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- Written by Daniel Shin
- Category: World
The Trans-Pacific Partnership (TPP) agreement was reached by trade ministers today (The New York Times 10/5/2015), and various organizations have been analyzing the text of the agreement. While the bulk of the agreement removes existing tariff for participating countries, there are some unique elements to the agreement, including standards agreement (Environmental, Labor, and Intellectual Property) and rules and practices in regards to internet regulations (i.e data flow).
The key component for President Obama to convince Congress, not including whether certain components of the agreement hurt certain critical (politically) American industries, is to demonstrate that the agreement will curtail China’s “influence” in various regions. Whether President Obama is able to convince Congress will depend on the amount of political capital he has and is willing to spend.
In the TPP discussion, there is a cause for concern on the vague notion that the agreement is somehow a reaction to China’s growing influence in various regions around the world, including Southeast Asia. While the agreement sets certain standards beyond a mere trade agreement, there does not seem to be any significant element or mechanism prima facie that would counter China’s “influence”.
It can be argued that China can use its vast amount of foreign capital (US Dollars) to continue exerting political and economic influence in various parts of the region. There is nothing in the TPP that would counter China’s growing influence based on China’s capital investments abroad.
Supporters of the TPP would argue that, without China’s participation of the TPP, China’s influence among the participating countries would deteriorate based on trade bloc exclusion. Nevertheless, China can simply exert political and economic (via foreign investments) influence by spending its vast foreign reserves to other nations. There is nothing in the TPP (so far reported) that would prevent a non-TPP member from continuing foreign direct investments in TPP member states.
Interestingly, TPP seems to be a potential welcoming framework among some Chinese academics (The New York Times 4/28/2015), so the notion that TPP has a negative effect on China is even more questionable.
It would be politically interesting to see President Obama attempting to pass the TPP if China suddenly expresses greater interest to join the trade union. Such a scenario demonstrates that the mechanisms designed to counter China’s influence might not even come to fruition due to China’s willingness to endorse such idea.
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- Written by Daniel Shin
- Category: World
After South Korean President Park Geun-hye addressed to the United Nations, North Korea has hinted to potentially cancel the upcoming family reunion event in North Korea based on President Park's remarks. (Korea Times 9/30/2015)
North Korea’s Committee for the Peaceful Reunification of Korea criticized President Park’s speech to the U.N. as “an unpardonable provocation”. Listening to President Park’s speech (C-Span 9/28/2015), one has to wonder whether the North Korean committee even bothered to listen the South Korean President’s speech or simply submitted a pre-written, boisterous response to the world.
The family reunion event is a rare inter-Korean event that carries significant emotional weight to all Koreans. With the North Korean dictator Kim Jung Un still attempting to solidify his power base in his own country, the occasional threatening messages from North Korea is not unusual.
However, North Korea should be very careful with its incendiary rhetoric.
It has merely been a few weeks ago since China celebrated its World War II victory parade with President Park seated merely two seats away from the Chinese President Xi. (Arirang News 9/3/2015) With North Korean leader Kim Jung Un not attending a significant Chinese event, the geopolitical alliance has shifted significantly to South Korea’s favor.
China, being the last reliable ally of North Korea, has constantly reiterated the stability of the Korean peninsula. If North Korea decides to cancel the family reunion event due to an unjustifiable reason, there is little reason to believe that China would publically support North Korea’s rash actions.
Being already unpopular among the Chinese citizens, Kim Jung Un is running out of options in foreign diplomacy. Unless North Korea changes its own behavior in face of the international community, it is a matter of time until China seriously considers stop helping North Korea.
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- Written by Daniel Shin
- Category: World
On August 20, 2015, North and South Korea exchanged weapon fires in the Demilitarized zone (Chosun Ilbo 8/21/2015). The Korean newspaper reports that the “…North fired anti-aircraft guns and direct-fire weapons at new South Korean loudspeakers that are blasting propaganda across the demilitarized zone. South Korea retaliated by lobbing 155 mm howitzer rounds into the North Korean side of the demilitarized zone.” There is no report of any military or civilian causality from the exchanged fire.
The New York Times reports that multiple analysts believe the recently installed large array of speakers in the South might be the cause of North Korea’s initial aggression (8/21/2015). South Korea has been using the speakers to demoralize North Korean soldiers near the Demilitarized zone. North Korean officials have demanded the South to dismantle the speaker array or face military force.
While gathering real information within North Korea is difficult, the provocative response by North Korea demonstrates the dire low moral atmosphere within the North Korean military ranks. By heightening the military readiness, Kim Jung Un, the leader of North Korea, is also attempting to consolidate his power at a time of multiple purging and executions of senior North Korean government officials.
