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Thread: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

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    Default Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    This is a thread to keep track of significant events, developments and changes in Eurasia and the New Silk Road / One Belt One Road (OBOR).

    There are large scale and fairly significant shifts taking place. This thread is a place to get a sense of these.

    For reference:
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Something is happening in the Kashmir region. There has been a lot of speculation in the last couple of days and now India has said they are revoking article 370 which grants two regions (Kashmir and Jammu) a special status.



    Quote India announces plans to revoke Jammu and Kashmir’s special status

    NEW DELHI, August 5. /TASS/. The Indian government has announced scrapping Article 370 of the Constitution, which grants a special status to the state of Jammu and Kashmir, Union Home Minister Amit Shah told the parliament on Monday.

    "I am presenting the resolution to revoke Article 370 in Jammu and Kashmir except the first clause 370 (1)," Shah said, noting that Jammu and Kashmir would be "reorganized."

    The order has been signed by President Ram Nath Kovind, Shah said, showing the document to the MPs.

    The ruling Indian People's Party has majority of seats in the country’s lower house of parliament (Lok Sabha), thus ensuring that the government’s decisions are backed by the legislature.

    Under India’s Constitution, Jammu and Kashmir - the only Indian state where Muslims constitute a majority - has special autonomy. All bills in this state passed by the central government (except for those related to defense and foreign relations) must be backed by a local assembly. Citizens of other Indian regions had no right to buy land in Kashmir. The state has its official flag.

    Under the government’s proposal, Jammu and Kashmir will lose its status of a state and will become a union territory (that has fewer rights than a state). Its historic Ladakh region will be separated from it, also becoming a union territory. Other changes related to Kashmir’s status and rule will be also introduced. However, Jammu and Kashmir will keep its legislature.

    The situation in Jammu and Kashmir has been tense for years. The territory of the ancient principality of Kashmir has been a matter of dispute between India and Pakistan since 1947, when the British Raj received independence and was split into two states based on religion. To date, there is no state border in Kashmir: its territory is divided by the Line of Control. Groups that favor departure from India are being active in the Indian part.
    From: https://tass.com/world/1071879/amp?_...mpression=true

    And:

    Quote India Decides to Revoke Article 370 on Kashmir's Special Status in Unprecedented Move

    Article 370 of the Indian Constitution gives special status to the State of Jammu and Kashmir. India controls the southern portion of Kashmir, a region that has historically been hotly contested between India and Pakistan.

    The Indian government has moved to scrap Article 370 of the national constitution, which grants special autonomy to the state of Jammu and Kashmir, the Muslim-majority Indian-controlled part of Kashmir.

    Home Minister Amit Shah told the upper house of parliament on Monday that the government would abrogate the cause, prompting a massive uproar from opposition lawmakers.

    Article 370 allows the state's local legislature, the Constituent Assembly of Jammu, to make its own laws and bans people from outside the state from buying property there as well as obtaining state government jobs and participating in state-sponsored scholarship programmes.

    By rejecting the special status of Jammu and Kashmir, the national government is ensuring that the national constitution will now be applied throughout the Himalayan state.

    Citing the threat of cross-border terrorism, Amit Shah announced that the state of Jammu and Kashmir will be divided into two union territories, governed directly by the central government – Jammu and Kashmir would be split from the mountainous region of Ladakh.

    Ladakh will become a union territory without a legislature, while Jammu and Kashmir will have a legislative assembly like other Indian states instead of its own, more autonomous Constituent Assembly.

    Pakistan's foreign minister, Mehmood Qureshi, claimed that the move violates a UN resolution on the status of Kashmir.

    The measure, which will come into force "at once", comes hours after the government ordered restrictions and night curfews to be imposed on Jammu and Kashmir over fears that foreign terrorists were planning to target police officers there.

    New Delhi has deployed thousands of additional troops to the Pakistan border to beef up security in Indian-ruled Kashmir, with mobile internet being shut down throughout the state. The authorities have told visiting pilgrims and tourists to leave the area, banning public meetings and advising regional schools to remain closed as a precautionary measure. Two former chief ministers of the territory have been placed under house arrest.

    A Troubled Region

    Kashmir has been divided between India and Pakistan since they gained independence in 1947. Both nations claim the entire region but control only parts of it. Over the past 70 years, the nuclear-armed foes have fought two wars and waged a limited conflict over the region.

    An Islamist insurgency has engulfed Jammu and Kashmir in the past decades, with militants seeking secession from India. There have been reports of gunfights across the Line of Control – the de facto border with Pakistan – in recent days.

    Peace talks between Pakistan and India have stalled, but speculation emerged last month that the United States could mediate a solution on Kashmir between the neighbouring nations.

    Donald Trump told reporters that Indian Prime Minister Modi had asked him if he would like to broker a peace deal, but India denied that Modi had ever made such a request.

    Although Pakistani Prime Minister Imran Khan, a Trump ally, has appeared to be willing to accept the US as a mediator, India responded that it would deal with Pakistan only bilaterally.
    From: https://sputniknews.com/amp/asia/201...mpression=true

    More about Kashmir: https://www.britannica.com/place/Kas...n-subcontinent
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)


    image source: https://www.suchtv.pk/pakistan/gener...nder-cpec.html

    Quote A few days ago, RT reported that China, in addition to the expansion of the new port in Gwadar, Balochistan, has entered agreements with Pakistan to build a military/air base in Pakistan, a new Chinese city for some half a million people, as well as several road and railway improvement projects, including a highway connecting the cities of Karachi and Lahore, reconstruction of the Karakoram Highway, linking Hasan Abdal to the Chinese border, as well as upgrading the Karachi-Peshwar main railway to be completed by the end of 2019, for trains to travel up to 160km / hour.

    This rehabilitation of dilapidated Pakistani transportation infrastructure is not only expected to contribute between 2% and 3% of Pakistan’s future GDP, but it offers also another outlet for Iranian gas / hydrocarbons, other than through the Strait of Hurmuz – for example, by rail to the new port of Gwadar which, by the way, is also a new Chinese naval base. From Gwadar Iranian hydrocarbon cargos can be shipped everywhere, including to China, Africa and India. With the new China-built transportation infrastructure Iranian gas can also be shipped overland to China.
    https://www.globalresearch.ca/wester...-apart/5685408

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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    there has never been a 'new' "Silk Road" and the conquest for it has always been the same- nothing changes- changing labelings doesn't change an original agenda-

    Larry

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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Quote Posted by Cardillac (here)
    there has never been a 'new' "Silk Road" and the conquest for it has always been the same- nothing changes- changing labelings doesn't change an original agenda-

    Larry
    Larry, are you able to share some data, quotations, articles or other materials that help readers understand more about what you’re saying? This thread is intended to collect information about what is going on, so additional articles will be most welcome.

