Britain ‘pivots’ to Asia on a Japanese-made hinge

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Louis Reynolds

At first glance the twin trade and cooperation agreements signed by William Hague and His Excellency Keiichi Hayashi in London last week were a positive yet unremarkable contribution to the Coalition’s ambitions regarding the expansion of Britain’s international trade relations and the promotion of Britain’s defence industry. In actual fact, the new pact represents a broader fulfilment of the Government’s strategic vision.

The basic substance of these agreements in itself, while ground-breaking, is rather reserved. The UK-Japan Defence Equipment Coordination Framework will facilitate joint research projects within the defence industry, while the Information Security Agreement outlines the rules regarding the sharing of classified information necessitated by the cooperation effort. Initial collaboration efforts will centre on chemical, biological and radiological protective equipment, with engagement expanding to anti-air defences and similar projects at a later date.  

While this Anglo-Japanese agreement is important in simple economic terms, in the manner of previous large-scale Coalition trade agreements such as those arranged with China, or India, it crucially also has specific value in and of itself. The collaborative potential for two nations with such exceptional high-tech industrial bases and pioneering technological expertise is extensive, and the pact has the added attraction of relative exclusivity; the United Kingdom is now Japan’s only defence research and development partner with the exception of the United States.

Furthermore, the agreements fulfil a significant part of Hague’s vision, as set out in his July 2010 speech Britain’s Prosperity in a Networked World,of an increased focus on new, tailored partnerships with a broader range of global powers. This is in turn part of the Coalition’s divergence from Britain’s previous (perhaps antiquated) foreign policy set around traditional alliances. Cameron and Hague are seeking to establish Britain as an innovative power capable of diplomatic flexibility in a multi-polar world.

Considered in the context of the UK’s recent activities in the Far East - her opposition to the removal of the EU arms embargo on China, Cameron’s tour of other Asian states, her expressed desire to see an augmentation of the military capabilities of China’s neighbours and finally the ‘Vietnam-UK Plan of Action - it would require little imagination to view these latest agreements with Japan as part of a broad attempt to increase Britain’s profile as a power-player in Asia.

Yet while these agreements are indicative of important cultural shifts in British foreign policy – shifts away from traditional alliances, away from Imperial baggage and away from a Eurocentric understanding of foreign policy – it is important to maintain perspective. Britain is not in a position to directly influence trends and events in Asia. Reduced military power, economic ailments and the continued decline of comparative European power in general limits Britain’s capability to act independently in such a critical region so far from home, in terms of hard or soft power. Yet Britain has unique strengths and capabilities and remains a powerful international actor as well as a highly desirable ally. For Britain to make best use of the opportunities of Asia in the twenty-first century, it is necessary that she applies her distinctive skills within the context of cooperation with other powers.

Earlier this year I attended the last foreign speech given by Leon Panetta, then United States Secretary of Defence. The address largely focused on the necessity of an American ‘pivot towards Asia’, and framed the European Union as a potential senior partner in such a strategy. Panetta’s argument was greeted with a degree of scepticism – the EU and foreign policy can occasionally seem to be incompatible concepts – but his logic seems clearer today than it did in January. The lack of reference to the United Kingdom as an independent power was prominent in Panetta’s speech, as was the firm focus on Britain’s role within the EU - perhaps more a reflection of changes in the international order than any significant British decline. This Government seems to understand the new reality too; Hague mentioned the European Union twelve times in his Britain in Asia speech last week.

These latest Anglo-Japanese agreements therefore represent much more than an innovative response to economic concerns, though Britain’s economic motivations are prominent in her foreign policy. For the United Kingdom they represent a positive reaction to broader shifts in international political dynamics. For the Coalition these developments demonstrate a positive and proactive attitude to changes which Britain must embrace, and which, if handled correctly, could stand to make Britain stronger.



Follow Louis on Twitter.

Media trivialisation of North Korea masks the horrific extent of its crimes against humanity

Jack Hands 10.25am

The North Korean state is responsible for systematically carrying out some of the darkest crimes against humanity this world has ever seen. Yet media and political reaction to the latest diplomatic tensions has predictably focused very little on the regime’s horrific human rights record.

