FARIBORZ MOSHIRIAN
The Age (Australia)
DURING the recent press conference of US President Barack Obama and Chinese President Hu Jintao, the two leaders did not address each other, and the body language of the two leaders indicated their frustration, which may reflect how difficult it was to come up with a joint statement. It is also noteworthy that the US official said that Obama's trip to China was only ''an important first step''.
Over the past few years, bilateral negotiations between the US and China have failed to resolve the problems - including the absence of a market-based exchange rate - that have contributed to the trade imbalance between the two countries.
In the absence of genuine reform of domestic policies by the US and China, it will be almost impossible for the G20 to achieve its goal of a ''framework for strong, sustainable, balanced growth'' in the years ahead. The lack of an effective global or regional framework to resolve the economic policy differences between the US and China is also creating challenges for other countries whose currencies have increased in value in recent times due to the decline in the value of the US dollar.
The low value of the yuan is also discouraging exports from the US, the European Union and Asia to China. At the same time, China's goods are becoming increasingly cheaper in places such as Europe and Asia. There is also a danger that the low value of the US dollar, similar to the Connelly-Nixon era, will lead to lower living standards and higher inflation in the US.
In an increasingly integrated global economy, the US needs to focus not only on its relationship with China as a way of tackling global economic, financial and environmental challenges, it also needs to focus on the Asia-Pacific region and assess how key players there, including Japan and India, can become accountable towards each other and also economically and financially integrated.
The Obama-Hu summit led China to explicitly welcome the US role in the Asia-Pacific region. In other words, there is no fear that China wishes the US out of this region. The US must capitalise on the goodwill from China and work hard for a new, inclusive, accountable and transparent regional architecture that in turn will influence the domestic policies of the relationship with China far more effectively.
The great differences between Germany and France were gradually resolved not only by bilateral negotiations, but particularly when these two countries became part of a regional bloc in Europe and had to ensure that their domestic policies were consistent with the exigencies and requirements of European policies. Despite the argument that the Asia-Pacific region is different to the 27 European countries (which also have vast differences in religion, culture, language, per capita income), modern technology, including the internet and the highly interdependent global economy in the 21st century, are making nations in Asia more willing to work closely with each other.
Despite the vast differences in religion, culture, language and political systems among the 10 member countries forming ASEAN, this bloc is gradually integrating. However, its new toothless Human Rights Commission and tension between Thailand and Cambodia have highlighted the significance of other stronger nations (such as Australia, New Zealand, Japan, Korea and India). These, with better track records on human rights, transparency and democratic systems, could work towards a more credible regional framework that includes ASEAN and China.
While Japan's new Prime Minister, Yukio Hatoyama, is keen for a regional community with these 16 nations, China is keen to work more closely with ASEAN. To counter the forces of ASEAN and close ties with China, the US is promoting the Trans-Pacific Partnership to assist the US and seven other countries to work towards a free trade zone and bring other nations in this region into such a partnership. It is almost a parallel force against ASEAN plus China and an indirect way of encouraging other nations to join this partnership rather than work with ASEAN plus China.
Such an approach may lead to further retarding of any cohesive regional architecture of which both China and the US could be members. At the same time, Russia is somehow left out in this process. It is part of APEC, though, but APEC is not an effective regional body, as testified by the recent statement of the APEC leaders' summit in Singapore where, for instance, the issue of a market-based foreign exchange could not have been frankly discussed as China did not support it. When climate change was discussed, there was even less commitment there. The absence of India from APEC also makes this forum less effective.
The recent meeting of Obama with ASEAN was an attempt to ensure that ASEAN was willing to embrace other countries in its bloc. The Obama Administration should capitalise on this momentum, particularly when the Obama-Hu summit led China to explicitly welcome the US's role in the Asia-Pacific region.
The inability of the US and China to adequately reform their domestic policies for the sake of regional and global interests, the lack of capacity of the G20 to bring its member countries to account except through peer review, and the difficulties in non-binding regional architectures so far should be justification enough to lead to the creation an effective framework for the emergence of an Asia-Pacific community that requires some accountability on the part of the member countries.
Obama's recent trip to Asia has created momentum for seriously promoting such a regional framework that could include ASEAN plus six and the US. Russia could also apply for membership over time. Such a regional approach will be more effective than simply relying on the US and China to reform their domestic policies in the absence of other key players such as Japan and India.
Fariborz Moshirian is professor of international finance at the Australian School of Business, University of NSW.
Over the past few years, bilateral negotiations between the US and China have failed to resolve the problems - including the absence of a market-based exchange rate - that have contributed to the trade imbalance between the two countries.