    Thanks.
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Some commentary and analysis from former Indian diplomat M.K. Bhadrakumar on the developments in Afghanistan:

    Quote US, Pakistan move in tandem to end Afghan war
    July 28, 2019 by M. K. BHADRAKUMAR

    The US State Department chose Friday to announce the decision to approve a $125 million aid package providing technical support to Pakistan’s fleet of F-16 fighter aircraft. Ironically, the news reached Delhi on the 20th anniversary of the Kargil Vijay Diwas, which symbolises, as Prime Minister Narendra Modi put it on Saturday, “India’s might, determination, capability, discipline and patience” to thwart Pakistan’s hostile acts.

    Clearly, Washington has begun to “incentivise” Pakistan, in the downstream of the talks between President Trump and Prime Minister Imran Khan at the White House on July 22.

    Meanwhile, the Pentagon also notified on Friday about a proposed $670 million follow-on support programme for the eleven C-17 Globemaster-III air-lift aircraft sold by the US to India in the recent years. By holding out the carrot to India, Washington hopes to create the hype that it is also favouring Delhi.

    The intention here is to finesse Delhi’s criticism over the revival of US military aid to Pakistan. Of course, it will be a delusional thought that the US is balancing India and Pakistan. In reality, the Pentagon’s India proposal is a purely commercial transaction — “after-sales service”, which will generate good business for the US vendors — while the military aid to Pakistan providing technical and logistics support for its F-16 fighter jets is on concessional terms and signifies a major political decision.

    Delhi will take note that the proposed US military aid may significantly enhance Pakistan’s offensive capability insofar as some of the F-16 jets are capable of delivering nuclear weapons.

    Indeed, the “big picture” emerging out of all this is that the US and Pakistan are marching ahead in tandem to implement the decisions taken by Trump and Imran Khan to swiftly end the Afghan war.

    No sooner than Imran Khan left Washington on July 23, the chairman of the US Joint Chiefs of Staff General Joe Dunford traveled to Afghanistan’s capital of Kabul for consultations with American, NATO and Afghan officials.

    Dunford said he wants to ensure Gen. Austin S. Miller, the US commander in Afghanistan, has all he needs. He added that he wanted to take the pulse of US military operations in the country. Indeed, the pulse rate is rather high, as the US withdrawal from Afghanistan looms large.

    Dunford insisted that the negotiations have not changed the military mission in the country. “Day to day, the mission hasn’t changed for General Miller and the team, and they are still taking the fight to the Taliban and supporting the Afghan military,” he said.

    But that’s putting a brave face. Evidently, the US is pushing forward a “face-saving way out of Afghanistan,” as former CIA deputy director Michael Morell has told Axios. The message has gone down the line in the State Department and the Pentagon that Trump wants to move quickly toward a deal to end the war in Afghanistan. Morell is deeply sceptical whether a deal with the Taliban will secure peace.

    He said, “I would bet that the US intelligence community and policymakers have a pretty good understanding of what the Taliban’s intentions are. So we’re making a deal that we know isn’t going to be kept just to save face, just to maintain honour.” Morell repeated his past warnings that the Taliban is “ideologically not disposed to sharing power.”

    However, an apocalyptic scenario cannot deter Washington anymore. On a parallel mission, the US special representative on Afghanistan Zalmay Khalilzad also took off on July 23 from Washington to Kabul (where he is now speaking with members of the Afghan government as he works to encourage inter-Afghan conversations between the Taliban and the government.)

    In immediate terms, Khalilzad expects Pakistan to deliver on the promise that Imran Khan made to Trump to the effect that he plans to meet with the Taliban to persuade them to hold negotiations with the government in Afghanistan. (Taliban has welcomed such a meeting.)

    Imran Khan had said, “Now, when I go back after meeting President Trump … I will meet the Taliban and I will try my best to get them to talk to the Afghan government so that the elections in Afghanistan must be inclusive where the Taliban also participate in it.”

    It may seem a tough call, but the news from Kabul on Saturday suggests that Pakistan may have made some headway already. The Afghan state minister for peace affairs Abdul Salam Rahimi announced on Saturday that “We (Afghan government) are preparing for direct talks (with the Taliban.) The government will be represented by a 15-member delegation. We are working will all sides and hope that in the next two weeks the first meeting will take place in a European country.

    The Norwegian capital Oslo is mentioned as the venue for the crucial meeting between the representatives of the Afghan government and the Taliban. The Taliban has not yet budged from its longstanding demand that a deal must be forged with the US first. Possibly, a deal may be announced after the 9th round of US-Taliban talks in Doha in the coming week.

    Indeed, we are witnessing an utterly fascinating spectacle of diplomatic pirouette being played out between and amongst five main protagonists — Trump who is demanding an expeditious US withdrawal from Afghanistan, assuming Imran Khan will deliver on his promises; Imran Khan, in turn, going through the motions of persuading the Taliban to be reasonable while expecting generous US reciprocal moves to accommodate Pakistani interests; Ashraf Ghani, Afghan president, seeing the writing on the wall that US withdrawal is unstoppable, whilst still hoping to secure a second term in office; Khalilzad pushing the reluctant Afghan government to fall in line with a Taliban deal, while also negotiating with the Taliban for an orderly US withdrawal, albeit with a weak hand; and the Taliban on a roll, sensing victory. There are caveats galore. But the compass has been set.
    From: https://indianpunchline.com/us-pakis...nd-afghan-war/
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    More on the Kashmir and Jammu issues with some useful history. Also includes comments on Hong Kong riots and the similarity of the two situations and western interference.

    Quote China reacts to J&K, India demands reciprocity
    August 7, 2019 by M. K. BHADRAKUMAR


    Srinagar, Jammu & Kashmir, on lockdown. File photo.

    In the aftermath of the Modi government’s decision to remove ‘special status’ for J&K and bifurcate the state into two union territories, the most keenly awaited regional and international reaction — and a hugely consequential one — would be that of China’s, not the US’ or even of the other three P5 member states.

    This is for three reasons. First, China is the only P5 member country that is party to the Kashmir dispute by virtue of its Faustian deal with Pakistan in 1963 — Sino-Pakistan Frontier Agreement and Sino-Pak Boundary Agreement — as well as due to Aksai Chin being a disputed territory.



    Second, it is well-known that China has a larger-than-life influence over Pakistan, and therefore, indirectly, is in a position to leverage the next moves by Islamabad on the J&K situation in practical or political terms.

    Third, of course, China is a veto-holding P5 member country. Although not involved in the making of the UN resolutions on Kashmir in 1948-1949 (which was an Anglo-American enterprise at a juncture when Nehru somehow deliberately refrained from seeking Soviet help to counter India’s isolation in the UN SC), nonetheless, China is a powerful protagonist today if the Kashmir file were to reopen in New York at Pakistan’s behest.

    On Tuesday, the Chinese reaction to the announcement in Delhi on Monday relating to J&K has come in two parts in the nature of remarks by the Foreign Ministry spokesperson in Beijing (a relatively low-key reaction in diplomatic terms in comparison with a full-fledged statement, as Turkey, for instance, has done.) One part exclusively relates to Ladakh’s new status as union territory, while the other one relates to the ‘current situation’ in J&K. Both remarks are devoid of any stridency and on the whole India can live with them although western media, unsurprisingly, has hyped them. In fact, neither voices any overt backing to Pakistan. And, importantly, there are no new overtones as such in the well-known Chinese stance.

