Publication in Economics, Politics and Public Policy in East Asia and the Pacific

Weak renminbi or strong US dollar?

A participant stands in front of a backdrop during the Asian Financial Forum in Hong Kong on 14 January 2013. China can increase 10 times the current level of investment quotas for Renminbi Qualified Foreign Institutional Investment (RQFII) and QFII, Guo Shuqing, chairman of the China Securities Regulatory Commission (CSRC), said on Monday at the Asia Financial Forum in Hong Kong (Photo: Reuters/Bobby Yip).

Author: Linda Lim, University of Michigan

United States Treasury Secretary Steven Mnuchin recently warned China against devaluing its currency, saying that any US–China trade deal must include a currency agreement against ‘competitive devaluation’. Read more…

Getting ahead of the next crisis in Asia

The public face of government: a police officer directs the response to a fire in Hazira, India. Greater public trust in officialdom builds domestic resilience (Photo: Reuters/Amit Dave).

Author: Gordon de Brouwer, ANU

The tenth anniversary of the global financial crisis has provided the occasion for serious reflection about the prevention and resolution of financial and economic crises, and whether the key lessons from the crisis have been addressed. In Asia and the Pacific, there are other crises to think of: it has been two decades since the Asian financial crisis, two-and-a-half decades since the Latin American crisis, three decades since Australia’s and Japan’s home-grown financial crises, and four decades since the collapse of the Bretton Woods system of fixed exchange rates. Read more…

Xi Jinping looks to the northeast to make China great again

A statue of former Chinese Chairman Mao Zedong is seen in front of a residential building in Dandong New Zone, Liaoning province, China, 12 June 2018 (Photo: Reuters/Stringer).

Author: Nathan Attrill, ANU

For 40 years, northeast China has frustrated the political leadership in Beijing. Once the heartland of an industrial, modern socialist China, the region has fallen behind the rest of the country on all measures of economic, social and environmental well-being. Read more…

Thailand’s post-coup foreign policy

Chinese Foreign Minister Wang Yi shakes hands with Thai Prime Minister Prayuth Chan-O-Cha at Government House in Bangkok, Thailand, 24 July 2017 (Photo: Reuters/Lillian Suwanrumpha/Pool).

Author: Pavin Chachavalpongpun, Kyoto University

Thailand’s foreign policy in the aftermath of the 2014 coup has been based on bamboo diplomacy, whereby it befriends undemocratic states in Asia to reduce its dependency on Western governments. Prime Minister Prayuth Chan-ocha is continuing to seek political recognition from Thailand’s partners, both in Southeast Asia and further abroad. His desperation has contributed to foreign policy based primarily on appeasement and compliance. Read more…

Deja vu? Old policy tools, old risks in China

Bullet trains nose-to-nose at Yantai station, Shandong province. Infrastructure projects have contributed significantly to China’s economic performance in recent decades, but some commentators believe the marginal return on such investments has turned from positive to negative (Picture: China Daily/Reuters).

Authors: Jiao Wang, University of Melbourne and Yiping Huang, Peking University

The communique of the Chinese Communist Party Politburo meeting, held on 31 July 2018, identified maintaining economic and social stability as the top policy priority. China’s real GDP growth rate edged down from 6.8 per cent in the first quarter of 2018 to 6.7 per cent in the second quarter, and is expected to soften further in the coming quarters due to increasingly difficult external and domestic conditions.

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China–Japan cooperation going global

Japanese Prime Minister Shinzo Abe (left) shakes hands with Chinese President Xi Jinping during a meeting in Beijing, China, 26 October 2018 (Photo: Kyodo via Reuters).

Author: Editorial Board, ANU

Japanese Prime Minister Shinzo Abe has just concluded his landmark state visit to China, the first by a Japanese leader to China in seven years. Commemorating the 40th anniversary of the China–Japan Peace and Friendship Treaty, Abe and Chinese President Xi Jinping announced a raft of initiatives.

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Japan joins to shape China’s Belt and Road

Asian Infrastructure Investment Bank (AIIB) President Jin Liqun speaks at an international forum on Belt and Road Legal Cooperation in Beijing, China, 2 July 2018 (Photo: Reuters/Jason Lee).

Author: Shiro Armstrong, ANU

On the first state visit to China by a Japanese leader in 11 years, Prime Minister Shinzo Abe and President Xi Jinping announced 50 joint infrastructure projects. This embrace of joint infrastructure investment cooperation through the Belt and Road Initiative in all but name is on a scale even larger than was anticipated before Abe’s arrival in Beijing. There was also a raft of other announcements that will help normalise the political relationship between the two Asian giants that share one of the largest economic relationships in the world. But the most consequential of those could be the joint investment in infrastructure projects.

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Coast guard competition could cause conflict in the South China Sea

A ship (top) of the Chinese Coast Guard is seen near a ship of the Vietnam Marine Guard in the South China Sea, about 210 km (130 miles) off shore of Vietnam 14 May 2014 (Photo: Reuters/Nguyen Minh).

