RUSSIA OVERSHADOWS G7 2022 SUMMIT

GUEST COMMENTARY by Banura Nandathilake

Despite being an informal collective of ‘advanced economic’ liberal democratic states, the Group of 7 (G7) bringing together Canada, France, Germany, Italy, Japan and the United Kingdom and the United States have fervent goals. Held from 26 to 28 June 2022, the summit was in response to a global society capsized by division and shocks, as a call to unite and join to defend ‘universal human rights and democratic values, the rules-based multilateral order, and the resilience of democratic societies’ (G7, 2022). The viability of such remains to be seen.

Formed in 1975, leading states in a world of global economic recession induced by the OPEC oil embargo understood it may be in their mutual interest to coordinate on macroeconomic interdependencies. While it was first a forum for Finance ministers to hold annual meetings, the G7 developed into a round-table between leaders of the Western World. In 1988, Russia joined the G7, which was then named the G8 albeit temporarily until Russia’s dismissal for its annexation of Crimea from Ukraine.

The G7 states in the contemporary, with an aggregate that represents 45 percent of the global economy in nominal terms and 10% of the world’s population, hold annual summits to coordinate economic policy goals, facilitate collective action on transnational issues and propagate neo liberal norms, in conjunction with the European Union and other invitees. All 7 member states are identified as mature and advanced democracies with a Human Development Index score of 0.800 or higher.

Unlike international organisations and groups such as NATO, the G7 group has no formal legal existence, no permanent secretariat or official members. It thus has no legally binding rules that abide by or ratify states to uphold decisions and commitments made at G7 meetings. As such, while compliance with G7 norms is procedurally voluntary, they are impacted by social norms of persuasion, influence, mutual accountability and reputation. Topics of conversation between member states have encompassed growing challenges such as counterterrorism, development, education, health, human rights and climate change.

The 2022 Summit

From 26-28 June 2022, the leaders of G7 States met in Elmau, Germany joined by the leaders of Argentina, India, Indonesia, Senegal and South Africa, as well as Ukraine. Representatives included German Chancellor Olaf Scholz, Italian Prime Minister Mario Draghi, US President Joe Biden, British Prime Minister Boris Johnson, Canadian Prime Minister Justin Trudeau, Japanese Prime Minister Fumio Kishida, French President Emmanuel Macron, European Council President Charles Michel and European Commission President Ursula von der Leyen,

The summit focused on the Covid-19 crisis, climate change, the Russian Ukrainian conflict, and China. 

Climate Change

The shared concerns of climate change were a major topic of discussion during the 2022 Summit. The group endorsed the goals of an open and cooperative international Climate Club, in alignment with the 1.5°C pathways and hastened the implementation of the Paris agreement. The group further pledged to commit to a decarbonised transportation sector by 2030, a fully or predominantly decarbonised power sector by 2035. However, the latter may have been incentivised by political concerns of Western states to a major degree.

Liberal Democracies of the West

Liberal democracies may be understood to exist where the state subscribes to a liberal economic system and a democratic political system. A concise summary of such is as a liberal economic system proscribes significant political control over an decentralised, capitalistic, market driven economic system, as it is understood that the market mechanism is the most efficient means of linking demand to supply, market to consumer. A democracy may be understood as a domestic political model which, in conjunction with an impartial judiciary, free media and others, elected representatives aim to promote a decentralised representative governance through accountable, transparent and inclusive institutions.

By virtue of being a liberal democracy, all member states find common ground, parallel norms, alignment of macro foreign policy goals and understanding with each other. This allows the informal G7 to coordinate hard power security and economic interdependence in addition to cooperating with civil society groups to promote human rights, and uphold a democratic zone of peace in the face of non-democratic powers. A strong culture of mutual accountability exists between G7 states. Accountability may be through internal processors of the forum, where social norms allow for persuasion and disincentivize coercion. Coercion may not at all be necessary, as liberal democratic states would all be of a positive sum world view. Furthermore, the level of trade interdependence between states would act as means of checks and balances, as every state is needed by the other, thus it is in every G7 state’s interest to be in their good books.

The Illiberal Rest

Russia and China, in addition to states such as Iran, Saudi Arabia and Venezuela are understood by the West to be illiberal states. Both major powers, albeit one a receding power, have capitalist and liberal economic systems where the state’s political machine exerts a heavy pressure on the market mechanism. While the state may be able to provide a higher quality safety net to its citizens by restraining the destructive forces of capitalism to better allocate scarce resources amongst the vulnerable, significant barriers to such exist. China’s GDP has grown at a surprising rate vis a vis other developing states, which has allowed the CCP significant geopolitical leverage. However, China’s domestic political model is authoritarian, whereby citizens do not have much say in how they are governed. Exclusive political institutions have no means of accountability or transparency, which leads to significant corruption. As Wedeman (2004) analyses, corruption is a feature of the Chinese system, thereby stifling economic and social growth. Corruption and lack of domestic checks and balances to those in power may be more apparent in Russia than China, where the control of the Kremlin and the Oligarchs have poignant effects on not just its citizens but also its neighbours; as the lack of domestic accountability may mean the lack of stringent checks balances, which then mean lesser shackles on the zero-sum ambitions.

