Stanley's blog

China’s influence on the world stage steadily increases but European media reporting remains generally prejudiced against China. This is probably due to two main factors. First, bad news makes good news in the news world. Second, there are well-organized lobby groups hostile to China, namely Taiwan, Tibet and human rights, and also industrial sectors seeking protection from Chinese imports. There is no equivalent Chinese lobby and official communications are, more often than not, counter-productive. This situation cannot be changed in the short-term, but Beijing would do well to review the extent to which the country’s international image is important.

Having regard to its experience in the 19th and 20th centuries, it is understandable why the country is vehemently opposed to what it regards as foreign interference China and the West. Unfortunately, there is a fundamental difference between China and the West on what is foreign interference in its domestic affairs. Western countries criticise, and sometimes use pressure on each other, but rarely is this regarded as interference.

The Chinese leadership should now feel confident enough not to regard foreign submissions as interference and non-respect of sovereignty. Beijing might also think about whether or not seeking to influence affairs in, say, Myanmar, Sudan and Zimbabwe amounts to foreign interference.

The death penalty is strongly opposed throughout Europe, but China is by no means the only country that still uses it – it remains the law in 35 American states. However is the negative international impact of executing Akmail Shaikh a price worth paying? It is a valid argument that he received the same treatment a Chinese national, but would a different sentence really have mattered in enforcing domestic drug policy?

A poor international reputation can be damaging to China. Take, for example, the danger of protectionism. Although not connected, if protectionism increases, China’s poor international standing would encourage lobby groups and even influence decision-makers to act against Chinese exports

The deterioration in relations between China and the West is disturbing. Without the PRC, EU and US acting boldly together, there is little hope of solving today’s major problems, reforming global governance or achieving, in the words of the Chinese leadership, and harmonious & participatory society. And much depends on Beijing.

Before looking ahead, an analysis of what has happened and is happening is essential. The trouble is that so few people (including Chinese) know what goes on in Zhongnanghai. And unlike in other countries, the leadership works and lives together in a single compound which deprives analysts of the benefit of leaks.
Preliminary remarks

Some preliminary remarks:

• There is no single Chinese view. The country is an autocracy but not a dictatorship. Political power is diffuse, complex and often highly competitive. The Party Politburo and its Standing Committee are not always able to dictate policy decisions. Power is shared with the state government bureaucracy (whose structures closely parallel the Party’s throughout China) and the People’s Liberation Army, operating mainly separately and with a blurred distinction between civilian, military, and Party leadership.
• Other political players embrace provincial and local officials; official and quasi-official policy research groups and think tanks; a dynamic academic community; state companies, multinationals and private businesses; the media; and a citizenship becoming more informed.
• Personal connections (guanxi ) are omnipresent.
• China is in many ways a de facto federation with enormous power residing in the provinces, many of which are bigger than big EU Member States. What Beijing decides is not necessarily what is implemented in Shanghai, Guangzhou, Xinning or Wuhan.
• The current leadership ends in 2012 and the struggle for the Fifth generation is in full flow, thus complicating decision-making.
• While Chinese leadership has consistently shown pragmatism, and China has changed drastically in the last 30 years, the current leadership is still conditioned by the Mao Zedong era and the Cultural Revolution.
• Humiliation by the West is history to us but to the Chinese it only happened yesterday. And the past has to some extent been preserved by western lecturing to the Chinese.
• This partially accounts for the Chinese preoccupation with the defence of sovereignty and resistance to what it regards as interference in domestic affairs.
• There is a public opinion in China which cannot be ignored by the leadership, with a potentially dangerous patriotism, verging on nationalism, just below the surface. The Han nation has strong views on Taiwan, Tibet and Japan.
• Due to the financial and economic crisis, China has been catapulted unexpectedly early into a global leadership role, for which it is not yet fully prepared. Chinese leadership sometimes seems to be overconfident and sometimes unsure of itseLf.
• The differences between Chinese and Western ways of thinking, views of the world and individual policies are often enormous.
• The EU-China relationship lacks mutual trust and mutual understanding and misperceptions abound on both sides.
• Media reporting of each other is frequently inaccurate and biased.
• The Chinese continue to flatter us by believing that there are coordinated European and also western strategies against China, eg over Tibet.
• Many observers believe that it has become more difficult than ever to understand Beijing policies and apparently inconsistent approaches.
Chinese approach

Hu Jintao, at a major internal diplomatic conference in Beijing in July 2009, talked about the four strengths of diplomacy: more political influence; more economic competitiveness; a more positive international image; and greater moral influence. This appeared to be a recognition that China needs the soft power which comes with international respect.

