The Changing / Emerging Global Landscape

[Cara]

I am noticing more movement and change in how larger global systems and structures are organised and aligned.

This is a thread for collecting different aspects of a changing global landscape, including:

Regional structures and alliances
Financial and trade structures and groupings
Military groups and alliances
Space alliances and groupings
Other aspects as they emerge


~~~~

First up is the idea of creating a regional trade currency for East Asia. It has been suggested by Malaysia; it has been suggested before (20 years ago). The example of the Euro is cited. Might it have more momentum this time?

From: https://www.eastasiaforum.org/2019/07/30/should-asia-have-a-regional-currency/


Should Asia have a regional currency?
30 July 2019
Authors: Namsung Kim and Yasuto Watanabe, AMRO and Hiro Ito, Portland State University

In May 2019, Malaysian Prime Minister Mahathir Mohamad stated that East Asia should ‘adopt a common trading currency, not to be used locally but for the purpose of settling of trade’ that would be pegged to gold. His intention is to create a currency that replaces the US dollar as the region’s vehicle currency in regional trade and investment. Mahathir has a record of suggesting a common currency for the region, particularly during the aftermath of the Asian Financial Crisis of 1997–1998. But is his suggestion more feasible now than it was 20 years ago?

https://www.eastasiaforum.org/wp-content/uploads/2019/07/2015-08-21T120000Z_1483442465_GF10000178351_RTRMADP_3_MARKETS-GLOBAL-600x351.jpg

There is no question that the US dollar is the vehicle currency in the Asian region. This is not just because of the inertia of the region’s long-time practice in international trade — the United States has been one of the largest ultimate destinations of Asia’s goods. The region’s reliance on the US dollar is deeper than the level of its economic relations with the United States suggests. The US dollar’s dominance is also evident in the regional financial transactions conducted with international organisations such as the Bank for International Settlements and the Society for Worldwide Interbank Financial Telecommunication.

Many Asian emerging market economies (EMEs) hold an enormous amount of US dollar-denominated reserve assets as a mean of self-insurance against potential financial instability. China alone holds US$3.2 trillion in foreign reserves as of the end of 2018 (about a third of the global total). EMEs in Asia hold more than 10 per cent of the total while Japan holds another 10 per cent. A large portion of the reserves, around 60 per cent, are invested in US treasuries.

With this level of reliance on the US dollar, Asian economies are highly exposed to shocks arising from changes in the economic policy and conditions of the United States. As Helen Rey argues (https://www.nber.org/papers/w21852), these economies are subject to ‘global financial cycles’ in capital flows, asset prices and credit growth.

In markets where capital moves freely, countries’ national monetary policies are subject to the monetary policy of the centre countries. While the US Federal Reserve Board (FRB) focuses on achieving domestic output and price stabilities as its mandates, EMEs are vulnerable to ‘global financial cycles’ emanating from the United States and incapable of independent monetary policy, regardless of the state of their own domestic economies.

One effective way for Asia to mitigate exposure to the US dollar would be to adopt a common currency, like the euro. The euro promotes regional investment and trade and helped develop the regional common market. Since its adoption in 1999, Europe has benefited from both regionalisation and globalisation. The euro has also helped mitigate the spillover effects emanating from key economies.

When then-FRB chairman Ben Bernanke mentioned in 2013 the possibility of tapering down quantitative easing policy, it caused large depreciation of the currencies of many EMEs — the ‘Taper Tantrum’. While it directly hit many of the emerging economies in Asia, it hardly affected European emerging markets because the impact of the market jitters was buffered by the euro. East European emerging markets are not exposed to depreciation risk because their currency values are primarily linked to the euro.

Of course, the euro was not built in a day and it would take several decades for Asia to adopt a common currency. Asia needs to establish a common monetary authority to issue the new currency and bonds denominated in it. This would require more regional financial integration and cooperation, macroeconomic policy coordination and a common supervisory function of financial institutions. Above all, a common vision (https://www.eastasiaforum.org/2019/04/16/finding-the-right-amount-of-independence-for-asias-central-banks/) for future financial integration and political consensus among the member countries is crucial.

With recent progress in regional economic integration in East Asia, adopting a common currency in the region may be more plausible than 20 years ago. If the regional international currency Mahathir suggests could be used not only for cross-border trade of goods and services but also for that of financial assets, it could function as the medium for rescue loans if a crisis occurs in any of the member economies.

This would mitigate East Asia’s overreliance on the US dollar and take a load off the United States’ excessive burden of ‘exorbitant duty’ as the lender of last resort. The member countries of the new currency arrangement could be given a choice of pegging their local currency to the new common currency or adopting the new currency as their domestic currency.

The ultimate goal of introducing this new currency is not just to facilitate regional trade and financial transactions, but to secure (https://www.eastasiaforum.org/2019/04/22/financial-warning-lights-are-flashing-red-in-asia/) economic and financial stability in the region. The regional common currency should also contribute to building an institutional framework to deal with financial volatilities.

At the time of the euro debt crisis, the euro area quickly established institutions such as the Eurosystem Collateral Framework and European Stability Mechanism (ESM). With these organisations, Europe was able to promptly prepare liquidity assistance and therefore maintain ownership of the crisis situation, rather than yielding control to the United States or other external parties. This was possible because the European Central Bank and the ESM committed themselves to being the region’s lender of last resort.

East Asian countries may not yet have sufficient momentum to move toward establishing a regional common currency. It is uncertain if Mahathir’s renewed suggestion will revive the momentum. But overreliance on the US dollar may not be beneficial for East Asia in the future. Having its own common currency might allow East Asia to solve financial instability in swift and effective ways that would benefit not just Asia but also the world economy.

Namsung Kim is CMIM Specialist at the ASEAN+3 Macroeconomic Research Office (AMRO).

Yasuto Watanabe is Deputy-Director of the ASEAN+3 Macroeconomic Research Office (AMRO).

Hiro Ito is Chair and Professor at the Department of Economics, Portland State University (PSU).

[Cara]

This development - the creation of an African Continental Free Trade Area - which I shared a while ago in Iloveyou’s thread on Africa (http://projectavalon.net/forum4/showthread.php?106876-Keeping-an-eye-on-Africa) is relevant here:


Important development - agreement of an African Continental Free Trade Area (AfCFTA).

I’m not sure if this is positive news or not. Certainly, it might help some African interests overcome very high costs of doing business across Africa. But it also creates a mechanism for furthering the interests of those with money rather than addressing the cares and concerns of ordinary people. It also may act as a necessary step in the path for those in Europe who are pushing their “Eurafrica” idea (more in the next post).


https://www.dw.com/en/african-leaders-launch-landmark-55-nation-trade-zone/a-49503393

African leaders launch landmark 55-nation trade zone
It took African countries four years to agree to a free-trade deal in March. The trade zone will unite 1.3 billion people, create a $3.4 trillion economic bloc and usher in a new era of development across the continent.

https://www.dw.com/image/49503342_303.jpg
African Union summit in Niger on July 7, 2019

Nigerian President Muhammadu Buhari and Benin's President Patrice Talon on Sunday signed a landmark trade agreement ahead of the accord's official launch at the African Union (AU) summit in Niger.

AU commission chairman Moussa Faki dubbed the African Continental Free Trade Area (AfCFTA) deal a "historic" moment.

Fifty-four out of 55 AU member states agreed to the deal in March, with only Eritrea holding out. It took African leaders four years to reach an agreement on the continental free-trade zone, which is expected to usher in a new era of development in Africa.

The AfCFTA is the largest trade bloc since the creation of the World Trade Organization in 1994.

Focus on Africa

"The eyes of the world are turned to Africa," Egyptian President and AU chairman Abdel-Fattah el-Sissi said at the summit's opening ceremony on Sunday.

"AfCFTA will reinforce our negotiating position on the international stage. It will represent an important step," he added.

https://www.dw.com/image/49503350_401.jpg
'AfCFTA will represent an important step,' says AU chairman el-Sissi (L)

The African free-trade bloc will help boost the continent's long-stymied economy by strengthening interregional trade and supply chains.

The free-trade zone should be operational from July 2020, AU trade and industry commissioner Albert Muchanga told the AFP news agency.

Major obstacles

Economic experts say the AU still faces significant challenges in implementing the deal. Poor roads and railway lines, violence-hit areas, strict border controls and rampant corruption are some of the obstacles to an effective continental free-trade zone.

AU member countries agreed to eliminate tariffs on most goods, which would boost regional trade by 15-25% in the medium term. It could be doubled in the long term if other issues were dealt with, according to the International Monetary Fund (IMF).

"Reducing tariffs alone is not sufficient," it said.

"It will be important to address those disparities to ensure that special and differential treatments for the least developed countries are adopted and successfully implemented," said Landry Signe, a fellow at the Brookings Institution's Africa Growth Initiative.

The IMF said in a May report that the AfCFTA could be an "economic game changer" for Africa – of a similar kind to the one that boosted growth in Europe and North America.

Amaka Anku, Africa analyst at Eurasia group, said the deal was a positive step but AfCFTA was still "a long way from taking off."

African nations currently trade only about 16% of their goods and services among one another, compared with 65% for the European Union member states.

shs/ng (AFP, Reuters)

[Cara]

The growing overt role of multinational corporations in global structures of governance is also a facet of this change.

This article, earlier shared here (http://projectavalon.net/forum4/showthread.php?92122-THE-CORPORATION-A-Powerful-compelling-movie), discusses how this is taking place at the United Nations.


...

This article points to the ongoing gains being made by global corporations towards taking overt roles in governance.

In this case, the gain made is via the World Economic Forum which has just signed a memorandum of understanding with the United Nations.

https://www.opendemocracy.net/en/oureconomy/how-united-nations-quietly-being-turned-public-private-partnership/


How the United Nations is quietly being turned into a public-private partnership
A new agreement with the World Economic Forum gives multinational corporations influence over matters of global governance.

Harris Gleckman
2 July 2019

A new corporate and government marriage quietly took place last week when the leadership of the World Economic Forum (WEF) and the United Nations (UN) signed a memorandum of understanding (MOU) (https://weforum.ent.box.com/s/dj7x7z2fjxrox49farw5dfxfa1hfqw3h) to partner with each other. While this MOU is proudly displayed on the WEF website, it is nowhere to be found on the UN website. The only indication on the UN website of this important new development is a picture of the pen (https://www.unmultimedia.org/s/photo/detail/811/0811012.html) used to sign the agreement, and two pictures of the signing ceremony.

One reason for this difference is that the UN’s corporate-centered Global Compact has received a good deal of bad press (http://www.globalpolicy.org/images/pdfs/images/pdfs/Fit_for_whose_purpose_online.pdf). Now the new WEF-UN agreement creates a second special place for multinational corporations inside the UN. There is no similar institutional homes in the UN system for civil society, for academics, for religious leaders, or for youth. It is hard to imagine a national government signing a similar formal partnership with one of its business organizations.

At the same time, the UN is under pressure from Donald Trump who wants to deconstruct the whole multilateral system. For Trump, dismantling the international system built after World War II is a companion piece to his domestic effort at deconstructing the administrative state. For the Secretary-General of the UN, the pact with the WEF may well be his effort to find new power actors who can support the current system, which is now celebrating its 75th anniversary (http://www.globalpolicy.org/images/pdfs/images/pdfs/Fit_for_whose_purpose_online.pdf), in the face of Trump’s onslaught.

On the other side, the WEF recently received significant public criticism after giving Hungarian Prime Minister Orban and Brazilian President Bolsonaro a warm welcome at its 2019 Davos gathering. This marriage may be seen as a way for the WEF to re-establish itself as part of the global governance center.

The timing and managing of public perceptions are not the only interesting aspect of this arrangement. In 2009, the WEF published a 600 page report entitled the Global Redesign Initiative (https://www.umb.edu/gri), which called for a new system of global governing, one in which the decisions of governments could be made secondary to multistakeholder led initiatives in which corporations would play a defining role. In a sense this WEF study recommended a sort of public-private United “Nations” – something that has now been formalized in this MOU. The agreement announces new multistakeholder partnerships to deliver public goods in the fields of education, women, financing, climate change, and health.

The rather detailed MOU includes forms of cross organizational engagement up and down the UN structure. The MOU contains commitments that the Secretary-General himself will be invited to deliver a keynote address at the WEF annual Davos gatherings. His senior staff and the heads of the UN programmes, funds, and agencies will also be invited to participate in regional level meetings hosted by the WEF. It also contains a promise that the UN’s individual country representatives will explore ways to work with WEF’s national Forum Hubs. Aware of the mutual importance of public legitimacy each institution can provide for the other, the MOU also contains an agreement to cross-publicize their joint activities.

Besides the institutional blessing of the United Nations, what does the WEF get from the MOU? The scope of each of the five fields for joint attention is narrowed down from the intergovernmentally negotiated and agreed set of goals to one with more in line with the business interests of WEF members. So under financing, the MOU calls only for ‘build[ing] a shared understanding of sustainable investing’ but not for reducing banking induced instabilities and tax avoidance.

Under climate change, it calls for ‘ …public commitments from the private sector to reach carbon neutrality by 2050’, not actions that result in carbon neutrality by 2030 . Under education, it re-defines the Sustainable Development education goal to ‘ensure inclusive and equitable quality education’ into one that focuses on education to meet the ‘rapidly changing world of work.’ The MOU explicitly restricts the WEF from making financial contributions to the UN, which might have ameliorated the economic impact of some of Trump’s threat to the budgets of the UN system. At the same time, it avoids any commitment to reduce global inequality, to make energy affordable, to hold multinational corporations accountable for human rights violations, or even to rein in the behavior of the WEF’s firms that act inconsistently to the re-defined goals set out in the agreement.

All this joint work might have some practical good if it were not for three crucial elements: firstly, the agreement circumvents the intergovernmental review process; secondly, the agreement elevates multistakeholderism as the solution to the problems with the current multilateral system; and thirdly the proposed multistakeholder partnerships are not governed by any formal democratic system. Were the Secretary-General convinced of the wisdom of a UN marriage with the WEF, he could have submitted the draft MOU for approval by the member states. Instead, the Secretary-General joined the WEF in declaring in effect that multistakeholder groups without any formal intergovernmental oversight are a better governance system than a one-country-one-vote system.

All multistakeholder governance groups are largely composed (https://www.tni.org/en/publication/multi-stakeholderism-a-corporate-push-for-a-new-form-of-global-governance) of a self-selected group of multinational corporations and those organizations and individuals that they want to work with. They work without any common internal rule book to protect the views of all who might be impacted by the group. Participation in multistakeholder group is a voluntary undertaking. The drop-in-drop-out arrangements are antithetical to the UN’s efforts for 75 years to build a stable secure global governance system with a clear understanding of obligations, responsibilities and liabilities.

What is surprising is that by accepting this marriage arrangement with the WEF, the Secretary-General of the UN is marginalizing the intergovernmental system in order to ‘save’ it.
From: https://www.opendemocracy.net/en/oureconomy/how-united-nations-quietly-being-turned-public-private-partnership/


To me, it looks like there is a plan for the eventual merger of the UN and WEF. The paragraph that leads me to this speculation is this:


The rather detailed MOU includes forms of cross organizational engagement up and down the UN structure. The MOU contains commitments that the Secretary-General himself will be invited to deliver a keynote address at the WEF annual Davos gatherings. His senior staff and the heads of the UN programmes, funds, and agencies will also be invited to participate in regional level meetings hosted by the WEF. It also contains a promise that the UN’s individual country representatives will explore ways to work with WEF’s national Forum Hubs. Aware of the mutual importance of public legitimacy each institution can provide for the other, the MOU also contains an agreement to cross-publicize their joint activities.

[Cara]

Relevant to the post above is a book written by David Korten in 1995 and republished in 2015: When Corporations Rule the World
https://upload.wikimedia.org/wikipedia/en/thumb/d/da/WCRWIIcoverart.gif/220px-WCRWIIcoverart.gif


Perhaps the most far reaching but little understood transformation in the late twentieth century has been the growth of multinational corporations. Under the guise of free market economics, modern corporations have assumed enormous economic and political power. Corporate libertarians have equated corporate growth with the public good, but as David C. Korten argues, increasing corporate power results in an enormous transfer of power, wealth, and resources from the public to the private sector. Unresponsive to the public will, corporations have placed their immediate self-interest over the public good. In WHEN CORPORATIONS RULE THE WORLD, former USAID official and Harvard Business School professor Korten examines the social, economic, and environmental consequences of the uncontrolled growth of multinational corporations.

The World Bank, the International Monetary Fund (IMF), and the World Trade Organization (WTO) have all facilitated the growth of multinational corporations. The new global economic environment has resulted in a massive transfer of jobs and capital and a drain on natural resources. Corporate expansion has been fueled by the disconnection of money from value in a predatory financial system, by corporate mergers and buyouts, and most of all by the illusory idea that unlimited growth is possible in a finite global environment. The corporate agenda of maximizing short-term profits often works against the common good, especially when corporations externalize their costs and export jobs and capital. A healthy society requires more than greed and self-interest to sustain itself.

With the unlimited growth of global corporate power, Korten foresees the emergence of a new corporate colonialism resulting in the loss of national sovereignty, economic dependence, and continued environmental and social decline. The corporate goal of global consumerism on a Western scale is simply unsustainable, Korten warns, without catastrophic social and environmental consequences. The coming “Ecological Revolution” will require a new corporate vision of social responsibility.
From: https://www.enotes.com/topics/when-corporations-rule-world

Here is a web version of the book (I think the 1995 version): http://www.thirdworldtraveler.com/Korten/WhenCorpsRuleWorld_Korten.html

[Cara]

Space forces are being openly created. Both the USA and France have initiated one.

Here are some of the more recent developments for the USA in this regard:

...

Astrophysicist Neil deGrasse Tyson has stated that a space force, in addition to war fighting responsibilities, should have the roles of space debris cleanup and asteroid defense.[23][24]

Former Secretary of Defense Jim Mattis has stated space "is becoming a contested war-fighting domain, and we have to adapt to that reality."[25] Former Secretary of the Air Force Deborah Lee James opposed an independent space service, believing that since it would be the smallest armed service, it would be detrimental to space operations, and instead supports the reestablishment of United States Space Command.[26]

The U.S. Congress directed two studies to examine the viability of a space force: the first was due in August 2018 and the second was due in December 2018.[26] According to Representative Rogers, the first study assesses to what extent a space force would be necessary, while the second one examines its nature, implementation, and costs.[27] ...

In August 2018, U.S. Vice President Mike Pence announced a plan that would establish the Space Force by 2020.[29] On August 13, 2018 the John S. McCain National Defense Authorization Act for Fiscal Year 2019 was signed into law, which included the re-establishment of U.S. Space Command, which will be led by a four-star general or admiral and will temporarily be organized as a sub-unified combatant command under U.S. Strategic Command, until it can be elevated to a full unified combatant command.[30] In December 2018, the Trump administration directed that U.S. Space Command to instead be reestablished as a full unified combatant command, with full responsibilities for space warfighting held under U.S. Strategic Command.[31][32] However, the elevation to full unified combatant command has met continued delays since it requires Congress to amend the law directing its reestablishment as sub-unified combatant command.[33] On February 19, 2019, Space Policy Directive-4 was signed, which calls for the Space Force to be initially organized within the Department of the Air Force, and at a later date transitioned to the Department of the Space Force. All space operations forces of the Air Force, Army, and Navy would be transferred into the new service branch.[3]

... On May 19, 2019, the House Appropriations Committee announced in a drafted report that they will not support the allocation of funding to establish a Space Force.[38] However, the committee also reports that they did not completely reject the idea of establishing a Space Force,[38] and have recommended that $15 million be appropriated to the Department of Defense for further study of how a space service could be organized.[38]

On May 23, 2019, the Senate Armed Services Committee voted to approve the establishment of the Space Force, but with a modified organizational buildup. ...

The House Armed Services committee voted to approve the establishment of the Space Corps on June 13, 2019. The proposal of the formation of a space force was included in the 2020 National Defense Authorization Act under the name of the United States Space Corps instead of the Space Force name in the Senate proposal.[41] The amendment made to the Senate Armed Services Committee's version of the 2020 NDA, which proposes the Space Corps, was amended by Democrat Jim Cooper and Republican Mike Rogers[42] and states that the space military branch will have personnel and assets transferred by the Air Force but may not include the personnel or assets of the National Reconnaissance Office or the National Geospatial-Intelligence Agency.[41] The Space Corps will be organized, trained, and equipped to provide freedom of operation for the United States in, from and to space and that the secretary of defense can transfer to the Space Corps “functions, assets and obligations" of the space elements of the Air Force (including all property, records, installations, activities, facilities, agencies and projects).[42] The proposal would also create the Commandant of the Space Corps, who would join the Joint Chiefs of Staff.[43]
From: https://en.m.wikipedia.org/wiki/United_States_Space_Force


And French President Macron recently announced a similar initiative:


Macron announces creation of French space force
14/07/2019 - 10:33

Kamil Zihnioglu, AFP | Emmanuel Macron announced the creation of a space command within the French air force in Paris, July 7, 2013.

The declaration -- made on the eve of France's Bastille Day national celebrations that feature a military parade down Paris's Champs-Elysees -- mirrors an initiative in the US championed by President Donald Trump (https://www.france24.com/en/tag/donald-trump/).

"To assure the development and the reinforcement of our capacities in space, a high command for space will be created in September," Macron (https://www.france24.com/en/tag/emmanuel-macron/) told military brass gathered for a traditional pre-Bastille Day reception.

He called the renewed military focus on space a "true national security issue".

Last year Macron had spoken of the need for a strategy for space defence and this was the result, he said.

"The new spatial and military doctrine that has been proposed to me by the (defence) ministry, which I have approved, will allow us to ensure our defence of space...," he added.

"We will reinforce our knowledge of the situation in space, we will better protect our satellites, including in an active manner," he said.

Defence Minister Florence Parly would reveal details of the funding at a later date, he added.

International space race

France's declared interest in boosting its military readiness in space follows increased spending and interest in the area by the United States, China and Russia.

Observers see military activities -- including spy satellites, location tracing and jamming, communications and cyber attacks -- increasingly being set up in orbit around Earth.

France 'needs to control what's happening around its satellites'

France has a 2019-2025 military spending plan that allocates 3.6 billion euros ($4 billion) to defence in space.

That includes the renewal of the France's CSO observation and Syracuse communication satellites, the launch of three CERES electromagnetic-monitoring satellites, and the modernisation of a spatial radar surveillance system called GRAVES.

The Pentagon has drafted plans for a new Space Force on orders from Trump who has declared space a "war-fighting domain". But that project still requires the approval of the US Congress.

In March, United Nations-backed talks in Geneva to prevent an arms race in outer space ended without agreement.

Parly announced research into the new generation of military satellites at the Paris Air Show last month.

French operations could no longer do without a presence in space "to contribute to our autonomy of evaluation, decision and action in a decisive manner," she said.

(AFP)
From: https://www.france24.com/en/20190713-macron-france-space-force

[Cara]

Apologies to all readers for the barrage of posts. I have been observing these changes for a little while and until today did not have a sense of how to collect and/or organise them.

I think I have now posted all the main items that were steeping in my mind.

[EFO]

You are a fine and SUBTLE observer and also you have the words for it.KKEP IT UP!

[Cara]

This shift is not so new and it seems that various commenters argue about what exactly it is. Some are calling it “globalisation backlash”, others “global retreat”, and yet others “deglobalisation”.

Brexit and the election of Trump are viewed as SYMPTOMS of this change, rather than causes, with most thoughtful commentators citing the global financial crisis of 2008/9 as the start.