Russia-Ukraine Conflict

The Russia-Ukraine conflict may be interpreted as a conflict between the forces of liberal democratic values of positive peace, pluralism and self-determination versus a one man’s nostalgic dreams of a ‘Neo’ USSR. Being at complete odds, the reaffirmed condemnation of Russia’s ‘’illegal and unjustifiable war of aggression against Ukraine’’ by the liberal democratic G7 states is hardly a surprise. Nor is their promise of ‘’needed financial, humanitarian, military, and diplomatic support’’ for Ukraine in its defence of its sovereignty, during its path on a free and democratic society.

The Sanctions Regime

Sanctions and more sanctions were promised by the group of seven advanced economies, who vowed to “align and expand targeted sanctions to further restrict Russia’’ in its access to key technological industrial imports and services. Such a move would severely restrict the ability to sustain their war machine thereby adhering to security commitments to Ukraine. The G7 Leaders pledged new sanctions on Russians who had committed war crimes in Ukraine, and are contributing to exacerbating “global food insecurity” by “stealing and exporting Ukrainian grain”. New penalties on Russian gold exports were further proposed, as well as a cap on the oil price to phase out global dependency on Russian energy.

However, a complete restriction of the import of Russian energy may be an ambitious task. European nations such as France get a quarter of their oil and 40% of their gas from Russia. While Germany has halted the progress of the controversial Nord Stream 2 pipeline, the EU has currently agreed to reduce its Russian gas imports by only two-thirds. President Biden however is banning all Russian oil and gas imports to the US, and the UK is ready to phase out Russian oil by the end of the year. The US, UK and Ukrainian Leaders are keen for other G7 nations to follow suit.

Ukraine's President Volodymyr Zelenskyy, who joined in on a trio of meetings via Videolink, stated that the summit will show "who is our friend, who is our partner and who sold us out and betrayed us". He reiterated his calls for fresh deliveries of weaponry, as he believes Russia will want to extend the war until winter wherein they could make new territorial gains to consolidate power. The financial support of G7 allies in 2022 already amounts to more than USD 2.8 billion in humanitarian aid, and a further USD 29.5 billion is pledged in supporting Ukrainian reconstruction.

China and the BRI

A growing China poses a “threefold threat” to G7 countries — economically, ideologically, and geopolitically. China’s GDP is second only to the US and it is fast catching up. China’s growing state-overseen tech industry, fuelled by globalisation and interdependence, is fast spreading a culture of surveillance and censorship, which act as means for the globalisation of authoritarianism. Said authoritarian ideals are further spread through Chinese geopolitical projects and alliances such as the BRI, which usually focus on developing, quasi democratic states with little to no accountability such as those in Africa and Central Asia. Furthermore, China’s action with regard to the Uyghurs in the Xinjiang region and its influence in Hong Kong have drawn condemnation from G7 members. China’s growing trade and defence ties with Russia have also caused concerns.

A Western Counter to the BRI

A Western counter to the BRI emerged during the G7 summit, aptly named Partnership for Global Infrastructure and Investment. The BRI is a global infrastructure development strategy which was developed as per Chinese leader Xi Jinping's vision in 2013, as a means for China to assume a greater role in global politics by easing access to China and its capabilities and boosting global GDP. Dubbed the Belt and Road Initiative and with over 145 countries signed up, the BRI is currently constructing a network of overland routes, rail transportation, sea lanes and energy pipelines to connect China to Southeast Asia, Central and South Asia, the Middle East, Europe and Africa. However, the project has been criticised as a tool to increase China’s political leverage in developing countries. Thereby, the BRI has been criticised for neocolonialism, economic imperialism.

In such a context, the G7 had launched a $600bn Build Back Better World (B3W) initiative infrastructure plan to counter China, in private and public funds to finance infrastructure in developing low and middle-income countries over five years. By working to narrow the global investment gap, the B3W would create new Just Energy Transition Partnerships with Indonesia, India, Senegal and Vietnam, building on existing partnerships with South Africa.