    The remark on the change in Ladakh’s status begins by underscoring explicitly that China is voicing its ‘firm and consistent position’, which ‘remains unchanged’. That is to say, it regards part of Ladakh to be Chinese territory and India should not unilaterally create facts on the ground through domestic laws. If India does, China will consider that unacceptable and it ‘will not come into force.’ The remark rounds off stating the Chinese stance that India should speak and act with prudence on the boundary question, strictly abide by relevant agreements (on peace and tranquility) and avoid precipitate steps.

    This is exactly what China has maintained and can be expected to state. No doubt, this is also what India would expect China to observe in regard of the unresolved border dispute. The Indian stance on CPEC is a fine example.

    The grey area here is whether the administration of Ladakh as UT will entail administrative arrangements on the ground that tread on Chinese sensitivity. Prima facie, that is unlikely to happen, since the two militaries present in the vacant spaces observe ground rules.

    On the other hand, the interesting aspect of the Chinese spokesperson’s remark on J&K situation is that there is no direct reference to the specific situation involving the abrogation of Article 370 of the constitution. The remark is of a generic nature. It repeats that the J&K situation is a matter of serious concern, but underscores categorically that ‘China’s position on the Kashmir issue as such is clear and consistent’.

    Most important, it flags that China is in sync with the ‘international consensus’ that Kashmir issue is a historical conundrum that India and Pakistan have to grapple with by exercising restraint and prudence. This means, however, that the two countries ‘should refrain from taking actions that will unilaterally change the status quo and escalate tensions.’ China calls on the two countries to peacefully resolve their ‘relevant disputes’ through dialogue and consultation in the interest of regional peace and stability.

    Indeed, the ‘known unknown’ here is to what extent, if any, the current upheaval in Hong Kong influenced Beijing to sidestep Modi government’s specific move to abolish Article 370 and abandon J&K’s ‘special status’. To be sure, a grave situation has arisen in Hong Kong, which has assumed anti-China overtones.

    No analogy holds good cent percent in politics, but there are similarities in the public alienation in J&K and in Hong Kong which foreign powers are exploiting. In fact, China also has to contend with its equivalent of our Article 370 — the Sino-British Joint Declaration, which is as sacrosanct as an international bilateral treaty, signed between China and Britain on 19 December 1984 in Beijing.

    Curiously, the Joint Declaration is also legally binding and like Article 370, it commits China to allow Hong Kong to ‘enjoy a high degree of autonomy, except for foreign and defence affairs’ even as the territory will be ‘directly under the authority’ of Beijing.

    Most important, the Joint Declaration affirms, “The government of the HKSAR [Hong Kong] is responsible for the maintenance of public order. Military forces sent by the Central People’s Government, stationed in HKSAR, for the purpose of defence shall not interfere in the internal affairs in the HKSAR.”
    From: https://indianpunchline.com/china-re...s-reciprocity/
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Comment from Pepe Escobar on both Hong Kong and Kashmir and Jammu.

    Quote Hong Kong, Kashmir: a Tale of Two Occupations

    Pepe Escobar
    August 7, 2019

    Readers from myriad latitudes have been asking me about Hong Kong. They know it’s one of my previous homes. I developed a complex, multi-faceted relationship with Hong Kong ever since the 1997 handover, which I covered extensively. Right now, if you allow me, I’d rather cut to the chase.

    Much to the distress of neocons and humanitarian imperialists, there won’t be a bloody mainland China crackdown on protesters in Hong Kong – a Tiananmen 2.0. Why? Because it’s not worth it.

    Beijing has clearly identified the color revolution provocation inbuilt in the protests – with the NED excelling as CIA soft, facilitating the sprawl of fifth columnists even in the civil service.

    There are other components, of course. The fact that Hong Kongers are right to be angry about what is a de facto Tycoon Club oligarchy controlling every nook and cranny of the economy. The local backlash against “the invasion of the mainlanders”. And the relentless cultural war of Cantonese vs. Beijing, north vs. south, province vs. political center.

    What these protests have accelerated is Beijing’s conviction that Hong Kong is not worth its trust as a key node in China’s massive integration/development project. Beijing invested no less than $18.8 billion to build the Hong Kong-Zhuhai-Macau bridge, as part of the Greater Bay Area, to integrate Hong Kong with the mainland, not to snub it.

    Now a bunch of useful idiots at least has graphically proven they don’t deserve any sort of preferential treatment anymore.

    The big story in Hong Kong is not even the savage, counter-productive protests (imagine if this was in France, where Macron’s army is actually maiming and even killing Gilets Jaunes/Yellow Vests). The big story is the rot consuming HSBC – which has all the makings of the new Deutsche Bank scandal.

    HSBC holds $2.6 trillion in assets
    and an intergalactic horde of cockroaches in their basement – asking serious questions about money laundering and dodgy deals operated by global turbo-capitalist elites.

    In the end, Hong Kong will be left to its own internally corroding devices – slowly degrading to its final tawdry status as a Chinese Disneyland with a Western veneer. Shanghai is already in the process of being boosted as China’s top financial center. And Shenzhen already is the top high-tech hub. Hong Kong will be just an afterthought.

    Brace for blowback

    While China identified “Occupy Hong Kong” as a mere Western-instilled and instrumentalized plot, India, for its part, decided to go for Full Occupy in Kashmir.

    Curfew was imposed all across the Kashmir valley. Internet was cut off. All Kashmiri politicians were rounded up and arrested. In fact all Kashmiris – loyalists (to India), nationalists, secessionists, independentists, apolitical – were branded as The Enemy. Welcome to Indian “democracy” under the crypto-fascist Hindutva.

    “Jammu and Kashmir”, as we know it, is no more. They are now two distinct entities. Geologically spectacular Ladakh will be administered directly by New Delhi. Blowback is guaranteed. Resistance committees are already springing up.

    In Kashmir, blowback will be even bigger because there will be no elections anytime soon. New Delhi does not want that kind of nuisance – as in dealing with legitimate representatives. It wants full control, period.

    Starting in the early 1990s, I’ve been to both sides of Kashmir a few times. The Pakistani side does feel like Azad (“Free”) Kashmir. The Indian side is unmistakably Occupied Kashmir. This analysis is as good as it gets portraying what it means to live in IOK (Indian-occupied Kashmir).

    BJP minions in India scream that Pakistan “illegally” designated Gilgit-Baltistan – or the Northern Areas – as a federally administered area. There’s nothing illegal about it. I was reporting in Gilgit-Baltistan late last year, following the China-Pakistan Economic Corridor (CPEC). Nobody was complaining about any “illegality”.

    Pakistan officially said it “will exercise all possible options to counter [India’s] illegal steps” in Kashmir. That’s extremely diplomatic. Imran Khan does not want confrontation – even as he knows full well Modi is pandering to Hindutva fanatics, aiming to turn a Muslim-majority province into a Hindu-majority province. In the long run though, something inevitable is bound to emerge – fragmented, as a guerrilla war or as a united front.

    Welcome to the Kashmiri Intifada.
    From: https://www.strategic-culture.org/ne...o-occupations/
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    With respect to China identifying western interference in Hong Kong, this is relevant:

    Click image for larger version

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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Iran steps in to comment on the situation in Kashmir and Jammu:

    Quote ‘No hasty decisions or military moves’: Iran urges Pakistan & India to keep cool in Kashmir row
    Published time: 11 Aug, 2019 04:32 Edited time: 11 Aug, 2019 05:10

    Iran has urged Pakistan and India to avoid any reckless moves in the Kashmir dispute that could escalate into a direct military confrontation and be devastating for the entire region.

    “Military approaches in this region will further complicate the situation,” Iran’s armed forces chief, Major General Mohammad Baqeri, told his Pakistani counterpart, Qamar Javed Bajwa, during a phone conversation on Saturday. The commander also urged the parties to maintain calm and avoid making any “hasty decisions.”

    Tensions have been running high in Jammu and Kashmir since Monday, when New Delhi revoked a constitutional provision (Article 370) that allowed the territory to have its own flag, constitution, and autonomy over its internal administration.

    Turning the Indian-administered Kashmir from a state to a federally controlled territory will help end decades of terrorism and separatism incited by Pakistan, Indian Prime Minister Narendra Modi stated earlier this week. To reinforce its sovereignty and to prevent potential acts of terrorism and violence, India sent some 35,000 troops to the region.

    In response, Pakistan downgraded its diplomatic relations with New Delhi and suspended trade and train links with its neighbor.

    Kashmir, with a predominantly Muslim population, has been the center point of contention between India and Pakistan ever since they gained independence from Britain in 1947. Three wars have been fought over the Himalayan region in the last 40 years, but they have failed to change the boundaries or control of the state.
    From: https://www.rt.com/news/466250-iran-...tary-solution/
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    There are challenge within China from local governments ‘rigging’ the system in the railway network component of One Belt One Road.

    It certainly seems that China is no different to the West in this: people will gear larger systems to meet their particular needs.

    Quote Empty trains on the modern Silk Road: when Belt and Road interests don’t align
    China’s provinces are sending empty freight trains to Europe. Chinese media explains why.

    TJMa 2019年8月23日

    China is sending empty freight trains to Europe through one of its key Belt and Road Initiative (BRI) projects: the China-Europe Railway Express. The bizarre phenomenon caught the attention of Depth Paper (等深线), a Chinese online news platform. In a rare move by a Chinese media outlet in today’s media environment, Depth Paper probed critically into one of the BRI’s most visible “connectivity” projects, uncovering the perverse incentives that are luring China’s local governments and companies to create huge “bubbles” of ostensibly flourishing rail routes that run tens of thousands of kilometers across the vast landmass of Eurasia.

    The revelation partly confirms what some observers have suspected all along: that China’s central government lacks the ability to keep BRI strategically tight and coordinated. Sub-national stakeholders, as they do in other policy areas, have the incentives to bend the initiative to their own narrowly defined interests and in the process undermine the overarching strategy, if such a strategy indeed exists at all. The curious case uncovers some important dynamics playing out among Belt and Road’s diverse stakeholders.


    Depth Paper uncovered the perverse incentives that are luring China’s local governments and companies to create huge “bubbles” of ostensibly flourishing rail routes that run tens of thousands of kilometers across the vast landmass of Eurasia.

    The China-Europe Railway Express

    Transporting goods between China and Europe through railroads is not a common choice for traders. Up to now, it only makes up 4.8% of the total bilateral trade volume, far behind commodities moved by sea (68%) and air (19.4%). For many years, the China-Europe rail routes were interrupted by the fragmented customs, quarantine and taxation regimes of countries along the way. As a rail transport agent in west China told Depth Paper, sending cargo to Germany through rail was unimaginable as recently as 1997. “Central Asia was as far as we could go.”

    But, according to the report, things changed about a decade ago. Years before the advent of the Belt and Road Initiative, the instigator of this change was in fact the American computer company Hewlett-Packard. In 2009, as the computer giant negotiated a major investment deal with Chongqing, the city on the upstream Yangtze River with no easy access to a sea port, it included a condition that it should be able to transport its products to the European market by train: westbound directly from the city, instead of first going east to the sea. The Chongqing government accepted the condition and after two years, the Chongqing to Duisburg rail route was made navigable, allowing HP to ship to Europe in a relatively low cost (compared to air transport) and speedy way (compared to shipping by sea).

    Before 2013, the year when BRI was formally announced, a few other freight rail routes were made possible by such bottom-up commercial interests. The city of Wuhan in central China, a major base for car manufacturing, developed Wuhan to Europe routes upon which half of its car outputs now depend for transportation. Similarly, Yiwu, the light industry powerhouse of Zhejiang province, opened up its own rail route to ship large quantities of small commodities, from garments to needles, to Europe. Ironically, those early trials, mostly developed by landlocked Chinese municipalities, received little central government support around that time. According to Depth Paper, China’s railway administrators even charged a fee for the extra burden those freight lines created. Its attitude toward such initiatives would make a 180 turn after BRI came into being.

    2013 saw the creation of BRI and the incorporation of China-Europe rail links under the umbrella of Xi’s signature initiative as a key connectivity component. As China’s 2015 Vision and Strategy document for the BRI declared the intention of building the rail routes into a “brand name service”, the number of routes began to explode. Dozens of Chinese cities, including those on the east coast with easy access to ports, joined the bandwagon of rail transportation.

    Click image for larger version

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    Planned train routes from China to Europe through Central Asia/Russia, source: NDRC

    Growing bubble

    In 2016, the National Development and Reform Commission (NDRC) laid out a five year plan for the expansion of westbound rail routes. And China’s railway planner published a blueprint document on building up the brand reputation of China Railway Express. China State Railway Group Corporation, which used to be the railway ministry, began to highlight the growth of Europe-bound voyages as a major achievement.

    The elevation of the freight service in political importance created powerful incentives for players to “rig the game”. Depth Paper reveals two groups of schemers in the game:

    Provincial and local governments: As the number of freight trips to and from Europe become a measurable indicator, local governments, particularly those sitting at key railway hubs, saw a clear opportunity to boost their visibility under the BRI (and probably to the leadership). At their disposal were subsidies to lower the cost of freight services and make them competitive with cargo ships.

    The Ministry of Finance provides a guiding subsidy ceiling of 0.8USD/container/kilometer. But ambitious local governments circumvent it by inventing all kinds of additional rewards to lure businesses to their train terminals, sometimes even compensating for the extra mileage of truck transportation to bring containers from thousands of kilometers away. According to a chart collated by Sino Trade and Finance, many municipal government offer around 3000USD per container for a one-way Europe bound trip and a whole train could receive a total of 123,000USD worth of subsidies per trip. These local governments also use tax rebate and land use subsidies to sweeten the deal for freight service companies.