~~~

This professor of International Economics and Macroeconomics at Erasmus University in the Netherlands, Peter A.G. van Bergeijk, uses economic analysis and historical data to conclude that what we are seeing is a repeat (with different characteristics) of the deglobalisation that took place in the 1930s.


Brexit delay will not postpone deglobalisation
Peter A.G. van Bergeijk 18 March 2019

Many associate Brexit and the Trumpian trade wars with the start of a new phase of deglobalisation. This column argues that we should view them as symptoms rather than causes, as the world had already started to fundamentally change before either came on the horizon. Neither the delay to Brexit nor the extended pause in the US–China tariff war means that the risks of deglobalisation have diminished.

===

While economists agree that the multilateral trading system is under pressure and that US trade wars and the Brexit chaos provide examples of behaviour that is completely new for the present generation, it is still unclear if we are actually in the midst of deglobalisation (O’Rourke 2018, 2019). Deglobalisation would imply a fundamental change in our economic environment but not a new phenomenon from a long-run perspective, because a period of significant deglobalization also occurred in the 1930. We can glean from history the pattern of emerging deglobalisation (van Bergeijk 2019). Figure 1 illustrates this historical perspective of alternating waves of globalisation (a more open world economy) and deglobalisation by means of the change in the world trade to world output ratio.1 The figure shows that strong globalisation phases are followed by decades in which the world’s trade-to-GDP ratio decreases or stagnates. What does the current pattern of emerging deglobalisation look like?

 Figure 1 Change in openness 1880-2023
(average annual change per decade of the world trade to world production ratio)
https://voxeu.org/sites/default/files/image/FromMay2014/bergeijk18marchfig1.png
Notes: The estimate for 2010-2023 is (partly) based on IMF forecasts. Note that the number of available years is limited in the 1910s and 1930s and the absence of the 1940s.
Sources: Maddison (1995, 2001), World Bank World Development Indicators, and IMF World Economic Outlook data base.

Deglobalisation 2.0

The start of the deglobalisation phase is a major economic crisis that reduces demand, increases uncertainty, and destroys confidence. Next follows a collapse of world trade and investment (Baldwin 2009). The collapse marks the end of decades of intensifying globalisation, and increasingly free international trade and capital flows. The start of a period of deglobalisation at first remains hidden under the veil of initial economic recovery, but later becomes clear and measurable. Figure 2 shows this pattern for the most recent phases and turning point. In the early 2000s openness (on the vertical axis) increased until it reached an all-time high in 2008 and from there deglobalisation sets in. Deglobalisation actually gains momentum around 2013 (and this leads to the recognition of the world trade slowdown; see Hoekman 2015). At the same time, uncertainty (on the horizontal axis) increases and moves into unknown territori. The figure makes an important point: deglobalisation started well before Trumpism and Brexit came on the horizon. Rather than being the causes of deglobalisation, we should therefore treat them as symptoms – the world had already started to change fundamentally and the wave of deglobalisation that we are currently experiencing may be here to stay for quite some while.

Figure 2 Openness and economic policy uncertainty of the world economy
https://voxeu.org/sites/default/files/image/FromMay2014/bergeijk18marchfig2.png
Sources: Davis (2016) and data underlying Figure 1.

The major difference between the 1930s and the 2000s is that authoritarian countries in the era of the Great Depression were more likely to reduce trade and openness, whereas reductions of trade and openness during the Great Recession were more likely to occur in democracies (van Bergeijk 2018). To some it may be especially worrying that the clearest manifestations of deglobalisation occur in democracies, because democracies built the Bretton Woods institutions (and the EU). Indeed, the popular anti-globalist movements currently seem to hit the system at its heart. It is unwise to downplay the issue of populism, but it is important to recognise that the turning point of globalisation in all major economies appears to have occurred well before the recent trade shocks. This is why the phenomenon of deglobalisation requires a much broader conceptualisation than the ‘backlash from globalisation’ or the ‘retreat from globalisation’ on which research is already well underway. Deglobalisation in the sense of reduced openness also occurs in countries where popular support for globalisation is still strong, and this is a research puzzle that has not yet been addressed.

Drivers of the turn towards deglobalisation

Phases of strong globalisation carry the seeds of their own destruction, that is, such phases generate the forces that ultimately set limits and force a retreat of internationalisation. A first mechanism operates in national economies: redistributing the gains from further openness to the people who lost from globalisation becomes more difficult at higher levels of globalisation. This is a double-edged sword. In the initial phase when a country starts to open up, the economy experiences steep increases in productivity and welfare, but once the low-hanging fruit has been picked the same increase in the intensity of globalisation brings less benefits to the economy. At the same time the costs of redistribution at a low intensity of globalisation are initially small, but they are on an increasingly steep path. This shift in the (marginal) costs and benefits of further globalisation shifts the political balance towards less openness

A second mechanism operates in the international arena. During both the Great Depression of the 1930s and the Great Recession, the leading economic power of the time deserted the rules of the game that underpinned globalisation and were actually designed by its initial interest in an open trade and investment climate. An open stable and relatively peaceful system, however, allows other countries to develop and grow faster, capturing a larger share of the benefits of globalisation. In the early phase of globalisation a smaller share from a larger economic pie may still be an improvement. At some point the costs of being a hegemon, however, outweigh the benefits. It is ironic, but sad, that the US and the UK (the hegemons that helped to build a constellation in which trade, democracy, and peace were reinforcing aspects of the world order) are opting against global and European governance.

Cease fire?

Deglobalisation is a structural transformation of the world economy. Political turbulence can perhaps hasten this process. To some observers, delays to the big topical trade shocks may therefore seem to help to turn the tide. Brexit and ‘Make America Great Again’ are, however, symptoms of underlying processes that have already generated significant trade and investment uncertainty and this is already exercising a concrete impact on trade and investment flows as firms and consumers are adjusting behaviour in anticipation of further trade shocks. The delay of the deadlines provides a pause at best. It is therefore pertinent to rethink global economic governance and make it resistant to deglobalisation. A repositioning of the extent of internationalisation is manageable, but then concerted action is necessary to make the required changes in the rules and regulations of the world economic system. Those rules and regulations should be redesigned to meet the requirements of globalisation and, as recent experiences have made crystal clear, also meet the challenges posed by a wave of deglobalisation.

References

Baldwin, R E (ed) (2009), The great trade collapse: Causes, consequences and prospects, a VoxEU.org eBook.

Davis, S J (2016), “An Index of Global Economic Policy Uncertainty,” Macroeconomic Review, October (updated on http://www.policyuncertainty.com).

Hoekman, B (ed) (2015), The global trade slowdown: A new normal, a VoxEU.org eBook.

Maddison, A (1995), Monitoring the World Economy 1820-1992, OECD.

Maddison, A (2001), The World Economy: A Millennial Perspective, OECD.

O'Rourke, K H (2018), "Economic history and contemporary challenges to globalization," CEPR Discussion Paper 13377.

O'Rourke, K H (2019), “The end of globalization”, Vox Talks, 1 February.

Pástor, L and P Veronesi (2018), “Inequality Aversion, Populism, and the Backlash Against Globalization", CEPR Discussion Paper 13107.

van Bergeijk, P A G (2018), "On the brink of deglobalization… again", Cambridge Journal of Regions, Economy and Society 11(1): 59-72.

van Bergeijk, P A G (2019), Deglobalization 2.0: Trade and openness during the Great Depression and the Great Recession, Edward Elgar.

Endnotes

The figure is intended to sketch a long-run perspective and thus by necessity focuses on merchandise trade in relation to world production. This of course ignores developments in services and financial flows.
From: https://voxeu.org/article/brexit-delay-will-not-postpone-deglobalisation

[Cara]

Related to the post above, here is a slightly different perspective, one more oriented towards political economy, of International Relations academic, Raffaele Marchetti. See below the video for his various affiliations including to the European Commission and NATO.

He speaks on the backlash against globalisation in this video (18:15 long). His three main topics:

Populism is relevant but not that important
The dichotomy between supranational integration and localisation
An increasing challenge to the macro narratives of the 90s, chiefly neoliberalism, with alternatives emerging

2RvWnYX_3qE

Published on Jul 4, 2018
Raffaele Marchetti (Laurea, Rome-La Sapienza; PhD, London-LSE) is senior assistant professor (national qualification as full professor) in International Relations at the Department of Political Science and the School of Government of LUISS. His research interest concerns global politics and governance, hybrid and city diplomacy, transnational civil society, (cyber-)security and political risk, and democracy.

He acts as external expert for the European Commission and other public/private institutions on issues of global governance, public policies, civil society, and security. He is member of the editorial board of The International Spectator, the Academic Advisory Board of the NATO Defense College-NDC, the European Joint Doctorate GEM-STONES academic board, and the steering committee of the Centro studi sulla Cina contemporanea. He is the editor of the Routledge series World Politics and Dialogues of Civilizations.

In 2015 he produced one of the first MOOCs on IR: From International Relations to Global Politics for Iversity. In the past, he was director of the FP6 Strep project SHUR. Human Rights in Conflicts: The Role of Civil Society and held a Jean Monnet European Module on EU’s Engagement with Civil Society, both funded by the European Commission. He was visiting/adjunct professor at American University of Rome-AUR, China Foreign Affairs University-CFAU-Beijing, Freie Universität Berlin, London School of Economics-LSE, MGIMO-Moscow, Sciences Po-Paris, Strathmore University-Nairobi, Université de Geneve, University of Naples L’Orientale, and Waseda-Tokyo. He was fellow at the European University Institute-EUI, Italian National Research Council-CNR, University of Exeter, the FP6 research project DEMOS. Democracy in Europe and the Mobilization of Society at the University of Urbino, the Network of Excellent GARNET. Global Governance, Regionalisation & Regulation: The Role of the EU, the SUSI on US National Security Policy-Making at the University of Delaware, and the Wissenschaftszentrum Berlin für Sozialforschung- WZB. He was research contractor for the DoC Research Institute, European Union Institute for Security Studies-EUISS, Istituto San Pio V, Istituto Affari Internazionali-IAI, and Finmeccanica. He was rapporteur for the European Commission on Civil Society in Global Governance, and received the Lawrence S. Finkelstein Award by the International Studies Association-ISA, Section on International Organization.

~~~

For those who would like a “primer” on regionalisation and globalisation in the international political arena, this is a good mainstream overview lecture style presentation:
58APKMnFccQ

Published on May 24, 2019
This Lecture talks about Globalization to Regionalization - Situation changes in World Politics .

[Cara]

Oil market dynamics and relationships amongst producers are changing quite dramatically. Russia and OPEC are now in close collaboration and Iran is allowing Russia use of two if its ports and several other agreements - both military and oil related - have been made.

