In a continuation of my Road to War series, I turn to the Trans-Pacific Partnership, the trade deal recently struck (but not yet ratified and executed) by the United States, Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. Much has been written about how this deal will (or will not) benefit the participants, but that is not the focus of this post. Instead, we turn to the strategic aspect of the TTP, and try to answer the question: is the TPP intended to contain China, or is it simply the extension of the Washington Consensus that drives the world towards greater openness and trade.
Uh oh. Have we finally reached the turning point for China's economy? Per Caixin:
(Beijing) – China's services sector continued to expand in December, albeit with less strength than in previous months, according to the latest Caixin China Services Purchasing Manager's Index.
December's index of 50.2 pointed to nationwide expansion for service business in general, even though the figure was down from 51.2 in November. It was also the second-lowest figure for the sector since record-keeping began in November 2005. The weakest services PMI ever recorded was 50 in July 2014.
I don't often get a chance to discuss Australia, an important but often overlooked (from the American perspective) continent-sized country that serves as America's greatest ally in the Asia-Pacific region. As an alternative to an article I cited in the forum early in 2015, here is an Australian perspective. The Executive Director of the Lowy Insitute (an Australian think tank), Michael Fullilove, gave a series of lectures based on his book A Larger Australia which attempt to address the question of how Australia's foreign policy should adapt itself to the changes sweeping over the world. The audio and transcripts for the lectures are available online courtesy of the Australian Broadcasting Corporation. I would like to highlight several exerpts from the lecture series, which can serve as an important template for examining Australia's role in the world.
What is China's Grand Strategy?
What connects China's push to internationalize the RMB, set up new global institutions to compete with the post-WWII order set up by the United States, and China's militarization of the South China Sea? I've revisited an old discussion in the forms debating the death of the American superpower, and wondering how it might be achieving by a rising China.
Here's a short video from FT exploring the effect of China's economic slowdown on its major trading partners. Outside of the commodity exporters, the takeaway seems to be that the slowdown won't affect the developed world to a significant degree, at least not directly. Here's the key screenshot:
And the video: