China
Australia’s new defence geography
Author: Hugh White, ANU
In one of its bolder steps, Australia’s new Defence Strategy and Force Structure Review is proposing a radical redefinition of the geographical reach of Australia’s strategic priorities. It rejects the expansive view of Canberra’s last major defence policy statement — the 2016 Defence White Paper — which accorded equal priority to local, regional and global missions and commitments.
Instead, the Defence Review says defence planning will focus on Australia’s immediate region — ‘ranging from the north-eastern Indian Ocean, through maritime and mainland South East Asia to Papua New Guinea and the South West Pacific’.
This is — in theory — quite an important shift. The definition of Australia’s area of strategic interest has always been a key factor in determining its strategic posture and the kinds of forces it needs. For decades there has been a policy tug-of-war between those who think Australia’s defence should focus closer to home and those who argue for a broader view.
Since the 1970s the regionalists have mostly prevailed until the 2016 White Paper endorsed a more global view. The Defence Review seems to mark a return to the regionalist perspective, refocussing defence strategy on Australia’s own backyard as strategic risks in Asia grow.
But things are not that simple. The new Review defines ‘immediate neighbourhood’ in a very expansive way, extending from Australia’s territory all the way up through mainland Southeast Asia to the borders of China and India. According to the review, this vast area constitutes a single undifferentiated region of strategic priority for Australia.
This departs from how regionalist policymakers have traditionally seen the region. Key policy statements like the 1987 and 2000 Defence White Papers divided the wider region into a series of concentric bands and gave a higher priority to those closer to Australia. This provided a robust basis for setting Defence Force priorities by making it clear, for example, that forces for maritime operations in Australia’s immediate approaches had a higher priority than forces for land operations on the Asian continent.
At the core of Canberra’s regionalist policies over many decades is the priority given to the defence of Australia itself from direct attack. This priority seems to have been completely dropped in the Defence Review. The defence of Laos now seems to have the same priority for Australia’s armed forces as the defence of its own continent.
This seems absurd, but it meshes with another significant shift in the way the Review describes Australia’s defence policy. Since the early 1970s every Australian government has committed itself to the goal of defence self-reliance — the idea that Australia should be able to defend itself against direct attack without relying on the armed forces of its allies. This commitment was heavily watered down for the first time in the 2016 White Paper and it has almost entirely disappeared in the Defence Review.
The natural conclusion to draw from this is that the government has abandoned the idea of self-reliance and now believes that its security depends on fighting alongside allies as far from its shores as possible. This marks a return to the policy of ‘forward defence’ which shaped Australian forces and drove its commitments in the 1950s and 1960s.
Forward defence fell out of favour after the failures of the Vietnam War, but perhaps it helped Australia and its neighbours to navigate the turbulent 1950s and 1960s. And one could argue that self-reliance was only ever taken seriously in relation to the relatively weak threats that could be posed by Indonesia. No government has seriously thought of defending Australia independently against a major power like China, which is the contingency we must take seriously today.
So perhaps a return to forward defence is a good idea? That depends on three things.
First, can Australia be sure of finding allies in its new and expansively-defined ‘immediate neighbourhood’ to fight alongside? The Defence Review talks a lot about cooperating with Asian neighbours to uphold regional peace and stability, and assumes that the United States will be there too. But this cannot be taken for granted. Countries closer to China have very different interests and priorities to Australia’s, and the extent of the future commitment of the US to Asia is uncertain as the costs and risks of confronting China grow.
Second, if the crunch came, would Australians be willing to fight so far from their own…
China
Exploring the Revamped China Certified Emission Reduction (CCER) Program: Potential Benefits for International Businesses
Companies in China must navigate compliance, trading, and reporting within the CCER framework, impacting operations and strategic objectives. The program focuses on afforestation, solar, wind power, and mangrove creation, offering opportunities for innovation and revenue streams while ensuring transparency and accuracy. The Ministry of Ecology and Environment oversees the program.
As companies navigate the complexities of compliance, trading, and reporting within the CCER framework, they must also contend with the broader implications for their operations, finances, and strategic objectives.
This article explores the multifaceted impact of the CCER program on companies operating in China, examining both the opportunities for innovation and growth, as well as the potential risks and compliance considerations.
Initially, the CCER will focus on four sectors: afforestation, solar thermal power, offshore wind power, and mangrove vegetation creation. Companies operating within these sectors can register their accredited carbon reduction credits in the CCER system for trading purposes. These sectors were chosen due to their reliance on carbon credit sales for profitability. For instance, offshore wind power generation, as more costly than onshore alternatives, stands to benefit from additional revenue streams facilitated by CCER transactions.
Currently, primary buyers are expected to be high-emission enterprises seeking to offset their excess emissions and companies aiming to demonstrate corporate social responsibility by contributing to environmental conservation. Eventually, the program aims to allow individuals to purchase credits to offset their carbon footprints. Unlike the mandatory national ETS, the revamped CCER scheme permits any enterprise to buy carbon credits, thereby expanding the market scope.
The Ministry of Ecology and Environment (MEE) oversees the CCER program, having assumed responsibility for climate change initiatives from the National Development and Reform Commission (NDRC) in 2018. Verification agencies and project operators are mandated to ensure transparency and accuracy in disclosing project details and carbon reduction practices.
On the second day after the launch on January 23, the first transaction in China’s voluntary carbon market saw the China National Offshore Oil Corporation (CNOOC), the country’s largest offshore oil and gas producer, purchase 250,000 tons of carbon credits to offset its emissions.
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
China Implements New Policies to Boost Foreign Investment in Science and Technology Companies
China’s Ministry of Commerce announced new policy measures on April 19, 2023, to encourage foreign investment in the technology sector. The measures include facilitating bond issuance, improving the investment environment, and simplifying procedures for foreign institutions to access the Chinese market.
On April 19, 2023, China’s Ministry of Commerce (MOFCOM) along with nine other departments announced a new set of policy measures (hereinafter, “new measures”) aimed at encouraging foreign investment in its technology sector.
Among the new measures, China intends to facilitate the issuance of RMB bonds by eligible overseas institutions and encourage both domestic and foreign-invested tech companies to raise funds through bond issuance.
In this article, we offer an overview of the new measures and their broader significance in fostering international investment and driving innovation-driven growth, underscoring China’s efforts to instill confidence among foreign investors.
The new measures contain a total of sixteen points aimed at facilitating foreign investment in China’s technology sector and improving the overall investment environment.
Divided into four main chapters, the new measures address key aspects including:
Firstly, China aims to expedite the approval process for QFII and RQFII, ensuring efficient access to the Chinese market. Moreover, the government promises to simplify procedures, facilitating operational activities and fund management for foreign institutions.
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
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.
- Exploring the Revamped China Certified Emission Reduction (CCER) Program: Potential Benefits for International Businesses
- China Implements New Policies to Boost Foreign Investment in Science and Technology Companies
- Q1 2024 Brief on Transfer Pricing in Asia
- New Report from Dezan Shira & Associates: China Takes the Lead in Emerging Asia Manufacturing Index 2024
- Is journalist Vicky Xu preparing to return to China?
- Guide for Foreign Residents: Obtaining a Certificate of No Criminal Record in China