In the absence of genuine reform of domestic policies by the US and China, it will be almost impossible for the G20 to achieve its goal of a ''framework for strong, sustainable, balanced growth'' in the years ahead. The lack of an effective global or regional framework to resolve the economic policy differences between the US and China is also creating challenges for other countries whose currencies have increased in value in recent times due to the decline in the value of the US dollar.
The low value of the yuan is also discouraging exports from the US, the European Union and Asia to China. At the same time, China's goods are becoming increasingly cheaper in places such as Europe and Asia. There is also a danger that the low value of the US dollar, similar to the Connelly-Nixon era, will lead to lower living standards and higher inflation in the US.
In an increasingly integrated global economy, the US needs to focus not only on its relationship with China as a way of tackling global economic, financial and environmental challenges, it also needs to focus on the Asia-Pacific region and assess how key players there, including Japan and India, can become accountable towards each other and also economically and financially integrated.
The Obama-Hu summit led China to explicitly welcome the US role in the Asia-Pacific region. In other words, there is no fear that China wishes the US out of this region. The US must capitalise on the goodwill from China and work hard for a new, inclusive, accountable and transparent regional architecture that in turn will influence the domestic policies of the relationship with China far more effectively.
The great differences between Germany and France were gradually resolved not only by bilateral negotiations, but particularly when these two countries became part of a regional bloc in Europe and had to ensure that their domestic policies were consistent with the exigencies and requirements of European policies. Despite the argument that the Asia-Pacific region is different to the 27 European countries (which also have vast differences in religion, culture, language, per capita income), modern technology, including the internet and the highly interdependent global economy in the 21st century, are making nations in Asia more willing to work closely with each other.
Despite the vast differences in religion, culture, language and political systems among the 10 member countries forming ASEAN, this bloc is gradually integrating. However, its new toothless Human Rights Commission and tension between Thailand and Cambodia have highlighted the significance of other stronger nations (such as Australia, New Zealand, Japan, Korea and India). These, with better track records on human rights, transparency and democratic systems, could work towards a more credible regional framework that includes ASEAN and China.
While Japan's new Prime Minister, Yukio Hatoyama, is keen for a regional community with these 16 nations, China is keen to work more closely with ASEAN. To counter the forces of ASEAN and close ties with China, the US is promoting the Trans-Pacific Partnership to assist the US and seven other countries to work towards a free trade zone and bring other nations in this region into such a partnership. It is almost a parallel force against ASEAN plus China and an indirect way of encouraging other nations to join this partnership rather than work with ASEAN plus China.
Such an approach may lead to further retarding of any cohesive regional architecture of which both China and the US could be members. At the same time, Russia is somehow left out in this process. It is part of APEC, though, but APEC is not an effective regional body, as testified by the recent statement of the APEC leaders' summit in Singapore where, for instance, the issue of a market-based foreign exchange could not have been frankly discussed as China did not support it. When climate change was discussed, there was even less commitment there. The absence of India from APEC also makes this forum less effective.
The recent meeting of Obama with ASEAN was an attempt to ensure that ASEAN was willing to embrace other countries in its bloc. The Obama Administration should capitalise on this momentum, particularly when the Obama-Hu summit led China to explicitly welcome the US's role in the Asia-Pacific region.
The inability of the US and China to adequately reform their domestic policies for the sake of regional and global interests, the lack of capacity of the G20 to bring its member countries to account except through peer review, and the difficulties in non-binding regional architectures so far should be justification enough to lead to the creation an effective framework for the emergence of an Asia-Pacific community that requires some accountability on the part of the member countries.
Obama's recent trip to Asia has created momentum for seriously promoting such a regional framework that could include ASEAN plus six and the US. Russia could also apply for membership over time. Such a regional approach will be more effective than simply relying on the US and China to reform their domestic policies in the absence of other key players such as Japan and India.
Fariborz Moshirian is professor of international finance at the Australian School of Business, University of NSW.
1 comment:
To KY,
Thanks for your attempts at expressing your opinions and writing your thoughts about issues concerning Cambodian politics or economics.
However, I've found that your English profiency is still limited. Consequently, I sometimes either didn't get what you were trying to say or write, or simply got confused over what you were thinking and the way you were reasoning things.
So, I would suggest that you proofread or edit all of your written pieces first before you want to have it published or posted on websites like KI-Media if you really want to get your points across and well-taken.
Your writing's got to be short, simple, precise, yet well-reasoned and well-referenced, in order for it to be clearly understood. On top of having good knowledge and understadning of subject matter, you also need very good command of the English grammar as it plays a good role in any writing.
I hope you don't get offended or get me worng for suggesting you this.
Peace
Post a Comment