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Showing posts with label Trump. Show all posts
Showing posts with label Trump. Show all posts

Tuesday 11 September 2018

Tariffs won’t make US firms produce in US

https://youtu.be/gEmu3Dz--bM

"It would not be profitable to build the Focus Active in the U.S. given an expected annual sales volume of fewer than 50,000 units," automaker Ford Motor Company said in a statement on Sunday.

US President Donald Trump tweeted earlier on Sunday that "'Ford has abruptly killed a plan to sell a Chinese-made small vehicle in the US because of the prospect of higher US Tariffs.' CNBC. This is just the beginning. This car can now be built in the USA and Ford will pay no tariffs!" Ford quickly clarified the facts, evidently rebuffing Trump's tweet.

Likewise, tech giant Apple Inc. wrote a letter to US Trade Representative Robert Lighthizer, saying that a proposed 25 percent tariff on $200 billion of Chinese imports would cover a "wide range of Apple products."

In another tweet, Trump told Apple to make their products in the US instead of China. Apple hasn't responded.

According to the US media, the price of iPhone may increase to $2,000 if the company does as told.

The multinational companies that produce automobile and mobile phones have different manufacturing and sales layouts. Car manufacturers tend to produce their products where they are sold, while mobile phone manufacturers optimize their production chain costs worldwide. That's the natural law of economic globalization which can't be easily changed by a country's government.

The White House lacks understanding of the global production and value chains. "Make your products in the United States instead of China" seems naive. Instead of coercing companies to follow demands, imposing tariffs will only scare them off.

Simply making US companies produce in the US can't deal with the complicated global industry today. We have also learnt from history that neither side will gain in a trade war.

China is the world's largest automobile and mobile phone market. Setting tariff barriers between Beijing and Washington won't make US companies give up on China for the sake of their own country. As long as China doesn't make things hard for US companies, it's unavoidable that they will place production operations in China. The Chinese market can help them make money, but the White House can't.

Most American high-tech companies will face difficulties if they leave China. The larger the market is, the higher return the companies will get from their research and development. High-tech companies, if they can't grow to be giant, don't usually survive for long, and it would be fatal for many of them to lose the Chinese market.

There hasn't been a previous US government that dares to instruct multinational companies in production layouts, and the current administration has overestimated its executive power. The global industrial chain today is formed by market rules established over decades and can't be easily changed by one government.

It would be the White House's dream to expect that the US is not only the world's technology and financial center, but also the world's factory that sells its products globally. If the US doesn't want to wake up from this dream, then the outside world has to step in and rouse Washington.

Source:Global Times

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The US, South Korea and Japan must clarify what exactly they want on the Korean Peninsula. They cannot have everything, especially things that contradict each other. If the US wishes for denuclearization and peace on the peninsula, it would see the value of China-North Korea ties and support them.

Saturday 4 August 2018

Trump's overture to emerging Asia drowned out by trade war with China

US Trade war with China overshadows US$113m investment initiatives trumpeted by US Secretary of State

https://youtu.be/4GR3Z37XaWY
https://youtu.be/fToa31LONM4

SINGAPORE (Reuters) - When the U.S. Secretary of State flies into Southeast Asia this week with a new investment pitch for the region, the response could be: thanks a million, but please stop threatening a trade war with China that will make us lose billions of dollars.

Analysts say the $113 million of technology, energy and infrastructure initiatives trumpeted by Mike Pompeo earlier this week - the first concrete details of U.S. President Donald Trump’s vague ‘Indo-Pacific’ policy - may be hard to sell to countries that form an integral part of Chinese exporters’ supply chains.

It may even further inflame tensions with Beijing, which has been spreading money and influence across the region via its Belt and Road Initiative development scheme.

“The Southeast Asian capitals are more worried about any blowback effects for them of U.S.-China trade tension than they are about how much they can benefit from this $113 million initiative,” said Malcolm Cook, senior fellow at the Institute of Southeast Asian Studies in Singapore.

“Pompeo has a hard selling job. There is still no real positive trade story for Asia coming out of the United States.”

Hot on the heels of Washington’s new economic plan for emerging Asia came reports the United States could more than double planned tariffs on $200 billion of imported Chinese goods from dog food to building materials. China called it “blackmail” and vowed retaliation.

After a brief meeting with new Malaysian Prime Minister Mahathir Mohamad in Kuala Lumpur, Pompeo will fly to Singapore - a global trading hub that could be one of the hardest-hit in the region by a trade war - for a sit-down with the 10-member Association of Southeast Asian Nations (ASEAN) on Friday.