The trivialisation of the North Korean problem is characterised by the media focusing on the quasi-religious cult of Kim Jong Un, its mythical propaganda induced tales and the enormous, grandiose public gatherings and predictable rhetorical flares of staged hatred against the United States. Recently, the escalating tensions and the restoration of its nuclear weapons programme have seen the eyes of the world focus on North Korea’s potential threat to peace.

North Korea relishes this of course. If the regime has proven anything since the end of the Korean War in 1953 – a war which never officially ended, it has shown it is adept at strategically turning up the tension to help consolidate its own power.

North Korea’s shadowy elite are fully aware that with its military-first policy backed up with a nuclear threat, it would be foolish for its enemies and indeed the world’s media not to take any such threat seriously - however unlikely and self-defeating of its own interests launching an all out war would be.

It does so because it knows it is an effective tactic in diverting attention away from its domestic failings, human rights abuses and crucially in consolidating the position of the insecure leadership of the young Kim Jong Un. Therefore, North Korean aggression acts as the perfect smokescreen and diversion tactic for the regime’s real aim, self-preservation.

This is shown by the regime’s extreme sensitivity to the discussion of its horrific human rights record. In our own Parliament, as at the United Nations, any attempts to raise human rights abuses have been met with emphatic, aggressive responses. The UN General Assembly and Human Rights Council have tabled several resolutions on the matter and on 21 March announced they will be setting up an official UN Commission of Inquiry on North Korea Human Rights abuses, a significant move.  

It is estimated there are five political prison camps called “Kwan-Li-So” in which an estimated 200,000-300,000 prisoners are today incarcerated. That figure is growing.

While many people are aware of the political prison camps there is a lack of coverage about their extremity. These are no ordinary state-driven crimes against its people; these camps are quite possibly the worst state-led systematic abuse of human rights anywhere in the world.

A report by Christian Solidarity Worldwide tracking known prisoners show some of the horrors, these people face. Take, Keum Joo Huh, a 29-year-old female Taekwando teacher who was sent to a camp for ‘collective punishment’ over her mother’s illegal job of brokering for those searching for family members that had been separated by the war. Keum Joo died from malnutrition in May 2002.

The horrors detailed by Shin Dong-hyuk, the only ever escapee from such a camp, in his sobering book Escape from Camp 14, is living testimony to these unimaginable horrors.

Shin who was born in the camp, and like Keum Joo Huh his only crime was being born into a family seen as politically dangerous. Crime by association is an effective tool in suppressing enemies which helps to explain how the North Korean regime has lasted for so long in comparison to other authoritarian rules. Mass torture, starvation, rape, killings, slave labour are a daily experience for prisoners. Nor is there any discrimination between the old, young, healthy or sick. These are crimes against humanity, yet still coverage focuses predominantly on the trivialisation of Kim Jong Un.

The UN High Commissioner for Human Rights, Navi Pillay, rightly said in January that the huge issue of North Korea’s nuclear program should not be allowed to completely overshadow the horrendous human rights situation, which “has no parallel anywhere else in the world,” and where “self-imposed isolation has allowed the government to mistreat it citizens to a degree that should be unthinkable in the 21st century.”

George Orwell once observed, “The war is not meant to be won, it is meant to be continuous. Hierarchical society is only possible on the basis of poverty and ignorance“.

In isolationist North Korea, people are forced to believe this but in the West we have the freedom to see beyond. We have the power to make the world’s people and governments to deplore these crimes and place this issue at the top of the agenda in future diplomatic talks. Put simply, we need to provide the voice for the voiceless.

From our own correspondent… with William Hague at the Foreign Office

Aaron Ellis 10.30am

I felt a bit ashamed when I joined Twitter a couple of years ago. It felt like I was Winston Smith at the end of George Orwell’s 1984, finally giving in to oppressive forces. Yet the social networking site has furnished me with opportunities I would not otherwise have had - such as meeting William Hague.

Last month, the Foreign Secretary asked his Twitter followers to say what they think should be the United Kingdom’s top foreign policy priority. The best five would then meet him to discuss their suggestions.

