New hopes or old fears for Malaysia?


December 24, 2018

New hopes or old fears for Malaysia?

by  Clive Kessler, UNSW

http://www.eastasiaforum.org/2018/12/23/new-hopes-or-old-fears-for-malaysia/

Image result for dr.mahathir mohamad

 Against the odds, and against most informed predictions, Malaysia’s 14th general elections in May 2018 produced a change of government. The Barisan Nasional (BN) coalition under Najib Razak, which had been in power since 1957, was ousted by the opposition Pakatan Harapan (PH) consortium led by Mahathir Mohamad, a now second-time Prime Minister. What had long seemed Malaysia’s permanent government was humbled, and its anchor party — the United Malays National Organisation (UMNO) — has been thrown into disarray.

The new government — a ruling bloc without a clear agenda brought together by Mahathir’s political wiliness, experience and familiarity with the Malaysian state — entered office largely unprepared. PH prevailed not upon its own political strength but as the vehicle and beneficiary of a groundswell of growing civil society activism.

In its first six months in power, PH has signalled its key intentions by unshackling the long-suborned judiciary and initiating the prosecution of those responsible for the 1Malaysia Development Berhad (1MDB) financial scandal. It has also made strong appointments to key positions, including the Attorney- General and Chair of the Election Commission.

 

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Speculation continues about the timing and implications of the political succession from Mahathir to Anwar Ibrahim, leader of the People’s Justice Party.

But its long-term strategic course remains vague. Speculation continues about the timing and implications of the political succession from Mahathir to Anwar Ibrahim, leader of the People’s Justice Party. Whereas Mahathir has long pulled the levers of state power, Anwar is less experienced. While Mahathir is a more single-minded promoter of Malay interests, he is viscerally a religious anti-clericalist. Anwar may be inter-communally more inclusive, but he is a soft and sentimental Islamist who has been amenable to hard Islamist influence.

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As the PH regime feels its way forward, its adversaries are biding their time, waiting for it to stumble. But PH has some breathing space for the moment. It is hugely benefiting from the post-election collapse of the once commanding UMNO. Many of its elected state and federal representatives are defecting to the component parties of PH. Others are gravitating towards the Malaysian Islamic Party (PAS).

But the longer-term implications of this tendency are towards the polarisation of Malaysian society and political life. There is a brutal contest between the fragmented forces of social democratic pluralism within the PH and religiously-driven Malay ethno-sectarians, made up of what is left of the UMNO and PAS.

Momentum is with the Malay ethno-sectarians. They are reviving efforts that began under Najib’s pre-election entente with PAS to gradually affirm the equal standing of the sharia and civil courts. Through new statutory reform of the civil law, they aim to increase the punishments for violations of Islamic criminal law — such as the consumption of alcohol and daytime eating during the fasting month — that the sharia courts may impose.

Such initiatives by the PAS–UMNO opposition will be used to place growing pressure on the authority of a divided, uncertain, unstable, and hesitating PH ruling bloc. The PH government arose from bottom-up mobilisation, not coherent opposition party strength. Its adversaries now seek to bring it down by recourse to far more rowdy and intimidating forms of the same strategy.

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As 2018 ends, the new government’s will is being jointly tested by PAS and UMNO, who marked the annual UN Human Rights Day by mobilising demonstrations and street-level opposition against the PH-promised proposal to ratify the UN International Convention on the Elimination of All Forms of Racial Discrimination. PAS and UMNO argue that ratification is incompatible with the Malaysian Constitution, whereas PH says it is not.

The division here turns upon the revisionist interpretation of the Constitution that UMNO began to promote in the 1980s, when its ideologues confected the notion that entrenched within the 1957 independence constitution — as the key tenet of the nation’s founding ‘social contract’ — is the principle of Ketuanan Melayu (Malay ascendancy). This view embodies the Malay instance of so-called ethnic nationalism: the powerful political fantasy of living exclusively among one’s own people, people of one’s own kind, on one’s own preferred cultural and historical terms, undiluted and undisturbed by strangers and outsiders.

