Asean
Calls for a Sino-Mongolia strategic partnership
Author: Mendee Jargalsaikhan, UBC The Chinese Foreign Minister’s brief visit to Mongolia on 24 February, like the Chinese Premier’s visit last June, did not trigger any negative public debate or protests in the streets of Ulaanbaatar. Rather, an op-ed by well-known columnist Baabar on the repression and marginalization of Chinese ethnic minorities during the communist era received wide attention. During this visit, Mongolian leaders called for a Sino-Mongolian Strategic Partnership — an unthinkable prospect a decade ago. Mongolia’s political leaders and people are changing their attitudes toward the Chinese. And although they make for great headlines abroad, sporadic incidents of xenophobia and racism against Chinese are not indicative of the wider public sentiment. Even after centuries of distrust, China was a normal neighbour of Mongolia in the 1950s; bilateral trade and all types of exchanges flourished, characterized by a process of learning. This learning came to a 30-year standstill when China became a ‘declared enemy’ of Mongolia. Another phase of cooperation and learning started in 1989, when Mongolia–China relations were normalized. At this time, Mongolians became increasingly dependent on Chinese infrastructure and the Chinese market . While Russia imposed visa requirements on Mongolians, and the safety of passengers and goods going through Russia was problematic, China granted visa waivers for Mongolian travellers and made its air, rail and sea ports accessible. Some might argue that this was Chinese soft power in play, but, above all else, these policies were based on economic practicality. By the Mongolian Embassy’s account, 350,000–370,000 Mongolians travel to China annually. This includes travel to Inner Mongolia or Beijing for medical diagnosis and treatment, as Seoul and Tokyo are costly. The number of Mongolian students in China is also on the rise, and Chinese language schools and training programs are abundant back home. And while China desires to increase its border trading posts with Mongolia, Moscow wants to close its posts. All these factors contribute to the learning between Mongolia and China, and a growth in bilateral trade and Chinese investment. This learning process for Mongolians has two palpable implications. It impels Mongolian political leaders to realize the ‘China factor’ in developing its economy and integrating with East Asia — thus calls for a strategic partnership. It assuages Mongolian misperceptions of China as a threat, something constructed by the Soviets in the 1960s. How much are the Chinese learning about Mongolia, one might ask? Is the Chinese government simply trying to make Mongolia a showcase of China’s benevolence and respect for the sovereignty of its smaller neighbours? This was highlighted when China concluded a border treaty with Mongolia while fighting against India in 1964. It was reiterated by Hu Jintao at the beginning of his first foreign visit to Ulaanbaatar. Whichever way, there is a change in the quality of Mongolia’s relations with China. Mendee Jargalsaikhan is a graduate student at the Institute of Asian Research, University of British Columbia. Chinese investment in Mongolia: A sequel Chinese investment in Mongolia: An uneasy courtship between Goliath and David Mongolia’s ‘third neighbour’ policy and its impact on foreign investment
Author: Mendee Jargalsaikhan, UBC
The Chinese Foreign Minister’s brief visit to Mongolia on 24 February, like the Chinese Premier’s visit last June, did not trigger any negative public debate or protests in the streets of Ulaanbaatar.
Rather, an op-ed by well-known columnist Baabar on the repression and marginalization of Chinese ethnic minorities during the communist era received wide attention. During this visit, Mongolian leaders called for a Sino-Mongolian Strategic Partnership — an unthinkable prospect a decade ago.
Mongolia’s political leaders and people are changing their attitudes toward the Chinese. And although they make for great headlines abroad, sporadic incidents of xenophobia and racism against Chinese are not indicative of the wider public sentiment.
Even after centuries of distrust, China was a normal neighbour of Mongolia in the 1950s; bilateral trade and all types of exchanges flourished, characterized by a process of learning. This learning came to a 30-year standstill when China became a ‘declared enemy’ of Mongolia.
Another phase of cooperation and learning started in 1989, when Mongolia–China relations were normalized. At this time, Mongolians became increasingly dependent on Chinese infrastructure and the Chinese market.
While Russia imposed visa requirements on Mongolians, and the safety of passengers and goods going through Russia was problematic, China granted visa waivers for Mongolian travellers and made its air, rail and sea ports accessible. Some might argue that this was Chinese soft power in play, but, above all else, these policies were based on economic practicality.
By the Mongolian Embassy’s account, 350,000–370,000 Mongolians travel to China annually. This includes travel to Inner Mongolia or Beijing for medical diagnosis and treatment, as Seoul and Tokyo are costly. The number of Mongolian students in China is also on the rise, and Chinese language schools and training programs are abundant back home. And while China desires to increase its border trading posts with Mongolia, Moscow wants to close its posts. All these factors contribute to the learning between Mongolia and China, and a growth in bilateral trade and Chinese investment.
This learning process for Mongolians has two palpable implications.
It impels Mongolian political leaders to realize the ‘China factor’ in developing its economy and integrating with East Asia — thus calls for a strategic partnership.
It assuages Mongolian misperceptions of China as a threat, something constructed by the Soviets in the 1960s.