However, despite China’s great achievement in weathering the financial and economic storms so well, its perception in the West is increasingly negative. Whether or not the criticism is just, Europeans on the whole are unhappy about Chinese policy over cheap exports, import and investment restrictions, Copenhagen, Iran, Zimbabwe, human rights… But, unlike the US, Europe is not in a geopolitical struggle with China, nor does it ‘fear’ China’s military and political rise. However, there is deep concern as to economic competition and the loss of jobs.

China is showing no flexibility or compromise in negotiations, but insists on getting what it wants. These perceptions, valid or not, are obstacles to China’s desire to gain international respect and therefore limit the growth of the country’s influence on the world stage.

.The “charm offensive”, as the Economist put it (Banyan, 9 January) seems to be over. During the past few years, China has resolved almost all of its border disputes, joined a free trade area with ASEAN, made a substantial contribution to African infrastructure, established hundreds of Confucius institutes, staged the Olympic Games, and generally increased its friendly relationships across the world.

But recently there have been a number of negative incidents: Cambodia being forced to return 22 Uighurs, Liu Xiaobo’s 11 year jail sentence, Akmal Shaikh’s execution, and a general tightening up on media freedom and, in particular, the Google issue. The RTZ dispute remains unresolved.

Beijing’s effort to prevent the screening in other countries (eg the Melbourne and Palm Springs film festivals) of what it regards as hostile films is counter-productive. To the West, these issues are not examples of foreign interference in Chinese domestic affairs, but the reverse.

Apart from these actions, Chinese leaders have become much more outspoken publicly and less diplomatic in their tone. Wen Jiabao told Xinhua news agency at the end of last year that China “will not yield to any pressure of any form forcing us to appreciate” the value of its currency. Diplomatic niceties seem to have been overlooked in Copenhagen.

Hitherto, the Obama administration has been conciliatory towards China: not branding China a “currency manipulator”, playing down human rights issues, softening criticism of government policies in Tibet and Xinjiang. The US President was seriously criticized for his malleability during his visit to China and refusing to se the Dalai Lama beforehand.

However, this policy does not appear to have earned any dividend. What exactly happened at the Copenhagen United Nations conference remains unclear, but it seems to show that Beijing’s priority remains its own economic development with far less regard for climate change. The Chinese behaviour certainly upset the Europeans and the Americans.
Growing frustration in the West

There is now considerable and growing frustration in the US and Europe that China is not behaving fairly in a number of areas. This perception has led to a deterioration in relations between China and the US, and between China and Europe; and is an obstacle to China’s desire to gain international respect. The EU supplies extensive financial and technical support to China but does not feel a spirit of reciprocation.

Trade & investment

It is believed in the West that anti-foreign attitudes and policies in China have been growing and hardening since the global economic and financial crisis plunged the US and Europe into depression, and China into a position of leadership on the world stage.

There is increasing frustration in the West with China continuing to drive hard its exports-based growth with apparently scant regard for other countries.

China is number one in the world in numerous sectors, including: aquaculture, aspirin, bicycles, cement, ceramics, cigarette lighters, computers, corn, containers, crayfish, digital cameras, electric car batteries, garlic, household electric appliances, iron & steel, leather, low consumption lamps, nylon, pianos, portable telephones, sex toys, shoes, solar panels, televisions, tennis racquets, textiles, tobacco, toys, vitamins and wind power.

Nobel Prize-winning economist Paul Krugman, in a New York Times op-ed on 1 January, declared that China “follows a mercantilist policy” that is, “to put it bluntly, predatory”. China’s economic policies appear to have become more nationalist. Many foreign investors in China complain about exclusion from key markets and unofficial forms of discrimination. This apparently involves the discriminatory application of regulations, product standards and testing, prejudicial benefits to state-owned companies, intellectual property theft, courts favouring Chinese companies…The foreign business community does not believe that the situation is improving.

A worry is that many current partnerships with the Chinese are at risk, with their partners becoming price under-cutting competitors, with the help of their technology and know-how.
Beijing strongly criticizes anti-dumping and other protectionist policies by third countries, while maintaining the RMB value at an artificially low level, which gives China a built-in trade advantage, and at the same time, the Chinese domestic market for imports and investment remains far less open than those in the West – particularly in Europe.