The PH government’s opponents proclaim that Islam is in peril, and that no one will save it but the Malays. They also argue that Malays, and their stake in the country, are in jeopardy and they can only be upheld through Islam. Devised to promote the UMNO–PAS entente since 2013, this rhetoric is now the theme of the growing opposition assault upon the PH government. It will provide the leitmotif of this new political era.

Clive Kessler is Emeritus Professor of Sociology and Anthropology at the University of New South Wales.

This article is part of an EAF special feature series on 2018 in review and the year ahead.

 

 

 

 

 

 

 

 

 

Navigating the new international economic policy landscape


December 22, 2018

Navigating the new international economic policy landscape

by Shiro Armstrong and Peter Drysdale, ANU
http://www.eastasiaforum.org/2018/12/19/navigating-the-new-international-economic-policy-landscape/

Image result for xi and trump g20

The United States under President Donald Trump is on a mission to add economic policy to the armoury of national security policy to deal with a rising China. The approach holds the global economic order hostage to the attempt to put China back in its box. The stakes are as high as they get. But how should middle powers like Australia and its neighbours like Japan or Indonesia respond to the hard choices they now confront?

Using economic instruments for geopolitical objectives is nothing new. Between the two world wars the practice ended in wholesale military conflict. But the US inspired post war rules-based international regime extended US political influence through the spread of open markets at the same time as it constrained the use of trade sanctions for political security objectives (although not completely as United Nations-based economic sanctions became a feature of the geopolitical action).

‘Geoeconomics’ — conventionally defined as the use of restrictions on international commercial transactions to achieve political objectives — is now being touted as a new force in international and security relations that should be brought into active play.

Without understanding the economic implications of international economic policies, alongside their political and security implications, however, the ill-considered use of economic policy for geopolitical objectives will produce misguided policies that damage both economic and national security.

That’s exactly what the United States is doing with tariffs on Chinese imports, increased barriers to investment and bilateral economic coercion in the name of national security. China is the main target but other countries, the WTO system and multilateral institutions are also under threat. These policies will make the United States poorer and weaker, and damage its status as a global leader. If other countries follow suit, they will make themselves and the world poorer, weaker, and less secure.

How should a country like Australia navigate a world in which its primary security ally and its largest economic partner are descending into destructive rivalry while still themselves being deeply economically integrated?

For some, the answer is to follow the United States further down this track and reframe foreign policy in security terms. In this conception, the only option is total alignment with US decoupling strategy, and every economic exposure to China is cast as an all-or-nothing risk to national security. No understanding of the economic costs or the security options enters this calculus. Nor are third countries assumed to be an effective object of policy engagement on an alternative, multilateral course with or without the United States.

For others, the answer is to add a geoeconomic approach to foreign policy. That might sound like a good idea but what exactly does that entail?

The intellectual origins of ideas about geoeconomics are twofold. The first is simply about the analysis of spatial, temporal, and political aspects of economies and resources. The second is a branch of geopolitics that interrogates international politics, security and economics and commonly insists that the same logic that underlies military conflict also applies to international commerce. The first idea is of interest, though marginal, to the big issues today. The second is the way of thinking about international commerce, that prominently undergirds that of Peter Narravo, US President Trump’s trade advisor, as an instrument of warfare. That idea has been hijacked by those focussed on security issues, absent hard economic calculation and comprehensive consideration of economic as well as political security that is ostensibly its purpose. Especially for small and middle powers such as Australia it’s a strategy that will sap both economic strength and national security.

The securitisation of all national interests reduces the policy space and instruments that can be deployed to enhance both economic and national security. Soundly framed international economic policies are central to reducing the costs of broader economic and political engagement, both in dollar and in policy terms.

Economic policy and engagement reinforce and habituate a rules-based international order and, significantly, they create a bigger, broader plurality of interests in countries that reduces the costs of national security.