~~~

First, Russia and Saudi Arabian are increasing coordination of oil output:


Saudi-Russian Oil Fling Becomes Marriage
Javier Blas and Jack Farchy
Wednesday, July 03, 2019

https://images.rigzone.com/images/news/articles/159216_582x327.png

(Bloomberg) -- It was supposed to be a six-month fling, but Saudi Arabia and Russia have instead signed up for eternity.

Complete with poem and celebratory badges, Moscow and Riyadh led two dozen countries in signing a charter to formalize the OPEC+ group that for the past 2 1/2 years has coordinated supply to prop up the price of oil.

OPEC Secretary General Mohammad Barkindo compared the pact to a “Catholic marriage,” saying it would last for “eternity.”

“The charter may end the perennial questions of whether Russia-Saudi is a relationship built to last,” said Helima Croft, chief commodities strategist at RBC Capital Markets. “The charter is the ring in the relationship.”

It was a moment that would have been hardly imaginable three years ago, when decades of distrust were poisoning relations between the world’s two largest oil exporters as prices languished. In late 2016, in the face of skepticism from analysts and some senior figures in both countries, Khalid Al-Falih of Saudi Arabia and Russia’s Alexander Novak promised the output cuts they’d agreed on would last just six months.

Oil Diplomacy

This week, the group agreed to extend the cuts into a fourth year, to March 2020. But signing the charter was a key moment in a much broader Saudi-Russian diplomatic effort.

It was Russian President Vladimir Putin who first telegraphed (https://mercury.bloomberg.com/news/PTVVZK6KLVR4) the result of the OPEC+ meeting, after discussions with Saudi Crown Prince Mohammad bin Salman in Osaka on Saturday. And when Putin visits Saudi Arabia later in the year, Riyadh is planning to invite other heads of state from the OPEC+ group for a signing ceremony of the charter.

For Saudi Arabia, turning what had been an ad hoc coalition into a formal group provides a hedge against future oil-market turbulence. The kingdom can now lean on a group representing almost half of global oil output for support.

For Russia, the formalization of the group helps expand Putin’s influence in the Middle East. That’s a blow to the U.S., which has spoken out against Russia’s growing clout in the region. “I am very confident that Vladimir Putin’s efforts will fail,” said (https://www.state.gov/interview-with-maria-bartiromo-of-mornings-with-maria-on-fox-business-network-2/) Secretary of State Mike Pompeo when asked earlier this year whether the Russian president could use oil diplomacy to supplant the U.S. in the Middle East.

The charter is, implicitly, a recognition of the long-term nature of the problem facing Saudi Arabia and the other major oil producers. Oil slid on Tuesday in spite of the agreement, with West Texas Intermediate and Brent dropping 4.8% and 4.1%, respectively. Prices edged higher on Wednesday.

Breakneck growth in U.S. shale oil production, combined with worries about slowing demand growth, mean that the OPEC+ group has little choice but to continue its cuts or see prices plunge.

Al-Falih acknowledged as much, saying that oil producers would need to “keep adjusting (https://mercury.bloomberg.com/news/PU0NEG6JIJUS)” until U.S. shale production eventually peaked.

That’s a particularly painful reality for Saudi Arabia, which is doing the bulk of the cutting. Russian output in June (https://mercury.bloomberg.com/news/PU03KG6JTSE8) of 11.155 million barrels a day is just 0.5% below its level in December 2016, before the cuts deal began. Saudi Arabia’s oil production, on the other hand, is more than 7% lower over the same period.

“Russia pulls the strings while Saudi output swings,” said Roger Diwan, a veteran OPEC-watcher at IHS Markit Ltd.