Singapore’s biggest bank, DBS, estimates that a full-scale trade war - defined as 15-25 percent tariffs on all products traded between the U.S. and China - could more than halve Singapore’s growth rate next year from a forecast 2.7 percent to 1.2 percent. Malaysia’s growth rate in 2019 could fall from an estimated 5 percent to 3.7 percent.

“We are all acutely aware of the storm clouds of trade war,” Singapore’s Foreign Minister Vivian Balakrishnan said at the opening of an ASEAN foreign ministers meeting on Thursday that precedes meetings with the United States and other nations.

Singapore’s Prime Minister Lee Hsien Loong said earlier this year that a trade war would have a “big, negative impact” on the country.

Ratings agency Moody’s said this week that an escalation of trade tensions in 2018 had become its “baseline expectation”, and that Asia was “especially vulnerable” given the integration of regional supply chains.

SANCTIONS ON NORTH KOREA

As well as trade, Friday’s meeting will also cover security issues such as South China Sea disputes and North Korea’s nuclear disarmament. The United States will press Southeast Asian leaders to maintain sanctions on Pyongyang following reports of renewed activity at the North Korean factory that produced the country’s first intercontinental ballistic missiles capable of reaching the United States.

Pompeo will also travel to Indonesia during his trip - Southeast Asia’s biggest economy which under Trump faces losing some of the trade preferences given by Washington for poor and developing countries.

Few officials around the region offered comment on the Indo-Pacific strategy when contacted by Reuters for this story. One said that the ASEAN meeting in Singapore would be an opportunity “to have clarity and a more unified position” on the vision.br

One reason for caution is that the region has been wrong-footed by U.S. advances before.

Former U.S. President Barack Obama’s “pivot” to Asia went on the backburner after Trump won the 2016 election promising to put “America First”. One of his early acts in office was to pull out of the Trans-Pacific Partnership (TPP) trade agreement, which involved four Southeast Asian states.

The result was that across Asia, more and more countries were pulled into China’s orbit: softening their stance on territorial disputes in the South China Sea and borrowing billions of dollars from Beijing to develop infrastructure.

The Philippines is one example of a country which has taken a more conciliatory approach to China despite a bitter history of disputes over maritime sovereignty.

Its President Rodrigo Duterte frequently praises Chinese counterpart Xi Jinping and in February caused a stir when he jokingly offered the Philippines to Beijing as a province of China.

Thailand, one of Washington’s oldest allies, is another major regional power perceived to have moved closer to China after U.S. relations came under strain because of concerns about freedoms under its military-dominated government.

Thai foreign ministry spokesperson Busadee Santipitaks told Reuters the country was proceeding with “a balanced approach” towards the United States and China.

U.S. officials said the Indo-Pacific strategy does not aim to compete directly with China’s Belt and Road Initiative. Yet, in an apparent reference to China, Pompeo said Washington will “oppose” any country that seeks dominance in the region.

While Chinese officials have not criticized the U.S. approach, its influential state-run tabloid the Global Times said in an editorial on Tuesday: “Belt and Road is destined to continue to flourish. This has nothing to do with certain forces that are selfish and engage in petty practices and make jibes.”

John Geddie Reuters

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Monday 19 December 2016

Goodbye 2016, a strange and difficult year


The year will be remembered for the West ending its romance with globalisation, and its impact on the rest of the world.

JUST a few days before Christmas, it is time again to look back on the year that is about to pass.

What a strange year it has been, and not one we can celebrate!

The top event was Donald Trump’s unexpected victory. It became the biggest sign that the basic framework and values underpinning Western societies since the second world war have undergone a seismic change.

The established order represented by Hillary Clinton was defeated by the tumultuous wave Trump generated with his promise to stop the United States from pandering to other countries so that it could become “great again”.

Early in the year came the Brexit vote shock, taking Britain out of the European Union. It was the initial signal that the liberal order created by the West is now being quite effectively challenged by their own masses.

Openness to immigrants and foreigners is now opposed by citizens in Europe and the US who see them as threats to jobs, national culture and security rather than beneficial additions to the economy and society.

The long-held thesis that openness to trade and foreign investments is best for the economy and underpins political stability is crumbling under the weight of a sceptical public that blames job losses and the shift of industries abroad on ultra-liberal trade and investment agreements and policies.

Thus, 2016 which started with mega trade agreements completed (Trans-Pacific Partnership) or in the pipeline (the Transatlantic Trade and Investment Partnership between the US and Europe) ended with both being dumped by the President Elect, a stunning reversal of the decades-old US position advocating the benefits of the open economy.