Last week, the winners of this competition – Katie Jamieson (@kejamieson), Antonia King (@antoniaking), Jack McCann (@Jack_Mc_Cann), James Willby (@JamesWillby), and I – met Mr Hague and enjoyed a long, interesting talk on a wide range of issues, including trade promotion and the war in Afghanistan.

A chunk of the discussion was about British foreign policy and the ‘Pacific Century’, which had been the topic of my winning suggestion. I argued that the United Kingdom had to define its role (or non-role) in a world where power was concentrated in Asia-Pacific, as it would impact on all our other defence and foreign policies. The Foreign Secretary emphasised to me that we had to be in the region, but he didn’t show that he appreciated how big an effort would be needed by the British to become real players there. ‘It would represent the most judicious, and audacious, use of the hard/soft power combination yet seen in contemporary politics,’ one expert has warned.

Mr Hague agreed with me that a potential role for the United Kingdom would be to “fill in” for the Americans as they retrench to the Pacific, which was what I argued in these pages in the summer. He used the Libyan intervention as an example of this “filling in”, ironic perhaps given my opposition to the campaign. I was too polite (as well as awed) to point out that the United States enabled 90 per cent of the military operations there, which implies we don’t yet have the capacity to take up Washington’s mantle in many areas of the world.

The other issue that I raised was British policy in Central and South Asia; as I argued in May, the United Kingdom is pursuing policies in the region that are incompatible with one another. We want a stable Afghanistan, a special relationship with India, and a strategic partnership with Pakistan – the problem is that the latter two countries believe stability in Afghanistan comes at the expense of either one or the other.

Mr Hague recognises the dilemma – in contrast to the Defence Secretary, Phillip Hammond, who denied it exists when I put it to him in December – but he thinks that the British are best placed to mediate a solution. As an example, he pointed to the recent meeting in New York between David Cameron and the Afghan and Pakistani leaders.

Though I am often critical of this Government’s foreign policies, I have always believed that Britain needs William Hague as its Foreign Secretary – a belief reinforced after meeting him. His policies are good for the country, even if I think some of them are strategically discontinuous. Mr Hague is also likeable, charismatic, and he has built up good connections with leaders around the world, which aren’t bad things when it comes to diplomacy.

The meeting also showed his enthusiasm for engaging younger people via new technologies, on the issue of the many challenges facing this country in the early twenty-first century.

Follow Aaron on Twitter @AaronHEllis

Despite slowdowns, economic stalemate between Europe and China is set to continue

Henry Hopwood-Phillips 3.44pm

Economic data from China is mixed. The bad news is that after first-quarter GDP growth of 8.1 per cent, second-quarter growth is being revised downwards from 9.5 per cent to 7.8 per cent by Caixin, one of China’s leading financial publications.

Reuters reckons second-quarter growth will fall even further, by 7.6 per cent, the weakest rise since 2008. Other indicators fare no better. Industrial production has risen by the lowest amount in three years, at 9.6 per cent. Electricity consumption fell to 3.7 per cent from 7 per cent in March. Property prices fell in over half of China’s seventy leading cities. And manufacturing PMI suffered its eighth consecutive month of contraction, from 48.8 in  June to 41.8 in May.

The second set of statistics paints a rather different picture. Exports were expected to clock a 6.8 per cent rise but instead surged by 15.3 per cent to $181.1 billion, mostly due to American demand. Not only that, imports only increased 12.7 per cent, giving a healthy trade surplus of around $18.7 billion. One of those imports was oil, which was bought at a record rate of six billion barrels a day in May due mainly to its low price and unstable future.

Bears point to a real estate bubble, over-capacity, over-investment, and a consequent lack of inflation as signs of over-extension. Bulls tend to side more with Jim O’Neill of Goldman Sachs who notes that the historical weight placed on production stats is misplaced and that “indicators of consumption are becoming more important”; and Jack Perkowski of Forbes who reckons “the phrase ‘property bubble’ will no longer be in the vocabulary” reasoning that it must have bottomed out after nine-months of decline.

The Chinese government, noticing a slow-down in demand, has not been slow in reacting. It has cut its interest rates for a second time. Consequently the yuan weakened against the US dollar in Shanghai.