While US President Biden understood that “Developing countries often lack the essential infrastructure to help navigate global shocks (thus) feel the impacts … and they have a harder time recovering,” he stressed that the B3W “isn’t aid or charity. It’s an investment that will deliver returns for everyone”. Despite being dwarfed in comparison to the multi-trillion-dollar BRI, the B3W offers means of accountability, transparency and mutual trust between the neo liberal developed states and the developing states. The initiative would, according to Biden, further allow developing states to “see the concrete benefits of partnering with democracies”. While a cynic may argue that the developed have no interest in the developing other than exploitation and/or self-interest, and such may be observed to be true, President Biden may have been right when he said that underdevelopment is “not just a humanitarian concern, but an economic and a security concern for all”.

Mutual gains depend on interdependence, and without developing countries, there cannot be any sustainable recovery of the world economy. However, the development of low-income states is necessary but insufficient for a holistic global economic recovery, which remains shadowed by the conflict of value systems: liberal and illiberal, democratic and authoritarian.

 

SHANGRI-LA DIALOGUE 2022: DEEPENING DIPLOMACY AND DEFENCE

GUEST COMMENTARY by Banura Nandathilake

On 12^th June, Asia Pacific’s leading forum for defence diplomacy - the Shangri-La Dialogue ended after a pandemic-induced three-year hiatus. While the Dialogue is procedurally focused on cultivating a sense of security community within the Asia Pacific, which it solely lacks, this year’s event concluded under the uncertain shadow of the Ukraine-Russia conflict and the increasingly tenuous US-Sino relations.

The Shangri-La Dialogue is an intergovernmental security conference held in Singapore, by the London based think tank, the International Institute for Strategic Studies (IISS) in collaboration with the government of Singapore. The Dialogue is chiefly attended by state actors such as Military chiefs, Defence and Foreign Ministers. However, non-state participants too, such as legislators, academic experts, distinguished journalists and business delegates attend the summit. Named after the host venue since 2002, the Shangri-La Hotel in Singapore, the forum serves as a platform for debate, expression of views and discussion on specific issues through bilateral meetings. However, off the record meetings are also held, chaired by IISS, to advance policy goals more freely.

Apart from the host nation, participating countries for the 2022 Shangri-La Dialogue included Australia, Cambodia, Brunei, Chile, France, Canada, China, India, Germany, Japan, Indonesia, Laos, South Korea, Myanmar, Mongolia, Malaysia, New Zealand, Russia, Pakistan, the Philippines, Sweden, Sri Lanka, Timor-Leste, Thailand, Vietnam, Ukraine, the United Kingdom and the United States. The Dialogue was attended by about 500 delegates from more than 40 countries.

Forum Proceedings

The 2022 Dialogue, as all previous sessions, was commenced by Dr John Chipman, the Director-General and Chief Executive of the IISS. This year’s keynote address was given by Fumio Kishida, the Prime Minister of Japan, who set the overall tone for the dialogue - the need for security cooperation and collective action between state and non-state actors in the Asia pacific to counter growing threats in the region and beyond. Broad topics such as the US Indo-Pacific Strategy - a significant shift of resources from the Middle eastern theatre, Competition in a Multipolar world, Military Modernisation, Prescriptions for Myanmar and China’s vision for Regional Order were covered. 

US-China Relations - a String Pulled Taut

The 2022 Shangri-La Dialogue was a significant milestone in contemporary US-China relations. The forum facilitated a meeting between the U.S. Defence Secretary Lloyd Austin and the Chinese Defence Minister Gen. Wei Fenghe, the first face-to-face encounter since President Biden's inauguration in January 2021. Any hope or reassuring signs of reinstalling lines of direct communication were dispelled by the increasingly sparring headline speeches and subsequent conversations between the two nations, on topics ranging from the status of Taiwan, proceedings within the South China Sea and questions and concerns surrounding grave human rights violations within China.

The US primary criticism of China’s international conduct centred around the latter’s coercive and aggressive actions in the disputed South China Sea, wherein China has constructed man made islands within the shared seaway in an attempt to solidify its claim to the areas enclosed by a ‘9-dash line’ which is claimed by Beijing to grant it exclusive rights, despite non-recognition by international law. “Indo-Pacific countries shouldn’t face political intimidation, economic coercion, or harassment by maritime militias,” Secretary Austin asserted, as “the PRC’s moves threaten to undermine security, stability, and prosperity in the Indo-Pacific.” He further reaffirmed the US position to defend its interests and those of its allies despite increased Chinese movement, mobilisation and pressure.