More anti-dumping actions are on their way. The year has begun with an American investigation into heavyweight iron or steel pipes and collars used to drill oil wells, following a complaint by the US Steel- workers Union and a group of companies which are asking for anti-dumping duties ranging from 429-496%. They also want additional countervailing duties to offset alleged government subsidies.

There are already 82 US antidumping duty orders against various Chinese goods and another 12 countervailing duty orders. Several 2009 cases will be concluded this year, including a record case of imports of $2.74 billion steel tubing and casing used in oil and natural gas production. The United Steelworkers Union has been a driving force behind many of the trade cases against China, not always with the support of US industry.
Trade frictions between the US and China over everything from cars to chemicals will increase in the coming years as the world’s biggest importer and exporter buy and sell more of each other’s goods, the World Trade Organization’s director general, Pascal Lamy said on 21 January 2010. However, Lamy added, somewhat optimistically, “There is no risk of slipping into a trade war.”

I fear that Beijing may be underestimating China’s vulnerability to a deterioration in economic relations. Chinese behaviour, as perceived, is fuelling protectionist sentiment in other countries. At the same time, The US and the West need to be convinced of the difficulties in the transition for China and not to insist that China adjust faster than it can. The relevant EU, Chinese and US policymakers must cooperate in producing a medium-term coordinated plan to resolve trade and political disputes.

Currency

The latest US study, by William Cline and John Williamson, at the Peterson Institute for International Economics, argues that the yuan must be revalued by 30% against the euro and other world currencies, and by 41% against the US dollar.

The US Economic and Security Review Commission, which advises Congress, has castigated the Administration for “refusing to acknowledge even that China is manipulating its currency.” It is possible that the President will bow to Congressional pressure and declare that China is manipulating its currency, which will be followed by protectionist measures. Europe and Asian countries are also suffering from an undervalued yuan. The export trade and growth of poorer countries particularly suffers.

Copenhagen

China is perceived as aggressively blocking an agreement at the UN Climate Change Conference in Copenhagen, refusing to agree figures and rejecting inspections. There was also a belief that Wen Jiabao snubbed Barack Obama and Chinese official conduct was not always diplomatic.

The Americans certainly see China as asserting the leadership of the developing countries, and seeking to occupy the moral high ground to pressure the developed countries into paying more, without putting forward any constructive proposals.

Human rights

Whatever the views of Western political leaders, they cannot their public opinion. Public criticism of alleged human rights abuses often shows a lack of understanding of China and overlooks Western failings (Guantanamo Bay, extraordinary rendition, torture…), and selectivity in the countries criticized. However, China’s desire and need to have better international recognition suggest that more attention should be paid to the effect of individual incidents and also to better communication.

China is strong enough, and should be confident enough, to relax some of its decisions. Liu Xiaobo was given, what the West believes to be, a disproportionate prison sentence, and unnecessary from a policy standpoint.

Beijing should also take into account that greater freedom of expression is needed in order to create an innovative society, a priority for China.

Google

The facts of the Google dispute with the Chinese authorities are unclear. Google entered the Chinese market in 2006 with a self-censored version of its search engine. The company now says that it may withdraw from the market because of alleged hacking attacks on its e-mail service and a tightening of restrictions on free speech. The hackers have apparently to gained access to the email of Chinese human rights activists.

Cynics believe that Google has made a commercial decision to cut its losses and used the privacy attacks as an excuse. Its search engine is a distant second to the Baidu, and that threatening to leave the market was more a public-relations move than a moral crusade. An even more cynical view is that Google does not want it known that its private and corporate data on Google is not secure.

The Chinese government denies any such action on its part and insists that it opposes computer crime and has been the victim of cyber attacks itself in the past. However, a statement, issued by the country’s foreign ministry, also contained a veiled threat to other companies which may be considering following Google’s stand. “China has tried creating a favorable environment for internet,” said a spokeswoman. “China welcomes international internet companies to conduct business within the country according to law. China’s law prohibits cyber crimes, including hacker attacks.”

The U.S. has formally protested to the Chinese government over the cyber attack on Google that the company says originated from China. Beijing has been asked to explain the attack. Does this mean that the US has knowledge that has not been made public? Is Beijing directing cyber-attacks on Western public and corporate networks? To what extent is do Western countries adopt similar practices?

There are moves in the US Congress to declare illegal cooperation by US companies with surveillance in “internet-restricting countries” – a growing list including democracies and close trade partners.