    International railway service companies: Competition with each other and pressure from local governments eager for BRI visibility has incentivized the companies who actually run the numerous rail routes to Europe to increase the number of train trips. Every month these companies have to book planned trips from the railway regulators and get what is called a “route slip” that permits them to run those trains. The ratio of actual trips to the applied number is called “realization rate” that regulators use to monitor rail capacity utilization.

    The interplay of these incentives drives both groups to boost indicators that make them look good in this game, creating scenes that are outright bizarre. The government of Xi’an is one of the most active players starting from 2018. The city, 1000 kilometers to the west of Beijing and the former capital of Tang Dynasty more than a millennium ago, considers itself the “starting point of the ancient Silk Road” and strives to restore its glory in the Belt and Road era. With full support from its provincial bosses, it is the most generous with subsidies, dwarfing other provinces by a wide margin. “Subsidized per container transportation price from Xi’an is constantly below RMB 8500, while it costs over 20000 RMB from Shandong,” a trade agent told Depth Paper.

    The subsidies are of the scale that they bend the gravity of trade. In the most extreme cases, traders in the far west Xinjiang Autonomous Region, which already borders Central Asia and is itself a Belt and Road rail hub, would move their cargo thousands of kilometers to the east to capitalize on the Xi’an government’s free handouts before transporting west across the Eurasian continent. Similarly, traders in coastal Shandong provinces would truck their goods all the way to Xi’an and load them onto trains, as it is cheaper even after taking into account the 5000 RMB per container transportation cost by truck (for which the Xi’an government also partially remunerates). The result is that Europe-bound freight train trips from Xi’an grew by a whopping 536.6% in just one year from 2017 to 2018.

    The railway service companies, on the other hand, blow up their trip numbers even when they have very little to ship. Before Xi’an arrived on the scene in 2018, the competition between Chongqing and Chengdu, two nearby cities, was so fierce that the two cities would refuse to merge cargo loads back from Germany despite neither being able to fill a whole train themselves. When the pressure (and reward) to be the top railway service company facilitating “Belt and Road” trips to Europe becomes huge, the companies simply start loading empty containers to their trains. They must ensure that each train meets the regulator’s 40-container minimum before it leaves the station, but there is no obligation and no ability (for lack of demand) to fill those containers.

    In the most extreme case, one train carried 40 empty containers and just one full container all the way to Europe. This makes the China Railway Express’s impressive growth number highly dubious, and most certainly a “bubble”. Even with all their tricks, companies can barely fulfill their promise to regulators: they have overbooked railway resources. In Q2 of 2019, Chongqing’s “realization rate” dipped to as low as 64% for some routes.

    BRI undermined

    Artificially enabled transportation routes are more of a disruption to than facilitation of trade, as China’s policy makers are slowly but painfully beginning to realize. Subsidies are both unsustainable and capricious: “Sometimes a city changes a Party Secretary and the new boss has other priorities for his budget.” This makes it hard for businesses to make long term plans and build China Railway Express into their logistic strategies.

    Heavy subsidies also encourage opportunistic behavior that runs against the original intention of the policy. “[Subsidies] are supposed to help first-time users overcome initial transition difficulties and cultivate user acceptance of freight rail as a reliable means of transportation”, says one anonymous Liaoning provincial official to Depth Paper. “[But] what Xi’an does can hardly nurture real needs. Traders will go back to sea and air as soon as subsidies disappear.” The official also warns that such unpredictability and fluctuation would hurt the China Railway Express’s reputation overseas and permanently scare clients away.

    The Ministry of Finance is reportedly determined to pierce the bubble by enforcing a schedule for phased subsidy reduction. Subsidies by local government are to be no more than 40% of a route’s total cost in 2019. The ceiling will be further lowered to 30% in 2020 and zero by 2022. The Ministry is hoping that by then the trains running up and down routes would be completely market driven and China Railway Express will stand on its own two feet.

    The episode reveals the fundamental difficulties for China’s central leadership to implement its vision by reducing it to seemingly measurable indicators and supposedly workable incentives that mobilize local players to participate in a central government cause. Distortions and outright undermining of central government agenda happens with GDP numbers, air pollution targets, and other domestic issues. BRI is no exception.

    It also calls into question a key underlying assumption of the BRI, that the power and “deep pocket” of the Chinese state can overcome problems that the market cannot solve when left alone. Trade flows, it turns out, are not easily bendable by the sheer will of the state. It is a rare occasion for a Chinese media outlet to so directly call out systemic problems in Xi Jinping’s signature initiative. As China embarks on other overseas adventures that premise on the ability of state capitalism to shift the center of gravity of global trade (through new ports and rail hubs), the troubles of China Railway Express should serve as a cautionary tale of the limits of state power.
    From: https://pandapawdragonclaw.blog/2019...ts-dont-align/
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    The Solomon Islands have switched diplomatic ties from Taiwan to China.

    Quote Taiwan terminates relations with Solomon Islands: foreign minister
    16 September 2019 18:322 min read

    Taiwan on Monday severed ties with the Solomon Islands after learning the Pacific nation had decided to switch diplomatic recognition to China, a decision it described as “extremely regrettable”.

    “The cabinet of the Solomon Islands government decided to switch diplomatic relations to the People’s Republic of China,” foreign minister Joseph Wu announced at a press conference in Taipei on Monday.

    “The government hereby declares the termination of diplomatic relations with the Solomon Islands with immediate effect,” he added.

    The move is yet another diplomatic blow for Taiwan which has seen its few remaining allies steadily whittled down by Beijing.

    Only 16 nations still diplomatically recognise the island over Beijing.

    Taiwan has been a de facto sovereign nation since the end of a civil war in 1949, but China still views the island as its territory and has vowed to seize it — by force if necessary.

    Over the decades, as China’s economic and military power has grown, dozens of countries, including the United States and most Western nations, have switched recognition to Beijing.

    In the last few years only a handful of countries have remained loyal to Taiwan, largely in Latin America and the Pacific.

    But Beijing stepped up its campaign to diplomatically isolate Taiwan after the 2016 election of President Tsai Ing-wen, who hails from a party that refused to recognise the idea that the island is part of “one China”.

    Since her election, six of Taiwan’s allies have now defected.
    From: https://www.hongkongfp.com/2019/09/1...-taiwan-china/
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Details of an extensive 2016 deal agreed between China and Iran have been released. The deal relates mostly to preferential pricing of, development of infrastructure for and access to Iranian oil. US Dollars are avoided. Russia get the option of participating to some degree.

    Quote China and Iran flesh out strategic partnership
    Staggered 25-year deal could mark seismic shift in the global hydrocarbons sector

    Simon Watkins

    Iran's foreign minister Mohammad Zarif paid a visit to his Chinese counterpart Wang Li at the end of August to present a road map for the China-Iran comprehensive strategic partnership, signed in 2016.