Secretary Austin’s Chinese counterpart's response was as headline jarring as his. Minister Wei Fenghe described his country’s position as one of self-defence in a global world of zero-sum, self-interested actors. Wei acknowledged his country’s increased nuclear and naval capabilities, in a speech peppered with warnings to tread carefully and avoid Chinese provocation. He further reaffirmed China’s strong stance of a rising great power, one of self-defence but also a crave for international legitimacy through recognition as a peaceful actor. Wei stressed that “It is a historic and strategic mistake to take China as a threat or enemy”. To ensure global peace and development, by virtue of China now being a great power, Wei called for a stop in attempts to “contain China, to stop interfering in China’s internal affairs, and stop harming China’s interests,” signalling that peace was conditional on China’s free reign. His speech further contained a stronger reiteration of the Chinese position on the disputed island of Taiwan - “If anyone dares to secede Taiwan from China – let me be clear – we will not hesitate to fight. We will fight at all costs and we will fight to the very end.”

Shared Ukrainian Costs

Ukrainian President Volodymyr Zelenskyy participated in this year’s Dialogue for the first time through a video link teleconference. Highlighting the Russian invasion of Ukraine, he urged the attendees of primarily Asian states to “remember that support and attention is not only for Ukraine but for (the greater Asia) as well, to ensure that our and your future is safe’’ in the contemporary globalised world. Despite Ukraine’s geographical distance from Asia, Russia’s invasion of his country has global implications, as the political, social and economic distance between countries are much shorter in the present than they ever were. Thus, the costs of war are shared between states, through trade interdependence, geopolitical institutions, and have direct effects such as rising global inflation.

Mr Zelenskyy further stressed that there are ideological costs, as “it is on the Ukrainian battlefield that the future rules of this world are being decided along with the boundaries of the possible.” His position drew clear parallels and a not-so-subtle nod to China's desire for Taiwanese reunification. The political alignments and the ideological divides of the attendee states were made abundantly clear as Prime Minister of Japan Kishida noted that “Ukraine today may be East Asia tomorrow,” further adding to the underlying tension of the Dialogue.

Collective Concerns of the Divided

Despite the lack of collective action on political qualms and tensions owing to non alignment of political compasses, the attendee states of the 2022 Shangri-La Dialogue remained receptive to prescriptions for collective concerns. The Dialogue served as a platform to tackle contemporary issues such as global underdevelopment and need of environmental security as a response to climate change, and the green defence agenda wherein the low-lying nations of Maldives, Polynesia and Micronesia were focused upon. The scope of prescriptions for global development and climate degradation are far beyond a single state, and collective action of all nations has shared global benefits. However, talks of nuclear disarmament were pushed by Prime Minister Kishida, who raised the potential for nuclear weapons of China, Russia and North Korea, to cause devastation more than that which was experienced in Hiroshima and Nagasaki. Despite such a statement representing a significant change in the security environment, as it differed from the zero-sum, negative peace structure of the past, it was not well received possibly as one nation may seek to gain more from the said action than the other.

Why They Do What They Do

Security forums such as the Shangri-La Dialogue would be those where one is likely to hear more bad news than good. However, the 2022 forum was not so much a “glass half empty but more of a vessel placed precariously close to the edge of a table, one small slip away from smashing to pieces” (Sachdeva, 2022). As New Zealand Defence Minister Henare noted, there existed “an underlying tension”.

Borrowing from the English School of International Relations (Buzan et al 2002, Bull 1977) would contribute to an apt analysis of the Shangri-La Dialogue. Great power interests define international aspirations and ambitions, even in regional institutions. The Dialogue subscribed to the broad tensions of the Ukraine-Russia conflict and the US-China hostilities. Military diplomacy and international institutions which are dominated by great power interests, and smaller developing states are more rule takers than agenda setters. Further, international and weak regional institutions would have little sway in changing great power behaviour and are platforms for great power machinations. Weak regional institutions and forums would have less stringent rules, and less enforcement of such rules which would serve as checks and balances to the power of larger states. Fora such as the Shangri-La Dialogue, as opposed to stronger institutions such as NATO do “not provide much in the way of reassurance about the future trajectory of the relationship (between states) and only reinforces the sense that competition between the two powers is likely to linger thereafter” (Parameswaran 2019).

The fact that the sour relations between US and China continued on since the 2019 Dialogue, which was dominated by the subject of heightened U.S.-China competition serves to solidify the aforementioned understanding.

Despite such dire notions for international cooperation and mitigating global anarchy, the Shangri-La Dialogue represents a necessary, albeit insufficient platform for diplomacy and the peaceful resolution of differences between states. Institutions are only as strong as the rules that states are willing to enforce on themselves. However, institutions and fora such as the Shangri-La Dialogue are still important platforms which aim to resolve statist tensions through negotiated compromise and diffused reciprocity over hard power coercion and war (Keohane and Nye, 1977). The contemporary world is interconnected, with the space and time between events and reactions to such decreasing at an exponential rate. The contemporary world cannot afford to disregard the power of diplomacy for in the words of Henry Kissinger, despite animosities of history, diplomacy serves as means of restraining power.