If geoeconomics is the answer, it had better be informed by the agencies of hard economic analysis, not left to the agencies of diplomacy or security, else it too will be a security strategy bereft of judgment about national economic interest.

Take the large economic relationship that Australia has with China. A third of Australia’s exports go to China, led by education, natural resources and tourism. No economist would sensibly advocate deliberately reducing trade dependence on China, even if they consistently argue for broadening Australia’s range of economic relationships. Many in the political and security community do. It may be doable, but the question is at what cost and whether there are better options?

It’s not a matter of just the profits of businesses at the high end of town but people’s livelihoods that are put at risk. If Australia made the choice to cut back dependence on China, it would be withdrawing from trade with the world’s largest trading nation, a country that’s playing by rules to which we’ve all agreed. We certainly need more rules in some areas. But only Mr Navarro (and perhaps Mr Trump) would suggest that that’s a reason for tearing down the rules we have and that have worked quite well.

The right strategy is to manage economic interdependence within the multilateral trade regime and continue to build rules and markets that reinforce the global plurality of interests on which security within the global economic system is more soundly built. That system protects Australia effectively. It’s Australia’s primary national economic and security priority. It would be most unwise to acquiesce in tearing it down.

Shiro Armstrong is Director of the Australia-Japan Research Centre and Director of the Asian Bureau of Economic Research, The Australian National University.

Peter Drysdale is Professor of Economics and head of the Asian Bureau of Economic Research, The Australian ,The Australian National University.

Singapore’s leadership one step ahead


December 13, 2018

After years of winnowing through candidates, Singapore Prime Minister Lee Hsien Loong has anointed Finance Minister Heng Swee Keat as his successor. Back in 2016 there were six candidates for the role but one by one they were removed from contention, mostly by mechanisms in the form of gifts from the Prime Minister. One of the stronger candidates, for instance, was unexpectedly made Speaker of the House, which put him out of contention.

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There is no formal process of selection and the decisions are made behind closed doors, with narratives about the selection process generated retrospectively. The trigger for the final declaration of Heng Swee Keat as the designated successor was his election to the rather obscure position of First Assistant Secretary-General of the ruling People’s Action Party. This election was initially greeted as an indicator that Heng Swee Keat was merely the front runner to be next Prime Minister but in the space of a day it morphed into a declaration of succession.

Heng Swee Keat was already known to be Lee Hsien Loong’s favourite even before 2016. When Heng Swee Keat suffered a stroke during a Cabinet meeting in May 2016 and spent six days in a coma, it was universally accepted as being a blow to Lee Hsien Loong’s succession plans. Only extreme medical intervention saved Heng Swee Keat’s career and brought him back into contention. Since then, the process of selecting the next prime minister has suffered unexplained delays. Now we know why the delay was necessary: to give Heng Swee Keat a chance to settle doubts about his health, while the other candidates were dropped.

Heng Swee Keat was never an obvious candidate. He has a relatively narrow range of Cabinet and professional experience and is a rather awkward public speaker. No one doubts his technocratic competence, nor that he will be ‘a safe pair of hands’ but few, if any, suggest that he has strong political skills. So why did Lee Hsien Loong endorse Heng Swee Keat ahead of younger, stronger and healthier candidates with better political instincts?

The question is easier to answer if we begin by asking who will be the next prime minister after Heng Swee Keat. Lee Hsien Loong’s son, Li Hongyi, is currently a senior civil servant working in one of the divisions of the Prime Ministers’ Office and has been identified by his close relatives as harbouring political ambitions. Li Hongyi denies that he wants to follow in his father’s and grandfather’s footsteps but he and his mother have been carefully cultivating his media and social media profiles as one would for an aspiring politician. Rumours are now circulating that he will enter parliament at the next General Election in 2020.

Lee Hsien Loong is 66 and indicated he would like to step down by age 70, which would make Heng Swee Keat about 61 when he becomes prime minister. If his health holds up, Heng Swee Keat can expect to enjoy a decade or perhaps longer as Prime Minister, by which time Li Hongyi would be 45 to 50 — an acceptable age for a prime ministerial aspirant.