    The updated agreement echoes many of the points contained in previous China-Iran accords, and already in the public domain. However, many of the key specifics of this new understanding will not be released to the public, despite representing a potentially material shift to the global balance of the oil and gas sector, according to a senior source closely connected to Iran's petroleum ministry who spoke exclusively to Petroleum Economist in late August.

    The central pillar of the new deal is that China will invest $280bn developing Iran's oil, gas and petrochemicals sectors. This amount may be front-loaded into the first five-year period of the deal but the understanding is that further amounts will be available in every subsequent five-year period, subject to both parties' agreement.

    There will be another $120bn investment in upgrading Iran's transport and manufacturing infrastructure, which again can be front-loaded into the first five-year period and added to in each subsequent period should both parties agree.

    Chinese presence

    Among other benefits, Chinese companies will be given the first refusal to bid on any new, stalled or uncompleted oil and gasfield developments. Chinese firms will also have first refusal on opportunities to become involved with any and all petchems projects in Iran, including the provision of technology, systems, process ingredients and personnel required to complete such projects.

    "This will include up to 5,000 Chinese security personnel on the ground in Iran to protect Chinese projects, and there will be additional personnel and material available to protect the eventual transit of oil, gas and petchems supply from Iran to China, where necessary, including through the Persian Gulf," says the Iranian source.

    "China will also be able to buy any and all oil, gas and petchems products at a minimum guaranteed discount of 12pc to the six-month rolling mean price of comparable benchmark products, plus another 6pc to 8pc of that metric for risk-adjusted compensation."

    Under the terms of the new agreement, Petroleum Economist understands, China will be granted the right to delay payment for Iranian production up to two years. China will also be able to pay in soft currencies that it has accrued from doing business in Africa and the Former Soviet Union (FSU) states, in addition to using renminbi should the need arise—meaning that no US dollars will be involved in these commodity transaction payments from China to Iran.

    "Given the exchange rates involved in converting these soft currencies into hard currencies that Iran can obtain from its friendly Western banks—including Europäisch-Iranische Handelsbank [in Germany], Oberbank [in Austria] and Halkbank [in Turkey]—China is looking at another 8-12pc discount [relative to the dollar price of the average benchmarks], which means a total discount of up to 32pc for China on all oil, gas and petchems purchases," the source says.

    Another positive factor for China is that its close involvement in the build-out of Iran's manufacturing infrastructure will be entirely in line with its One Belt, One Road initiative. China intends to utilise the low cost labour available in Iran to build factories, designed and overseen by large Chinese manufacturing companies, with identical specifications and operations to those in China, according to the Iranian source.

    Transport infrastructure

    The resulting products will be able to enter Western markets via routes built or enhanced by China's increasing involvement in Iran's transport infrastructure. When the draft deal was presented in late August to Iran's Supreme Leader Ali Khamenei by Iran's vice president, Eshaq Jahangiri—and senior figures from the Economic and Finance Ministry, the Petroleum Ministry and the Islamic Revolutionary Guard Corps—he announced that Iran had signed a contract with China to implement a project to electrify the main 900km railway connecting Tehran to the north-eastern city of Mashhad. Jahangiri added that there are also plans to establish a Tehran-Qom-Isfahan high-speed train line and to extend this upgraded network up to the north-west through Tabriz.

    Tabriz, home to a number of key oil, gas and petchems sites, and the starting point for the Tabriz-Ankara gas pipeline, will be a pivot point of the 2,300km New Silk Road that links Urumqi (the capital of China's western Xinjiang Province) to Tehran, connecting Kazakhstan, Kyrgyzstan, Uzbekistan and Turkmenistan along the way, and then via Turkey into Europe, says the Iranian source.

    The pipeline plan will require the co-operation of Russia, as it regards the FSU states as its backyard. And, because, until recently, Russia was weighing a similarly all-encompassing standalone deal with Iran. So, according to the source, the agreement includes a clause allowing at least one Russian company to have the option of being involved, also on discounted terms, alongside a Chinese operator.

    Benefits for Iran

    The Iranians expect three key positives from the 25-year deal, according to the source. The first flows from China being one of just five countries to hold permanent member status on the United Nations Security Council (UNSC). Russia, tangentially included in the new deal, also holds a seat, alongside the US, the UK and France.

    "In order to circumvent any further ramping up of sanctions—and over time encourage the US to come back to the negotiating table—Iran now has two out of five UNSC votes on its side. The fact that [Iran foreign minister Mohammad] Zarif showed up unexpectedly at the G7 summit in August at the invitation of France may imply it has another permanent member on side," he adds.

    A second Iranian positive is that the deal will allow it to finally expedite increases in oil and gas production from three of its key fields. China has agreed to up the pace on its development of one of Iran's flagship gas field project, Phase 11 of the giant South Pars gas field (SP11). China National Petroleum Corporation (CNPC), one of China's 'big three' producers, added to its 30pc holding in the field when it took over Total's 50.1pc stake, following the French major's withdrawal in response to US sanctions. CNPC had since made little progress developing SP11—a 30pc+ discount to the global market price on potential condensate and LNG exports could change that.

    China has also agreed to increase production from Iran's West Karoun oil fields—including North Azadegan, operated by CNPC, and Yadavaran, operated by fellow 'big three' firm Sinopec—by an additional 500,000bl/d by the end of 2020. Iran hopes to increase projected recovery rates from these West Karoun fields, which it shares with neighbour Iraq, from a current 5pc of reserves in place to at least 25pc by the end of 2021 at the very latest. "For every percentage point increase, the recoverable reserves figure would increase by 670mn bl, or around $34bn in revenues even with oil at $50/bl," the Iranian source says.

    A final Iranian benefit is that China has agreed to increase imports of Iranian oil, in defiance of a US decision not to extend China's waiver on imports from Iran in May. China's General Administration of Customs (GAC) figures released in late August show that, far from reducing its Iranian imports, China imported over 925,000bl/d from the country in July, up by 4.7pc month-on-month, from an already high base.

    The actual figure is still higher, according to the Iranian source, with excess barrels being kept in floating storage in and around China; without having gone through customs they do not show up on customs data, but are effectively part of China's Strategic Petroleum Reserve.
    From: https://www.petroleum-economist.com/...ic-partnership
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    There is some media narrative about getting China’s status at the WTO changed or about challenging the WTO itself. I have read elsewhere that there are ongoing US moves against the WTO. It could be an attempt to address both.

    Quote Australia PM joins Trump calling for China to drop 'developing economy' status

    (Reuters) - Global trade rules are "no longer fit for purpose" and must be changed to accommodate China's new status as a developed economy, Australian Prime Minister Scott Morrison said in a major foreign policy speech in the United States.

    The global community had engaged with China to help it grow but now must demand the world's second-largest economy bring more transparency to its trade relationships and take a greater share of the responsibility for addressing climate change, Morrison said.

    "The world's global institutions must adjust their settings for China, in recognition of this new status," said Morrison in a speech to the Chicago Council on Global Affairs, referring to China as a "newly developed economy".

    "That means more will be expected of course, as has always been the case for nations like the United States who've always had this standing," Morrison said in the speech, according to transcript provided to Reuters.

