China
Does US-China strategic cooperation have to be so hard?
Author: Evan A Feigenbaum, CFR Can the United States and China cooperate to forestall threats to stability? A new CFR report, Managing Instability on China’s Periphery , asks this question in the context of fragile states and regions that share borders with China — specifically North Korea, Myanmar, Pakistan and Central Asia. I participated in the project, which included workshops with Chinese specialists assembled by Peking University. I also wrote the report’s chapter on Central Asia. The project is interesting because the US and China actually have a long history of cooperating in places along China’s border. Just take recent tensions over Afghanistan, for example. These strains belie the degree to which Beijing and Washington worked jointly to defeat the Soviet occupation of Afghanistan in the 1980s. Washington encouraged Chinese support for the Afghan mujahideen , and the two countries cooperated in other unprecedented ways during the conflict. But that was then. Today, the US and China are often at loggerheads in such places. US officials have argued that Chinese policies help to bolster Myanmar’s ruling junta. Many in Washington argue, too, that Chinese policies have shielded North Korea from the effects of international sanctions that Beijing itself has repeatedly voted for. For their part, Chinese officials often view US policies in these countries as naïve at best, destabilising at worst. Many in Beijing hold the view that US and South Korean ‘failures’ have cornered North Korea and thus urge deepened policies of engagement. In Central Asia, meanwhile, as Deputy Assistant Secretary of State for the region in 2006 and 2007, I heard Chinese officials argue ad infinitum that US actions to promote political reform could, ultimately, destabilise these countries. What’s going on? Does cooperation really have to be so hard? For that matter, is coordination so hard because the US and China lack common interests? I think not. In fact, asserting so is a too-easy cop out because, in most cases, it would be awfully hard to demonstrate empirically that China actually ‘wants’ an unstable Pakistan or would just ‘love’ a North Korea with nuclear weapons. In the countries at the heart of this CFR study, why wouldn’t China share America’s interest in stability, security, development and prosperity? No, I suspect the problem usually isn’t a lack of common interests. It’s that shared interests are very general in nature. Turning (abstract) common interests into (concrete) complementary policies requires that Beijing and Washington overcome two very high hurdles: First, Beijing almost never seems to share American threat assessments anymore. Countries like Iran and North Korea don’t threaten China directly, so Beijing can probably afford to be more relaxed and many Chinese analysts argue that Washington overstates the scope and urgency of such threats. Second, even when Beijing shares America’s sense of threat, countervailing interests still obstruct cooperation. In Afghanistan, for example, China certainly shares America’s core interest: a stable Afghan state that does not harbour, nurture or export terrorism. But Chinese decision-makers have become uncomfortable when told that the path to victory may require a long-term NATO presence on China’s western border, US bases and access agreements in Central Asia, and enhanced US and NATO strategic coordination with neighbours that have had difficult relations with China. So, what’s to be done? More dialogue, perhaps? I’m sceptical. Dialogue, in itself, is not a policy, not least because dialogue for its own sake has not, in the recent past, proved especially useful. The US and China have held routine dialogue on Central Asia since at least 2006. An institutionalised Central Asia sub-dialogue was established in December 2005 in the wake of a meeting of the US-China Senior Dialogue in Washington. But the quality of the conversations has been mixed and few, if any, coordinated actions have emerged from it. Here, then, are a few bottom lines: First, since coordination has been weak, the US and China should aim at complementary, but not necessarily joint, projects and actions. Of course the US and China need, in the first instance, to establish more transparency and a better mutual understanding of each other’s strategic intentions. But both countries are active, for example, with capacity-building programs and projects . So it is important to remember that complementary projects and actions need not be conducted jointly. One example is counter-narcotics work, where Washington and Beijing could coordinate their areas of focus, direct their respective financial assistance packages at similar drugs-related goals, and build complementary capacity while maintaining separate efforts. Second, of course the two countries should aim to improve coordination, but they shouldn’t expect to do real joint contingency planning. Not anytime soon, in any case. US-China coordination will continue to be difficult for the various reasons noted above: China does not often share American threat assessments; China does not support the US approach to political or economic reform in, say, Central Asia or Pakistan; and finally, countervailing interests, clashing security concepts, and mutual suspicions will remain an obstacle for some time. That means contingency discussions of, for example, donor principles and modalities in a prospective food crisis — in Central Asia or North Korea, for example — could build a better platform for US-China coordination than, say, aiming high at the big security issues. Third, to use an American football metaphor: the two countries don’t always have to ‘throw long’. Working now on peripheral issues may well give both countries a better chance to work over time toward core strategic issues. My bet is that coordinating economic policies will prove easier than coordinating security policies. And coordinating with ad hoc groups — for instance, with the Asian Development Bank’s Central Asia Regional Economic Cooperation program — will provide China with some ‘cover’, and thus prove easier than coordinating bilaterally. At the end of the day, the US and China badly need to create a track record of concrete successes. And this is especially true in the places where shared strategic interests exist but remain awfully abstract. Evan A Feigenbaum is Adjunct Senior Fellow for East, Central and South Asia at the Council on Foreign Relations. A version of this article was first published here at the Council on Foreign Relations. North Korea: Why is Seoul and Tokyo Cooperation Necessary? North Korea: strategic thinking, strategic response China-Pakistan space technology cooperation
Author: Evan A Feigenbaum, CFR
Can the United States and China cooperate to forestall threats to stability?