Whatever the truth of the Google affair, it is not in the interests of either country that this dispute should spill over more broadly into the relationship. Damage limitation is essential. ‘Control’ of the internet and modern communication technology is likely to be the battle ground of the future – both domestic and international.

Taiwan

This appears be one bright spot, with cross-strait relations between Taipei and the mainland having dramatically improved under Ma Ying-Jeou ‘s presidency, although tensions remain. The overrall position is probably best characterised as ‘no war, no separation, but no (re)unification”.
Chinese support to Haiti, one of the 20-odd countries which still recognize Taiwan, was a practical example of the new spirit. No longer are the two fighting over the recognition of the remaining (small) countries. And a more pragmatic approach is being taken to Taipei’s relationship with international bodies, such as the World Health Organization.

Given the current state of the relationship, it is understandable that Beijing has strongly denounced the intended sale of a $6.4 billion arms package by the US to Taiwan. Were you Chinese, how might you feel when the US insists on China remaining in a selective arms embargo list of countries, including Myanmar and Zimbabwe but not Libya and Iran; and sells $6.4 billion worth of arms to Taiwan?

Tibet

Relations with Denmark are being restored. The next event is the expected meeting of Barack Obama with the Dalai Lama. This will no doubt give rise to tension (see below).

Negotiations between Beijing and the Dalai Lama’s representatives have begun again but it is hard to see how it is possible for a compromise to be agreed. The autonomy being sought is not only being sought for Tibet itself, but that the right of Tibetans to govern themselves be recognised and implemented throughout the region (Gansu, Sichuan, Qinghai and Yunnan) where they live in compact communities. This region represents a substantial percentage of China’s territory.

A resolution of the Tibet issue is not therefore currently foreseeable.

Xinjiang

The strains between the Uighurs and the Han continue. The geographical position of the province suggests that there is an underlying risk of external Jihadist interference, bearing in mind the millions of Muslims within and on its borders.

Iran

China is resisting further sanctions against Iran, notwithstanding Russia’s softened position. Failure to support full sanctions is resented in the West, particularly as China is substantially investing in the country, despite the nuclear threat.

Whatever China’s self interest, Beijing does not like sanctions in principle, possibly influenced by an extensive Washington-led blockade of the country from 1949 to 1964.

As Iran’s statements and apparent actions facilitating the development of nuclear weapons increase in intensity, the issue of sanctions is likely to come to a head and China’s reaction will have a serious impact on its international standing, particularly if Russia aligns itself closer to the US and Europe.

Neighbourhood

China’s increased assertiveness is not only towards the West. The claim to the Indian state of Arunachal Pradesh has become more vocal. Japan has expressed concern that China plans to develop the Chunxiao gasfield unilaterally, in breach of the 2008 agreement. Vietnam complains that China has included in its tourist promotion plans the Paracels, which it claims.
Africa

China’s approach to Africa may not be altruistic, and no different from the Western approach in the scramble for oil and natural gas. It’s aid contribution, focusing on infrastructure has certainly been more valuable to the African countries than the Western policy. The Chinese are now, however, encountering African resentment and violence which need to be addressed. Sino-European cooperation could help.

China’s image suffers because of the nature of some of the régimes it deals with (even though they are following in Western footsteps), but the PLA trying to send a shipment of arms to Zimbabwe, while the West was seeking increased sanctions, did nothing for China’s reputation.

Sovereignty

The importance of sovereignty to the Chinese and the total rejection of foreign interference in domestic affairs is fully understandable in the light of China’s historical experience. However, the Chinese leadership has always been strong on pragmatism, and in China’s own interest gave up part – or pooled – sovereignty by joining the WTO.

The US protested loudly against the decision of the British government to send the ‘Lockabee murderer’ back to Libya. London rejected the protest but at no time suggested that the US had no right to raise it and was interfering with a domestic decision.

But the UK’s plea for clemency for Akmail Shaikh, was harshly criticised for interference. Beijing could just as easily ‘take account’ of the plea and reject it. In any case, it is unimaginable that Beijing never brings pressure on other countries’ domestic decisions. Foreign and domestic policies are closely interlinked and China expresses its views – rightly so – to the governments of North Korea, Iran, Sudan and the like. China should not forget its past experience, but is now strong enough, and should be confident enough, to relax a little.