Further measures are also being taken. The monetary authority is pumping 225 billion yuan into the financial system by conducting reverse-repurchase operations. The last steps to lower the amount of cash banks need in reserve, started in November and freeing up 1.2 trillion yuan for lending, are being implemented. And investment projects, many in the underdeveloped interior and western parts of the country, are being fast-tracked.

Beijing also hopes to boost energy demand by subsidising energy-saving white goods to the tune of 26.5 billion yuan. Such measures make a mockery of bullish claims that the Chinese government would intentionally try to cool the economy down in order to tactically restructure it.

China knows the oil that lubricated the post-war global economy is running dry. As the purchasing power of the Western consumer, based at first on rising wages but later on rising house prices has evapourated, no significant replacement has compensated for that lost demand. According to Bloomberg’s David Roseberg over 80 per cent of the world’s top economies are now posting a contraction in industrial activity. The EU and US together account for approximately 40 per cent of Chinese total exports but China knows that its long-term future lies with its own domestic consumer. This is why it has not been afraid to upset the laissez-faire apple cart by playing dirty with its currency, by using state funds to stockpile underpriced rare earths whilst imposing quotas and caps that ensure they remain in its domestic market, by refusing to “save” the eurozone, and by imposing duties worth £2.1 billion on US-made cars.

But the long term is naturally a long way off. Though there is talk in some quarters that the West needs to restructure its economy from a consumer-driven to an export-based one and that China needs to do exactly the opposite, the fact remains that the Chinese, with no real welfare state to speak of, are driven by both economic necessity and to a lesser extent culture, to save and supply rather than consume and demand. The West also has a tendency to overlook the old cronyist fundamentals of the Chinese economy which ensure the masses have little option but to stash their cash.

The fact is that much of the economy is still run on political rather than economical capital and that many bad debts are still sloshing round the system. Current generations are also living with the repercussions of the one-child policy legacy left to them by Xiaoping in 1979. They must save because demographically fewer and fewer people must support an ageing 1950s baby-boom generation.

In the short to medium-term the Chinese middle classes are not going to be either big enough or rich enough to fill the demand gap left by western homo consumericus and that gap remains unfilled by both BRIC and MIKT countries. This is the biggest single factor in the Chinese growth slow-down from averaging 10-13 per cent in the past decade to more humble 8-9 per cent IMF predictions this year.

But the Chinese have so far refused to invest in European customers who live in a eurozone that, according to Jin Liqun, Chairman of CIC, they believe to be profligate, lazy and politically undecided. China wants a eurozone to rise in its own image, with a freer market at ground level and a more centralised political command.

However, both seem unlikely to materialise and so, ceteris paribus, until one side blinks the economic stalemate looks set to continue.

Follow Henry on Twitter @TheHolySmoke

A British Empire could rise again…on American coat-tails

Aaron Ellis 10.07am

The rise and fall of great powers is a familiar theme of history and a regular concern for politicians. Yet few appreciate that a country can rise and fall and rise again.

During the past millennium, England has held and lost many empires, and gone from one of the known world’s foremost powers to its weakest and back again. An Anglo-Saxon chronicler lamented in the late tenth century that England’s navy was not what it was just sixty years previously, “when no fleet was ever heard of except of our own people who held this land.”

England can be one of the world’s foremost powers once more, but it is a long-term ambition, and I will be long gone if and when it is achieved.

We are only a secondary world power today and, since the 1940s, we have been dependent on the United States for our security. Trident is not the only thing for which we rely on Washington: half of the material processed by the Joint Intelligence Committee (JIC) comes from American sources. We could not have intervened in Libya without the help of the US military either, no matter how fiercely the Prime Minister believed that venture was vital to national security.

In order to justify the many benefits we enjoy from our close relationship with the Americans, Britain tries to make herself useful. Yet we will find this more and more difficult to achieve as successive administrations in Washington "pivot" to the Pacific, and as successive governments in London try to keep the defence budget as respectably low as they can.

So how could Britain make itself useful? There is an option: take responsibility for those parts of the world the US can no longer afford to look after.