    Global trade rules were "no longer fit for purpose" and in some cases were "designed for a completely different economy in another era, one that simply doesn't exist any more", he added.

    Referring to China as a newly developed economy marks a change from Beijing's self-declared status as a developing economy, which affords it concessions such as longer times to implement agreed commitments, according to the World Trade Organization (WTO).

    It also puts Australia into line with a campaign led by U.S. President Donald Trump to remove China's developing nation status. In an April 7, 2018 tweet, Trump wrote that China was a "great economic power" but received "tremendous perks and advantages, especially over the U.S."

    Morrison has previously urged China to reform its economy and end a trade war with the United States but has until now stopped short of taking a public position on its WTO status.
    ...
    More and from: https://mobile-reuters-com.cdn.amppr.../idUSKBN1W9010

    This may all be media noise because here is what is said on the WTO website. I guess it depends on how costly the agreements are to implement and what is the value of having extra time to implement agreements.

    Quote Definition of a “developing country” in the WTO

    How is the selection made?
    There are no WTO definitions of “developed” and “developing” countries. Members announce for themselves whether they are “developed” or “developing” countries. However, other members can challenge the decision of a member to make use of provisions available to developing countries.

    What are the advantages of “developing country” status?
    Developing country status in the WTO brings certain rights. There are for example provisions in some WTO Agreements which provide developing countries with longer transition periods before they are required to fully implement the agreement and developing countries can receive technical assistance.

    That a WTO member announces itself as a developing country does not automatically mean that it will benefit from the unilateral preference schemes of some of the developed country members such as the Generalized System of Preferences (GSP). In practice, it is the preference giving country which decides the list of developing countries that will benefit from the preferences. For more information about the GSP, see the United Nations Conference on Trade and Development (UNCTAD)’s website, (opens in a new window).
    From: https://www.wto.org/english/tratop_e..._e/d1who_e.htm
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Quote Posted by Cara (here)
    (Reuters) - Global trade rules are "no longer fit for purpose" and must be changed to accommodate China's new status as a developed economy, Australian Prime Minister Scott Morrison said in a major foreign policy speech in the United States.

    [...]

    Global trade rules were "no longer fit for purpose" and in some cases were "designed for a completely different economy in another era, one that simply doesn't exist any more", he added.
    On one hand a statement like "Global trade rules are no longer fit for purpose" sounds pretty innocent -- on the other hand it is somewhat similar to all that talk about the "rules-based order."

    It seems to me that this debate about China’s status at the WTO is just one aspect of an expanding trade war between the US and China.

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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Quote Posted by silvanelf (here)
    ...On one hand a statement like "Global trade rules are no longer fit for purpose" sounds pretty innocent -- on the other hand it is somewhat similar to all that talk about the "rules-based order."

    It seems to me that this debate about China’s status at the WTO is just one aspect of an expanding trade war between the US and China.
    Thanks!

    Yes, indeed, this does seem to be more of the “rules based international order” narrative.
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)


    I would much recommend you see this analyst's talk (he gives the same talk many times over, with small tweaks by audience), or read one of his books. His point is that China has a lot of loose capital looking for any safe harbor, and thus funds a lot of projects at the very edge of unprofitability, or far beyond it, like most things in the Belt and Road. However, there is a second possibility.. that the financial system will, in short order, change in a way that makes the rules completely different, and with that would go the definition of who wins and of who loses. Everyone can agree the U.S. has a great geographical advantage because of the two oceans and the vast Mississippi river basin, largest and most agricultural one on the planet, but might not a few select floods, which have already happened, change that power at a crucial moment? Looking around at Chinese history, and having read up on Mao, it is equally possible that the CCP has lost control of the situation and is patching up holes, or that they have a surprising grand strategy and will see the Anglo system to its grave. Never sure with them.
    In the Time of Rage the mat and the throne of the righteous were buried; They would walk bowed and silent until their time to take up the rulership, and Wisdom alone would be their mark. -Chilam Balam-

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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Thank you LakeofMarch. He has some interesting statistics on demographics and their impact on economic models and the nature of competition as perceived by the USA.

    I do not agree with his version of 20th century history and I am wary of his association with Stratfor (not an organisation without an agenda).

    ~~~

    For anyone interested in demographics, this site has figures charted for the world and individual countries and continents:
    https://www.populationpyramid.net/
    Last edited by Cara; 28th September 2019 at 07:30.
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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    Japan and the European Union have signed an infrastructure deal.

    It’s pitched as being a counter to the One Belt One Road but I think that maybe just be the media narrative spin.

    More significant to me is the build out of capacity across Eurasia and the question:
    where is the financing coming from for all this?

    If the world is in this precarious economic situation of overblown debt, the need for “austerity programmes”, cuts in social welfare etc., what is the source of the funding?

    Quote In counterweight to China, EU, Japan sign deal to link Asia

    BRUSSELS (Reuters) - The European Union and Japan signed an infrastructure deal on Friday to coordinate transport, energy and digital projects linking Europe and Asia, seeking an alternative to Chinese largesse that has raised suspicion in Brussels and Tokyo.


    European Commission President Jean-Claude Juncker and Japan's Prime Minister Shinzo Abe gesture during the conference Communication Connecting Europe and Asia, in Brussels, Belgium September 27, 2019. REUTERS/Francois Lenoir

    The accord, signed by Japanese Prime Minister Shinzo Abe and European Commission President Jean-Claude Juncker, formalizes Japan’s involvement in a new EU-Asia “connectivity” plan that is set to be backed by a 60 billion euro ($65.48 billion) EU guarantee fund, development banks and private investors.

    “Whether it be a single road or a single port, when the EU and Japan undertake something, we are able to build sustainable, rules-based connectivity from the Indo-Pacific to the Western Balkans and Africa,” Abe told an EU-Asia forum in Brussels.

    Since 2013, China has launched construction projects across more than 60 countries, known as the Belt and Road Initiative, seeking a network of land and sea links with Southeast Asia, Central Asia, the Middle East, Europe and Africa.

    The sea route that leads to the Mediterranean and the Atlantic must be open,” he added, referring to the need to prevent projects funded by Beijing and its vast foreign exchange reserves dominating transport routes.

    Juncker also vowed to help build infrastructure “without mountains of debt” or a reliance “on a single country”.

    That was a veiled reference to Chinese-financed projects that have sent debts in some central Asian and Balkan countries soaring after they embarked on building bridges, roads and tunnels they could ill-afford.

    The EU and Japan also want stricter environmental standards.

    EU officials said they are concerned about what they see as a Chinese investment model which lends to countries for projects they may not need, making them reliant on China once under way. Poor countries across Asia and Africa have seized on the attractive Chinese loans.

    A Chinese-funded highway to link Montenegro’s Adriatic coast to landlocked neighbor Serbia has so indebted Montenegro that the International Monetary Fund has told the country it cannot afford to finish the project.

    Although not all European and Japanese money will be spent in Asia, the Commission’s strategy makes spending on infrastructure links with Asia official EU policy involving the EU’s common budget.