Granted that any of the six original candidates would have met the basic threshold of political and administrative competence, the attraction of Heng Swee Keat is his age, health record and ordinary communication skills. In short, he is not likely to disturb a succession plan by overstaying his welcome — as did former Prime Minister Goh Chok Tong, who was supposed to be a stop gap between Lee Kuan Yew and Lee Hsien Loong but persisted in the job for 14 years.

The main risk of the Heng Swee Keat succession is that it leaves the government with a Prime Minister who has no record of being an effective politician (as opposed to an effective administrator) at a time when a number of political red flags have surfaced.

The most serious institutional issue is the government’s recent declaration that Housing and Development Board flats will have nil value at the end of their 99 year leases and at that point will revert to the government without compensation. This is a particularly uncomfortable issue because about 80 per cent of Singaporeans ‘own’ their flats and regard them as their main financial asset. The government has also spent decades talking up their values. Now it turns out that devaluing flats is part of its plan.

The government is not going to lose the next election but it does not like to leave anything to chance. In the absence of good political instincts and a mediocre record of administrative achievements, the Cabinet has upscaled the intensity of its repressive actions throughout 2018, continuing a trajectory that has been developing for several years.

This may be satisfactory as a short-term measure to retain control but it is not a great way to launch a new round of change in government, nor to lay the groundwork for the following generation.

Michael D. Barr is Associate Professor of International Relations at Flinders University and a Fellow of the Australian Academy of the Humanities.

This article is part of an EAF special feature series on 2018 in review and the year ahead.

 

 

Malaysian reform dynamics


December 8, 2018

Malaysian reform dynamics

 

by  Andrew Harding, NUS

http://www.eastasiaforum.org/2018/12/06/malaysian-reform-dynamics/

The pattern of political reform following a regime change is usually predictable: the reformers gain popular support, make changes to the constitution and then use constitutional politics to achieve their ends. But Malaysia’s current period of political change is straying far from this pattern. Instead, Malaysia is proving that peaceful transition and reform may be possible without debates about constitutional amendment.

 

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The new Pakatan Harapan (PH) government — a coalition of four political parties — was unexpectedly elected to power on 9 May 2018, replacing the incumbent Barisan Nasional (BN) coalition government. Much of the PH’s current political leadership team were part of the BN’s largest member party and now discredited United Malays National Organisation (UMNO), including a former prime minister, two former deputy prime ministers and a slew of former ministers and members of parliament.

The election also revived the political career of former and now incumbent Prime Minister Mahathir Mohamad. Mahathir had gone down in history as one of the strong men of Asian authoritarianism. His recent campaign replaced this image with one of a moderate democrat who believes in a free press, a two-party parliamentary system and the rights of citizens.

Mahathir’s campaigning against his old party carried enough rural Malay voters into the PH fold to overturn the BN’s dominance. Voters were appalled at the level of corruption in former prime minister Najib Razak’s government. The contrast was stark between voters’ own economic struggles — including the extra burden of a goods and services tax — and the wanton expenditure of leaders like Najib and his wife.

While the PH have not yet changed a single word of the constitution, it has already redefined the state as one based on good governance, the rule of law, parliamentarism and the separation of powers. The PH has proposed signing the international human rights covenants (except for ICERD), abolishing the death penalty, and addressing the political and legislative autonomy of East Malaysian states Sabah and Sarawak.

The question now is whether the reform process is politically sustainable and can be constitutionally entrenched.

One challenge facing the PH coalition is that any ordinary legislative changes — let alone constitutional amendments — can easily be blocked in Malaysia’s upper house, which is still controlled by senators appointed by the former BN government. The upper house has already rejected a bill to repeal the Fake News Act that was rushed through parliament by Najib before the election to restrict criticism of the government regarding the 1Malaysia Development Berhad (1MDB) scandal.