Not only would this justify perks such as intelligence sharing and the nuclear deterrent, it would also give time to develop these and other capabilities ourselves or wait for emerging powers to develop them and realign ourselves accordingly. It also offers Britain an opportunity to build her influence in those regions vacated by the Americans in the twentieth century.

By limiting ourselves to a few “spheres of influence”, Britain can also prove itself useful to the US without overstretching. Moreover, if the British are to be “deputy” to the American “sheriff”, we must choose parts of the world where we have real interests at stake. This requires thinking strategically and making tough choices in defence and foreign policies. We would also have to put our money where our mouth is on the subjects of “hard” and “soft” power.

There are several regions the Americans could turn over to Britain. For instance, rather than evenly divide its navy between the Atlantic and Pacific Oceans, the US plans to shift its emphasis to the latter in the next eight years (with a 60:40 ratio). Britain could make up the difference and gradually take on full responsibility for the Atlantic. This would require us to build up our own naval power.

We could also relieve the US of responsibility for Afghanistan and Pakistan. The British have a better relationship with Islamabad than the Americans do, putting us in a better position to oversee security in the region once troops depart Afghanistan next year.

Britain has tangible national security interests at stake: the head of MI5 has said that half of the terrorist plots against the country come from Pakistan. With the latter paralysed by political crises and its army suffering an ideological crisis, it is unlikely that figure will go down in the foreseeable future.

Yet if we were to assume the burden of security in that region from the US, we would have to try to match their presence. This won’t merely be about “hard power” (i.e. US counterterrorism), but also about diplomatic presence and financial assistance. One expert has described British aid to Pakistan as a “drop in the ocean” compared to America’s.

Though British politics is becoming increasingly eurosceptic, Washington would like to see us play a bigger part in the continent’s security, preferably by helping to forge a better working relationship between NATO and the EU. The always-sharp Christopher Coker has suggested the UK can earn real gratitude here, “provided we are seen to be a useful European ally to our European friends.”

This entire approach is ambitious in the long term but prudent in the short to medium terms. In order to sustain the special relationship throughout the twenty-first century, it sticks to the theme of Giuseppe di Lampedusa’s novel The Leopard: if we want things to stay the same, things shall have to change.

As for the twenty-second century, it offers an opportunity for the United Kingdom to lay the foundations for yet another rise to the top of the world.

No Englishman should have any less ambitious a vision.

Follow Aaron on Twitter @AaronHEllis

As Europe sinks we should look to new horizons

Alexander Pannett 12.30pm

This week it became clear that the procrastinated efforts to save the European single currency have failed.

Greece will leave the single currency when it votes for anti-austerity political parties in a month’s time. Possibly even the European Union too if Greek anti-European sentiment continues to grow.

What must be done now is ensure the contagion does not spread to other peripheral countries: Ireland, Portugal, Spain and Italy. This may even be too late, as we receive reports of a bank run in Spain. If the markets lose confidence in these countries’ ability to manage their debts it will precipitate a collapse of the entire European banking system as capital flight prompts liquidity to dry up, as in 2008.

David Cameron has called for fiscal and political union as the only way to shore up confidence in the euro and stop it being seen as less a single currency and more a strict exchange rate union ready to be un-raveled.

The Prime Minister echoes calls from other European leaders for more concerted action to save the euro, notably via the use of 'eurobonds'. I proposed on these pages in November last year that without further political solidarity the euro was doomed.

Political solidarity has not emerged. Instead there is growing acrimony and competing ideas. If anything, the unfolding disaster has exposed the fractious concept of common citizenship behind the entire European project, something Nik alluded to earlier this week.

There is no interest in Europe. There is only a Europe with interests.

It is not too late to salvage the ambition of closer union. But for now this can only be a Franco-German union. Only those nations who will accept being absorbed under the dictates of Paris and Berlin shall join. For the rest, the EU will remain a trading block, and an economically and politically impoverished one at that.

It seems that the great play of world history is about to leave the European stage and transpose itself to the more exciting and economically dynamic scene of Asia. Whether this new Act will be of tragedy or farce is as of yet unknown.