    In their 10-point accord, the EU and Japan promised to pay “utmost attention” to countries’ “fiscal capacity and debt-sustainability”.
    From: https://www.reuters.com/article/us-e...-idUSKBN1WC0U3

    And here’s that so-called “rules-based” international order again:
    Quote we are able to build sustainable, rules-based connectivity from the Indo-Pacific to the Western Balkans and Africa
    *I have loved the stars too dearly to be fearful of the night*

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    Default Re: Watching Eurasia and the New Silk Road / One Belt One Road (OBOR)

    This last week there was a meeting of the EAEU (Eurasian Economic Union) in Yerevan, Armenia. Iran seems now to have formally joined and Singapore has signed a free trade agreement with the organisation.

    ~~~

    First Iran:
    Quote Joining Eurasian Economic Union good opportunity for Iran's economy: Rouhani


    Iran's President Hassan Rouhani (C) speaks to reporters in Tehran on September 30, 2019 before leaving for the Armenian capital to attend the Eurasian Economic Union’s summit in Yerevan. (Photo by president.ir)

    Iran's President Hassan Rouhani says joining the Eurasian Economic Union (EAEU) provides the country’s public and private economic sectors with a very good opportunity to develop their foreign trade activities.

    Rouhani made the remarks in an interview in Tehran on Monday before leaving for the Armenian capital to attend the EAEU’s summit in Yerevan.

    He said Iran's joining the EAEU would be a very good opportunity for the private-sector businesspeople as well as the public economic sector to expand trade ties with the five member states of the union and to connect to the economy of other regions.

    Quote “This is a very important step under the circumstances that the Americans cruelly seek to apply pressure and sanctions on the Iranian nation and Iran's foreign trade," the Iranian president said.
    He noted that the five member countries of the union have a population of some 180 million while Iran is a nation of 83 million, and therefore relations between Iran and these countries can be of high significance.

    Rouhani said an agreement between Iran and the five EAEU states would become operational and implemented on October 27.

    As the first step, some 502 Iranian goods can be exported to EAEU countries by receiving preferential tariffs as a nearly zero tariff will be applied to them, Rouhani said, adding that further steps would be taken in this regard in the future.

    He noted that Kyrgyzstan, Kazakhstan, Russia, Belarus and Armenia are the five members of the union while Iran, Singapore, Moldava and Vietnam plan to join it.

    The Iranian chief executive said he is scheduled to hold bilateral talks with senior officials attending the meeting, including the Armenian president and prime minister as well as presidents of Kazakhstan and Russia and Singapore's prime minister.

    The Eurasian Economic Union is an international organization for regional economic integration. It has international legal personality and is established by the Treaty on the Eurasian Economic Union.

    The EAEU provides for free movement of goods, services, capital and labor, pursues coordinated, harmonized and single policy in the sectors determined by the treaty and international agreements within the union.

    The Iranian government in June cleared a last hurdle to its bid to launch a free trade zone with the Eurasian Economic Union, a major regional organization which could help Tehran increase its revenues from non-oil export at the time of increased US sanctions.

    The spokesman of Iran’s Guardian Council, which oversees government’s accession to regional and international treaties, said that the body had approved an agreement signed on May 17, 2018 between Iran and the EAEU that was meant to facilitate trade between the two sides.
    From: https://www.presstv.com/Detail/2019/...ic-Union-trade

    ~~~

    And Singapore:

    Quote EAEU trade deal shows resolve to resist protectionism: PM Lee Hsien Loong


    Prime Minister Lee Hsien Loong; Armenia Prome Minister Nikol Pashinyan; and Eurasian Economic Commission Board Chairman Tigran Sargsyan, attend a joint press conference at the Governmental Residence in Yerevan, Armenia, on Oct 1, 2019.ST PHOTO: JASON QUAH

    YEREVAN, ARMENIA - A new free trade agreement signed between Singapore and the Eurasian Economic Union (EAEU) will deepen ties, and catalyse greater trade and investments between the two sides, Prime Minister Lee Hsien Loong said on Tuesday (Oct 1).

    But the FTA is also "significant because it shows our resolve to resist the tide of protectionism".

    Mr Lee said he was glad Singapore has found in the members of the EAEU - comprising Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia - "like-minded partners committed to multilateralism and free trade".

    "We are convinced that free trade will foster competition and innovation, allow our businesses access to new technologies and global networks, increase our productivity and grow our economies."

    PM Lee was speaking at a joint press conference with Armenian Prime Minister Nikol Pashinyan and Eurasian Economic Commission chairman Tigran Sargsyan, following the signing of two deals under the EAEU-Singapore FTA.

    The Framework and Non-Services and Investment Agreements were inked at the Governmental Residence in Yerevan, Armenia, at the session of the Supreme Eurasian Economic Council, a meeting of the EAEU leaders

    PM Lee, who witnessed the signing, was in New York last week to attend the United Nations General Assembly. He noted on Tuesday that many leaders there, particularly of small states, had expressed concern "at the instinct to turn inwards, harden borders and hinder the free flow of trade and commerce".

    Mr Lee said he hopes the FTA will lead to a broader trade agreement between the EAEU and Asean.

    "We have 800 million people between us, so it would be a substantial FTA. Such an FTA will help us unlock many more opportunities and realise our full potential," said the Prime Minister.

    On the benefits of the FTA, he noted trade between EAEU and Singapore now stands at US$6.5 billion (S$9 billion), which is "not insignificant, but still quite modest".

    When the FTA comes into force, Singapore companies can enjoy lower tariffs and non-tariff barriers, he added.

    "These are tangible benefits that can immediately and meaningfully boost our trade. In the longer term, regulatory cooperation, enhanced business linkages and greater familiarity with each other will enable our companies to operate across our regions with more ease and efficiency," he said.

    After the press conference, Singapore and Armenia signed the bilateral Services and Investment Agreement, which is part of the EAEU-Singapore FTA.

    PM Lee said he was looking forward to a swift conclusion of the remaining agreements with other EAEU members.

    Discussing the approach to negotiating FTAs with other countries, he said in an interview with Singapore media that the Republic is at a "disadvantage" because it is small, its economy is open, and tariffs are nearly zero.

    "Therefore, people say what is the point of negotiating an FTA with Singapore. So our answer to them has been, because there are other non-tariff aspects which we can work together on and liberalise, particularly in the services sector like financial services.

    "Also, if you have an FTA with Singapore, that is a pathfinder which encourages other countries also to enter into FTAs with you," he added, citing trade deals Singapore has with countries such as China, New Zealand, Japan and Australia.

    Mr Sargsyan said the EAEU-Singapore FTA is a good example of how the union can structure trade deals with other countries.

    He also said the union has received an application from Israel to initiate negotiations for a comprehensive agreement covering goods, and services and investment.

    "We hope to continue this practice further," he added.
    From: https://www.straitstimes.com/politic...ee-hsien-loong
    *I have loved the stars too dearly to be fearful of the night*

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