There are fears that the PH coalition may simply revert to the Malaysian dominant-coalition stereotype. These are partly fears that the leader of the People’s Justice Party Anwar Ibrahim — the largest party of the PH coalition — will assert what he sees as his entitlement to the prime-ministership.

There are also worries about factionalism within Anwar’s party, quite apart from tensions between the four coalition partners. As matters stand, Mahathir is supposed to hand over to Anwar within two years of the election. At 93 years old, Mahathir could hardly plan to go on longer than that, whatever the politics dictates.

For the time being at least, the reformers are in charge.  Attorney General Tommy Thomas and Legal Affairs Minister Liew Vui Keong are implementing the PH’s campaign promises. These include the good-governance reforms that Mahathir wryly suggests would not have been so extensive had the PH expected to win the election. Bringing those guilty of corruption to account is the major priority at this point, and ensuring that problems such as the 1MDB scandal will not occur again is also high on the agenda.

Despite the flurry of reforms, announcements, prosecutions and policy changes since the election, most legal changes — such as abolition of the death penalty — remain to be implemented. These depend on parliamentary arithmetic.

But over the next two to three years, as current senators leave office, there will be opportunity for the PH government to gain much more control over the reform process. These reforms may well involve changes to the Senate itself, which has far too many appointed members and no longer fulfils its original purpose of protecting states’ rights. This of course assumes that PH will remain stable and reform-oriented.

Entrenching the reforms in the longer-term may also be a challenge. While an extended period of constitutional debate would be beneficial for the somewhat ad hoc current reform proposals, politics can change quickly. This could side-line reform and reemphasise ethnic and religious issues. The PH still has to establish its credentials with the majority of Malay voters. At the same time, Anwar has consistently advocated democratic reforms and suffered in jail as a result of overweening executive power.

These reforms are so long overdue that many of them could become fiats accomplis, or matters of consensus rather than contention. For the moment, the further down this road the reforms go, the harder it will be to reverse them.

Singapore’s uphill battle to maintain ASEAN unity


December 3, 2018

Singapore’s uphill battle to maintain ASEAN Unity

by Joel Ng, RSIS

http://www.eastasiaforum.org/2018/11/30/singapores-uphill-battle-to-maintain-asean-unity/

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As year as the ASEAN chair was marked by several milestones in the deepening of regional peace and security. Ahead of the 33rd ASEAN summit from 11–15 November 2018 that finished with Singapore’s official handing over of the chairmanship to Thailand, Singaporean Foreign Minister Vivian Balakrishnan stated that ASEAN ‘actually achieved far more than I dared to anticipate’.

 

As a small nation, Singapore cannot impose its own ideas in regional or global settings. Instead it has the much trickier challenge of convincing other players, each with their own contexts and agendas, that strengthening the multilateral framework is in their best interests.

Tensions in the South China Sea, North Korea’s long-range missile tests and threats of a US–China trade war clouded the end of 2017 and presented a considerable challenge to ASEAN’s ongoing efforts to enhance regional cooperation. Despite the uphill battle, ASEAN and Singapore have played an integral part in ameliorating tensions on all three fronts.

Most recently, the 33rd ASEAN summit made an important contribution to the easing of regional tensions, with China agreeing to participate in talks on the long-proposed South China Sea Code of Conduct (COC). China offered a timeframe of three years for COC negotiations to be completed, which Singaporean Prime Minister Lee Hsien Loong declared as good progress.

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The COC is perhaps the most important document related to the South China Sea disputes. With competing states attempting to apply different rules to claim legitimate sovereignty over the waters, fears have arisen that conflict could break out over misunderstandings or maritime encounters going wrong. The COC has been in gestation since the 2002 Declaration on Conduct in the South China Sea, but has barely progressed in the intervening years.

Claimants agreed upon a draft negotiating text for the COC earlier this year, ahead of the ASEAN–China Post Ministerial Meeting in August 2018, and now China has committed to signing the COC within three years. While this may sound like piecemeal progress, it is important to remember the headwinds facing the discussion: as a much larger power, there is little incentive for China to sign anything at all.