Stability

Now comes the dilemma. Why is the current régime, which appears strong and legitimate, apparently fearful? There are no doubt diverse contributing factors and differences of opinion in the Party and Government. Is it a question of the ‘hardliners’ winning through or is there a deep underlying fear of instability? Or are there other reasons or a mixture of reasons?

This may be at the root of much that is happening. The statistics of Chinese economic development, despite the global crisis, are remarkable. Is the rate of development sustainable? Is there in fact a deep anxiety inside Zhongnanhai that China may be heading for a difficult period with the potential bursting of the property bubble and, worst of all, serious inflation of food prices? The Chinese people seem generally happy with their government. Hitherto, protests have been directed more at provincial and local governments than Beijing, focusing on corruption, environment, land seizure, schools, police brutality… Although it has been estimated that there is a protest, involving over 100 people, every four minutes, these have been diffuse and not necessarily well organized. There could be a fear that these protests develop into an organized movement. Economic expectations may be too high among a population much of which has not experienced real poverty.

One can only sympathize with a leadership which has to govern over 1.3 billion people, roll back systemic corruption, tackle environmental degradation and build education, health care and other social services for an ageing population; but at the same time maintain economic growth. Priorities are necessarily domestic.

China-US relations

No paper on the EU-PRC relationship can ignore the US dimension. Current relations are worrying for us all. We have witnessed problems such as the uncomfortably Obama visit, reciprocal anti-dumping measures, Copenhagen, the Palm Springs Film Festival , Google and now the Taiwan arms sale. Ahead are the Dalai Lama visit to Washington, increasing concern in Congress over Chinese imports, the undervalued RMB and Iran sanctions.

All these are reflected in a deterioration in public rhetoric with some aggression being detected on both sides. There is a serious danger of growing protectionism which would be an all-round disaster. The unprecedented decline in US self-confidence can have negative consequences.

Hopefully, Deng Xiaoping’s summary of the bilateral relationship remains valid:

“When it is good, it won’t get exceedingly good, because of our basic differences; when it is bad, it won’t get exceedingly bad, because of our common interests.”

We really need a trilateral relationship but this is not yet feasible. Closer coordination between the three bilateral relationships would be a start. The EU can play an important moderating influence on both sides, if it can speak with one voice.
China’s continuing frustration

Beijing always focuses on two issues when discussing China-EU relations: the arms embargo and market economy status.

Arms embargo

The embargo is solely symbolic. The 1998 EU Code of Conduct on Arms Exports controls sales. Arguably, it is easy for China to buy arms from the EU without the ban being lifted than if the ban were lifted and the code strengthened. Indeed, Wen Jiabao has expressly stated that were the ban to be lifted, China would be prepared to undertake not to buy arms from EU countries. Currently, France, Italy and the UK supply arms, as well as Russia, Israel and…the US.

Figures are not forthcoming on direct and indirect sales to China by the EU Member States and the US (believed to take place mainly through Israel). The ban has not prevented China from building up its military strength.
China considers an end to the ban to be long overdue. “The embargo is outdated, it does not go along with the partnership between China and the EU.” said Wang Xining, a spokesman for the Chinese Mission to the EU. The EU can hardly contemplate entering into such a partnership (as defined in the European Security Strategy), with the weapons ban remaining Revisiting China arms embargo

Market economy status (MES)

The EU maintains that China has not fulfilled the necessary pre-conditions for granting MES. The decision is really political, as Beijing knows, Russia having been granted it in 2002. The granting would stem anti-dumping proceedings. MES will automatically apply from 2015-6. While it would make sense for MES to be granted in return for further market access openings, there can be no assurance that Chinese commitments will be implemented at provincial and local level.

Conclusion

Beijing has clearly become more assertive in foreign policy. The resistance to further sanctions against Iran has been mentioned. This assertiveness is both on substance and tone. The EU has been treated in a manner which could be described as contemptuous, by the way it has been punished for its Member State leaders meeting the Dalai Lama, even to the extent of cancelling a summit. There was a surprising lack of diplomacy shown in Copenhagen.

Why is there an increase in assertiveness? There is no doubt a number of factors, which we can but guess at. It is only human for a country which has performed so well in the economic and financial crisis compared with the developed countries, to feel confident and show it through assertiveness. It is also hard to resist an opportunity to turn the tables on past Western patronizing lectures.

However, a mature and confident power would not need to do this. Domestic stability and territorial integrity are so important to China that it would not be surprising if its leaders also felt a little insecure. Tibet and Xinjiang remain deep concerns.