From: https://www.rigzone.com/news/wire/saudirussian_oil_fling_becomes_marriage-03-jul-2019-159216-article/

~~~

Next, the growing ties between Russia and Iran (this commentator is not happy about the developments):


Russia Gains Stranglehold Over Persian Gulf
By Simon Watkins - Aug 04, 2019, 4:00 PM CDT

In a potentially catastrophic escalation of tensions in the Persian Gulf, Russia plans to use Iran’s ports in Bandar-e-Bushehr and Chabahar as forward military bases for warships and nuclear submarines, guarded by hundreds of Special Forces troops under the guise of ‘military advisers’, and an airbase near Bandar-e-Bushehr as a hub for 35 Sukhoi Su-57 fighter planes OilPrice.com has exclusively been told by senior sources close to the Iranian regime. The next round of joint military exercises in the Indian Ocean and the Strait of Hormuz will mark the onset of this in-situ military expansion in Iran, as the Russian ships involved will be allowed by Iran to use the facilities in Bandar-e-Bushehr and Chabahar. Depending on the practical strength of domestic and international reaction to this, these ships and Spetsntaz will remain in place and will be expanded in numbers over the next 50 years.

This gradual roll-out of Russian capability in a country is the Kremlin’s tried and tested operating procedure for leveraging economic and/or political support for a country into that country allowing itself to be used as, effectively, one large multi-level forward military base for Russia. Exactly the same plan was used, and remains in place, in Syria, with Russia maintaining a massive army presence in and around Latakia, Syria, despite having repeatedly made assurances that it was to withdraw from this military theatre. In the early stages, these troops – again, in reality all Spetsnatz foreign operatives – appeared in the guise of military advisers and to provide ‘security staff’ for the huge Russian Khmeimim Air Base and the S-400 Triumf missile system in place in and around Latakia. This Russian presence was later duly expanded and formalised under an agreement signed with Syria in January 2017, which allowed Russia to continue its operations in Latakia and also to utilise the naval facility at Tartus for the next 49 years. This is precisely the format of agreement that has been agreed by Iran’s Islamic Revolutionary Guards Corp (IRGC) and Supreme Leader Ali Khamenei in the last few days, despite muted protest from the broadly pro-JCPOA (Joint Comprehensive Plan of Action) nuclear deal allies of President Hassan Rouhani.

Given how poorly Iran has fared in its recent dealings with Russia – most notably over its Caspian Sea oil and gas rights (https://oilprice.com/Energy/Energy-General/How-Iran-Was-Swindled-Out-Of-32-Trillion.html)– Iran’s decision to go ahead with this latest deal may seem surprising to many but is the product of two key reasons. First, Iran has no other choice of a potential geopolitical ally in its current fight against sanction-induced economic austerity and political marginalisation. There are only five Permanent Members on the United Nations Security Council: the U.S. (the prime mover against Iran), the U.K. and France (both toeing the U.S. line), China (whose support ebbs and flows according to its own agenda), and Russia. “If you have no means of getting food from the supermarket ten miles away then you have no choice but to shop at the store around the corner, no matter how crappy it is,” one senior Iran source told OilPrice.com last week.

The second reason is that President Rouhani and his broadly moderate pro-West, pro-JCPOA supporters have lost the confidence of many who voted for him due to his inability to deliver the economic prosperity that he promised would result from the nuclear deal agreed in 2015 and implemented on 16 January 2016. “This includes [Supreme Leader, Ali] Khamenei, who supported Rouhani for the first few years but now has no choice but to go along with the IRGC’s recommendations, and this Russia deal is at the forefront of these,” said a senior Iran source.

Why is the IRGC backing this deal with Russia, given that its senior personnel are extremely capable people and hardened military officers, well aware of the trouble that the deal could create on a global scale? “Firstly, they [the IRGC] honestly believe that a corollary financial deal agreed with Russia last year is the only economic lifeline that Iran has that will stop it from falling into a popular revolutionary scenario, and the second reason is that some of the most senior figures in the IRGC also stand to gain monetarily by co-operating with Russia,” an Iran source told OilPrice.com last week. The cornerstone deal in question was part of a wide-ranging 22-point memorandum of understanding signed by Iran’s deputy petroleum minister, Amir-Hossein Zamaninia, and Russia’s deputy energy minister, Kirill Molodtsov, at the time covering closer co-operation between the two countries across the board.

For the oil and gas sector, specifically, it involved Russia giving US$50 billion per year every year for at least five years so it could complete its top priority oil and gas projects to Western standards, which was estimated to cost around US$250 billion. Another US$250 billion would then be available for the following five years for Iran to build-out the remainder of its economy. In exchange for this, Iran would give Russian companies preference in all future oil and gas field exploration and development deals, to add to the seven already agreed at that time. These included: Zarubezhneft for Aban and Paydar-e Gharb, Lukoil for Ab Teymour and Mansouri, GazpromNeft for Changouleh and Cheshmeh-Khosh, and Tatneft for Dehloran. In addition – and crucial for what is now in view militarily – Iran also agreed to buy Russia’s S-400 missile defence system, to allow Russia to expand its number of listening posts in Iran, and to double the number of senior ranking IRGC officers that are seconded in Moscow for ongoing training, to between 120 and 130.

The deal also ensured that there was a clause not allowing Iran to impose any penalties on any Russian development firm for slow progress on any field for 10 years, including not being able to re-offer these fields in new bidding rounds even if no progress at all was being made. Over the 10-year period the Russians would have the right to dictate exactly how much oil was produced from each field (to the barrel), when it was sold (to the day), to whom it was sold (by company), and for how much it was sold (to the cent). “Added to this is the fact that within the contracts there was another killer clause: Russia had the right to be able to buy all of the oil – or gas – being produced from fields that their companies were supposedly developing at 55 to 72 per cent of its open market value, for the next 10 years,” said one of the Iran sources. In just the last week as well, Russia – despite it swindling Iran out of its arguably rightful share of Caspian Sea resources – has offered to extract oil and gas from Iran’s sector in the Caspian and sell supplies on in the international markets.

The other reason that has prompted the IRGC into allowing Russia to use Iran as a forward operating military base is that at least two of the most senior commanders have been given monetary inducements to champion Russia’s cause. This was also the reason why Iran ended up buying the inferior capability 28-year old S-300 missile system from Russia rather than the cutting edge new S-400 system. “Russia told Iran that it didn’t actually need the S-400 system and that the S-300 system would be adequate for its needs, despite the S-300 system still costing in total US$7 billion – US$4 billion up front and US$3 billion when it was actually delivered – which was three times the cost that Russia charged Egypt for the better S-400 system,” said one of the Iran sources. “At the same time, two of the key IRGC commanders who had allowed this deal to go ahead pocketed US$105 million each just from that one deal, and they and others get another cut of the US$50 billion per year deal if that fully re-emerges and of the newly-agreed Caspian deal,” he added.

As it stands, then, Russia not only has unfettered access to all of Iran’s onshore, offshore and Caspian Sea oil and gas reserves to sell on as it wishes, however it wishes, but also is set to secure two of the most strategically well-placed ports and surrounding areas in the world’s most sensitive oil and gas hotspot, giving it effective control over the Strait of Hormuz. The Strait, of course, remains the world’s most important oil transit chokepoint – and the key route from the Arabian Gulf to the Far East via the Indian Ocean - with roughly 35% of all seaborne oil and about a third of global liquefied natural gas supplies passing through it. “Bandar-e-Bushehr and Chabahar will give Russia a potential stranglehold over the entire Persian Gulf area and into the Indian Ocean, which will allow it as well to conduct joint naval operations with China with more ease in the U.S. sphere of influence in the East, including around Japan, South Korea, and the Philippines,” a London-based intelligence analyst told OilPrice.com last week. “The fact that Russia also intends to use these two ports not just for warships but for nuclear submarines as well when the waters in its more northern ports are frozen is significantly upping the Russian ante on the West in general and on the U.S. in particular,” he concluded.

By Simon Watkins for Oilprice.com
From: https://oilprice.com/Energy/Energy-General/Russia-Gains-Stranglehold-Over-Persian-Gulf.html#

[silvanelf]

Next, the growing ties between Russia and Iran (this commentator is not happy about the developments):


Russia Gains Stranglehold Over Persian Gulf
By Simon Watkins - Aug 04, 2019, 4:00 PM CDT

In a potentially catastrophic escalation of tensions in the Persian Gulf, Russia plans to use Iran’s ports in Bandar-e-Bushehr and Chabahar as forward military bases for warships and nuclear submarines, guarded by hundreds of Special Forces troops under the guise of ‘military advisers’, and an airbase near Bandar-e-Bushehr as a hub for 35 Sukhoi Su-57 fighter planes OilPrice.com has exclusively been told by senior sources close to the Iranian regime.

--- snip ---

By Simon Watkins for Oilprice.com
From: https://oilprice.com/Energy/Energy-General/Russia-Gains-Stranglehold-Over-Persian-Gulf.html#

A nice fairy tail has exclusively been told by OilPrice.com ...


No, There Will Be No Russian Base In Iran

A somewhat weird report published at Oilprice.com claims that Russia will station troops, ships and fighter jets in Iran. The piece was reproduced at Yahoo.com and Zerohedge even as it is obviously bonkers.

The headline: Russia Gains Stranglehold Over Persian Gulf:



In a potentially catastrophic escalation of tensions in the Persian Gulf, Russia plans to use Iran’s ports in Bandar-e-Bushehr and Chabahar as forward military bases for warships and nuclear submarines, guarded by hundreds of Special Forces troops under the guise of ‘military advisers’, and an airbase near Bandar-e-Bushehr as a hub for 35 Sukhoi Su-57 fighter planes OilPrice.com has exclusively been told by senior sources close to the Iranian regime. The next round of joint military exercises in the Indian Ocean and the Strait of Hormuz will mark the onset of this in-situ military expansion in Iran, as the Russian ships involved will be allowed by Iran to use the facilities in Bandar-e-Bushehr and Chabahar. Depending on the practical strength of domestic and international reaction to this, these ships and Spetsntaz will remain in place and will be expanded in numbers over the next 50 years.

Where to start?

1. The Persian Gulf is a lake with an average(!) depth of less than 50 meter. It is a place where one might use small and nimble midget submarines. But no one serious will put a nuclear submarines there.

2. Sukhoi Su-57 fighter planes have yet to be build. Those currently flying are test planes which still lack the required new engines. Russia recently ordered the first batch of Su-57 but the first deliveries will only be in 2022-24. 35 of these planes may be available in a decade or so. When they are they protect mother Russia from NATO and not some Iranian oil wells.

3. Spetsnaz (not Spetsntaz) are expensively trained special forces. They do not do guard duty for bases.

4. Iran's constitution (pdf) does not allow the stationing of foreign troops. Article 146 is pretty clear about that:


The establishment of any kind of foreign military base in Iran, even for peaceful purposes, is forbidden.

-- snip --

https://www.moonofalabama.org/

[Cara]

Thanks, good catch.

[Bill Ryan]

Relevant to the post above is a book written by David Korten in 1995 and republished in 2015: When Corporations Rule the World
https://upload.wikimedia.org/wikipedia/en/thumb/d/da/WCRWIIcoverart.gif/220px-WCRWIIcoverart.gif

[ .... ]

Here is a web version of the book (I think the 1995 version): http://www.thirdworldtraveler.com/Korten/WhenCorpsRuleWorld_Korten.html

Yes, highly recommended. I read it from cover to cover back in 2002, and it really made quite an impact. :thumbsup:

[Cara]

State issued cryptocurrencies are on the way.

China:

China’s Digital Currency Coming Soon, Says Central Bank
By Kalyan Kumar On 8/12/19 at 10:37 AM EDT

At a time, the currency war between the U.S and China is raging in the name of deliberate weakening of yuan, here comes news that the central bank of China is all set to issue its sovereign digital currency.

Disclosing this, Mu Changchun, deputy director of the People’s Bank of China’s payments department, said the PBOC’s cryptocurrency is “almost ready” for release.

Earlier China was maintaining the stand that cryptocurrency creates disorder as speculators sell off the regular currency and would buy up virtual currency.

In the new system, China might be hoping to create stability with the off-blockchain model.

According to reports, the central bank’s researchers have been working on the currency for five years.

The news comes amidst central bankers worldwide taking a skeptical view of Facebook’s plan to create a cryptocurrency named Libra in association with a consortium of companies including Visa and Uber.

No fixation on Blockchain

The cryptocurrency news from China’s central bank said its digital token will have a two-tier system in which the PBOC and commercial banks will be the authorized issuers at tier 1 and tier two.

The significant part is that PBOC is not fussy about making blockchain the exclusive platform. Rather, it will be technology-neutral.

Blockchain is the main decentralized ledger technology platform guiding most cryptocurrencies including bitcoin.

China's digital currency plan gained traction after Facebook announced details of its Libra cryptocurrency in June.

Wang Xin, head of the research bureau at the PBOC, said in June that the central bank is paying “high attention,” to Libra and would ramp up the development of its digital currency.

China wants more control

However, shunning the decentralized blockchain-based offerings reveals Beijing’s intent to exercise more control over its financial system.

According to reports, the PBOC has already filed 52 patents relating to its digital currency in the name of the Digital Currency Research Lab of the PBoC.

The patents registered by the central bank suggest consumers and businesses have to download a mobile wallet and swap their yuan for the digital money, that could be used to make and receive payments.

The PBOC will track every time money changes hands.

Changchun also said the “blockchain platform just couldn't deliver the throughput needed for retail.”

He said the PBOC’s digital currency will serve as a substitute for M0 –coins and notes in circulation, but not M2, including bank deposits.

Mu said the digital currency would boost the circulation of the yuan internationally.
...
From: https://www.ibtimes.com/chinas-digital-currency-coming-soon-says-central-bank-2812278?amp=1&__twitter_impression=true

Iran:

Iran Announces Gold Backed National Cryptocurrency
July 20, 2019

The Tehran News agency has reported that Iran intends to launch a gold-backed cryptocurrency. This comes less than a week after President Trump slammed virtual currencies on Twitter amid tensions between the historic foes. The New agency reported the development on its English website.

Accordingly, the Central Bank of Iran (CBI) has approved the issuance of new cryptocurrencies. This is according to the CEO of Iranian Information and Communication Technology (ICT) FANAP, Shahab Javanmardi.

Shahab described the measure as follows:


“Iran’s cryptocurrency will be supported by gold, but its function is similar to other cryptocurrencies. The crypto asset is designed to maximize the use of Iranian frozen bank assets.”

As a matter of fact, banks like Parsian Bank, Bank Pasargad, Bank Melli Iran and Bank Mellat were working with blockchain startup Kuknos Company on this as early as January. The Financial Tribune reported that the gold-backed cryptocurrency project will be called Paymon.

The Legal Status of Cryptocurrency in Iran

The Iranian government had earlier this year signaled some opposition to Bitcoin and mining in general. This is because the government decried the use of power which is a feature of cryptocurrency mining. Notably, power is subsidized in Iran and many miners took advantage of this opportunity to have large mining farms.

Mehr news reported that CBI was looking to ban private cryptocurrency and encryption services like in China. That said, the status of Bitcoin in the legal system is still quite unclear. Different government agencies have given conflicting positions in the recent past. In this regard, the conundrum of crypto regulation is as unclear in Iran as it is in most countries globally.

...

Ironically, the American government has accused the Iranian government of actually using Bitcoin to circumvent sanctions. This is because Bitcoin is immutable and not subject to centralized control. Therefore, the Iranian government seems to have a “do as I say and not as I do” stance on Bitcoin.

The Role of Politics

...

Iran is similarly in the middle of currency turmoil after more sanctions from the USA. The fact that cryptocurrency is a way to escape the monopoly of SWIFT transfer in finance is lucrative. As such the country is simply taking a logical measure to cope.

Iran is not alone in exploring cryptocurrency. In fact, more than 70 percent of the world’s central banks are looking at the impact of such a coin. The announcement by the Central bank of Iran will certainly up the ante.
From: https://www.asiacryptotoday.com/iran-announces-gold-backed-national-cryptocurrency

Russia:

Russian Engineering Union Proposes Stablecoins “Backed by Material Valuables”
cryptoregradar July 27, 2019

The Russian Engineering Union (‘SoyuzMash’) has requested that the Central Bank of consider exploring blockchain technology as a potential means of exchange for arms deals with foreign customers.

Vladimir Gutenev, the vice-president of SoyuzMash, has indicated that he made the recommendation directly to Elvira Nabiullina, the head of the Central Bank of , alongside “a whole range of measures” also endorsed by the union.

Specifically, Mr. Gutenev recommended the consideration of stablecoins to conduct Russian arms sales, emphasizing the advantages such offered in facilitating the bypassing of economic sanctions. He stated:

The so-called ‘stablecoins’ are cryptocurrency backed by material valuables, especially gold. That is to say, anonymous payments are one of the possible ways to resolve the existing problems.

Mr. Gutenev’s comments also indicated his preference that arms only be exported after receiving full payment upfront, stating:


It’s hard to name any new conditions with respect to competition, because of course, this is not a competitive environment, it is powerful sanction pressure. Whereas previously there were a few reference points according to which one could say that a contract had been fulfilled, we are now encountering cases where for months the delivered equipment and adopted equipment is not paid for, the transactions are very difficult to carry out.

The recommendation was made by the Russian Engineering Union in partnership with an “expert council on military and technological cooperation” of the State Duma’s commission on legal support for the development of defense industry organizations, which was established during 2019.

Russian Cryptocurrency Legislation Expected by the End of 2019

Last month, local media outlet Interfax reported that the Russian deputy finance minister, Alexei Moiseyev, had announced that the country’s lawmakers were discussing allowing the purchase and sale of cryptocurrencies while preparing Russia’s upcoming virtual currency regulation. However, Mr. Moiseyev indicated that cryptocurrency payments will not be legitimated under the bill.

“Like with foreign currency, it would be possible to buy and sell [cryptocurrencies], but impossible to use them for payments,” he stated.

The report also cited the head of the Duma Financial Market Committee, Anatoly Aksakov, as having indicated that Russia must develop and implement a regulatory apparatus for cryptocurrencies before 2020 to comply with the recommendations of the international financial watchdog, the Financial Action Task Force (FATF).
From: https://reginnovate.com/2019/07/27/russia-mulls-cryptocurrency-use-in-arms-sales/

Other countries have also made announcements:

So far, the countries that launched their own Cryptocurrency

To date, countries that have issued their own cryptocurrencies include Ecuador, China, Senegal, Singapore, Tunisia, though these countries will not be standing alone for long with Estonia, Japan, Palestine, Russia and Sweden looking to launch their own national cryptocurrencies. Some of these countries are likely to take it a step further and replace paper tender altogether with China being one nation that is looking to take one step beyond a virtual and paper version.

Of the countries looking to introduce their own cryptocurrencies, the world’s largest economies could force the hands of smaller nations and we would expect momentum to build in the years ahead. Central banks now looking closely at the successes and constraints faced by those who have already stepped into the light, though only in early September, ECB President Draghi stated in a press conference that no member state of the Eurozone can introduce its own digital currency, with the currency of the Eurozone being the euro.
From: https://www.fxempire.com/education/article/the-next-cryptocurrency-evolution-countries-issue-their-own-digital-currency-443966
(I think the article is somewhat out of date as it does not mention Venezuela’s announcement to launch a petro backed cryptocurrency.)

[Cara]

A new(?) Scramble for Africa seems to be on.

It's "announced" here by the Economist magazine, which of course has its own particular bias and is at pains to tell us that (a) this time round Africans are in a much better position, and (b) be careful of those dastardly Russians and Chinese (who are bad because they are NOT US):

BV61lqlLnds

The Economist
Published on Mar 8, 2019
The past decade has seen a big surge of foreign interest in Africa—involving China, India and Russia. If the continent handles this new "scramble" wisely, the main winners will be Africans themselves.

====

For reference, here is the original carving up of Africa:
https://upload.wikimedia.org/wikipedia/commons/2/2a/ColonialAfrica.png

The Scramble for Africa, also called the Partition of Africa or the Conquest of Africa, was the occupation, division, and colonisation of African territory by European powers during the period of time known to historians as the New Imperialism (between 1881 and 1914). In 1870, only 10 percent of Africa was under formal European control; by 1914 it had increased to almost 90 percent of the continent, with only Ethiopia (Abyssinia), the Dervish state (a portion of present-day Somalia)[1] and Liberia still being independent. There were multiple motivations for European colonizers, including desire for valuable resources available throughout the continent, the quest for national prestige, tensions between pairs of European powers, religious missionary zeal and internal African native politics.
From: https://en.wikipedia.org/wiki/Scramble_for_Africa

====

This time around, aside from the legacy European powers, the USA (mostly seen in AFRICOM), and Russia and China as mentioned above, there are some interesting players:

Korea:

Scramble for Africa intensifies as Korea joins the party
On Friday, July 26, Korea Overseas Infrastructure & Urban Development Corporation, a state-owned Enterprise, inaugurated its KIND Africa Office in Nairobi,

In Summary

For AfCFTA to succeed, Africa needs gigantic infrastructure, and in consequence, Africans are spending more on infrastructure.
KIND’s initiative will deliver desired results if the Government of President MOON Jae-in can formulate a clear policy on Africa.


To say that China, with her nonpareil financial muscle, is fundamentally altering the character of African nations is not news. What is news is that Korea, which has significant strengths, has decided to join the battle for the soul of Africa.

On July 26, Korea Overseas Infrastructure & Urban Development Corporation, a state-owned Enterprise, inaugurated its KIND Africa Office in Nairobi, Kenya. They wear the badge of DFI — Development Finance Institution — and PPP Project Developer and Investor.

A high-powered delegation from South Korea led by Kim Seong-ho, Director-Construction Policy Bureau, Overseas Construction Policy Division, Ministry of land, infrastructure & Transport, and Lim Han-kyu, Executive Vice President, KIND, attended the grand opening ceremony. Amb. Choi Yeong-ha led the Korean diaspora and agencies in Kenya.

Nancy Karigithu, PS State Department for Maritime and Shipping Affairs led the Kenyan delegation.

...

Now enters the Dragon. Chinese infrastructure investments shot up from $6.4 billion to $19.403 billion, an increase of $13 billion. When you compare this with the top four Asian economies, China was followed by Japan, $2.361 billion, India at $704 million, and South Korea at $10 million. For South Korea, this was a huge drop from the 2016 commitment of $432 million.

China is winning in Africa because of its clear policy on Africa implemented through the Belt and Road Initiative, China-initiated Asian Infrastructure Investment Bank. Benin, Djibouti, and Rwanda memberships were approved this July and the Forum on China-Africa Cooperation.

...
From: https://www.the-star.co.ke/news/2019-08-04-scramble-for-africa-intensifies-as-korea-joins-the-party/

Israel:

ISRAEL’S SCRAMBLE FOR AFRICA: SELLING WATER, WEAPONS AND LIES – AL JAZEERA ENGLISH

For years, Kenya has served as Israel’s gateway to Africa. Israel has been using the strong political, economic and security relations between the two states as a way to expand its influence on the continent and turn other African nations against Palestine. Unfortunately, Israel’s strategy seems, at least on the surface, to be succeeding – Africa’s historically vocal support for the Palestinian struggle on the international arena is dwindling.

...

THE ISRAELI SCRAMBLE FOR AFRICA