Keeping all parties on board while pushing consensus and norms forward — at a pace that divergent parties can accept — is something ASEAN does well. With Singapore at the helm, ASEAN has helped to keep the COC moving forward without alienating any of the negotiating parties. The significant difference in 2018 has been China’s explicit commitment to a rules-based order, a position it believes distinguishes itself from the United States.

Perhaps the most surprising event of 2018 was the US–North Korea peace talks in Singapore. As recently as 2017, both sides had issued threats against the other. North Korea continued to conduct missile tests, and the murder of Kim Jong-nam had soured its previously cordial relations with Malaysia. Singapore was one of the only plausible choices as a venue because of its high security, positive relations with both sides and an avowed impartiality.

While talks were initially cancelled just weeks before they were to be held, Singapore remained alert and ready for their resumption. The country’s experience in hosting summits put it in good stead for facilitating the dialogue, regardless of uncertainties on either side. The eventually successful engagement demonstrated the importance of Singapore as an open, inclusive and highly efficient state ready to contribute to international security.

ASEAN has paddled against global currents in 2018 to offer hope that multilateral initiatives will continue to bring states closer together on common objectives. But trade tensions between ASEAN’s two largest partners — the United States and China — continue to concern the region. Progress on the Regional Comprehensive Economic Partnership (RCEP) remains a priority for ASEAN to offset this concern, though negotiations will continue into 2019 after RCEP partners failed to meet the November 2018 deadline.

The initial impetus for Southeast Asia to unite as a region was to buffer individual countries against the pull of larger powers, whose efforts to draw smaller states exclusively towards them are often driven by whimsical domestic agendas. As Prime Minister Lee noted during the opening ceremony of November’s ASEAN summit, ASEAN has raised its standing in the world and made itself greater than the sum of its parts by maintaining a collective voice on global issues.

Singapore’s chairmanship offered a strong restatement of ASEAN’s aims and bolstered the frameworks that were devised to address the myriad concerns of its members. Maintaining unity in the face of these external pressures is probably the best way for ASEAN states to maintain a strong position and secure the best outcomes for their continued growth.

Joel Ng is a Research Fellow in the Centre for Multilateralism Studies at the S Rajaratnam School of International Studies (RSIS), Nanyang Technological University.

A version of this article originally appeared here on RSIS.

 

Decoupling the US from Asia


November 21, 2018

Decoupling the US from Asia

Author: Editorial Board, ANU

Image result for Mike Pence and Xi

ww.eastasiaforum.org/2018/11/19/decoupling-the-us-from-asia/#more-155952

 

...[D]ecoupling or divorce from China, Cold War-style, is an option that would threaten economic and political turmoil and promise a global winter of discontent that stretched the Asia Pacific order to breaking point”.

Maybe US Vice President Mike Pence didn’t mean to fire the opening shots in a new Cold War with China in his 4 October speech at the Hudson Institute, but the global policy community can be forgiven now for taking the proposition seriously.

 

The idea of a new Cold War is of course not new: it had been canvassed in security circles in Washington and the chill has been cultured actively by some in allied capitals for some time. A range of President Donald Trump’s advisors and former advisors, Steve Bannon, Peter Navarro, John Bolton and Robert Lighthizer, all identify as proponents of political and economic decoupling from China to a more-or-less extreme degree. Navarro most recently advocated the idea in its most extreme form at his CSIS speech about how China was undermining US national security, giving the impression that an economic ‘self-sufficiency’ strategy, like that which has been so disastrous in North Korea, was the only way to keep America secure. Larry Kudlow, Director of the President’s National Economic Council, disavowed that thinking with an unequivocal declaration that Navarro had misspoken and had no authority to speak on the matter on behalf of the Trump administration.