Author: Yang Fang, ANU

Claimants of the South China Sea are investing significant resources in modernising their respective coast guards. These fleets, commonly called ‘white hulls’, play a strategic role in asserting sovereignty and enforcing national jurisdiction. As bellwether claimants such as China and Vietnam gradually upgrade both the capabilities and operational mandate of their ‘white hulls’, the risks of skirmishes grow higher. Read more…

The limits of Australia’s defence diplomacy

A C-130 Hercules support aircraft arrives during sunset at a Royal Australian Air Force (RAAF) base near Darwin to participate in 'Exercise Pitch Black', 15 July 2004 (Photo: Reuters/Australian Defence Force/Corporal Darren Hilder).

Author: Daniel Baldino, Notre Dame University

In July 2018, several Indo-Pacific air forces joined the United States, France, Canada and Australia for a multinational air combat exercise that was hosted over northern Australia. Code-named Pitch Black, the biennial exercise started as a bilateral combat exercise in the mid-1980s between Australia and the United States. Pitch Black has now evolved into a complex training workout with over 140 aircraft and 4000 personnel taking part. Read more…

Big gains or growing pains in store for the SCO?

Russian President Vladimir Putin, President of the People’s Republic of China Xi Jinping and President of the Republic of Tajikistan Emomali Rahmon are seen during a photo session of the Shanghai Cooperation Organisation in Qingdao, China, 10 June, 2018 (Photo: Reuters/Sputnik).

Author: Jingdong Yuan, University of Sydney

The Shanghai Cooperation Organization (SCO) is expanding. At its 2018 Qingdao Summit, it formally welcomed India and Pakistan as the organisation’s new members. Stretching from Eurasia to South Asia, the SCO now contains 44 per cent of the world’s population and 21 per cent of its GDP. It is also an organisation with four nuclear weapons states and two on the UN Security Council. Despite these impressive numbers, the organisation has yet to demonstrate its full potential and its expansion presents new challenges just as it offers new opportunities. Read more…

Central Asia at the mercy of Russia and China

Foreign ministers and officials of the Shanghai Cooperation Organisation(SCO) pose for a group photo before a meeting at the Diaoyutai State Guest House in Beijing, China, 24 April, 2018 (Photo: Reuters/POOL)

Author: Gennady Rudkevich, Georgia University

Over the past year, Central Asia has grown increasingly reliant on its two powerful neighbours: Russia and China. The ongoing conflict in Afghanistan and Uzbek–Russian rapprochement have strengthened Russia’s political position in the region — a position that was already favourable given Russia’s domination of a series of interlocking regional alliances and organisations. Read more…

Japan’s balancing act tours Beijing

Chinese Premier Li Keqiang and Japanese Prime Minister Shinzo Abe shake hands during their meeting at the Great Hall of the People in Beijing, China, 25 October 2018 (Photo: Reuters/Roman Pilipey).

Author: Rumi Aoyama, Waseda University

Japanese Prime Minister Shinzo Abe is visiting Beijing this week — the latest event in a gradual thawing of Japan–China relations. The expected outcomes of Abe’s visit will continue his administration’s foreign policy rebalance between China and the United States. While China welcomes the opportunity for deeper relations with Japan, the United States may be less enthusiastic. Read more…

The past, present and future of SOE reform in China

A security guard stands in position in front of the company's and Chinese flags outside the headquarters of Aluminum Corp of China in Beijing in this 5 June 2009 (Photo: Reuters/Christina Hu).

Author: Ligang Song, ANU

The reform of state-owned enterprises (SOEs) has been a core element of China’s economic reform process over the past 40 years. SOEs formed the backbone of China’s economy during the central planning era. Their transformation is among the most prominent changes to China’s enterprise system — changes that have been taking place in tandem with other institutional and policy reforms as China transitions to a market-based economy. Market-oriented development has progressed with a reduction in the scope of the SOE sector in the economy. Read more…

Bilateral currency swaps: facility and risk

A man walks past an advertisement promoting renminbi, US dollar and Euro exchange services in Hong Kong. China is keen to internationalise the renminbi (Photo: Reuters/Tyrone Siu).

Author: Kazumasa Iwata, University of Tokyo

Recent decades have seen Asian economies make greater use of bilateral currency swap lines. Both Japan and China deploy these facilities, though some difference in approach has become apparent, with China allowing its facilities to be used not only to facilitate settlements in trade and investment using the renminbi but also to resolve balance of payment crises — an approach that is not free of risk. Read more…

Xinjiang and the ‘Chinese Dream’

A delegate wearing a traditional costume attends a session of the Xinjiang Uyghur Autonomous Region on the sidelines of the National People's Congress (NPC) at the Great Hall of the People in Beijing, China, 13 March 2018 (Photo: Reuters/Thomas Peter).

Author: Ben Hillman, ANU

Since ethnic riots broke out in Urumqi in 2009, the Chinese Communist Party (CCP) has steadily turned Xinjiang into a provincial police state. Uyghurs, Kazakhs and other Muslim minorities are being closely surveilled and detained by security forces. Read more…