On July 5, 2016, Benjamin Netanyahu kick-started Israel’s scramble for Africa with an historic visit to Kenya, which made him the first Israeli prime minister to visit Africa in the last 50 years. After spending some time in Nairobi, where he attended the Israel-Kenya Economic Forum alongside hundreds of Israeli and Kenyan business leaders, he moved on to Uganda, where he met leaders from other African countries including South Sudan, Rwanda, Ethiopia and Tanzania. Within the same month, Israel announced the renewal of diplomatic ties between Israel and Guinea.

The new Israeli strategy flowed from there. More high-level visits to Africa and triumphant announcements about new joint economic ventures and investments followed.

...

...In January this year, for example, Chad, a Muslim-majority nation and central Africa’s geo-strategically most important country, established economic ties with Israel.

As it tried to establish itself as a partner to African nations, Israel did make some contributions that benefited Africans, such as delivering solar, water and agricultural technologies to regions in need. However, these contributions came at a significant cost.

When, for example, in December 2016, Senegal co-sponsored UN Security Council Resolution 2334, which condemned the construction of illegal Jewish settlements in the occupied West Bank and East Jerusalem, Netanyahu recalled Israel’s ambassador to Dakar and swiftly cancelled the Mashav drip-irrigation projects – The projects had previously been “widely promoted as a major part of Israel’s contribution to the ‘fight against poverty in Africa’.

Israel not only used projects like these to punish African nations when they failed to give blind support to Israel in international forums, it also used this new relationship to turn Africa into a new market for its arms sales.

African countries such as Chad, Niger, Mali, Nigeria, and Cameroon, among others, became clients of Israel’s “counterterrorism” technologies, the same deadly tools that are actively used to suppress Palestinians in their ongoing struggle for freedom.

...
From: https://www.zimfocus.net/2019/07/23/israels-scramble-for-africa-selling-water-weapons-and-lies-al-jazeera-english/

Continues in next post....

[Cara]

Part 2 of the post above.... The New(?) Scramble for Africa:

This article from February 2018 focuses on the Horn of Africa and outlines the steps being taken by the Gulf countries (UAE, Saudi Arabi, etc), Turkey, and China.


February 26, 2018
The New Scramble for Africa
Jacqulyn Meyer Kantack

The modern scramble for Africa is intensifying. A sharp uptick in the expansion of foreign militaries in the Horn of Africa accompanied the growth of economic competition in the region in 2017. China, Turkey, and the United Arab Emirates have opened military bases throughout the area in the past two years. The region is strategically important to these states for various reasons: securing shipping routes in the Bab al Mandab Strait, proximity to the ongoing conflict in Yemen, and the desire to array forces in the region alongside rivals including the United States.

China has concentrated its military presence in Djibouti near American and other Western forces.
The competition between the United Arab Emirates and Turkey in the Horn of Africa has yielded mixed results in Somalia. The Somali Federal Government (SFG) has received significant counterterrorism training support from both nations, as well as humanitarian aid from Turkey. The competition has strained relations between the SFG and Somalia's semi-autonomous regions, however. Somali President Mohammed Abdullahi Farmajo rejected the legitimacy of a 30-year Emirati contract on the port of Berbera in Somaliland, for example.[1]
The 2017 crisis between Qatar, Saudi Arabia, and the UAE exacerbated tensions between Somaliland and President Farmajo after the semi-autonomous government of Somaliland supported the boycott of Qatar, while the SFG remained neutral in the conflict.[2]


https://www.criticalthreats.org/wp-content/uploads/2018/02/HOA_Militarization_MapWithText_022218.jpg

Emirati operations in Yemen relied originally on basing in Djibouti. The UAE invested heavily in Eritrea beginning in mid-2015.[3] The Emirati military now operates from the Assab base in Eritrea and smaller outposts on the Yemeni islands of Socotra and Perim. The UAE is also expanding its presence into Somaliland at the port of Berbera.[4]

In 2008, Djibouti agreed to lease the Doraleh Container Port to Dubai-based company DP World.[5]
The UAE and Saudi Arabia leased a base in the Haramous district of Djibouti City in April 2015 to support operations during the Saudi-led intervention in Yemen.
On April 28, 2015, the UAE and Djibouti broke diplomatic relations due to a conflict between Emirati officials and the chief of Djibouti’s Air Force over the lease and after an Emirati plane landed at Djibouti’s Ambouli International Airport without authorization.[6]

Longstanding strained relations exacerbated tensions between the two countries after Djibouti prematurely rescinded a 20-year agreement with Dubai’s DP World to run the Doraleh Container Terminal in 2014.[7]
Djibouti ordered the eviction of UAE and Saudi troops from the country the following day.

On April 29, 2015, as Djibouti evicted Emirati troops, Saudi King Salman bin Abdulaziz met with Eritrean President Isaias Afewerki to finalize a 30-year agreement to base Gulf Cooperation Council (GCC) operations in Yemen out of Eritrea.[8] The UAE conducted a heavy military buildup at the Assab base in Eritrea in May-July 2015. The UAE also undertook significant infrastructure developments at Assab, including the addition of new deep-water port facilities next to the airfield, the construction of a pier, the expansion of the airfield’s tarmac space and air traffic control system, and the rerouting of major highways and security perimeters around the base.
The UAE launched operations from Assab to retake Aden, Yemen in August 2015.
Emirati forces have also used the Assab base to train and equip thousands of Yemeni counterterrorism forces.[9]


The UAE opened a military training center in Mogadishu in May 2015.[10]

UAE Special Forces fund and operate the base with the goal of training a brigade of Somali National Army soldiers to combat al Shabaab.[11] The facility and training program remain operational.[12]
The UAE signed a 30-year lease on the Port of Berbera in Somaliland in February 2017. The base remains under construction, but Emirati ships have docked at the port. Emirati forces are using it to support operations in Yemen.[13] The Yemeni al Houthi movement threatened to strike the Berbera port with ballistic missiles in December 2017.[14]
Somali President Farmajo called for the cancellation of the Berbera contract in February 2017.[15]
The UAE has funded police and intelligence operations in Puntland and Somaliland.[16]
The UAE also took over the management and development of the Boosaaso port in the semi-autonomous Puntland state in October 2017.[17]


The UAE confirmed the presence of its military forces on the Yemeni island of Socotra in May 2017.[18]

President Hadi reportedly leased the islands of Socotra and nearby Perim and Abd al Kuri (part of the Socotra archipelago) to the UAE for 99 years before abdicating his position in 2014.[19]
The UAE does not appear to be using Socotra to support operations in Yemen. It has only trained soldiers on the island thus far.[20]
The UAE also is reportedly building an airstrip and related support facilities on Perim Island to support its operations in southern Yemen.[21] The UAE has not yet established a presence Abd al Kuri.


China opened its first overseas military base in Djibouti’s Gulf of Tadjoura on August 1, 2017.[22]

China had used the port in Djibouti since February 2015 but negotiated permission for construction of a permanent military base with President Ismail Omar Guelleh in early 2015.[23] The Chinese began construction on the base in early 2016 and completed construction in July 2017. Djibouti is attractive for numerous reasons, including its proximity to key shipping lanes through the Bab al Mandab Strait and the Suez Canal.Djibouti is attractive for numerous reasons, including its proximity to key shipping lanes through the Bab al Mandab Strait and the Suez Canal. Additionally, China’s new presence in Djibouti alongside major Western powers such as the United States, France, Spain, and Italy indicates its intent of maintaining military capabilities with global reach.
The current agreement ensures China’s right to maintain up to 10,000 soldiers in Djibouti through 2025.[24] Approximately 1,000 personnel currently staff the base.[25]
China has previously invested heavily in Djiboutian infrastructure, funding upgrades to ports and airports and financing 70% of the Addis Ababa-Djibouti railway.[26]
China claims that the base will be used to support blue-helmeted peacekeepers and humanitarian operations in Africa, as well as anti-piracy efforts in the Gulf of Aden. China will also likely use the base to protect its economic interests in the region and ensure safe shipping between East Africa and China.[27]

China has approximately 2,200 personnel deployed in Africa and 500 others in the Middle East.[28]
China claims to have escorted more than 6,000 ships through the Gulf of Aden. [29]



Turkey opened its largest overseas military base in Mogadishu on September 30, 2017.[30]

The Turkish military began construction on the base in 2015.
Turkey has announced its intention to use the base to train 10,000 Somali soldiers. The base reportedly has the capacity to train 1,500 personnel at a time.[31]
Turkey claims that it intends to maintain only 200 troops at the base, but a Turkish official clarified that the opening of the base aligns with Turkey’s prioritization of weapons sales to new markets.[32]
Turkey has previously cultivated a strong relationship with Somalia through a combination of direct investment and humanitarian aid.
Turkey’s only other operational foreign military base is in Qatar, which houses approximately 5,000 Turkish troops.[33]


Sudan signed an agreement on December 26, 2017 to transfer responsibility for Suakin Island in the Red Sea to Turkey.[34]

Turkey has stated its intent to build a naval dock on the island to support both military and commercial vessels, stating that the agreement “could result in any kind of military cooperation.”[35]
The agreement prompted Egypt to deploy hundreds of troops, additional weapons, and military transport vehicles to the Sawa military base in Eritrea.[36] Sudan responded by deploying thousands of troops to the border region of Kassala. Ethiopia similarly sent additional troops to the Eritrean border.[37] The Suakin Island agreement followed decades of disagreement between Sudan and Egypt over the Halaib Triangle border region.[38]

Watch how the new scramble for Africa has developed since 2010:
https://www.criticalthreats.org/wp-content/uploads/2018/02/hoa_gif_022618.gif

From: https://www.criticalthreats.org/analysis/the-new-scramble-for-africa

Continues in next post....

[Cara]

Part 3 of the above post .... The New(?) Scramble for Africa:


U.S. GENERALS WORRY ABOUT RISING RUSSIAN AND CHINESE INFLUENCE IN AFRICA, DOCUMENTS SHOW
Nick Turse
August 13 2019, 7:31 p.m.

THE TRUMP ADMINISTRATION and the Pentagon have repeatedly warned that China and Russia are expanding their influence across Africa, where the two longtime American adversaries “interfere with U.S. military operations and pose a significant threat to U.S. national security interests,” national security adviser John Bolton said last December (https://www.whitehouse.gov/briefings-statements/remarks-national-security-advisor-ambassador-john-r-bolton-trump-administrations-new-africa-strategy/).

That view was echoed by the former head of U.S. Africa Command, Marine Corps Gen. Thomas Waldhauser (https://www.voanews.com/africa/us-general-warns-russian-chinese-inroads-africa), who left the job last month, and his replacement, Stephen Townsend (https://www.washingtonpost.com/national-security/2019/04/02/us-africa-command-nominee-cites-potential-russian-chinese-threats-us-interests-region/), both of whom testified publicly before Congress earlier this year. But the two generals went further in written responses to Congress obtained by The Intercept via the Freedom of Information Act, describing an Africa ever more likely to fall under the sway of Beijing and Moscow — with Russia exerting influence in as many as 10 different African countries and China likely to open more bases across the continent.

Beijing and Moscow have steadily increased their economic ties across Africa and, with them, their diplomatic sway. Trade between China and Africa has risen from $765 million (http://www.chinadaily.com.cn/a/201809/03/WS5b8c8f22a310add14f38929c.html) to more than $170 billion in the last 40 years, and 39 of 54 African nations have now signed on to Beijing’s Belt and Road Initiative – a trillion-dollar plan to link infrastructure and trade via a vast new network of roads, rail lines, ports, and pipelines across Eurasia, the Middle East, and Africa. Russia’s trade with Africa increased from $5.7 billion (http://www.tralac.org/files/2011/11/RussiaAfrica-trade-at-a-glance-201111091.pdf) in 2009 to $17.4 billion (https://www.aljazeera.com/programmes/countingthecost/2019/07/driving-russia-interest-africa-190710104009158.html) in 2017, and the country has been aggressively promoting nuclear infrastructure and technology (https://www.gatewayhouse.in/russia-returns-to-africa/) partnerships as well as oil and gas investments there.

Both nations have also aimed to increase their cultural influence. The number of Chinese-government-sponsored Confucius Institutes in Africa, which promote Chinese language and culture, have risen from zero in 2004 to 48 last year (http://www.chinadaily.com.cn/a/201808/23/WS5b7e209aa310add14f38753c.html), according to data compiled by Development Reimagined, a Beijing-based international consulting firm. AFRICOM documents note that these centers are located in 20 different African countries. The Russian equivalent, Russkiy Mir Foundation (https://allafrica.com/stories/201809280371.html), a nongovernmental and nonprofit organization, is active in nine African countries, according to AFRICOM.

Russia and China have also been forging stronger military ties with African nations through arms sales (https://www.ft.com/content/a5648efa-1a4e-11e9-9e64-d150b3105d21), security agreements, and military training programs (https://www.nytimes.com/2019/03/31/world/africa/russia-military-africa.html). Russian private military companies are active in 15 African nations, according to AFRICOM.

Last month, Beijing hosted the first China-Africa Peace and Security Forum (http://eng.mod.gov.cn/news/2019-07/18/content_4846034.htm), which brought together nearly 100 security officials from 50 African countries and the African Union, including 15 defense ministers and chiefs of general staff, according to China’s Ministry of Defense. While that gathering was underway, the Russian news agency Tass announced that roughly 35 African leaders had confirmed their attendance at the first Russia-Africa Summit (https://tass.com/world/1068966) – co-chaired by Russian President Vladimir Putin and Egyptian President Abdel-Fattah el-Sissi — set to be held in Russia’s Black Sea resort city of Sochi in October.

IN HIS TESTIMONY before the Senate Armed Services Committee, Waldhauser mostly focused on Russia’s increasing inroads in Central African Republic and, to a lesser extent, Algeria (https://www.armed-services.senate.gov/imo/media/doc/19-08_02-07-19.pdf), Libya, and Sudan (https://www.armed-services.senate.gov/imo/media/doc/Waldhauser_02-07-19.pdf). But in his written responses, Waldhauser mentioned six other nations that were also involved with Russia or susceptible to its influence including Angola, Guinea, Guinea-Bissau, Mali, Mauritania, and Tunisia. Russia is leveraging or seeking to leverage military aid in return for mining rights and energy partnerships, according to Waldhauser. “To thwart Russian exploitative efforts, USAFRICOM continues to work with a host of partners to be the military partner of choice in Africa,” he wrote.

In the Central African Republic, “Russia has bolstered its influence with increased military cooperation including donations of arms, with which it has gained access to markets and mineral extraction rights,” Waldhauser explained in his public testimony. “With minimal investment, Russia leverages private military contractors, such as the Wagner Group.” He noted that the president of the Central African Republic, Faustin-Archange Touadéra, had recently installed “a Russian civilian as his National Security Advisor. The President also promised the armed forces would be deployed nationwide to return peace to the country by forces likely trained, equipped, and in some cases, accompanied by Russian military contractors. Russia’s ability to import harsh security practices, in a region already marred by threats to security, while systematically extracting minerals, is concerning.”

Asked to privately explain these “harsh security practices,” Waldhauser mentioned reports of Russian contractor cooperation with militias and acquiescence to their human rights violations; the abuse of local security force trainees as well as civilians “who approach Russian mining interests”; and the possibility of involvement in the deaths of Russian journalists (https://time.com/5637539/russia-central-african-republic-militia-anniversary/) who were murdered in the Central African Republic while investigating the activities of Russian military contractors.

In his public testimony, Townsend ranked China just below Russia as a threat to U.S. primacy in Africa but said he expected the People’s Republic to eclipse Russia. “I think that they are after access and influence to our detriment,” the new AFRICOM commander said of China. Behind the scenes, Townsend also badmouthed China’s efforts on multiple fronts, including arms sales, and explained that the U.S. needed to emphasize the shoddy nature of Chinese military technology to African countries. “China has provided Nigeria with armed unmanned aerial systems … but the poor quality of the platforms has contributed to infrequent use,” he wrote. “Low cost and short delivery timelines entice African partners to purchase Chinese equipment, but purchases frequently do not address the underlying military need. We need to tell this story to a greater extent.”

In his written remarks, Waldhauser explained that current Chinese efforts in Africa were unlikely to inhibit U.S. military access and operations in the near term but warned that “China could gain that capability within the next decade.” While China only opened its first overseas military base (https://www.nytimes.com/2017/02/25/world/africa/us-djibouti-chinese-naval-base.html), located six miles (https://foreignpolicy.com/2018/07/31/will-djibouti-become-latest-country-to-fall-into-chinas-debt-trap/) from the U.S. military’s Camp Lemonnier in the Horn-of-Africa nation of Djibouti in 2017, Waldhauser mentioned more Chinese facilities on the horizon. “China is actively working with African partners to open new bases in several locations across the continent,” he wrote. “By working with other [African] nations … we may be able to ensure that when China or Russia do gain military access to ports, bases, or airspace, that they are unable to take full advantage of that access to threaten U.S. freedom of maneuver in and around Africa.”

IN RESPONSE TO perceived threats from its great power rivals, AFRICOM has launched a five-year campaign plan designed, in part, to counter the “increased presence” of China and Russia on the continent. The command is also strengthening alliances in order to “deter Chinese and Russian malign action,” Waldhauser wrote in March. In his written answers, Townsend also referenced “Russia’s malign influence in Africa” and took aim at China, noting that “[t]he Chinese have successfully promoted their false narrative that their assistance comes with no strings attached.”

While Waldhauser and Townsend painted Russian and Chinese motives as “malign” and America’s as virtuous, some experts take a different view. “It’s hard to make the case that any of the great powers truly have Africa’s best interest at heart. America’s behavior simply cannot be categorized as altruistic because its overly militarized post-9/11 foreign policy actually correlates to an increase of violence on the continent rather than deterrence,” Temi Ibirogba, a program and research associate with the Africa Program at the Center for International Policy, told The Intercept. “American officials like Nagy,” referring to the assistant secretary of state of African affairs, “and Waldhauser seem to have the false perception that American foreign policy is loved and welcomed by Africans, but it’s really the Chinese who are winning there at the moment.”

In his public testimony (https://www.armed-services.senate.gov/imo/media/doc/Waldhauser_02-07-19.pdf) before the Senate in February, Waldhauser noted that the National Defense Strategy has outlined the importance of limiting “the harmful influence of non-African powers on the continent.” Ibirogba agreed. “Waldhauser’s claim that non-African powers have a harmful influence in Africa is true — and the U.S. is one of those powers,” she said.

At the same time that U.S. military efforts in Africa have soared (https://theintercept.com/2019/07/29/pentagon-study-africom-africa-violence/), as The Intercept has previously reported, key indicators of security and stability on the continent have plummeted. “Overall, militant Islamist group activity in Africa has doubled since 2012,” according to the Defense Department’s Africa Center for Strategic Studies. There are now roughly 24 “active militant Islamist groups” operating on the continent, up from just five in 2010; 13 African countries face attacks from these groups — a 160 percent increase over that same time span; and the number of “violent events” across the continent has jumped 960 percent, from 288 in 2009 to 3,050 in 2018.
From: https://theintercept.com/2019/08/13/russia-china-military-africa/

[Cara]

I posted in #14 above (http://projectavalon.net/forum4/showthread.php?108184-The-Changing-Emerging-Global-Landscape&p=1310339&viewfull=1#post1310339) about nation / state issued cryptocurrencies.

In addition to this change (and maybe as a necessary precursor - see in the article below, 2nd last paragraph), it seems there is also work underway by Central Banks to transform payment systems in a significant way - they are aiming at a digital system, with interoperability across regional systems and a span of control that includes ALL payments (including small local banks).

(Bold emphasis in the original, my emphasis underlined)


Lost Within the Rate Cut: The Fed’s Drive to Establish a New Payment System
5 days ago [14 August 2019]

https://stevenguinness2.files.wordpress.com/2019/08/payment-systems-1169825_640.jpg?w=626&h=540
Part way through delivering a press conference following the Federal Reserve’s first rate cut since December 2008, chairman Jerome Powell let it be known that the central bank was ‘looking carefully‘ at developing a new faster payments system. Unsurprisingly, his words on the subject proved the equivalent of screaming into the face of a force ten gale. Besides a handful of financial outlets, nobody heard him. All that analysts and observers were really interested in was the Fed’s stance on interest rates.

This was unfortunate because whilst they may appear banal and complex on the surface, payments systems are of far greater significance than whether a central bank opts to cut or raise interest rates. Anyone keeping pace with the myriad of speeches and publications emanating from central banks will know that globalists are working incrementally to introduce a cashless monetary system under their control. The Federal Reserve are one strand of this strategy as we will discover.

Less than a week after the rate cut, the Fed announced that they were planning to devise a new ‘round-the-clock real-time payment and settlement service (https://www.federalreserve.gov/newsevents/pressreleases/other20190805a.htm).’ Called ‘FedNow‘, the system would be an RTGS run service designed to initiate faster payments.

RTGS stands for ‘Real Time Gross Settlement‘, and is the same model through which the Bank of England and the European Central Bank operate their payment systems. The BOE announced back in May 2017 a blueprint for the introduction of a ‘renewed‘ RTGS service (https://www.bankofengland.co.uk/-/media/boe/files/news/2017/may/a-blueprint-for-a-new-rtgs-service-for-the-united-kingdom.pdf?la=en&hash=C3C5EFE19203BBEDF725BEFB6D45CFDC0504D6FE), whilst the ECB in late 2018 launched a new system dubbed TIPS (https://www.ecb.europa.eu/press/key/date/2018/html/ecb.sp181130.en.html) (TARGET Instant Payment Settlement). It was around the time that TIPS launched that the Fed issued a ‘request for comment‘ on reforming their own system. Taken as a whole, this is a further example of central banks working in coordination.

In a press release announcing ‘FedNow‘, the Fed justified the venture on the premise that the ‘rapid evolution of technology‘ had presented them with a ‘pivotal opportunity‘ to modernise the U.S. payment system. Exactly how long the Fed have been looking into adopting a new payment system is unclear. But if the Wall Street Journal is to be believed, they have been exploring a faster system since at least 2013.

The press release also pointed out that over 10,000 financial institutions are incorporated into the current Fed payment system known as ‘Fedwire‘, and argued that new real time infrastructure developed through the central bank would be best placed to offer full nationwide coverage.

The next stage of ‘FedNow‘ sees the Fed ‘requesting comment on how the new service might be designed‘. As for when it becomes available, the expectation is either 2023 or 2024. The Bank of England’s renewed RTGS system is due to be operational by 2025.

On the day ‘FedNow‘ was announced, Lael Brainard, a member of the Fed’s board of governors, offered up more information on the system in a speech at the Federal Reserve Bank of Kansas City (https://www.federalreserve.gov/newsevents/speech/brainard20190805a.htm). As you might expect, Brainard was there to extol the benefits. The big selling point was 365 days a year access, 24 hours a day, 7 days a week. Funds would be available immediately after payment is sent. It would be a system built on convenience and one that was fit for the speed of the 21st century.

Of greater interest than these superficial benefits, however, is the motivation behind what the Fed are seeking to achieve with ‘FedNow‘. Brainard was equally as explanatory in this regard.

We learned from her speech four key bits of information.

Firstly, fintech companies are openly supportive of the Fed’s new system. These are companies that are part of an industry that has pioneered the creation of distributed ledger technology.

Secondly, the planned implementation for either 2023 or 2024 is not a fixed objective. More important to the Fed is the goal of achieving ‘nationwide access for all‘, meaning that their overarching aim is for ‘FedNow‘ and private sector payment services to work in conjunction (or, as Brainard put it, to ‘interoperate by exchanging payments among services directly).