The legitimacy of the Party depends on economic growth, made more difficult by the global economic problems and the need for growth to be sustainable.

Foreign policy attitudes are almost invariably influenced by domestic considerations. The ongoing struggle between hardliners and reformers is at its peak when a leadership change is on the way. Hu Jintao and Wen Xiabao pass the baton to the ‘fifth generation’ of leaders in 2012. There is accordingly considerable manoeuvring for position. There appears to be an increasing resort to nationalism as a popular policy among the party cadres.

The conventional wisdom was that, once China became more integrated globally, it would work towards a multilateral world by playing a constructive role in working together with the developed world to meet common challenges. At the same time, this would strengthen its relations with the US, Europe and others, important for its own progress. However, it seems that a successful China prefers to become more assertive and less committed to flexibility and compromise in negotiations.
My worry is whether the Chinese leadership fully understands the dangers of its apparent policy in international relations. Attitudes towards China are hardening, particularly in the US. Obama’s weakened position viv-à-vis Congress will not help. The chances of the US declaring China a “currency manipulator” are increasing. This would add to the protectionist measures already being taken in the anti-dumping field.

If protectionism substantially increases in America, it will spread to Europe, where its leaders are becoming more critical of Beijing and resent the way they have been treated. The ‘anti-China’ lobbies, in the West (Taiwan, Tibet, Xinjiang, human rights…) will lend their weight to events. And I’m afraid that China does not have any true friends in the West. While it is better to be feared than loved, it is desirable also to be loved.

Deng Xiaoping’s axiom “Keep a cool head and maintain a low profile. Never take the lead – but aim to do something big”, has been rejected. We knew from the Diplomatic Conference in July 2009 in Beijing that the axiom had been modified, but the revised wording has not been published – an interesting omission.

Much has been written about the relevance of ‘soft power’ to China. Zheng Bijian put it this way:

“On soft power, I’d like to emphasize that part of the goal of the peaceful rise of China is to realize a civilizational blooming and revival — to combine the best Chinese tradition with new thought and technology from around the world. If we realize this, it will be a great thing.”

Bijian also declared that:

“The long-term goal of our political reform is democratic politics. Democratic politics and peaceful development are the two big concepts we will pursue in the next 25 years.”
The ‘peaceful rise’ approach still appears to have support in China, with the understanding that China needs good relations with the West. But it seems that others do not appreciate the danger of acting in ways which will increase the likelihood of major countries uniting to contain China. China is an important country, but it needs the US and Europe at least as much as the West needs China.

This is where better relations with Europe could have a moderating influence. Protectionism is a curse from which we would all suffer, but arguably China the worst. The resultant tensions between China and the US would be very dangerous. It is time for leaders on both sides of the Pacific and Atlantic to lift their heads above overwhelming domestic concerns and put right the deteriorating relationship between China and the West which is not in anyone’s interests. The implications of the Google affair go far beyond the ‘local’ problem on China.

Since writing this paper, Washington has announced the Taiwan arms sale and Beijing has threatened retaliation against the suppliers, partially frozen mutual military exchanges and cooperation onstrategic security, arms control and anti-proliferation. This adds substantially to the bones of contention between the two countries. The next tension will arise if China blocks economic sanctions against Iran, in the face of agreement by Russia.

Given the factors set out above, domestic populist pressure may increase the public rhetoric, and be dangerous for all of us. Common sense dictates that China, the EU and the US work closely together, but at the moment, the best we can hope for is greater coordination of the three bilateral relationships.

The West expects China to accept greater responsibility for global affairs – to be a “responsible stakeholder”. At the same time, the EU cannot continue its over-representation on international bodies – one-third of the UN Security Council seats, including two out of five permanent ones; one-third of the G20 members, one third of the IMF voting shares (twice US, times China)…

It is appreciated that this paper raises more questions than it answers. This reflects the complexity of the relationships and the fast-changing circumstances involved. One thing is clear and needs constant repetition. We live in a globalized, interdependent world. No major problem can be solved without international cooperation. National political leaders do not seem to accept this and furthermore make matters worse by playing domestic politics with foreign affairs. Indeed, maybe it’s time to stop talking about ‘foreign’ affairs but rather use the term ‘international’ affairs, which are so often in fact the international dimension of domestic issues.

Finally, it is clear that much greater efforts must be made to understand each other, including how the other sees a problem and the context in which it is seen. Perceptions are frequently more important than the underlying realities.

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