The South Korean reaction should be cautious but also confident that this particular incident won’t develop into something more worrisome. Given the increasing economic and political ties South Korean President Park Geun-hye has made with both China and Russia, North Korea is hard pressed to find any significant political support for its actions in the region. In fact, since Kim Jung Un rose to power, there has not been one action by North Korea that has not raised concerns from both China and Russia.
If North Korea continues to act provocatively in the name of consolidating power for Kim Jung Un, then the country faces significant international political isolation even with its traditional staunchest supporters. China and Russia are more interested in cooperating with South Korea then continuously defending a failing state of North Korea.
The fall of a failed state requires nothing but time. Hopefully, the current trend would bring a more smooth and peaceful reunification resolution for the Koreas.
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- Written by Daniel Shin
- Category: World
The current fiscal crisis in Greece seems to be repeating in a series of events. Instead of presenting a viable plan to even temporarily satisfy foreign creditors, the government of Greece has been dancing on the issue of fundamentally reforming the country’s budget and addressing a long term solution in tackling the debt crisis.
Greek Prime Minister Alexis Tsipras should be credited for recognizing the fiscal realities of Greece and focusing on, first, preventing a Greek default, and second, securing a long term plan with his European partners on addressing this fiscal crisis.
By no means had the Prime Minister given into the demands of the creditors easily. His initial hardline approach, which some might see as admirable, allowed the people of Greece to voice their dissatisfaction with the rest of Europe. Despite the heroic attempts to demand concessions from the European creditors, Germany and others simply did not blink, and Greece was positioned worse at the negotiating table.
After several anxious weeks of a political standoff, Greece and the European partners are back at the negotiating table. Domestically, the Greek government is facing significant political pressure against the austerity measures demanded by the European finance ministers. The bailout measurement is largely opposed by the anti-austerity wing of the Syriza (The Prime Minister’s own party) members, and the bailout vote will not only test the political opposition to the Prime Minister’s austerity budget but also the stability of the Greek political climate. (Reuters 8/13/2015)
Even if the Greek government is able to pass the austerity measure, the European creditors are skeptical on the political continuity of the Greek government. If there is a rapid shift in the political makeup in the Greek government, then the confidence of the Greek government’s ability to carry out the austerity measures is in doubt.
Frankly, the austerity measures will theoretically hurt the Greek economy. However, there has been little domestic political accountability on the Greek fiscal situation. Furthermore, without a fundamental change in the Greece’s finances, the current fiscal debt crisis, even if Europe and other creditors decide to categorically forgive them, will come back again. No matter how the current situation develops, once Greece reach a hypothetical situation of resolving this issue, the constituents ought to scrutinize their government’s finances more carefully during the elections.
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- Written by Daniel Shin
- Category: World
Greece and the rest of Europe were cutting it close when all parties finally agreed on a preliminary deal that would allow further bailout talks. While the deal forces Greece to extreme austerity measures, Europe has avoided a possibility of one of its members from being forced out of the union (Reuters 7/13/2015). As the European Commissioner President Jean-Claude Juncker mentioned, the deal is not total defeat against the Greeks per se but a fair political compromise, if and only if, the Greece Prime Minister Alexi Tsipras is able to hold the current compromise to a successful vote in his parliament and win smart concessions from the EU in future negotiations.
There is a great theoretical argument that austerity under conditions similar to Greece would backfire and hamper economic recovery (The Guardian 4/29/2015). While economically conservative Germany wants Greece to quickly cut spending and focus on balancing the budget, austerity will dash Greece from any significant economic recovery in the near term. Some type of stimulus is favorable in order to jump start the Greece economy, which in turn would increase government revenue to pay down the national debt.
In the current political development, there is no possibility of a government stimulus from the Greek government due to the recent austerity agreement. Furthermore, stimulus investments by private actors, including foreign direct investments, seem unlikely given the chaotic political and economic conditions in Greece. Greece needs an economic stimulus, so how would the government of Greece get it?
The answer is the European Union.
Prime Minister Tsipras should compromise with German chancellor Angela Merkel and promise heavy Greek austerity measures for years to come. Such austerity policies will hurt many Greeks, given that cuts in pensions and other government services would likely reduce the fixed income for many dependents of the government. In exchange for austerity measures, Prime Minister Tsipras ought to negotiate hard on stimulus programs from the European Union itself. The European Union can use its member funds to invest in infrastructure projects and setup other EU-run projects in Greece. Such stimulus spending would, theoretically, create additional jobs, however temporary, to the people in Greece as long as the people of Greece are allowed to work in these various stimulus projects.
The EU being involved in transnational investment is not new. There already has been an investment project on improving the transportation infrastructure (The European Commission 1/29/2015), and thus Prime Minister Tsipras needs to focus on securing many EU projects to Greece in order to generate a potential economic stimulus for his country that is funded by the European citizens.
Even Germany knows that austerity alone would hamper Greece’s economic development. A lean Greek government with a temporary economic stimulus in Greece by EU projects might be an attractive option for everyone in Europe.