2016 will be remembered as the year when the romance in the West with “globalisation” was killed by a public disillusioned and outraged by the inequalities of an economic system tilted in favour of a rich minority, while a sizeable majority feel marginalised and discarded.

In Asia, the dismantling of the globalisation ideal in the Western world was greeted with a mixture of regret, alarm and a sense of opportunity.

Many in this region believe that trade and investment have served several of their countries well. There is fear that the anti-globalisation rebellion in the West will lead to a rapid rise of protectionism that will hit the exports and industries of Asia.

As Trump announced he would pull the US out of the TPP, China stepped into the vacuum vacated by the US and pledged to be among the torchbearers of trade liberalisation in the Asia-Pacific region and possibly the world.

The change of direction in the US and to some extent Europe poses an imminent threat to Asian exports, investors and economic growth. But it is also an opportunity for Asian countries to review their development strategies, rely more on themselves and the region, and take on a more active leadership role.

China made use of 2016 to prepare for this, with the Asian Infrastructure Investment Bank taking off and the immense Belt and Road Initiative gathering steam.

Many companies and governments are now latching on to the latter as the most promising source of future growth.

The closing months of 2016 also saw a surprising and remarkable shift in position by the Philippines, whose new President took big steps to reconcile with China over conflicting claims in the South China Sea, thus defusing the situation – at least for now.

Unfortunately, the year also saw heart-rending reports on the plight of the Rohingya in Myanmar, and the deaths of thousands of Syrians including those who perished or were injured in the end-game in Aleppo.

On the environmental front, it is likely 2016 will be the hottest year on record, overtaking 2015. This makes the coming into force in October of the Paris Agreement on climate change all the more meaningful.

But there are two big problems. First, the pledges in the agreement are grossly insufficient to meet the level of emissions cuts needed to keep the world safe from global warming, and there is also insufficient financing to support the developing countries’ climate actions, whether on mitigation or adaptation.

And secondly, there is a big question mark on the future of the Paris agreement as Trump had vowed to take the US out of it.

The biggest effect of 2016 could be that a climate skeptic was elected US President.

In the area of health, the dangers of antibiotic resistance went up on the global agenda with a declaration and day-long event involving political leaders at the United Nations in September.

There was growing evidence and stark warnings in 2016 that we are entering a post-antibiotic era where medicines will no longer work and millions will die from infection and ailments that could once be easily treated by antibiotics.

The world will also be closing in a mood of great economic uncertainty. In 2016 the world economy overall didn’t do well but also not too badly, with growth rates projected at 2.4 to 3%.

But for developing economies like Malaysia, the year ended with worries that the high capital inflows of recent years are reversing as money flows back to the US.

The first in an expected series of interest rate increases came last week.

All in all, there was not much to rejoice about in 2016, and worse still it built the foundation for more difficulties to come in 2017.

So we should enjoy the Christmas/New Year season while we can. Merry Christmas to all readers!

Global Trends By Martin Khor

Martin Khor (director@southcentre.org) is executive director of the South Centre. The views expressed here are entirely his own.


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Saturday 26 November 2016

US electoral democracy is failing, enter the China model? 21st century belongs to strivers

Authoritarian regimes and dictators around the world must feel vindicated by the just concluded presidential race in the United States, the one-time champion of liberal democracy that had the habit of exporting if not imposing its political system and the accompanying values to the rest of the world.

It is not so much the final outcome of last week’s race as the entire democratic process that is being questioned or scrutinized in and outside the US.

In the run-up to the Nov. 8 election, spectators of American politics were served with the tale of a contest between two candidates, both with problematic backgrounds and flawed characters.

More negative revelations about the candidates emerged as the election day neared to raise serious questions about their credibility and competency of whoever is elected to lead the world’s most powerful country.

The American media had rightly if not unkindly described this as an election where voters had to choose between the lesser of two evils.

When that choice fell on Donald Trump rather than Hillary Clinton, there was more indignation, both at the outcome as well as the electoral process.

What went wrong with the system, many people asked?

Is the American electoral system failing that we should question its effectiveness and efficiency in picking national leaders? Or are we seeing signs of fatigue in the system that has evolved in the last two centuries? To describe this as a systemic breakdown of the electoral process would probably go too far, and would give pretext for countries to conveniently discard or to forget liberal democracy.

Maybe it is worth recalling that just eight years ago, the same system gave America its first black president in Barack Obama, who was reelected in 2012. This year, the same system almost produced the first US woman president.