For Britain, we are too old an actor to play outside the limelight. Our pride is too heavy and dress bill too dear. It is time we pursued a new free trade pact with countries in Asia.

We could start with Australia, New Zealand, Korea, Japan, America, Indonesia and Singapore, perhaps with the old Commonwealth as the foundation. This could and should include those European nations that share our interests in global trade.

Such a free trade organization would also be able to promote a more responsible capitalism in global trade that protected the environment, traditional cultures and social values. Far better to promote progressive humanitarian standards by engaging with Asia rather than heckling it behind trade barriers.  

We should mirror America’s re-orientation to Asia by reversing the Suez doctrine and re-establishing naval bases in Asia. Singapore may value such a presence. This does not even have to be a military base but could be a humanitarian crisis response centre, in readiness for when another natural disaster strikes that seismically vulnerable part of the world.

Europe will still remain important to Britain. But it should be seen and supported as a neighbour. Not as our place of work.

For that we will need to travel further afield.

Follow Alexander on Twitter @alpannett

George Osborne has to dump this toxic 50p tax rate

Craig Barrett 11.48am

Time and time again, I am reminded of those words of Sir John Major, spoken early on in the Blair maladministration:

"The Conservatives are elected to govern, Labour governs to be elected."

So nightmarishly often in those thirteen years was policy made on the hoof. We endured a bewildering array of ill-thought out responses to opinion polls, designed to retain an unnecessary lead with no election in sight.

Of all the policies adopted by the last Labour government, none was more cynically designed to make life difficult for a future Conservative government than the 50 pence tax rate.

A lot has been written saying it is unlikely to cover the costs of its administration. But even to analyse its economics is to give Messrs Brown, Balls and Miliband the undeserved courtesy of implying they have any kind of grasp of basic economics.

Put simply, the 50p tax on incomes over £150,000 was designed to be eye-catching, a demonstration to the masses that Labour was prepared to soak the rich until the pips squeaked, so to speak.

Much of Gordon Brown’s fiscal policy during his tenure at the Treasury was less about raising revenue and more about making the tax system too complicated for people to understand.

Faced with a possible Conservative election victory, Brown’s Labour government knew the 50p tax policy was one that a future Chancellor Osborne would find difficult to reverse. The left-wing media would instantly bash it as a tax cut for the rich.

Yet abolish it Mr Osborne must. I have written before about the dangers of punitively high and unjustifiable taxation in a mobile global economy. This applies both to individuals and companies - the news earlier this week that Prudential may shift its headquarters to Hong Kong demonstrates our loss of competitive advantage.

Nearly 30 per cent of all income tax revenue is paid by the top 1 per cent of the earning population. We would all have to work a lot harder to replace one high earner who fled abroad to protect their salary. Many people may not hold much of a candle for high earners these days, but surely it is better that they and their companies remain on these shores so their taxes pay for British hospitals, rather than Chinese ones.

I welcomed the news yesterday that 537 entrepreneurs have written a letter to the Telegraph calling for the Chancellor to abolish the 50p tax rate. I understand that self-assessment tax revenues have fallen by £509 million year-on-year, which these entrepreneurs attribute to the toxic top tax bracket.

A tax that costs more to administer than the revenue it generates is no tax at all. It is just a soundbite. An embarrassing sop.

As the Chancellor prepares this month’s Budget, fully three years before the next general election, he must take note to use the opportunity to announce that Britain is open for business and encouraging of growth.

And there is one lesson he could learn from Gordon Brown, the old master of hiding bad news amidst the details. Just as Brown silently abolished the 10p tax band (doubling the tax rate on the lowest earners), so must George Osborne silently abolish the 50p rate.

Labour MPs, rightly, wailed with fury at that earlier sleight of hand. Conservative MPs will only cheer, rightly, at the sight of the second. The loss of a tax rate whose only effect is to tell the world the UK is not on the side of the wealth generator is nothing worth crying over.

Follow Craig on Twitter @mrsteeduk

China can still learn from the West

Alexander Pannett 11.50pm

This week has seen the visit of Xi Jinping, the Vice-President of China, to the US.