 

RCEP: Recipe for 21st Century Regional Cohesiveness?

 

by Trivan Annakarage

The Regional Comprehensive Economic Partnership (RCEP) has been signed into operation and is gaining traction owing to its magnitude and composition. As of 2020, the collective Gross Domestic Product (GDP) of all member states in the regional trade bloc amounted to 30% of global GDP (US$ 38.81 trillion)[1]. This figure is larger than the GDP of both NAFTA 2.0 (US$ 22.20 trillion) and the European Union (US$ 15.17 trillion) combined[2]. Moreover, the 15 member states represent a cumulative population of 2.2 billion people, amounting to 30% of world population[3]. Thus RCEP is currently the largest trade bloc to have existed in the history of multilateralism. At a time when the concept of multilateralism itself is brought into question, a regional trading bloc of such magnitude gives credence to the potential of RCEP.

Background

Signed on November 15, 2020 when Vietnam hosted a virtual ASEAN summit[4], RCEP represents three regions - Southeast Asia, Far East Asia, and Australia & Oceania. The Southeast Asian nation-states include all 10 ASEAN members namely, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam. The Far East Asian countries include China, Japan and South Korea. The two countries from Australia & Oceania are Australia and New Zealand. RCEP is a key milestone for ASEAN since it was instrumental in its formation, and was able to bring China into the grouping without creating a fallout with Japan, South Korea and Australia, that experience tensed relations with Beijing.

RCEP is geared towards creating a tight knit market where member states can benefit from imports and exports with minimum trade barriers. In addition to trade in goods and services other focus areas include investment, intellectual property, dispute settlement and e-commerce followed by small and medium enterprises[5]. The latter is a very important focus area since SMEs comprise over 90% of business establishments in the 15 member countries[6]. Within the first 20 years of the trading bloc’s existence, RCEP plans to eliminate 90% of tariff imports between signatories[7] [8]. Furthermore, with the increasing traffic in the online market space and innovation that takes place in these regions, RCEP would establish common rules for e-commerce and intellectual property rights. The trade bloc has been criticised for not being explicit on labour laws, environmental protection and government subsidies[9]. Nevertheless, analysts argue that initiatives spearheaded by ASEAN begin with a broad vision and are gradually streamlined and achieved with necessary and timely amendments as time progress. This strategy has contributed to the longevity and relevance of ASEAN and would hopefully do the same for RCEP.[10] 

China’s prospects

The advanced democratic economies in RCEP (Japan, South Korea and Australia) are close allies of the United States. The recently invigorated military alliance; Quadrilateral Security Dialogue (QUAD) results in US, Japan, India and Australia’s joint effort to curtail China’s growing military prowess in the Indian Ocean and Asia Pacific. Against these developments RCEP becomes more intriguing as the United States is not part of it. This creates an absence of a power balance, with China being the most influential country in the grouping in terms of its economic and military might. If member countries work cohesively, RCEP would pull the economic centre of gravity closer to the East[11] [12]. The possibility of such a favourable outcome has therefore aided in softening the relationship between these three countries and China for a much larger purpose of economic prosperity.

The other trade bloc that would have rivalled RCEP was the Trans-Pacific Partnership (TPP) which was signed by 14 countries in 2016. President Donald Trump however withdrew USA from the trade bloc in 2017. This paved the road for the creation of RCEP due to the lack of momentum and cohesiveness in TPP[13]. Today, nine countries have membership in both RCEP and TPP.

In November 2019, New Delhi decided to stay out of RCEP sending out mixed signals. Prime Minister Modi outlined that the trading bloc did not address India’s need to commit to such an agreement.[14] Potential adverse effects to domestic industrial and agricultural sectors from Chinese manufactured goods and dairy products from Australia and New Zealand were cited as reasons[15] [16]. Yet experts predict Indian pharmaceuticals, cotton yarn and services industries would have benefitted enormously given the size of the market available[17].

If there was a vision for RCEP to become a mighty economic force from the East, this may have fallen short since India is the third largest economy in Asia after China and Japan. This may have been the reason why RCEP has provided flexibility to India to become a member-state in the future whenever New Delhi deems it fit[18]. However, Singapore’s former representative to the United Nations, Kishore Mahbubani, stated that the absence of both USA and India in this trace bloc has paved the way for China to proceed with its geopolitical ambitions and to create a unanimous economic ecosystem centred around RCEP where China would be its nucleus[19].   