Still, the 2016 American presidential race, from the process to the final outcome, gives plenty of ammunition to those who doubt the ability of liberal democracy in producing great leaders.

The timing could not be worse, coming as the US superpower status is waning, through a combination of its own failing strengths and the rise of China challenging America’s supremacy.

Liberal democracy a la America had its strong appeals in recent history that it seemed to be the natural or only course for any nation to go. Theories were postulated about the first wave, second wave and third wave of democracy. There may not be a fourth wave, at least not until nations are convinced that this is really the best way to move forward.

Enter the China model.

Because it is a system that has proven efficient and effective, and certainly delivered the economic goods, it is now being touted as the better option than liberal democracy for developing countries looking for the right kind of nation-building model, including in the way they pick their leaders.

One caveat about the China model, however: Forget freedom and basic rights, the fundamental tenets that underpin liberal democracy.

What matters is that the system brings economic growth and development and raises people’s prosperity. The suppression of some freedoms and rights — big or small is relative — is the price nations have to pay to ensure stability, a prerequisite to development.

Freedoms and basic rights can come later, if at all.

In The China Model — Political Meritocracy and the Limits of Democracy (2015, Princeton University Press), author Daniel A. Bell shows how China introduced a meritocratic system that has produced leaders the nation can be proud of.

The leaders that have come out of this system have consistently produced rapid growth rates that turned China from a large poor developing country to the second-largest economy in the world in these last two decades.

The system still ensures periodic changes of national guards to prevent China from becoming a dictatorship. It offers a degree of predictability to ensure stability, a factor sorely missing in liberal democracies. It is not a perfect system by any measure, but it is a model that has evolved in China out of the socialist system that the founding fathers of the People’s Republic of China launched in 1949.

But if countries are not comfortable with the costs to freedom and basic rights that the China model entails, they should probably take another look at the US democracy, and consider 2016 as an aberration rather than a system that is failing, a system that is suffering from fatigue and needing reforms.

Americans need to look at the role of the political parties and the way they produced presidential candidates. Surely a country of 320 million people deserved better choices than Trump and Clinton. How their track records and flawed characters got past the political screening system is simply baffling.

The US electoral system — including the primaries and the conventions — is simply too long and too expensive for any country to emulate. For that price, Americans should feel they are being shortchanged by the system.

This year’s voter turnout, estimated at 58 percent this year, is another reflection of the growing public apathy toward the electoral system or the candidates it produced.

The 2016 American presidential race saw the ugliest and most divisive campaigns ever seen that inevitably would leave behind a sour taste, even if Clinton gave a gallant concessionary speech.

The US election has become one big and long political show of selecting the most popular, but not necessarily the most capable candidate. One could compare it with American Idol, but even this reality TV show has been pulled out due to viewers’ fatigue.

If this is the picture of democracy, then many nations around the world would want none of it.

The US electoral system actually has built-in self-correcting mechanisms such as the two-term limits and the various institutional checks-and-balances to prevent the emergence of a despot.

The First Amendment, and the independent media, ensure that people will always have the right to speak up and to be heard, even if they have made the wrong choice.

But these may not be enough to restore the faith in liberal democracy in producing great leaders. This faith has further waned after the 2016 US presidential election. One could also throw in Brexit as another product of a democratic exercise in the Western world that has gone wrong.

In many countries, liberal democracy is no longer considered the best political system in selecting national leaders. It is not the only way forward. The China model has never been more attractive alternative in some countries, including Indonesia, still grappling with nation building.

America can help restore faith in liberal democracy by carrying out the necessary electoral reforms. It needs to show once again that democracy is the best political system in selecting leaders because it is based on the principles of respecting freedoms and basic human rights.

Yes, America can be great once again. But probably it would be asking too much from the new elected president.

By Endy Bayuni, Editor-in-chief of The Jakarta Post

Can China overtake US to lead the world?


 
Trump’s trade tempest

Discussions were running high on global governance among Western public opinion on the eve of the Asia Pacific Economic Cooperation (APEC) leaders meeting in Lima, Peru. Some Western media outlets hold the US is giving up its global leadership following Donald Trump's election as US president on promises to abolish the Trans-Pacific Partnership (TPP) and withdraw from the Paris climate deal. They believe a rising superpower, China, will replace the US to lead the world.

Trump's campaign remarks do reveal his intention to retract US global strategy. He seemingly wants to focus more energy and resources on reviving the US economy and social development. But as the US has been central to globalization, Trump is unlikely to take on the traditional isolationist road.