A new CFR report, Managing Instability on China’s Periphery, asks this question in the context of fragile states and regions that share borders with China — specifically North Korea, Myanmar, Pakistan and Central Asia. I participated in the project, which included workshops with Chinese specialists assembled by Peking University. I also wrote the report’s chapter on Central Asia.
The project is interesting because the US and China actually have a long history of cooperating in places along China’s border. Just take recent tensions over Afghanistan, for example. These strains belie the degree to which Beijing and Washington worked jointly to defeat the Soviet occupation of Afghanistan in the 1980s. Washington encouraged Chinese support for the Afghan mujahideen, and the two countries cooperated in other unprecedented ways during the conflict.
But that was then.
Today, the US and China are often at loggerheads in such places. US officials have argued that Chinese policies help to bolster Myanmar’s ruling junta. Many in Washington argue, too, that Chinese policies have shielded North Korea from the effects of international sanctions that Beijing itself has repeatedly voted for.
For their part, Chinese officials often view US policies in these countries as naïve at best, destabilising at worst. Many in Beijing hold the view that US and South Korean ‘failures’ have cornered North Korea and thus urge deepened policies of engagement. In Central Asia, meanwhile, as Deputy Assistant Secretary of State for the region in 2006 and 2007, I heard Chinese officials argue ad infinitum that US actions to promote political reform could, ultimately, destabilise these countries.
What’s going on? Does cooperation really have to be so hard? For that matter, is coordination so hard because the US and China lack common interests?
I think not. In fact, asserting so is a too-easy cop out because, in most cases, it would be awfully hard to demonstrate empirically that China actually ‘wants’ an unstable Pakistan or would just ‘love’ a North Korea with nuclear weapons. In the countries at the heart of this CFR study, why wouldn’t China share America’s interest in stability, security, development and prosperity?
No, I suspect the problem usually isn’t a lack of common interests. It’s that shared interests are very general in nature. Turning (abstract) common interests into (concrete) complementary policies requires that Beijing and Washington overcome two very high hurdles:
First, Beijing almost never seems to share American threat assessments anymore. Countries like Iran and North Korea don’t threaten China directly, so Beijing can probably afford to be more relaxed and many Chinese analysts argue that Washington overstates the scope and urgency of such threats.
Second, even when Beijing shares America’s sense of threat, countervailing interests still obstruct cooperation. In Afghanistan, for example, China certainly shares America’s core interest: a stable Afghan state that does not harbour, nurture or export terrorism. But Chinese decision-makers have become uncomfortable when told that the path to victory may require a long-term NATO presence on China’s western border, US bases and access agreements in Central Asia, and enhanced US and NATO strategic coordination with neighbours that have had difficult relations with China.
So, what’s to be done? More dialogue, perhaps? I’m sceptical.
Dialogue, in itself, is not a policy, not least because dialogue for its own sake has not, in the recent past, proved especially useful. The US and China have held routine dialogue on Central Asia since at least 2006. An institutionalised Central Asia sub-dialogue was established in December 2005 in the wake of a meeting of the US-China Senior Dialogue in Washington. But the quality of the conversations has been mixed and few, if any, coordinated actions have emerged from it.