Prospects and Concerns

It is clear that China, Japan and South Korea will reap the most out of this trade bloc[20]. For China, RCEP helps to leverage its position as a world power and invigorates her geopolitical ambitions for world ascendency through the Belt and Road Initiative. Moreover, it provides China with the opportunity to tighten her cultural affinity with a growing ethnic Chinese community across Southeast Asia. For Japan and South Korea, RCEP would be a new market to export their high-end industrial products as the quality of life in ASEAN and its share of billionaires is on the rise. It is an opportunity to enhance soft-power diplomacy in ASEAN, Australia and New Zealand through their respective entertainment industries. For Australia and New Zealand, RCEP is beneficial for an economic recovery strategy from Covid-19 as they access new export markets and explore investment in Southeast Asia[21] [22]. RCEP would provide greater access to developed economies for Southeast Asian countries such as Indonesia, Thailand, Myanmar, Cambodia and Laos whose economies largely depend on exports of finished garments, agricultural produce and commodities[23]. Countries such as Vietnam, Philippines and Malaysia would benefit from further investments in the tech industry. RCEP would have less impact on Singapore and Brunei since these countries have already established strong trade relations with the advanced economies of Far East Asia, and Australia & Oceania. If all member states are equally optimistic in the success of this trade bloc, RCEP might gradually bring about a solution to the ongoing disputes in the South China Sea and East China Sea. This is too early to judge though.               

A major concern is that since signing the agreement in 2020, not all member states have ratified the treaty. Currently only four countries - China, Japan, Singapore and Thailand - have ratified the treaty. The latter was the first to ratify it. This is a clear indication that there is opposition to this bloc domestically in these countries where ratification is pending. It must be taken into account that many countries in South Asia have a booming tech industry. RCEP might be a threat to this domestic industry due to flooding of low cost but equal/better quality Chinese imports. Further integration with the Chinese economy would mean Tokyo and Canberra being unable to fully commit themselves to supporting Washington’s geopolitical rivalries against Beijing. This would be detrimental to US influence over Southeast and Far East Asia.

The gradual ratification and operationalization of RCEP will undoubtedly lead to an economic revolution that has the potential to create a model for regional cohesiveness further into the 21^st century. However early ratification and realization of strategies remain crucial at this juncture.

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[1] New Zealand Foreign Affairs & Trade (2021). Regional Comprehensive Economic Partnership. Avaialble at https://www.mfat.govt.nz/en/trade/free-trade-agreements/free-trade-agreements-concluded-but-not-in-force/regional-comprehensive-economic-partnership-rcep/rcep-overview 

[2]BBC News (2020). RCEP: Asia Pacific Countries form the largest trading bloc. Available at https://www.bbc.com/news/world-asia-54949260

[3] Shotaro Tani (2020). India stays away from RCEP talks in Bali. Nikkei Asia. Available at https://asia.nikkei.com/Economy/Trade/India-stays-away-from-RCEP-talks-in-Bali 

[4] CNA (2020). Asia-Pacific nations sign world’s largest trade pact RCEP. Available at https://www.channelnewsasia.com/news/business/rcep-trade-pact-asean-summit-singapore-china-13534960

[5] Laura Zhou (2020). Explainer: What is RCEP and what does an Indo-Pacific free trade deal offer China? South China Morning Post. Available at https://www.scmp.com/news/china/diplomacy/article/3109436/what-rcep-and-what-does-indo-pacific-free-trade-deal-offer

[6] Association of Southeast Asian Nations (2021). Regional Comprehensive Economic Partnership. Available at https://asean.org/?static_post=rcep-regional-comprehensive-economic-partnership

[7] Ibid^5 

[8] Ibis^6

[9] Keith Bradsher & Anna Swanson (2020). China-led Trade Pact is Signed, in Challenge to U.S. The New York Times. Available at https://www.nytimes.com/2020/11/15/business/china-trade-rcep.html

[10] Peter Petri & Michael Plummer (2020). RCEP: A new trade agreement that will shape global economic and politics. Brookings. Available at https://www.brookings.edu/blog/order-from-chaos/2020/11/16/rcep-a-new-trade-agreement-that-will-shape-global-economics-and-politics/

[11] CNA (2020). US being left behind after Asia forms world’s biggest trade bloc RCEP: US Chamber. Available at https://www.channelnewsasia.com/news/asia/rcep-us-chamber-of-commerce-left-behind-asia-economy-trade-13576598

[12] Amy Gunia (2020). Why the U.S. Could be the Big Loser in the Huge RCEP Trade Deal between China and 14 Other Countries. Time. Available at https://time.com/5912325/rcep-china-trade-deal-us/