The West likes to use "leadership" to define the function of a major power. Admittedly, different countries have different powers and obligations due to varied national strength. The world after the Cold War was dominated by US leadership. Washington designed and maintained a string of systems, including the world trade system, the financial system, the Internet system, the security pattern and so on.

The US has invested much into maintaining this leadership and also gained considerable benefits. In the foreseeable future, it's impossible for the US to abandon its global leadership.

The US sought supremacy over everything in the past few years. However, it didn't have enough national strength to bolster this unrealistic goal. Trump appears to be redesigning the US leadership, withdrawing the country from fields in which he thinks resources are being wasted. China thus will gain some room to exert its influence, but is China ready?

China still cannot match the US in terms of comprehensive strength. It has no ability to lead the world in an overall way, plus, neither the world nor China is psychologically ready for it. It's beyond imagination to think that China could replace the US to lead the world.

But as China is rapidly developing, bringing about changes to the global power structure, its participation in global governance will be a natural and gradual process, which Beijing cannot rush or escape.

If Washington withdraws from the Paris climate deal, China can stick to its commitment, yet it won't be able to make up for the loss caused by the US. Or if the US takes on an anti-free trade path, the messy consequences will be beyond China's ability to repair.

But on the other hand, the US, under the leadership of Trump, cannot rope in China's neighboring countries to contain China or isolate China from the world trade system. Obama's administration had worked to undermine China-initiated projects, such as the Asian Infrastructure Investment Bank and the "One Belt and One Road" initiative, but to no avail.

So Sino-US cooperation is the only choice for future global governance. For a long time to come, the leadership of the US will be irreplaceable, meanwhile, China's further rise is inevitable.

- Global Times

Commentary: 21st century belongs to strivers 


"The 21st century is the time for the Chinese," said the CEO of a Chinese mobile phone company at the recent launch of a new product. The CEO remarked that Western bigwigs will finally be surpassed by Chinese strivers who are determined to change their lives through hard work.

He further explained that, although some companies in developed countries are leading the world in many aspects, their bureaucracy, laziness, arrogance and ego will hinder their development.

To some extent, all Chinese people in the past 100 years are strivers who have managed to change their own fates and the fate of their country through sheer diligence; this trend is vividly illustrated by the process of reform and opening-up. After keeping their noses to the grindstone despite hardships and difficulties, Chinese people have finally succeeded in ushering in a new era.

Those who have doubted China over the years were not aware of the strivers' true personalities. The strivers desperately thirst for better lives. They are able to bear unbearable hardships and endure unendurable suffering. Such morale and pluck can never be defeated.

The struggle of a software company in Guangdong, which has grown from a small enterprise into an industry titan, offers an inspiring story. During a trip to Germany for an exhibition shortly after the company's founding, both boss and employees slept on park benches in order to save money. More importantly, none of them complained about having to do so.

In 2009, China needed to build a large exhibition area, as the guest of honor of that year’s Frankfurt Book Fair. However, shortly before the opening of the event, construction was not yet complete because of German workers' fixed schedule. Therefore, the Chinese exhibitor invited workers from China to complete the work, and that team was able to finish before the opening ceremony.

It is the effort, hard work and sweat of these strivers that have contributed to China's current development. Their willingness to struggle came from a thirst to change their fate.

In recent years, many Chinese enterprises are expanding their business in Africa. Instead of spending money on entertainment, Chinese employees there save money to make phone calls to their families back home. This priority was not received well by some locals, who believe that one should enjoy life with one’s money. As a result, people cooked up stories that Chinese employees in Africa were prisoners sent by the Chinese government. Believing these rumors, some Western media outlets even slammed China for human rights violations. Finally, a media outlet from the U.K. discovered the truth. These Chinese workers are just the same as their Western counterparts: they love their families and hope to change their lives through hard work. They consider it their life purpose to improve the quality of life of their families, especially their children. The U.K. outlet ultimately concluded that the unyielding spirit of Chinese people is unrivalled, and they will certainly change the world.

Hard work pays. This is the basis for social function. Any society will collapse without such faith.

China is no longer the impoverished country it was 30 years ago. Even so, the enterprising spirit of its citizens has endured. The country needs to stay confident, especially during the “new normal” of slower economic growth. As long as its people have the faith to change fate through hard work, they should fear no difficulty.

One dare not say that the 21st century is destined to be the era of China, but it certainly belongs to the strivers who are determined to change their lives through work.

This article was edited and translated from 21世纪属于渴望奋斗改变命运的"泥腿子"
Source: People's Daily

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