Here, then, are a few bottom lines:
First, since coordination has been weak, the US and China should aim at complementary, but not necessarily joint, projects and actions. Of course the US and China need, in the first instance, to establish more transparency and a better mutual understanding of each other’s strategic intentions. But both countries are active, for example, with capacity-building programs and projects. So it is important to remember that complementary projects and actions need not be conducted jointly.
One example is counter-narcotics work, where Washington and Beijing could coordinate their areas of focus, direct their respective financial assistance packages at similar drugs-related goals, and build complementary capacity while maintaining separate efforts.
Second, of course the two countries should aim to improve coordination, but they shouldn’t expect to do real joint contingency planning. Not anytime soon, in any case. US-China coordination will continue to be difficult for the various reasons noted above: China does not often share American threat assessments; China does not support the US approach to political or economic reform in, say, Central Asia or Pakistan; and finally, countervailing interests, clashing security concepts, and mutual suspicions will remain an obstacle for some time.
That means contingency discussions of, for example, donor principles and modalities in a prospective food crisis — in Central Asia or North Korea, for example — could build a better platform for US-China coordination than, say, aiming high at the big security issues.
Third, to use an American football metaphor: the two countries don’t always have to ‘throw long’. Working now on peripheral issues may well give both countries a better chance to work over time toward core strategic issues. My bet is that coordinating economic policies will prove easier than coordinating security policies. And coordinating with ad hoc groups — for instance, with the Asian Development Bank’s Central Asia Regional Economic Cooperation program — will provide China with some ‘cover’, and thus prove easier than coordinating bilaterally.
At the end of the day, the US and China badly need to create a track record of concrete successes. And this is especially true in the places where shared strategic interests exist but remain awfully abstract.
Evan A Feigenbaum is Adjunct Senior Fellow for East, Central and South Asia at the Council on Foreign Relations. A version of this article was first published here at the Council on Foreign Relations.
- North Korea: Why is Seoul and Tokyo Cooperation Necessary?
- North Korea: strategic thinking, strategic response
- China-Pakistan space technology cooperation
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Does US-China strategic cooperation have to be so hard?
China
Q1 2024 Brief on Transfer Pricing in Asia
Indonesia’s Ministry of Finance released Regulation No. 172 of 2023 on transfer pricing, consolidating various guidelines. The Directorate General of Taxes focuses on compliance, expanded arm’s length principle, and substance checks. Singapore’s Budget 2024 addresses economic challenges, operational costs, and sustainability, implementing global tax reforms like the Income Inclusion Rule and Domestic Top-up Tax.
Indonesia’s Ministry of Finance (MoF) has released Regulation No. 172 of 2023 (“PMK-172”), which prevails as a unified transfer pricing guideline. PMK-172 consolidates various transfer pricing matters that were previously covered under separate regulations, including the application of the arm’s length principle, transfer pricing documentation requirements, transfer pricing adjustments, Mutual Agreement Procedure (“MAP”), and Advance Pricing Agreements (“APA”).
The Indonesian Directorate General of Taxes (DGT) has continued to focus on compliance with the ex-ante principle, the expanded scope of transactions subject to the arm’s length principle, and the reinforcement of substance checks as part of the preliminary stage, indicating the DGT’s expectation of meticulous and well-supported transfer pricing analyses conducted by taxpayers.
In conclusion, PMK-172 reflects the Indonesian government’s commitment to addressing some of the most controversial transfer pricing issues and promoting clarity and certainty. While it brings new opportunities, it also presents challenges. Taxpayers are strongly advised to evaluate the implications of these new guidelines on their businesses in Indonesia to navigate this transformative regulatory landscape successfully.
In a significant move to bolster economic resilience and sustainability, Singapore’s Deputy Prime Minister and Minister for Finance, Mr. Lawrence Wong, unveiled the ambitious Singapore Budget 2024 on February 16, 2024. Amidst global economic fluctuations and a pressing climate crisis, the Budget strategically addresses the dual challenges of rising operational costs and the imperative for sustainable development, marking a pivotal step towards fortifying Singapore’s position as a competitive and green economy.