[13] Charles Riley (2017). Trump’s decision to kill TPP leaves door open for China. CNN. Available at https://money.cnn.com/2017/01/23/news/economy/tpp-trump-china/

[14] Ibid^15

[15] ET Bureu (2019). India decides to opt out of RCEP, says key concerns not addressed. The Economic Times. Available at https://economictimes.indiatimes.com/news/economy/foreign-trade/india-decides-to-opt-out-of-rcep-says-key-concerns-not-addressed/articleshow/71896848.cms

[16] Business Standard (2020). What is RCEP? Available at https://www.business-standard.com/about/what-is-rcep 

[17] Ibid^15

[18] Bangkok Post (2020). What happens now the RCEP trade deal has been signed? Available at https://www.bangkokpost.com/business/2020503/what-happens-now-the-rcep-trade-deal-has-been-signed-

[19] Kishore Mahbubani (2021). Why Attempts to Build a New Anti-China Alliance Will Fail. Foreign Policy. Available at https://foreignpolicy.com/2021/01/27/anti-china-alliance-quad-australia-india-japan-u-s/

[20] Ibid^2

[21] Qu Caiyun (2020). Australia needs Southeast Asia for market, not politics. Global Times. Available at https://www.globaltimes.cn/content/1203633.shtml

[22] Ibid^1

[23] Heimkhemra Suy & Phnom Penh (2021). How RCEP benefits Cambodia in the long term. East Asia Forum. Available at https://www.eastasiaforum.org/2021/02/13/how-rcep-benefits-cambodia/

EUROPE DAY: HOW REGIONALISM TRANSFORMED EUROPE

 70^th anniversary of the Treaty of Paris

By George I. H. Cooke

Whilst Europe Day is marked across the European Union on 9^th May each year in marking the anniversary of the Schuman Declaration, in which a former French Foreign Minister articulated the need for political cooperation across Europe to make war unthinkable, it is the steps taken thereafter and in particular the Treaty of Paris on 1951 that deserves due emphasis.

Considered to be the deepest form of integration experienced in modern world, the European Union has member States who have pooled resources, personnel, services and even sovereignty to emerge as a formidable force on the global stage. In April 1951, France, Italy, West Germany and the three Benelux countries, Belgium, Luxembourg and the Netherlands took a bold step of signing a treaty which came to be known as the Treaty of Paris. Establishing the European Coal and Steel Community, the measures taken seventy years ago have borne fruit over the decades since then.

Whilst the treaty was expected to ensure stability in Western Europe as the Cold War had commenced and the rapid division of the world was taking place, the significant aspect of the Treaty was that countries were pooling their most important resources through this agreement in a bid to consolidate their positions, collectively. Seen as the precursor to the current day European Union, the Treaty of Paris was a harbinger of its time as it provided an example of integration, collective action and a sharing of resources which would ultimately benefit the signatories. The advantageous situation would then spread across the rest of the region too, and lead to the EU of today.

The treaty which came into force on 23^rd July 1952 and would end half a century later in 2002 revolutionized trade and regionalism, as it aimed to organize the free movement of coal and steel and more critically it opened access to resources of production.  Through the Treaty these countries witnessed the established of a common High Authority which was geared towards supervising the market, monitoring compliance with competition rules and also ensuring price transparency.

Given the animosity, destruction and tension that the Second World War had spawned the efforts made to collaborate at this juncture were laudable as the common market that was being created would give rise to economic expansion, generate employment and improve living standards, all of which was in a debilitated state following the travails of conflict that had been witnessed in the preceding years. Interestingly the Treaty ensured fair and equal access to the sources of production, and guaranteed prices whilst improving working conditions.

Institutionalization of the Treaty

The Treaty led to the creation of a series of institutions including a High Authority, an Assembly, a Council of Ministers and a Court of Justice, all of which ensured the implementation of the Treaty and adherence to that which had been pledged by member States. The High Authority, which is today’s European Commission was independent. This is the unique characteristic of even the Commission today where Commissioners though coming from countries across the EU, sit as Europeans as opposed to natives of their respective countries. This allows for decision making that is beneficial for the entirety of the Union. The lesson that could be derived from the European Commission is that in a regional grouping while the voices of all member States are relevant and crucial, it is the objective of ensuring that action is taken to promote the integration of the whole that matters the most. The model of the European Commission is the only one of its kind in existence today and is worthy of emulation given its reflection of the views of the whole, rather than its parts. This is where true synergy is harnessed.