The new Cold War narrative gained traction as President Xi Jinping consolidated his power and began to assert the discipline of the Chinese Communist Party across the government and society in China. It has been accompanied by a discernible shift right across the political spectrum in the United States towards a hard-line posture on China. The conflation of frustration with China’s military assertiveness in the South China Sea and the perception that its Party dominated political system qualified every commitment China had made under international law to the rules-based international economic system has been an easy logical slide even for those in the US policy community who had been architects of China’s entrapment within that system.

Make no mistake. There are real issues on the agenda for negotiation in securing a more efficient and more equitable foundation for the next phase of the economic and political relationship between China and the United States. China is no longer a poor, developing country aspirant to membership of the WTO but a very large, upper-middle income economy that is the largest trader in the world. While China’s entry to the WTO was on terms that were more onerous than that even advanced and established members of the WTO had to bear, issues beyond the coverage of the WTO, with respect to its foreign investment regime for example, and new issues, such as those related to digital trade, beg negotiation. Contrary to much of the new American narrative, it is not that China has flagrantly flouted the rules of the system to which it and its partners signed on in 2001 — it is rather that it has outgrown them bigtime.

Many of the issues for negotiation now that have the highest priority — to do with treatment of foreign investment, intellectual property, industrial subsidization and competition policy — were encompassed within the negotiations that had been on-going between China and the United States over a Bilateral Investment Treaty, that have now been suspended. There is also the issue of further trade liberalisation and industrial reform that the absence of progress with multilateral negotiations through the WTO has left unattended. Attending to these issues is not only in the interests of the United States and other countries, it is also in the interests of China in prosecuting the reform agenda that it has articulated as the path towards catching up with at least lower-end advanced industrial economies and avoiding the middle income trap.

All these things would seem eminently negotiable, if only President Xi and President Trump could agree to sort them and some others things out.

But as Gary Hufbauer warns in our lead essay this week, the Pence declaration last month represents a significant departure from ‘business-as-usual’.

‘Economic sanctions are the front line of the new Cold War, unlike the US–Soviet confrontation of yesteryear,’ says Hufbauer. ‘But military escalation cannot be far behind. Since the United States and China already possess enough intercontinental nuclear missiles for “mutually assured destruction”, and since the United States would be hopelessly outnumbered in conventional land battles, military escalation will focus on naval power and hypersonic short-range missiles.’

Hufbauer worries that the United States will ramp up its economic war, with the goal of securing an economic divorce from China. While the immediate complaints from the Trump administration are about the persistent US trade deficit with China and the appropriation of US firms’ technology, the real story is simply fear that China will overtake the United States economically and technologically as the arithmetic, however manipulated, suggests it will by 2030 or 2050, take your pick.

Hufbauer sees American attempts to decouple from the Chinese economy and the close down of US trade and technological ties as a loser’s game — a national science and technology strategy that stayed open to scientific and technological links would more likely keep the United States ahead of the game, incorporate less risk of pushing China back into a corner from which it posed a bigger threat and strengthen US economic and political security, he suggests. But he rates the chances of this outcome low, barring unlikely conciliation from Xi’s China. The new Cold War promises, he assesses, to be a lasting legacy of presidents Trump and Xi.

Yet, in a hard-headed if gloomy assessment of where China and the United States are at right now, Henry Paulson, Secretary of the Treasury under former US President George W Bush and leading US China expert, sounds a strong warning on the decoupling strategy.

Decoupling, he says, is easier when you’re actually a couple. But the United States and China are not a couple. They are part of an international economy that is multilaterally integrated on an unprecedented scale, especially within Asia.

The United States might well continue to pursue divorce through cutting back trade, capital and technology flows, but that’s a cost no Asian country, including US allies, can readily afford, Paulson says. The cost is a function of their geography, of economic gravity and of the strategic reality in which they live day-by-day.

Many countries around the world may share many of Washington’s present concerns. But decoupling or divorce from China, Cold War-style, is an option that would threaten economic and political turmoil and promise a global winter of discontent that stretched the Asia Pacific order to breaking point.

The EAF Editorial Board is located in the Crawford School of Public Policy, College of Asia and the Pacific, The Australian National University.