In anticipation of global tax reforms, Singapore’s proactive steps to implement the Income Inclusion Rule (IIR) and Domestic Top-up Tax (DTT) under the BEPS 2.0 framework demonstrate a forward-looking approach to ensure tax compliance and fairness. These measures reaffirm Singapore’s commitment to international tax standards while safeguarding its economic interests.
Transfer pricing highlights from the Singapore Budget 2024 include:
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
New Report from Dezan Shira & Associates: China Takes the Lead in Emerging Asia Manufacturing Index 2024
China has been the world’s largest manufacturer for 14 years, producing one-third of global manufacturing output. In the Emerging Asia Manufacturing Index 2024, China ranks highest among eight emerging countries in the region. Challenges for these countries include global demand disparities affecting industrial output and export orders.
Known as the “World’s Factory”, China has held the title of the world’s largest manufacturer for 14 consecutive years, starting from 2010. Its factories churn out approximately one-third of the global manufacturing output, a testament to its industrial might and capacity.
China’s dominant role as the world’s sole manufacturing power is reaffirmed in Dezan Shira & Associates’ Emerging Asia Manufacturing Index 2024 report (“EAMI 2024”), in which China secures the top spot among eight emerging countries in the Asia-Pacific region. The other seven economies are India, Indonesia, Malaysia, the Philippines, Thailand, Vietnam, and Bangladesh.
The EAMI 2024 aims to assess the potential of these eight economies, navigate the risks, and pinpoint specific factors affecting the manufacturing landscape.
In this article, we delve into the key findings of the EAMI 2024 report and navigate China’s advantages and disadvantages in the manufacturing sector, placing them within the Asia-Pacific comparative context.
Emerging Asia countries face various challenges, especially in the current phase of increased volatility, uncertainty, complexity, and ambiguity (VUCA). One notable challenge is the impact of global demand disparities on the manufacturing sector, affecting industrial output and export orders.
This article is republished from China Briefing. Read the rest of the original article.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.
China
Is journalist Vicky Xu preparing to return to China?
Chinese social media influencers have recently claimed that prominent Chinese-born Australian journalist Vicky Xu had posted a message saying she planned to return to China.
There is no evidence for this. The source did not provide evidence to support the claim, and Xu herself later confirmed to AFCL that she has no such plans.
Currently working as an analyst at the Australian Strategic Policy Institute, or ASPI, Xu has previously written for both the Australian Broadcasting Corporation, or ABC, and The New York Times.
A Chinese language netizen on X initially claimed on March 31 that the changing geopolitical relations between Sydney and Beijing had caused Xu to become an expendable asset and that she had posted a message expressing a strong desire to return to China. An illegible, blurred photo of the supposed message accompanied the post.
This claim was retweeted by a widely followed influencer on the popular Chinese social media site Weibo one day later, who additionally commented that Xu was a “traitor” who had been abandoned by Australian media.
Following the publication of an ASPI article in 2021 which exposed forced labor conditions in Xinjiang co-authored by Xu, the journalist was labeled “morally bankrupt” and “anti-China” by the Chinese state owned media outlet Global Times and subjected to an influx of threatening messages and digital abuse, eventually forcing her to temporarily close several of her social media accounts.
AFCL found that neither Xu’s active X nor LinkedIn account has any mention of her supposed return to China, and received the following response from Xu herself about the rumor:
“I can confirm that I don’t have plans to go back to China. I think if I do go back I’ll most definitely be detained or imprisoned – so the only career I’ll be having is probably going to be prison labor or something like that, which wouldn’t be ideal.”
Neither a keyword search nor reverse image search on the photo attached to the original X post turned up any text from Xu supporting the netizens’ claims.
Translated by Shen Ke. Edited by Shen Ke and Malcolm Foster.
Asia Fact Check Lab (AFCL) was established to counter disinformation in today’s complex media environment. We publish fact-checks, media-watches and in-depth reports that aim to sharpen and deepen our readers’ understanding of current affairs and public issues. If you like our content, you can also follow us on Facebook, Instagram and X.
Read the rest of this article here >>> Is journalist Vicky Xu preparing to return to China?
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