Thirdly, Brainard told us that no one private sector provider of a U.S. payment system has ever been able to establish nationwide reach by itself. Nationwide coverage would have to encompass the many thousands of small and medium sized banks. Hence why the Fed are now making a determined move to utilise private sector technology and incorporate it into their own system. I would contend that the Fed’s goal is to achieve full spectrum control of America’s payment infrastructure, with all digital transactions falling under their jurisdiction. ‘FedNow‘ would be the mechanism in making this happen.

Fourthly, as Brainard laid out, the path that the Fed are embracing is not one of ‘incremental‘ change. Rather, it is of ‘transformative‘ change. I would take this to mean that the infrastructure underpinning current payment systems must be overhauled to allow for the implementation of fintech devised technology.

An accompanying list of FAQ’s (https://www.federalreserve.gov/paymentsystems/fednow_faq.htm) lent credence to the understanding that fintech is central to the construction of ‘FedNow‘. Here, the Fed expounded that the market for faster payments in the U.S. remains in the ‘early stages‘. Banks and fintech firms can provide a range of services, but the functionality of them is limited which restricts their level of coverage and reliability. They lamented the ‘lack of a universal infrastructure to conduct faster payments‘, which means that at present users who are signed up to one service such as Paypal invariably cannot send or receive payment from a user signed up to another service. As a result, the market remains ‘fragmented‘.

With the Federal Reserve system encompassing twelve regional banks, and the relationships the Fed has with 10,000 plus banking institutions, their belief is that they are ‘well positioned to overcome the challenge of extending nationwide access.’

Throughout their communications there is a preoccupation with the objective of achieving nationwide access. So much so that the Fed board are apparently intending to ‘explore interoperability and other paths to achieving the ultimate goal of nationwide reach.’

‘FedNow’ would provide the necessary universal infrastructure that the Fed are seeking, and allow banks of all description to offer real-time payments.

Undoubtedly this presents an opportunity for the Fed, and indeed central banks throughout the world, to move in and claim hegemony over the next generation of global digital payment systems. But they, along with the Bank for International Settlements and the International Monetary Fund that preside over them, cannot do this by themselves. This is where the private sector comes in, for it is here where the expertise and technological innovation is found.

Within the FAQ’s it is also stated that the ‘FedNow‘ service would ‘operate alongside private sector RTGS services for faster payments‘. Prior to the announcement of the new system, the Federal Reserve board had come to the conclusion that private sector RTGS services ‘cannot be expected to provide an infrastructure with reasonable effectiveness, scope and equity alone.’ A roundabout way of saying that whilst the Fed do not possess the technology, they do have the reach in order to disseminate private sector innovation to every corner of the U.S. The beauty for the Fed is that they would have full regulatory authority over ‘FedNow‘. In conjunction with fintech, their level of control over the payments infrastructure would be unassailable.

If central banks manage to utilise fintech successfully, it will give them a clear path to begin the gradual implementation of central bank issued digital currencies. Back in April I published an article (BIS General Manager Outlines Vision for Central Bank Digital Currencies (https://stevenguinness2.wordpress.com/2019/04/04/bis-general-manager-outlines-vision-for-central-bank-digital-currencies/)) that looked into the subject of CBDC’s more deeply.

In regards to ‘FedNow‘, equally as interesting as what was discussed by the Fed is what was left unsaid. There was no mention throughout any of the supporting documentation of plans to incorporate distributed ledger technology. Instead, there will be ‘engagement between the Fed and the industry to inform the final service design.’ This is a process that is now getting underway.

I would expect that once the final design of ‘FedNow‘ is confirmed, it will have the capability of interacting with systems that use distributed ledgers. This would follow on from the Bank of England who in 2018 announced that their new RTGS service would enable such systems to achieve settlement in central bank money.

Once this has been achieved, the next logical step for central banks is to complete the process of digitising all financial assets through the issuance of central bank digital currency. And as BIS general manager Agustin Carstens warned back in March 2019 (https://www.bis.org/speeches/sp190322.pdf), this would mean that people would no longer have the option of paying with cash. ‘All purchases would be electronic‘.

In a follow up article I will be exploring the process underway at the Bank of England and the European Central Bank to reform their payment systems, and how China is proving to be the test bed for fintech innovation.
From: https://stevenguinness2.wordpress.com/2019/08/14/lost-within-the-rate-cut-the-feds-drive-to-establish-a-new-payment-system/

[Cara]

The role of the corporation is changing (noted above (http://projectavalon.net/forum4/showthread.php?108184-The-Changing-Emerging-Global-Landscape&p=1307994&viewfull=1#post1307994)) with moves for companies to play an ever increasing role in governing society.

The Business Roundtable (a powerful US organisation of corporations and companies) has just released a new statement on the wider purpose and role of the company.


The Business Roundtable (BRT) is a group of chief executive officers of major U.S. corporations formed to promote pro-business public policy.[1][2][3][4]

...

Members of the board of directors include Jamie Dimon, Mary Barra, Michael S. Burke (AECOM), Safra Catz, Mark Costa (Eastman Chemical Company), Lynn Good, Alex Gorsky, Greg Hayes, Marillyn Hewson, Tom Linebarger, Kevin Lobo (Stryker Corporation), Doug McMillon, Larry Merlo, Dennis Muilenburg, Douglas L. Peterson, Chuck Robbins, Ginni Rometty, Arne Sorenson, Randall L. Stephenson, Mark Sutton (International Paper), and Mark Weinberger.[21]
From: https://en.m.wikipedia.org/wiki/Business_Roundtable

Here is their statement, which was signed by 181 CEOs:


Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy That Serves All Americans’
Aug 19, 2019

WASHINGTON – Business Roundtable today announced the release of a new Statement on the Purpose of a Corporation signed by 181 CEOs who commit to lead their companies for the benefit of all stakeholders – customers, employees, suppliers, communities and shareholders.

Since 1978, Business Roundtable has periodically issued Principles of Corporate Governance. Each version of the document issued since 1997 has endorsed principles of shareholder primacy – that corporations exist principally to serve shareholders. With today’s announcement, the new Statement supersedes previous statements and outlines a modern standard for corporate responsibility.

“The American dream is alive, but fraying,” said Jamie Dimon, Chairman and CEO of JPMorgan Chase & Co. and Chairman of Business Roundtable. “Major employers are investing in their workers and communities because they know it is the only way to be successful over the long term. These modernized principles reflect the business community’s unwavering commitment to continue to push for an economy that serves all Americans.”

“This new statement better reflects the way corporations can and should operate today,” added Alex Gorsky, Chairman of the Board and Chief Executive Officer of Johnson & Johnson and Chair of the Business Roundtable Corporate Governance Committee. “It affirms the essential role corporations can play in improving our society when CEOs are truly committed to meeting the needs of all stakeholders.”

Industry leaders also lent their support for the updated Business Roundtable Statement, citing the positive impact this commitment will have on long-term value creation:

“I welcome this thoughtful statement by Business Roundtable CEOs on the Purpose of a Corporation. By taking a broader, more complete view of corporate purpose, boards can focus on creating long-term value, better serving everyone – investors, employees, communities, suppliers and customers,” said Bill McNabb, former CEO of Vanguard.

“CEOs work to generate profits and return value to shareholders, but the best-run companies do more. They put the customer first and invest in their employees and communities. In the end, it’s the most promising way to build long-term value,” said Tricia Griffith, President and CEO of Progressive Corporation.

“This is tremendous news because it is more critical than ever that businesses in the 21st century are focused on generating long-term value for all stakeholders and addressing the challenges we face, which will result in shared prosperity and sustainability for both business and society,” said Darren Walker, President of the Ford Foundation.

The Business Roundtable Statement on the Purpose of a Corporation is below and the full list of signatories is available here.

Statement on the Purpose of a Corporation

Americans deserve an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity. We believe the free-market system is the best means of generating good jobs, a strong and sustainable economy, innovation, a healthy environment and economic opportunity for all.

Businesses play a vital role in the economy by creating jobs, fostering innovation and providing essential goods and services. Businesses make and sell consumer products; manufacture equipment and vehicles; support the national defense; grow and produce food; provide health care; generate and deliver energy; and offer financial, communications and other services that underpin economic growth.

While each of our individual companies serves its own corporate purpose, we share a fundamental commitment to all of our stakeholders. We commit to:
Delivering value to our customers. We will further the tradition of American companies leading the way in meeting or exceeding customer expectations.
Investing in our employees. This starts with compensating them fairly and providing important benefits. It also includes supporting them through training and education that help develop new skills for a rapidly changing world. We foster diversity and inclusion, dignity and respect.
Dealing fairly and ethically with our suppliers. We are dedicated to serving as good partners to the other companies, large and small, that help us meet our missions.
Supporting the communities in which we work. We respect the people in our communities and protect the environment by embracing sustainable practices across our businesses.
Generating long-term value for shareholders, who provide the capital that allows companies to invest, grow and innovate. We are committed to transparency and effective engagement with shareholders.

Each of our stakeholders is essential. We commit to deliver value to all of them, for the future success of our companies, our communities and our country.
From: https://www.businessroundtable.org/business-roundtable-redefines-the-purpose-of-a-corporation-to-promote-an-economy-that-serves-all-americans

Larry Fink, Chairman of Blackrock, in his 2019 Letter to Shareholders articulates much the same sentiment but in starker terms.

Blackrock:

BlackRock, Inc. is an American global investment management corporation based in New York City. Founded in 1988, initially as a risk management and fixed income institutional asset manager, BlackRock is the world's largest asset manager with $6.84 trillion in assets under management as of June 2019.[3] BlackRock operates globally with 70 offices in 30 countries and clients in 100 countries.[4] Due to its power and the sheer size and scope of its financial assets and activities, BlackRock has been called the world's largest shadow bank.[5][6]
From: https://en.m.wikipedia.org/wiki/BlackRock

From Larry Fink’s letter:

...
Market uncertainty is pervasive, and confidence is deteriorating. Many see increased risk of a cyclical downturn. Around the world, frustration with years of stagnant wages, the effect of technology on jobs, and uncertainty about the future have fueled popular anger, nationalism, and xenophobia. In response, some of the world’s leading democracies have descended into wrenching political dysfunction, which has exacerbated, rather than quelled, this public frustration. Trust in multilateralism and official institutions is crumbling.

Unnerved by fundamental economic changes and the failure of government to provide lasting solutions, society is increasingly looking to companies, both public and private, to address pressing social and economic issues. These issues range from protecting the environment to retirement to gender and racial inequality, among others. Fueled in part by social media, public pressures on corporations build faster and reach further than ever before. In addition to these pressures, companies must navigate the complexities of a late-cycle financial environment – including increased volatility – which can create incentives to maximize short-term returns at the expense of long-term growth.

...

As divisions continue to deepen, companies must demonstrate their commitment to the countries, regions, and communities where they operate, particularly on issues central to the world’s future prosperity. Companies cannot solve every issue of public importance, but there are many – from retirement to infrastructure to preparing workers for the jobs of the future – that cannot be solved without corporate leadership.

...

Companies that fulfill their purpose and responsibilities to stakeholders reap rewards over the long-term. Companies that ignore them stumble and fail. This dynamic is becoming increasingly apparent as the public holds companies to more exacting standards.
...

From: https://www.thegeniusworks.com/2019/01/blackrock-chairman-larry-finks-letter-to-shareholders-2018-linking-purpose-to-profit-for-sustained-growth/

[Cara]

For a possible view on how the world might be with corporations playing a larger role in governing society, I can recommend a sci-fi novel by Neal Stephenson (https://en.m.wikipedia.org/wiki/Neal_Stephenson) called Snow Crash. obviously this is only speculative fiction, so it’s an imagining. However, the extrapolation of the themes of digital / cyber technology and laissez fairy capitalism are very interesting.

Neal Stephenson:

His novels have been categorized as science fiction, historical fiction, cyberpunk, postcyberpunk, and baroque.

Stephenson's work explores subjects such as mathematics, cryptography, linguistics, philosophy, currency, and the history of science. He also writes non-fiction articles about technology in publications such as Wired. He has also written novels with his uncle, George Jewsbury ("J. Frederick George"), under the collective pseudonym Stephen Bury.

Stephenson has worked part-time as an advisor for Blue Origin, a company (founded by Jeff Bezos) developing a spacecraft and a space launch system,[1] and is also a cofounder of Subutai Corporation, whose first offering is the interactive fiction project The Mongoliad. He is currently Magic Leap's Chief Futurist.
From: https://en.m.wikipedia.org/wiki/Neal_Stephenson

And Snow Crash:

Stephenson's breakthrough came in 1992 with Snow Crash, a comic novel in the late cyberpunk or post-cyberpunk tradition fusing memetics, computer viruses, and other high-tech themes with Sumerian mythology, along with a sociological extrapolation of extreme laissez-faire capitalism and collectivism.[6][7] Snow Crash was the first of Stephenson's epic science fiction novels.
From: https://en.m.wikipedia.org/wiki/Neal_Stephenson

https://modemworld.files.wordpress.com/2016/01/snow-crash.jpg

[Cara]

The Bank of England signals the end of the use of the US dollar as international currency. This is quite a signal. This is from Bloomberg which tends to give a particular narrative... so it may just be political.


World needs to end risky reliance on U.S. dollar: BoE's Carney

JACKSON HOLE, Wyo. (Reuters) - Bank of England Governor Mark Carney took aim at the U.S. dollar’s “destabilizing” role in the world economy on Friday and said central banks might need to join together to create their own replacement reserve currency.

The dollar’s dominance of the global financial system increased the risks of a liquidity trap of ultra-low interest rates and weak growth, Carney told central bankers from around the world gathered in Jackson Hole, Wyoming, in the United States.

“While the world economy is being reordered, the U.S. dollar remains as important as when Bretton Woods collapsed,” Carney said, referring to the end of the dollar’s peg to gold in the early 1970s.

Emerging economies had increased their share of global activity to 60% from around 45% before the financial crisis a decade ago, Carney said.

But the dollar was still used for at least half of international trade invoices - five times more than the United States’ share of world goods imports - fuelling demand for U.S. assets and exposing many countries to damaging spillovers from swings in the U.S. economy.

Carney - who was considered a candidate to be the next head of the International Monetary Fund but failed to secure backing from Europe’s governments - said the problems in financial system were encouraging protectionist and populist policies.

Earlier on Friday, U.S. President Donald Trump said he was ordering U.S. companies to look at ways to close their operations in China, the latest escalation of mounting trade tensions between Washington and Beijing.

Carney warned that very low equilibrium interest rates had in the past coincided with wars, financial crises and abrupt changes in the banking system.

As a first step to reorder the world’s financial system, countries could triple the resources of the IMF to $3 trillion as a better alternative to countries protecting themselves by racking up enormous piles of dollar-denominated debt.

“While such concerted efforts can improve the functioning of the current system, ultimately a multi-polar global economy requires a new IMFS (international monetary and financial system) to realize its full potential,” Carney said.

China’s yuan represented the most likely candidate to become a reserve currency to match the dollar, but it still had a long way to go before it was ready.

The best solution would be a diversified multi-polar financial system, something that could be provided by technology, Carney said.

Facebook’s (FB.O) Libra was the most high-profile proposed digital currency to date but it faced a host of fundamental issues that it had yet to address.

“As a consequence, it is an open question whether such a new Synthetic Hegemonic Currency (SHC) would be best provided by the public sector, perhaps through a network of central bank digital currencies,” Carney said.

Such a system could dampen the “domineering influence” of the U.S. dollar on global trade.

“Even a passing acquaintance with monetary history suggests that this center won’t hold,” Carney said. “We need to recognize the short, medium and long-term challenges this system creates for the institutional frameworks and conduct of monetary policy across the world.”

Writing by William Schomberg; Editing by David Milliken and Andrea Ricci
From: https://uk.reuters.com/article/us-usa-fed-jacksonhole-carney/world-needs-to-end-risky-reliance-on-u-s-dollar-boes-carney-idUKKCN1VD28C

Re:
best solution would be a diversified multi-polar financial system, something that could be provided by technology
see posts #14 (http://projectavalon.net/forum4/showthread.php?108184-The-Changing-Emerging-Global-Landscape&p=1310339&viewfull=1#post1310339) and #18 (http://projectavalon.net/forum4/showthread.php?108184-The-Changing-Emerging-Global-Landscape&p=1310953&viewfull=1#post1310953) above for more on plans for digital monetary system developments.

[Hervé]

Top UK bankster argues for new 'synthetic hegemonic currency' to replace sinking dollar (https://www.rt.com/business/467175-bank-england-synthetic-reserve-currency/)

RT (https://www.rt.com/business/467175-bank-england-synthetic-reserve-currency/)
Sat, 24 Aug 2019 02:27 UTC


https://www.sott.net/image/s26/535370/large/5_Battle_for_the_Bucks_and_Bit.jpg (https://www.sott.net/image/s26/535370/full/5_Battle_for_the_Bucks_and_Bit.jpg)
Form and Function © Reuters/Dado Ruvic


Bank of England head Mark Carney has urged his fellow central bankers to embrace tech like Facebook's Libra to build a multipolar system, warning against "swapping one currency hegemon for another" - unless it's their hegemon.

Acknowledging that the US dollar's days as the world reserve currency are numbered, he gushed that "technology has the potential to disrupt the network externalities that prevent the incumbent global reserve currency from being displaced" - and to ensure that Western central banks are properly positioned to take the helm in whatever system replaces it.

Carney declared that a Libra-like currency - with a few tweaks to silence critics - can bring about a new "multipolar international monetary financial system" (IMFS) during a speech at the Fed-sponsored Jackson Hole Economic Policy Symposium on Friday.

The Bank of England bigwig warned a who's-who of status quo representatives, shocked many with his suggestion of radical change:
"Blithe acceptance of the status quo is misguided. When change comes, it shouldn't be to swap one currency hegemon for another. Any unipolar system is unsuited to a multipolar world." But it soon became clear his objection was to one particular country winning the unipolar sweepstakes, as he acknowledged that China has long since overtaken the US' trade volume and the yuan is logically next in line for reserve-currency status.

The yuan, Carney maintained, had too many problems - though he couldn't name any, instead admitting that with the Belt and Road Initiative unfolding, China was ideally positioned to fill the void left by the decaying dollar - and "a multipolar global economy requires a new IMFS to realize its full potential." How to get there without the economic carnage that usually surrounds such a massive paradigm shift? That's where (pseudo?) decentralized cryptocurrency comes in, he suggested.

"We would do well to think through every opportunity, including those presented by new technologies, to create a more balanced and effective system," Carney continued, with a nod to his Silicon Valley ally. Facebook CEO Mark Zuckerberg met with Carney while Libra was still in the planning process, and while neither have been forthcoming about what they discussed, Carney is one of the few non-corporate leaders to express unqualified support for the not-quite-cryptocurrency, which he calls "the most high profile" of electronic payment systems even though it hasn't actually been rolled out yet and is facing major regulatory scrutiny from governments wary of Facebook's dismal privacy track record.

Carney framed the embrace of a "synthetic hegemonic currency" as a natural step in breaking up with the dollar, though Libra is backed by a "basket of currencies" that includes not only the dollar but also the pound, euro, and Swiss franc. Noting that trouble in the US economy tends to spill over into emerging market economies which have difficulty absorbing the shock, he claimed a Libra-like coin could reduce the negative impact on those countries if the dollar takes a dive, as if placing emerging markets at the mercy of US, UK, and European central bankers solved the problem. Far from breaking up with the dollar - adopting any central-bank-backed "crypto" as a reserve currency would just make the unhealthy relationship polygamous.

With the US poised on the brink of a recession, alienating its allies with a sanctions regime that violates their economic sovereignty, and ramping up a trade war it can't conceivably win with China, it's not surprising that establishment stalwarts like Carney are finally coming to terms with the post-dollar future. But a central bank governor, even one a few months away from retirement, proposing such a huge paradigm shift doesn't happen if the central bank doesn't benefit from that shift.

For a talk touting the virtues of a "synthetic hegemonic currency," Carney's omission of actual cryptos - bitcoin being the obvious name, but any of the less well-known currencies actually in use by real people would have made more sense than Libra, which still exists only in theory - is proof his embrace of the Facebook coin is merely a means to an end. As governments grudgingly accept cryptos - with New Zealand legalizing paying salaries in Bitcoin, and many governments mulling issuing their own digital currencies - central banks live in fear of being sidelined. Libra - and other corporate "cryptos" that are anything but - represents a chance to keep their hooks in the global economy, even when the current system falls apart. If you can't beat them, (pretend to) join them.


Related:

'US dollar is the only real currency!' Trump seeks banking regulation of Bitcoin, Facebook's Libra (https://www.sott.net/article/416646-US-dollar-is-the-only-real-currency-Trump-seeks-banking-regulation-of-Bitcoin-Facebooks-Libra)



Ellen Brown: Facebook makes an audacious bid for global monetary control (https://www.sott.net/article/415804-Ellen-Brown-Facebook-makes-an-audacious-bid-for-global-monetary-control)



Facebook cryptocurrency launch meets widespread skepticism, demand for safeguards (https://www.sott.net/article/415257-Facebook-cryptocurrency-launch-meets-widespread-skepticism-demand-for-safeguards)



Fool's Gold: Facebook Coin is a Trojan Horse of Corporate Oligarchy (https://www.sott.net/article/415311-Fools-Gold-FacebookCoin-is-a-Trojan-Horse-of-Corporate-Oligarchy)

========================================

Right... electronic currency... cashless society... RFIDs... ooops... your infraction points have reached the maximum authorized... your account has been closed...

[Cara]

The speech referred to in post #21 above (here (http://projectavalon.net/forum4/showthread.php?108184-The-Changing-Emerging-Global-Landscape&p=1311618&viewfull=1#post1311618)) from The Bank of England’s Mark Carney at Jackson Hole, Wyoming, USA is here: https://www.bankofengland.co.uk/-/media/boe/files/speech/2019/the-growing-challenges-for-monetary-policy-speech-by-mark-carney.pdf?la=en&hash=01A18270247C456901D4043F59D4B79F09B6BFBC

[Cara]

This also posted here: http://projectavalon.net/forum4/showthread.php?88051-The-Problems-with-Facebook&p=1314723&viewfull=1#post1314723

This move by Facebook ties into the growing overt role of multinational corporations in global structures of governance, first posted in this thread in post #3: http://projectavalon.net/forum4/showthread.php?108184-The-Changing-Emerging-Global-Landscape&p=1307994&viewfull=1#post1307994