How much are the Chinese learning about Mongolia, one might ask? Is the Chinese government simply trying to make Mongolia a showcase of China’s benevolence and respect for the sovereignty of its smaller neighbours? This was highlighted when China concluded a border treaty with Mongolia while fighting against India in 1964. It was reiterated by Hu Jintao at the beginning of his first foreign visit to Ulaanbaatar. Whichever way, there is a change in the quality of Mongolia’s relations with China.
Mendee Jargalsaikhan is a graduate student at the Institute of Asian Research, University of British Columbia.
- Chinese investment in Mongolia: A sequel
- Chinese investment in Mongolia: An uneasy courtship between Goliath and David
- Mongolia’s ‘third neighbour’ policy and its impact on foreign investment
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Calls for a Sino-Mongolia strategic partnership
Asean
ASEAN weathering the COVID-19 typhoon
Author: Sandra Seno-Alday, Sydney University
The roughly 20 typhoons that hit Southeast Asia each year pale in comparison to the impact on the region of COVID-19 — a storm of a very different sort striking not just Southeast Asia but the world.
Just how badly is the COVID-19 typhoon thrashing the region? And what might the post-crisis recovery and reconstruction look like? To answer these questions, it is necessary to investigate the strengths and vulnerabilities of Southeast Asia’s pre-COVID-19 economic infrastructure.
Understanding the structure of the region’s economic house requires going back to 1967, when Southeast Asian countries decided to pledge friendship to one another under the ASEAN framework. While other integrated regions such as NAFTA and the European Union have aggressively broken down trade barriers and significantly boosted intra-regional trade, ASEAN regional economic integration has chugged along slower.
Southeast Asian countries have not viewed trade between each other as a top priority. The trade agreements in the region have been forged around suggestions for ASEAN countries to lower tariffs on intra-regional trade to within a certain range and across limited industries. This has lowered but not eliminated barriers to intra-regional trade. Consequently, a relatively significant share of Southeast Asian trade is with countries outside the region. This active extra-regional engagement has resulted in ASEAN countries’ successful integration into global value chain networks.
A historically outward-facing region, in 2010 around 75 per cent of Southeast Asian commodity imports and exports came from countries outside of ASEAN. This share of extra-regional trade nudged closer to 80 per cent in 2018. This indicates that ASEAN’s global value chain network embeddedness has deepened over time.
Around 40 per cent of ASEAN’s extra-regional trade is with the rest of Asia. From 2010 to 2018 Southeast Asian countries forged major trade relationships with four Asian countries: China, Japan, South Korea and India. Outside Asia, the United States is the region’s major trading partner. ASEAN’s trade focus on Asia’s largest markets is not surprising. Countries tend to establish trade relationships with large, geographically close, and culturally similar markets.
Fostering deep relationships with a few large markets, however, is a double-edged sword. While it has allowed ASEAN to benefit from integration in global value chains, it has also resulted in increased vulnerability to the shocks affecting its network connections.
ASEAN’s participation in global value chains has allowed it to transition from a net regional importer in 1990 to a net regional exporter in 2018. But the region’s deep embeddedness in a small and tightly-coupled network cluster of extra-regional global value chain partners has exposed it to disruption to any and all of its external partners. By contrast, ASEAN’s intra-regional trade network structure is much more loosely-coupled: a consequence of persistent intra-regional trade barriers and thus lower intra-regional trade intensity.
In the pre-COVID-19 period, ASEAN built for itself an economic house held up by just five extra-regional markets, while doing less to expand and diversify its intra-regional trade network. The data shows that ASEAN trade became increasingly concentrated in these few external markets between 2010 and 2018.
This dependence on a handful of markets does not bode well for risk and crisis management. All of the region’s major trading partners have been significantly affected by COVID-19 and this in turn is blowing the ASEAN economic house down.
What are the ways forward? The immediate task at hand is to get a better picture of the region’s position in global value chain networks and to get on top of managing its network risk exposure. Already there are red flags around the region’s food security arising from its position in food value chains. It is critical to look for ways to introduce flexibility into existing supply chains for greater agility in responding to crises.
It is also an opportune time for ASEAN to harness the technology transfer gains of global value chain participation and invest in innovation-driven diversification of products and markets. The region’s embeddedness in global value chain networks certainly places it in a strong position to readily access large export markets not just in Asia but also Europe and the Americas.
Over the longer term, ASEAN is faced with the question of whether it should seriously look…
Markets
Tiger Trade Launches SGX Trading, Meeting Demand from Asian Investors
Access to the Singapore Exchange (SGX) adds to Tiger Brokers’ current menu of stock exchanges, such as the New York Stock Exchange (NYSE) and the Nasdaq Stock Market (NASDAQ), the world’s two largest stock exchanges, as well as the Hong Kong Stock Exchange (HKEX).
SINGAPORE (ACN Newswire) – Tiger Trade, a one-stop mobile and online trading application by Tiger Brokers, has launched access to the Singapore Exchange (SGX).
(more…)Asean
Can Asia maintain growth with an ever ageing population ?
To boost productivity in the future, Asian governments will have to implement well-targeted structural reforms today.
Asia has been the world champion of economic growth for decades, and this year will be no exception. According to the latest International Monetary Fund Regional Economic Outlook(REO), the Asia-Pacific region’s GDP is projected to increase by 5.5% in 2017 and 5.4% in 2018. (more…)
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