Seven decades ago when the High Authority was established it became a supranational entity tasked with supervising the modernization and improvement of production, ensuring the supply of products under identical conditions, developing a common export policy and, from a labour perspective, was entrusted with the mandate of improving the working conditions in the coal and steel industries.  To ensure clarity of purpose and efficiency of service the Treaty also saw the creation of a Consultative Committee which comprised the key stakeholders in the Coal and Steel industry, notably the producers, workers, consumers and dealers, who were directly responsible and would have the task of ensuring the success or failure of the Treaty.

Further, the Treaty established the Assembly, which would lead to the European Parliament as we know it today, which at the time had 78 members, drawn from national parliaments. Whilst there were 18 representatives from Germany, France and Italy, 10 from Belgium and the Netherlands and 4 from Luxembourg, the supervisory power they possessed ensured guidance in keeping with national sentiments. Even the European Parliament which gradually transformed from a body of appointed individuals to one which consisted of elected representatives, displayed the potential of integration and collective decision making for countries which only a few years before had been at war which each other.

The Council that was formed led to the subsequent Council of the European Union that is in existence today, with 6 members at the time from the member States, and with a rotating presidency for 3 months. Geared towards ensuring smooth functioning of the action being taken by the High Authority, this was also the body that was responsible for the final decision making process.

Finally the Treaty also created a Court of Justice, which later transformed into the Court of Justice of the European Union with 7 judges to ensure that the Treaty was accurately interpreted and implemented.

Evolution of the Treaty

The Treaty of 1951 would see several amendments pursuant to discussions among member States who perceived the review as being necessary to keep the values and principles enshrined in the Treaty relevant and timely. While the Merger Treaty of 1965 brought together the European Coal and Steel Community with the European Economic Community and the Eurotom, there was also the Treaty of Greenland in 1984, the Treaty of the European Union in 1992, The Single European Act of 1986, the Treaty of Amsterdam of 1997, the Treaty of Nice in 2001 and the most significant could be considered to be the Treaty of Rome of 1957 which truly moulded the EU into what it is today.

Taking Regionalism forward

Upon reflection of the journey taken by Europe from the Treaty of Paris onwards, it is evident that visionary decision making, clear strategizing and effective implementation of policy were highly essential and valuable attributes. The decision to pool the most important of resources, notably coal and steel and the creation thereby of an oligopoly controlled by the signatories of the Treaty would lead to integration in Europe which went beyond the economic dimension and gradually saw it progressing to its current state of being the deepest form of integration on the planet.

Whilst regionalism as a concept has evolved from its original form of being dependent on geography alone, to now embracing economics, finance, defence, language and even religion, the notion and potential of regionalism was first given meaning through the European Union. Other regional groupings aspire to progress accordingly but of essence is the need to develop indigenous models as opposed to attempting to emulate the same journey taken by the Europeans. The Coal and Steel Pact was of prime importance to the Europeans, and while economics and trade are crucial for all geographical regions, it is but one of the means through which integration can and should be achieved. Similarly the comparison of the EU with other regional groupings is unfair and irrelevant as the conditions, circumstances and context of Europe is vastly different to other regions.

From an Afro-Asian perspective, the Association of South East Asian Nations (ASEAN) has been able to make steady progress, and the African Union (AU) has also attempted deeper integration. However the South Asian Association for Regional Cooperation (SAARC) which is brimming with potential and has the ability to become a shining example of harnessing the value of collaborative action is far from where its founders expected it to be, owing chiefly to bilateral issues which are spilling over onto the regional table. Whilst this must be avoided for the sake of the whole, it needs to be a part of the past, as countries surge forwards to realize the potential of the 21^st century. Similarly the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) is another grouping with much opportunity as it bridges SAARC and ASEAN, and brings together key countries who can achieve much more than is being experienced at present. Unfortunately the realization of potential has not reached fruition as member States still discuss the visionary potential and are slow to take concrete steps towards realizing that true value.

Whilst multilateralism continues to dominate the international sphere and augments bilateral engagement, models of regional groupings like the European Union which bring together a multiplicity of countries, need to be studied for what they have achieved and the mistakes they have made, analyzed for their progress and understood for the realization of scope in similar bodies elsewhere in the world, especially in Asia. The world of 1951 was vastly different from the one in which we exist today. Having come out of a deadly destructive world war, a few countries of Europe took the bold decision of cooperating to ensure stability, development and prosperity. The fruits of their endeavours are being felt decades later. It was the visionary leadership of the time to which the Europeans of today are thankful, as a region shattered by war, rose once again, and become a contender on the global stage as a collective unit, and not individual countries. This is the effect of collective action and as Europe Day is marked on 09^th May in commemoration of the Schuman Declaration, the lessons of the Treaty of Paris ring true today and are worthy of critical study, to promote stability, cooperation and prosperity.