~~~

Facebook steps into the role of the judiciary.... this may be a precedent for corporate managed and controlled law in other spheres of social life.

As quoted in the article below, Mark Zuckerberg:
“We expect the board will only hear a small number of cases at first, but over time we hope it will expand its scope and potentially include more companies across the industry as well”


Facebook will bankroll an ‘independent supreme court’ to moderate your content & set censorship precedents
Published time: 18 Sep, 2019 01:43

Facebook has unveiled the charter for its ‘supreme court,’ a supposedly independent content moderation board that will take money from, and be appointed by, Facebook itself – while making binding decisions. What could go wrong?

Facebook has released preliminary plans for an “Oversight Board” tasked with reviewing content disputes. The 40-member body, referred to previously as Facebook’s “supreme court,” will have the authority to make binding decisions regarding cases brought to it by users or by the social media behemoth itself, according to a white paper released Tuesday, which stresses that the new board will be completely independent of Facebook, by popular request.

The company has clearly taken pains to make this new construct look independent, the sort of place a user might be able to go to get justice after being deplatformed by an algorithm incapable of understanding sarcasm or context. But board members will be paid out of a trust funded by Facebook and managed by trustees appointed by Facebook, while the initial board members will also be appointed by Facebook.

“We agreed with feedback that Facebook alone should not name the entire board,” the release states, proceeding to outline how Facebook will select “a small group of initial members,” who will then fill out the rest of the board. The trustees – also appointed by Facebook – will make the formal appointments of members, who will serve three-year terms.

Facebook insists it is “committed to selecting a diverse and qualified group” – no current or former Facebook employees or spouses thereof, current government officials or lobbyists (former ones are apparently OK), high-ranking officials within political parties (low-ranking is apparently cool), or significant shareholders of Facebook need apply. A law firm will be employed to vet candidates for conflicts of interest, but given Facebook’s apparent inability to recognize the conflict of interest inherent in paying “independent” board members to make binding content decisions, it’s hard to tell what would qualify as a conflict.

How will Facebook decide which cases get the democracy treatment? Cases with significant real-world impact – meaning they affect a large number of people, threaten “someone else’s voice, safety, privacy, or dignity,” or have sparked public debate – and are difficult to parse with regard to existing policy will be heard first. “For now,” only Facebook-initiated cases will be heard by the board – Facebook users will be able to launch their own appeals by mid-2020. Is the company merely reaching for an “independent” rubber-stamp to justify some of its more controversial decisions as the antitrust sharks start circling? Decisions will not only be binding, but also applicable to other cases not being heard, if they’re deemed similar enough – potentially opening a Pandora’s box of far-reaching censorship.

In a letter accompanying the white paper, Facebook CEO Mark Zuckerberg claims the company’s moderators take into account “authenticity, safety, privacy, and dignity – guided by international human rights standards” when they make a decision to take down content. Given that the company’s own lawyers have questioned the very existence of users’ privacy, what does this bode for the other “values,” let alone international human rights standards?

Perhaps most ominously, Zuckerberg seems to have bigger things in mind for his Oversight Board than merely weighing in on Facebook content moderation decisions. “We expect the board will only hear a small number of cases at first, but over time we hope it will expand its scope and potentially include more companies across the industry as well” (emphasis added). Not exactly a throwaway line from the man who said he wanted Facebook to become an internet driver’s license. The private-sector social credit score may be closer than we think – and Zuckerberg would very much like to be the scorekeeper.

By Helen Buyniski, RT
From: https://www.rt.com/news/469041-facebook-supreme-court-democracy-fail/amp/?__twitter_impression=true

[Cara]

Sergei Lavrov, foreign minister of Russia, in his usual articulate manner outlines the current global landscape. This article is timed to coincide with the opening of this year’s UN session.

This is a review of some of the themes and strategies being played in the international arena - along with their consequences. He rightly draws attention to the hypocrisy of and dissonance between what is said and what is done. He highlights the devastation wrought on the world by a privileged, unipolar, western power elite:


So, what do we have as a result?

In politics, erosion of the international legal basis, growth of instability and unsustainability, chaotic fragmentation of the global landscape and deepening mistrust between those involved in the international life.
In the area of security, blurring of the dividing line between military and non-military means of achieving foreign policy goals, militarization of international relations, increased reliance on nuclear weapons in US security doctrines, lowering the threshold for the use of such armaments, the emergence of new hotbeds of armed conflicts, the persistence of the global terrorist threat, and militarization of the cyberspace.
In the world economy, increased volatility, tougher competition for markets, energy resources and their supply routes, trade wars and undermining the multilateral trade system.
We can add a surge of migration and deepening of ethnic and religious strife.


He draws attention to the manipulation of language and ideas that is being done to suit the purposes of this elite through the examples he cites.

This article is well worth reading for the summary and overview of the attempts to shape the global landscape by this elite.


World at a Crossroads and a System of International Relations for the Future
September 21, 2019

“World at a Crossroads and a System of International Relations for the Future” by Foreign Minister Sergey Lavrov for “Russia in Global Affairs” magazine, September 20, 2019

These days, the 74th session of the United Nations General Assembly opens up. So does a new international “political season”.

The session begins at a highly symbolic historical moment. Next year we will celebrate two great and interconnected anniversaries – the 75th Anniversary of the Victory in the Great Patriotic and Second World Wars, and the establishment of the UN.

Reflecting on the spiritual and moral significance of these landmark events, one needs to bear in mind the enormous political meaning of the Victory that ended one of the most brutal wars in the history of mankind.

The defeat of fascism in 1945 had fundamentally affected the further course of world history and created conditions for establishing a post-war world order. The UN Charter became its bearing frame and a key source of international law to this day. The UN-centric system still preserves its sustainability and has a great degree of resilience. It actually is kind of a safety net that ensures peaceful development of mankind amid largely natural divergence of interests and rivalries among leading powers. The War-time experience of ideology-free cooperation of states with different socioeconomic and political systems is still highly relevant.

It is regrettable that these obvious truths are being deliberately silenced or ignored by certain influential forces in the West. Moreover, some have intensified attempts at privatizing the Victory, expunging from memory the Soviet Union’s role in the defeat of Nazism, condemning to oblivion the Red Army’s feat of sacrifice and liberation, forgetting the many millions of Soviet citizens who perished during the War, wiping out from history the consequences of the ruinous policy of appeasement. From this perspective, it is easy to grasp the essence of the concept of expounding the equality of the totalitarian regimes. Its purpose is not just to belittle the Soviet contribution to the Victory, but also to retrospectively strip our country of its historic role as an architect and guarantor of the post-war world order, and label it a “revisionist power” that is posing a threat to the well-being of the so-called free world.

Interpreting the past in such a manner also means that some of our partners see the establishment of a transatlantic link and the permanent implanting of the US military presence in Europe as a major achievement of the post-war system of international relations. This is definitely not the scenario the Allies had in mind while creating the United Nations.

The Soviet Union disintegrated; the Berlin Wall, which had symbolically separated the two “camps,” fell; the irreconcilable ideological stand-off that defined the framework of world politics in virtually all spheres and regions became a thing of the past – yet, these tectonic shifts unfortunately failed to bring the triumph of a unifying agenda. Instead, all we could hear were triumphant pronouncements that the “end of history” had come and that from now on there would be only one global decision-making center.

It is obvious today that efforts to establish a unipolar model have failed. The transformation of the world order has become irreversible. New major players wielding a sustainable economic base seek to increase their influence on regional and global developments; they are fully entitled to claim a greater role in the decision-making process. There is a growing demand for more just and inclusive system. The overwhelming majority of members of the international community reject arrogant neocolonial policies that are employed all over again to empower certain countries to impose their will on others.

All that is greatly disturbing to those who for centuries have been accustomed to setting the patterns of global development by employing exclusive advantages. While the majority of states aspire to a more just system of international relations and genuine rather than declarative respect for the UN Charter principles, these demands come up against the policies desighned to preserve an order allowing a narrow group of countries and transnational corporations to reap from the fruits of globalization. The West’s response to the ongoing developments reveals true worldview of its proponents. Their rhetoric on liberalism, democracy and human rights goes hand in hand with the policies of inequality, injustice, selfishness and a belief in their own exceptionalism.

“Liberalism”, that the West claims to defend, focuses on individuals and their rights and freedoms. This begs the question: how does this correlate with the policy of sanctions, economic strangulation and overt military threats against a number of independent countries such as Cuba, Iran, Venezuela, North Korea or Syria? Sanctions directly strike at ordinary people and their well-being and violate their social and economic rights. How does the bombing of sovereign nations, the deliberate policy of destroying their statehood leading to the loss of hundreds of thousands of lives and condemning millions of Iraqis, Libyans, Syrians and representatives of other peoples to innumerable suffering add up to the imperative of protecting human rights? The reckless Arab Spring gamble destroyed the unique ethnic and religious mosaic in the Middle East and North Africa.

In Europe, the proponents of liberal concepts get along quite well with massive violations of the Russian-speaking population rights in a number of EU and EU-neighboring countries. Those countries violate multilateral international conventions by adopting laws that infringe language and education rights of ethnic minorities.

What is “liberal” about visa denials and other sanctions imposed by the West on residents of Russia’s Crimea? They are punished for their democratic vote in favour of reunification with their historical homeland. Does this not contradict the basic right of the people to free self-determination, let alone the right of the citizens to freedom of movement enshrined in international conventions?

Liberalism, or rather its real undistorted essence, has always been an important component of political philosophy both in Russia and worldwide. However, the multiplicity of development models does not allow us to say that the Western “basket” of liberal values has no alternative. And, of course, these values cannot be carried “on bayonets” – ignoring the history of states, their cultural and political identities. Grief and destruction caused by “liberal” aerial bombings are a clear indication of what this can lead to.

The West’s unwillingness to accept today’s realities, when after centuries of economic, political and military domination it is losing the prerogative of being the only one to shape the global agenda, gave rise to the concept of a “rules-based order.” These “rules” are being invented and selectively combined depending on the fleeting needs of the people behind it, and the West persistently introduces this language into everyday usage. The concept is by no means abstract and is actively being implemented. Its purpose is to replace the universally agreed international legal instruments and mechanisms with narrow formats, where alternative, non-consensual methods for resolving various international problems are developed in circumvention of a legitimate multilateral framework. In other words, the expectation is to usurp the decision-making process on key issues.

The intentions of those who initiated this “rules-based order” concept affect the exceptional powers of the UN Security Council. A recent example: when the United States and its allies failed to convince the Security Council to approve politicized decisions that accused, without any proof, the Syrian government of using prohibited toxic substances, they started to promote the “rules” they needed through the Organization for the Prohibition of Chemical Weapons (OPCW). By manipulating the existing procedures in flagrant violation of the Chemical Weapons Convention, they managed (with the votes of a minority of the countries participating in this Convention) to license the OPCW Technical Secretariat to identify those responsible for the use of chemical weapons, which was a direct intrusion in the prerogatives of the UN Security Council. One can also observe similar attempts to “privatize” the secretariats of international organizations in order to advance interests outside of the framework of universal intergovernmental mechanisms in such areas as biological non-proliferation, peacekeeping, prevention of doping in sports and others.

The initiatives to regulate journalism seeking to suppress media freedom in an arbitrary way, the interventionist ideology of “responsibility to protect”, which justifies violent “humanitarian interventions” without UN Security Council approval under the pretext of an imminent threat to the safety of civilians are part of the same policy.

Separately, attention should be paid to the controversial concept of “countering violent extremism”, which lays the blame for the dissemination of radical ideologies and expansion of the social base of terrorism on political regimes that the West has proclaimed undemocratic, illiberal or authoritarian. This concept provides for direct outreach to civil society over the head of legitimate governments. Obviously, the true goal is to withdraw counterterrorism efforts from beneath the UN umbrella and to obtain a tool of interference in the internal affairs of states.

The introduction of such new concepts is a dangerous phenomenon of revisionism, which rejects the principles of international law embodied in the UN Charter and paves the way back to the times of confrontation and antagonism. It is for a reason that the West is openly discussing a new divide between “the rules-based liberal order” and “authoritarian powers.”

Revisionism clearly manifests itself in the area of strategic stability. The US torpedoing first the ABM Treaty and now the INF Treaty (a decision that enjoys unanimous NATO members’ support) have generated risks of dismantling the entire architecture of nuclear arms control agreements. The prospects of the Treaty on Measures for the Further Reduction and Limitation of Strategic Offensive Arms (The New START) are vague – because the US has not given a clear answer to the Russian proposal to agree to extend the New START beyond its expiry date in February 2021.

