day turns into night, the debates not only dominate my waking hours, they enter my dreams.Europe and China have much to talk about. We are so different and yet we have much in common. There is the shared challenge of encouraging sustainable growth, tackling problems in our respective neighbourhoods, dealing with an ageing population, making sure we eliminate inequalities.But much also separates us. Europe believes in democracy, elections and human rights. China wants western countries to stop pontificating and giving Beijing lessons on democracy. The focus should be on governance, not on elections and other the rituals of democracy, one Chinese academic tells us.“We have to treat each other equally ... the West should stop looking down on us,” another Chinese colleague insists at the round-table discussion between European and Chinese think tanks.Indeed, much has changed — and is changing — in Beijing. President Xi Jinping has embarked on an unprecedented national reform drive, demanding an end to corruption, stronger implementation of the rule of law, a rebalancing of the economy from investments and exports to domestic consumption.And for the last year, President Xi and Prime Minister Li Keqiang have been promoting the ambitious idea of a Silk Road which would connect China to Europe, weaving its way across Central Asia and Central and Eastern Europe on the one hand while also building connections through a maritime route which would include the Maldives and Sri Lanka and many South-East Asian states.Full disclosure: I confess that I am completely fascinated, intrigued by the initiative. As a young girl growing up in Pakistan, I spent hours reading of the adventures of the intrepid men and women who plyed the Silk Road, connecting towns, industries and people.Exotic looking Chinese traders, with their bundles of silk, satins and brocades, made their way to Islamabad, persuading my mother and aunts to buy their goods. I watched from the sidelines, amused by the good-natured bargaining, the chuckles resulting in mutually satisfactory transactions.Years later, I went up the Silk Road — or rather the silk track — to Hunza and Gilgit and felt my heart almost break at the exquisite beauty of the landscape. Many hundreds of Chinese and Pakistani workers died while building the road in such a hostile land. Their sacrifice was enormous, their memories preserved in plaques along the route.That was then. The Road was about romance and adventure. Today it’s about commerce. China’s new concept of the Silk Road has little to do with romance — and a lot to do with business.Still it is a visionary idea which is getting much attention in Asia and Europe. And so it should. As they did when they came out with their ‘China Dream’ concept a year or so ago, the ‘Silk Road’ initiative is a work in progress.Beijing has yet to articulate its ambitions in detail. “We are not yet talking about a strategy,” says a Chinese colleague.Clearly, China wants to use the Road to increase its trade relations with countries along the route. Beijing is interested in Central Asia’s energy resources. It wants to counterbalance Russia’s political influence in the region.Also, the Silk Road provides a strong counter move to America’s much-touted ‘pivot’ to Asia and to the Trans Pacific Partnership (TPP) trade agreement that the US wants to negotiate with countries in the region but without China.As I listen to the discussion, I am convinced that this is an idea whose time has come — again. China has the political clout to make it happen. And it has the money to finance many of the projects.Still, it won’t be easy. The 21st century Silk Road will not only allow goods to be trade freely across borders, it could also facilitate the cross-frontier movement of drugs, arms and terrorists.As such, the proposal needs to be developed with care and caution.As I prepare to leave Changsha, my head is still spinning with new information and ideas. I dream of ancient bazaars and long, winding roads through mountains and plains. The Silk Road as envisioned by Beijing may be based on national self interest and, given the challenges, may never see the light of day.But the vision of an interconnected world it articulates is worth preserving — and developing.

10/21/14 10/21/14

View from Abroad: Western nightmares are just bad dreams (Originally published 19/10/2014 at dawn.com)

It's the stuff of Western nightmares: imagine if, one day, a strong China and a weak but assertive Russia “gang up” against the United States and Europe, winning more friends and allies and imposing their writ on the rest of the world?The recent high profile meetings between Chinese Premier Li Keqiang and Russian President Vladimir Putin have been watched carefully — and fretfully — in all Western capitals with uneasy policymakers seeking to understand if this is just a passing show of affection or if the two countries are planning to build a more solid partnership.Beijing has made clear that it has no intention of being part of any geopolitical power play being hatched by Moscow. China’s interests are global. Indeed before he met Putin, Li was in Germany striking two billion euro worth of business deals. He then headed to Italy for more headline-grabbing commercial overtures.Beijing’s standard line is that it has no allies, only friends. That’s not how Russia views the world. Russia in contrast is under Western sanctions. The EU is struggling to reduce its dependence on Russian oil and gas while the Nato military alliance talks menacingly about Russian actions in Ukraine and its annexation of Crimea.Some warn it is the beginning of a second Cold War. Clearly, it isn’t. The multipolar world today is a very different place from what it was in the Cold War years.Still, some thing is afoot. The Russians are working overtime to woo the Chinese. Beijing is clearly interested in accessing more Russian oil and gas, providing Moscow with new markets as Europe diversifies away from Russian energy. Some 50 agreements and memorandums of understanding are reported to be signed during Li’s visit to Moscow, including in areas related to high-speed transit and finance. China is also eager to supply Russia with fruit and vegetables, products that Moscow is no longer importing from Europe.Western attention is focused on Russian-Chinese cooperation within the Shanghai Cooperation Organisation which some in the West view as a potential competitor for Nato. And the recent decision to launch the BRICS bank is seen as a joint challenge by Russia and China to the post-war liberal order and the supremacy of the Bretton Woods institutions.Both China and Russia are often on the same side on tackling global flashpoints, eschewing military intervention unless sanctioned by the United Nations Security Council.There’s no doubt, however, that while it may want to stay friends and do business with Moscow, China has no interest in being seen as Russia’s best friend. As friendships go, in fact, the focus in many envious Western capitals is on the ‘special relationship’ between China and Germany.While in Berlin, Li and German Chancellor Angela Merkel signed deals worth approximately US$18.1 billion, covering cooperation in areas including agriculture, automotive, telecom, healthcare and education.Li requested that Germany help to relax the EU’s high-tech export restrictions to China and continue expanding bilateral trade and investment. He further stated that the two countries should continue working together on feasibility studies concerning the proposed China-EU Free Trade Agreement. The two sides also signed guidelines covering 110 cooperative agreements over the next five to 10 years.At the Hamburg Summit organised by Germany’s top industrialists that was attended by Premier Li the message was clear: China is not only the the biggest market for German companies, it is also a growing one. China’s huge national reform programme agenda, opens up exciting new export and investment opportunities for German — and other European — companies. Discussions focused on China’s massive urbanisation needs which can be met by European companies.Chinese investments into Germany and the EU are soaring. Significantly, unlike many other countries, China has shown a strong interest in the future course of Asem, the Asia Europe Meeting forum which is often criticised for being a mere talk shop.At the Asem summit in Milan last week, Li waxed lyrical about Asem’s role in improving connectivity between Asia and Europe, underlining his vision of building a Silk Road between Asia.Li knows he is on a winning streak. As the Financial Times newspaper reported recently, Chinese investors are surging into the EU.In 2010, the total stock of Chinese direct investment in the EU was just over 6.1bn euro — less than what was held by India, Iceland or Nigeria. By the end of 2012, Chinese investment stock had quadrupled, to nearly 27bn euro, according to figures compiled by Deutsche Bank.Not surprisingly, the EU and China are in the process of negotiating a bilateral investment treaty aimed at protecting each others’ investments but also ensuring better marker access.China is clearly not about to ditch Russia. But Beijing’s focus is on the growing markets of Europe. Western policymakers can sleep easy. For many nights.