It has been heralded as an important moment for the man widely expected to become China’s next president.

If this is so, Xi Jinping will be the leader of China at the moment that China has been forecast to eclipse the US as the largest economy in the world (in 2023).  To underline the importance of this fact, this will be the first time that a non-Western nation will have been the largest economy in the world for 500 years and the first non-democracy in almost 200 years.

The visit has again raised debate over the huge economic achievement of China compared with a soporific West that seems to lurch from one debilitating crisis to another. Commentators have insisted that it is now the West who should take political and economic lessons from China regarding the “China Model” of state capitalism rather than the alleged languidness and instability of the Western democratic model.

Impressive and sustained Chinese growth has been the defining feature of geo-strategic politics over the last 20 years cannot be denied. It appears that the rise of Islamic terrorism was a minor detour against the real historical changes affecting the world; the continuing transfer of wealth and power from West to East.

 Chinese advocates point to their government’s long-terms solidity, being able to implement projects that bring economic growth regardless of public opinion. The one party state can extend its will throughout China as no Western democratic government can. This allows for extensively ambitious construction works that have forged an infrastructure that has driven China to its current economic paean.

While the East has grown in importance, the West has descended into paralysis due to internal disputes. In the US, politics has never been more partisan, which has resulted in repeated failure to reach an agreement in lowering the titanic debt that is undermining America’s stature in the world, symbolic as the Chinese are the main creditors of this debt. In Europe, a sovereign debt crisis that has no end in sight threatens the very survival of the European Union.

America’s war on terrorism has shattered the Western unity that existed during the Cold War. Worse still, the Western intellectual genealogy that stemmed from a shared Enlightenment inheritance appears to be fraying as an increasingly secular and liberal Europe drifts further apart from an increasingly religious and conservative America. As America looks to the Pacific, Europe is becoming more pacific.

However, while there are undoubted merits to China’s economic growth, it still has much to learn from the West. Fractious as Western politics may be, democracies benefit from an attribute that all the economic growth in the world cannot bring: accountability.

Ruling through the acquiescence of the people ensures that Western governments must justify why grand endeavours are of benefit to their people. This checks the more hubristic ambitions of politicians. It also brings a modicum of transparency to the corridors of power that can too easily be swayed by vested interests, even corruption.

 A society that permits free expression will produce more innovative thinkers than a state that rejects views that differ from its priorities. It is telling that China has caught up with the technology of the West not from creating rival products or ideas through native research and development but from widespread piracy of Western intellectual property.

Though its economic growth has been herculean, China’s environmental record has been consequently sisyphean. Development has led to huge water shortages, with more than two-thirds of cities reporting an inadequate water supply and two-thirds of Chinese lakes have chemical deficiencies caused by pollution according to government estimates. Huge dust storms now envelop Beijing due to increasing desertification from over-farming. In 2005 China’s worsening air pollution cost the country $112 billion in lost economic productivity.

This is to say nothing of the social costs that have resulted from human rights abuses and a growing economic under-class. Despite its prosperity, most of China’s population earn too little to reach the threshold for income taxation. Only 24 million people make the $545 monthly threshold for taxation, according to the Ministry of Finance.

 This is the dark underside of a political system that is not accountable for its actions. The former USSR provides plenty of horrendous examples of wide-reaching government ambitions having ill-thought out and disastrous consequences. The Aral Sea is now an environmental wasteland and half its original size, due to extensive Soviet irrigation that attempted to turn Kazakhstan into a giant rice and cotton production centre. The Chernobyl nuclear disaster is another example.

 The Western model of democracy is not the only model of governance or without its own faults. Western governments have often been guilty of grand strategies that have brought more pain and suffering than any lasting achievement. It should also be recognised that the current Chinese one party model originates from political ideologies that were cultivated in the West.

 However, before China grows too confident in its own manifest destiny, it should be aware of the severe dangers of a government that rules without accountability. While China’s economic achievements currently dwarf those of the West, China still has much to learn from Western democracy.

Let us hope that the coming century will be a beacon of mutual erudition between East and West. A Confucian century of social harmony, rather than a Machiavellian century of rivalry.

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