In his book Fear, journalist Bob Woodward suggests that Donald Trump’s protectionist instincts may be stronger than previously thought, preventing him from making commercial peace with traditional allies or trade partners. Recent actions against China leave no doubt. Yet, this is not simply the Trump administration directing “protectionist firepower” against China, to quote James Politi of the Financial Times. A geopolitical fight is also emerging about global technological leadership and US ambitions to contain China on this crucial frontier.
Throughout the 2016 presidential election, then candidate Donald Trump blasted China for its protectionist trade policies, currency manipulation, and several other accusations. Indeed, these accusations were not limited to Trump as China bashing is simply standard fare for anyone seeking elected office on campaign trails. Much of Trump’s campaign was however met with derision. As the election process unfolded, the derision soon turned to snickers. As the election continued, the snickers turned downright somber while he sailed past his Republican opponents Jeff Bush, Ted Cruz, Marco Rubio, and others who had been deemed more likely GOP nominees.
Among the intelligentsia, the mood has turned to alarm as now President Trump has set out to do exactly as he had promised during his “America First” campaign. To show his sincerity to the campaign promise of bringing jobs back to the United States, he kicked off his first day in the Oval Office by issuing an Executive Order cancelling American participation in the Trans-Pacific Partnership (TPP). It was President Barack Obama’s signature trade deal creating a free-trade zone with eleven other nations for approximately 40 percent of the world’s economy. Trump also threatened to impose a 45-percent tariff on Chinese goods if China does not “behave” accordingly.
A Chinese company is preparing to begin work on the Nicaragua Interoceanic Canal. Once — and if — the canal is ever finished, it will size up to more than 170 miles (about 275 km) and connect the Caribbean Sea to the Pacific Ocean, with Lake Nicaragua in the middle. It’s a major project — larger than any other geo-engineering project underway in the world. Officially, it’s an opportunity for development championed by Nicaraguan President Daniel Ortega. But critics look at the canal as a boondoggle, and a means by which Ortega is developing a long-term relationship with Beijing — and China’s geopolitical interests. The builders of the canal also have important ties with the Chinese People’s Liberation Army (PLA). » More
When the United Kingdom (UK) sought to join the European Economic Community (EEC) in the early 1970s, it stirred a backlash in Australia. Because its prime exporters enjoyed easy access to the large British market, many feared a possible collapse would occur in bilateral trade. Today, the debate over whether the UK should remain in the EU attracts few headlines in Australia. It is not a replay of the previous EEC debate. Nevertheless, a British “no” vote in the 2017 referendum could yet again have negative consequences for the economic relationship between the two countries. This time, however, Australia wants the UK to stay in the grand ‘European Project’ rather than to stay out.
Much has clearly changed since the 1970s. Back then, Western Europe’s Common Customs Tariff and Common Agricultural Policy (CAP) represented substantial trade barriers for Australia’s major exporters. When the UK finally did join the EEC, Canberra not only lost its preferential access to an alternative export market, it also deepened its rift with Brussels. In the years that followed, Australia-EU relations therefore continued to suffer from ongoing trade disputes, several of which ended in international legal proceedings. » More
Is an “economic NATO” possible? This striking – and perhaps misleading – expression has been used by some commentators to convey a possible outcome of negotiations between the United States and European Union over the creation of a Transatlantic Trade and Investment Partnership (TTIP). The origins of this proposed partnership date back to November 2011, when a joint High Level Working Group (HLWG) on Jobs and Growth began discussing shared priorities. The HLWG delivered its final report in February 2013, and highlighted a range of options for expanding transatlantic trade and investment. Brussels and Washington are expected to give the green light for negotiations shortly, with talks possibly starting before the summer recess.
It remains unlikely that negotiations will result in a “fortress scenario” in which the US and EU mutually protect themselves from rising economic powers. What can be anticipated, however, is that the TTIP will have significant consequences for global economic security, irrespective of its final shape and structure. » More