Now we are witnessing alarming signs that a media campaign in the United States is being launched to lay the groundwork for abandoning the Comprehensive Nuclear Test Ban Treaty (which has not been ratified by the United States). This calls into question the future of this treaty, which is vital for international peace and security. Washington has embarked upon the implementation of its plans to deploy weapons in outer space, rejecting proposals to agree on a universal moratorium on such activities.

There is one more example of introducing revisionist “rules”: the US withdrawal from the Joint Comprehensive Plan of Action on Iran’s nuclear program, a multilateral agreement approved by the UN Security Council that is of key importance for the nuclear non-proliferation.

Yet another example is Washington’s open refusal to implement unanimous UN Security Council resolutions on the settlement of the Israeli-Palestinian conflict.

In the economic field, the “rules” consist of protectionist barriers, sanctions, abuse of the status of the US dollar as the principle means of payment, ensuring competitive advantages by non-market methods, and extraterritorial use of US laws, even towards the United States’ closest allies.

At the same time, our American colleagues are persistently trying to mobilise all of their foreign partners to contain Russia and China. Simultaneously they do not conceal their wish to sow discord between Moscow and Beijing and undermine multilateral alliances and regional integration projects in Eurasia and Asia-Pacific that are operating outside of the US oversight. Pressure is exerted on those countries that do not play by the rules imposed on them and dare make the “wrong choice” of cooperating with US “adversaries”.

So, what do we have as a result? In politics, erosion of the international legal basis, growth of instability and unsustainability, chaotic fragmentation of the global landscape and deepening mistrust between those involved in the international life. In the area of security, blurring of the dividing line between military and non-military means of achieving foreign policy goals, militarization of international relations, increased reliance on nuclear weapons in US security doctrines, lowering the threshold for the use of such armaments, the emergence of new hotbeds of armed conflicts, the persistence of the global terrorist threat, and militarization of the cyberspace. In the world economy, increased volatility, tougher competition for markets, energy resources and their supply routes, trade wars and undermining the multilateral trade system. We can add a surge of migration and deepening of ethnic and religious strife. Do we need such a “rules-based” world order?

Against this background, attempts by Western liberal ideologues to portray Russia as a “revisionist force” are simply absurd. We were among the first to draw attention to the transformation of the global political and economic systems that cannot remain static due to the objective march of history. It would be appropriate to mention here that the concept of multipolarity in international relations that accurately reflects emerging economic and geopolitical realities was formulated two decades ago by the outstanding Russian statesman Yevgeny Primakov. His intellectual legacy remains relevant now as we mark the 90th anniversary of his birth.

As is evident from the experience of recent years, using unilateral tools to address global problems is doomed to failure. The West-promoted “order” does not meet the needs of humankind’s harmonious development. This “order” is non-inclusive, aims to revise the key international legal mechanisms, rejects the principle of collective action in the relations between states, and by definition cannot generate solutions to global problems that would be viable and stable in the long term rather than seek a propaganda effect within an electoral cycle in this or that country.

What is being proposed by Russia? First of all, it is necessary to keep abreast of the times and recognise the obvious: the emergence of a polycentric world architecture is an irreversible process, no matter how hard anyone tries to artificially hold it back (let alone send it in reverse). Most countries don’t want to be held hostage to someone else’s geopolitical calculations and are determined to conduct nationally oriented domestic and foreign policies. It is our common interest to ensure that multipolarity is not based on a stark balance of power like it was at the earlier stages of human history (for example, in the 19th and the first half of the 20th century), but rather bears a just, democratic and unifying nature, takes into account the approaches and concerns of all those taking part in the international relations without an exception, and ensures a stable and secure future.

There are some people in the West who often speculate that polycentric world order inevitably leads to more chaos and confrontation because the “centers of power” will fail to come to terms among themselves and take responsible decisions. But, firstly, why not try? What if it works? For this, all that is necessary is to start talks on the understanding that the parties should seek a balance of interests. Attempts to invent ones’ own “rules” and impose them on all others as the absolute truth should be stopped. From now on, all parties should strictly comply with the principles enshrined in the UN Charter, starting with the respect for the sovereign equality of states regardless of their size, system of government or development model. Paradoxically, countries that portray themselves as paragons of democracy actually care about it only as they demand from other countries to “put their house in order” on a West-inspired pattern. But as soon as the need arises for democracy in intergovernmental relations, they immediately evade honest talk or attempt to interpret international legal norms at their own discretion.

No doubt, life does not stand still. While taking good care of the post-WWII system of international relations that relies on the United Nations, it is also necessary to cautiously though gradually adjust it to the realities of the current geopolitical landscape. This is completely relevant for the UN Security Council, where, judging by today’s standards, the West is unfairly overrepresented. We are confident that reforming the Security Council shall take into account interests of the Asian, the African and the Latin American nations whilst any such design must rest upon the principle of the broadest consensus among the UN member states. The same approach should apply to refining the world trade system, with special attention paid to harmonizing the integration projects in various regions.

We should use to the fullest the potential of the G20, an ambitious, all-encompassing global governance body that represents the interests of all key players and takes unanimous decisions. Other associations are playing a growing role as well, alliances projecting the spirit of a true and democratic multipolarity, based on voluntary participation, consensus, values of equality and sound pragmatism, and refraining from confrontation and bloc approaches. These include BRICS and the SCO, which our country is an active member of and which Russia will chair in 2020.

It is evident that without collective effort and without unbiased partnership under the central coordinating role of the UN it is impossible to curb confrontational tendencies, build up trust and cope with common threats and challenges. It is high time to come to terms on uniform interpretation of the principles and norms of international law rather than try to follow the old saying “might goes before right”. It is more difficult to broker deals than to put forward demands. But patiently negotiated trade-offs will be a much more reliable vehicle for predictable handling of international affairs. Such an approach is badly needed to launch substantive talks on the terms and conditions of a reliable and just system of equal and indivisible security in the Euro-Atlantic and Eurasia. This objective has been declared multiple times at the top level in the OSCE documents. It is necessary to move from words to deeds. The Commonwealth of Independent States (CIS) and the Collective Security Treaty Organisation (CSTO) have repeatedly expressed their readiness to contribute to such efforts.

It is important to increase our assistance to the peaceful resolution of numerous conflicts, be it in the Middle East, Africa, Asia, Latin America or the post-Soviet space. The main point is to live up to the earlier arrangements rather than to invent pretexts for refusing to adhere to the obligations.

As of today, it is especially relevant to counter religious and ethnic intolerance. We urge all the nations to work together to prepare for the World Conference on Interfaith and Inter-Ethnic Dialogue that will be held in Russia in May 2022 under the auspices of the Inter-Parliamentary Union and the UN. The OSCE that has formulated a principled position condemning anti-Semitism should act with equal resolve toward Christianophobia and Islamophobia.

Our unconditional priority is to continue providing assistance to the unhindered formation of the Greater Eurasian Partnership, a broad integration framework stretching from the Atlantic to the Pacific that involves the member states of the Eurasian Economic Union (EAEU), the Shanghai Cooperation Organization (SCO), the Association of Southeast Asian Nations (ASEAN) and all other countries of the Eurasian continent, including the EU countries. It would be unwise to contain the unifying processes or, worse still, to put up fences. It would be a mistake to reject the obvious strategic advantages of the common Eurasian region in an increasingly competitive world.

Consistent movement towards this constructive goal will allow us not only to keep up the dynamic development of the national economies and to remove obstacles to the movement of goods, capital, labor and services, but it will also create a solid foundation of security and stability throughout the vast region from Lisbon to Jakarta.

Will the multipolar world continue to take shape through cooperation and harmonization of interests or through confrontation and rivalry? This depends on all of us. Russia will continue to promote a positive and unifying agenda aimed at removing the old dividing lines and preventing the appearance of new ones. Russia has advanced initiatives to prevent an arms race in outer space, establish efficient mechanisms for combating terrorism, including chemical and biological terrorism, and to agree upon practical measures to prevent the use of cyberspace for undermining national security or for other criminal purposes.

Our proposals to launch a serious discussion on all aspects of strategic stability in the modern era are still on the table.

There have been ideas floated recently to modify the agenda and update the terms. The proposed subjects for discussion vary between “strategic rivalry” and “multilateral deterrence.” Terminology is negotiable, but it is not terms but the essence that really matters. It is now much more important to start a strategic dialogue on the existing threats and risks and to seek consensus on a commonly acceptable agenda. Yet another outstanding statesman from our country, Andrey Gromyko (his 110th birth anniversary we mark this year) said wisely: “Better to have ten years of negotiations than one day of war.”
From: http://thesaker.is/world-at-a-crossroads-and-a-system-of-international-relations-for-the-future/

[Cara]

The next two posts are copied from the Financial Flows thread (http://projectavalon.net/forum4/showthread.php?108637-Financial-flows-moves-changes-and-significant-events) and they concern the trade and economic war between the USA and China / Russia (and others).

Both are significant because they point to a new cold war situation with a bifurcation of the global economy.

[silvanelf]

Moderator note

This is posted previously here: http://projectavalon.net/forum4/showthread.php?108637-Financial-flows-moves-changes-and-significant-events&p=1316369&viewfull=1#post1316369

~~~~


This to me is a very significant statement:

the Trump administration is trying to divide the world in two. In other words, there's a China-based system, and there's an American-based system. And in other words, there's a lot more that comes after this trade dispute. In other words, there's attempts to try and divide the world economy. And that was more or less what was happening in the 1930s.

What if ... the trade war is in reality an already ongoing process of economic decoupling between US and China?

Delisting Chinese firms from US stock markets appears as a major escalation of the trade war. Take a look at the news:


Trump considers delisting Chinese firms from U.S. markets: sources

WASHINGTON (Reuters) - President Donald Trump’s administration is considering delisting Chinese companies from U.S. stock exchanges, three sources briefed on the matter said on Friday, in what would be a radical escalation of U.S.-China trade tensions.

-- snip --

China says it cannot allow its companies to submit to oversight by PCOAB because of rules prohibiting the storage, processing or transfer of any material considered to be state secrets or national security matters.

U.S. hedge fund manager Kyle Bass, a prominent critic of China, said on Friday that Chinese companies should have to play by U.S. rules if they want to sell to U.S. investors.


https://www.reuters.com/article/us-usa-trade-china-limits/trump-considers-delisting-chinese-firms-from-u-s-markets-source-idUSKBN1WC1VP


An article which represents the Chinese view -- emphasis is mine:


An economic decoupling from the United States is looking more likely and China should get ready, scholars in Beijing warned on Saturday, a year after US President Donald Trump fired the first shot in the trade war.

The break-up of the world’s two biggest economies was gradually becoming a real possibility as Beijing and Washington clashed over issues beyond trade and the White House sought to push China out of global value chains, according to Li Xiangyang, director of the National Institute of International Strategy, a think tank under the Chinese Academy of Social Sciences.

“This economic decoupling is completely possible, in theory,” Li told a symposium on the trade war at Renmin University of China on Saturday.

[...]

“The ultimate target [of the United States] is to contain China’s rise … this is a life-or-death game [for them],” Li said, adding that decoupling could be seen as “strategic blackmail” for Washington to try to prevent China from growing stronger.

He made the remarks as debate heats up in both the US and China about a potential economic decoupling.

Chinese President Xi Jinping told an economic forum in St Petersburg last month that he did not want a decoupling from Washington, and he doubted Trump did either.

https://www.scmp.com/news/china/article/3017550/chinese-economists-warn-beijing-prepare-decoupling-us

[Cara]

Moderator Note:

This is posted previously here: http://projectavalon.net/forum4/showthread.php?108637-Financial-flows-moves-changes-and-significant-events&p=1316563&viewfull=1#post1316563

~~~~



...What if ... the trade war is in reality an already ongoing process of economic decoupling between US and China?...

Thanks Silvanelf, that's an important wider context.

And your question and articles you shared remind me of a piece written by Alastair Crooke published 18 December 2018:


America’s Technology and Sanctions War Will End, by Bifurcating the Global Economy
Alastair Crooke, Strategic Culture Foundation, 18 Dec 2018

“The true reason behind the US-China ‘trade’ war has little to do with actual trade … What is really at the basis of the ongoing civilizational conflict between the US and China … are China’s ambitions to be a leader in next-generation technology, such as artificial intelligence (AI), which rest on whether or not it can design and manufacture cutting-edge chips, and is why Xi has pledged at least $150 billion to build up the sector”, Zerohedge writes (https://www.zerohedge.com/news/2018-12-10/what-trade-war-china-really-about).

Nothing new here: yet behind that ambition, lies another, further ambition and a little mentioned ‘elephant in the room’: that the ‘trade war’ is also the first stage to a new arms race between the US & China – albeit of a different genre of arms race. This ‘new generation’ arms-race is all about reaching national superiority (https://www.zerohedge.com/news/2018-05-25/heres-when-china-will-win-arms-race-us-and-how-bofa-trading-it) in technology over the longer-term, via Quantum Computing, Big Data, Artificial Intelligence (AI), Hypersonic Warplanes, Electronic Vehicles, Robotics, and Cyber-Security.

The blueprint for it, in China, is in the public domain. It is ‘Made in China 2025’ (now downplayed (https://www.zerohedge.com/news/2018-12-12/giant-trade-war-concession-china-prepares-replace-made-china-2025), but far from forgotten). And the Chinese expenditure commitment ($ 150 billion) to take the tech lead - will be met ‘head on’ (as Zerohedge puts it (https://www.zerohedge.com/news/2018-05-25/heres-when-china-will-win-arms-race-us-and-how-bofa-trading-it)), “by a [counterpart] ‘America First’ strategy: Hence the ‘arms race’ in tech spending … is intimately linked with defence spending. Note: military spending by the US and China is forecast by the IMF to rise substantially in coming decades, but the stunner is: that by 2050, China is set to overtake the US, spending $4tn on its military, while the US is $1 trillion less, or $3tn … This means that sometime around 2038, roughly two decades from now, China will surpass the US in military spending.”

This close intimacy between tech and defence in US future defence thinking is plain: It is all about data, big data and AI: A Defense One article (https://www.defenseone.com/technology/2016/09/how-us-air-force-rapidly-mobilizing-cyber-war/131746/) makes this very clear,


“The battle domains of space and cyber are divorced, largely, from the raw physical reality of war. To Hyten [Gen. John E. Hyten, who leads US Air Force Space Command], these two uninhabited spaces mirror one another in another way: They are fields of data and information and that’s what modern war runs on. “What are the missions we do in space today? Provide information; provide pathways for information; in conflict, we deny adversaries access to that information,” he told an audience on Wednesday at the Air Force Association’s annual conference outside Washington, D.C.. The same is true of cyber.

The U.S. wages war with tools that require a lot of information … Inevitably, more adversaries will eventually employ data-connected drones and gunships of their own. The heavy information component of modern-day weapons, particularly that those wielded by air forces, also creates vulnerabilities. Air Force leaders this week discussed how they are looking to reduce the vulnerability for the United States while increasing it for adversaries”.

So, the ‘front line’ to this trade/tech/defence war, effectively pivots about who can design - and manufacture - cutting-edge, semi-conductors (since China already has the lead in Big Data, Quantum computing, and AI). And, in this context, General Hyten’s comment about reducing US vulnerability, whilst increasing it for adversaries takes on major significance: For Washington, the plan is to ramp up export controls (i.e. ban the export) of so-called ‘foundational technologies’ — those that can enable development in a broad range of sectors.

And the equipment for manufacturing chips, or semi-conductors – not surprisingly - is one of the key ‘target areas’ under discussion.

Export controls though, are just one part of this ‘war’ strategy of ‘data denial’ to adversaries. But semi-conductors is one field in which China is indeed vulnerable: since the global semiconductor industry rests on the shoulders of just six equipment companies, of which three are based in the US. Together, these six companies make nearly all of the crucial hardware and software tools needed to manufacture chips. This implies that an American export ban would choke off China’s access to the basic tools needed to manufacture their latest chip designs (though China can retaliate by choking-off the supply of Raw Earth, upon which sophisticated tech, is reliant).

"You cannot build a semiconductor facility without using the big major equipment companies, none of which are Chinese,” said Brett Simpson (https://www.zerohedge.com/news/2018-12-10/what-trade-war-china-really-about), the founder of Arete Research, an equity research group. And, as the FT, notes, the real difficulty is not [so much] designing the chips, but in the making of very cutting-edge chips."

So here is the point: the US is attempting to clasp to itself both the ‘pure’ technology-knowledge, plus additionally, the practical tech supply-chain experience and knowhow, in order to repulse China out from the western tech sphere.

At the same time, another strand to the US strategy – as we have witnessed with Huawei, a global leader in 5G infrastructure technology (in which the U.S. is falling behind) – is to scare everyone off incorporating Chinese 5G in to their national infrastructures - through such devices as the arrest of Meng Wanzhou (for breach of US sanctions).

Even before her ‘arrest’, America has been systematically cutting Huawei out of the global 5G rollout, by quoting the magical words: ‘security concerns’ (Just as it is attempting to cut Russia out of weapons sales in the Middle East, on similar, tech-protective, grounds: i.e. that states should not buy Russian air defence, since this would give Russia a ‘window’ into NATO tech capabilities).

And, as General Hyten made clear, this not just about increasing tech and area denial, and promoting vulnerability for adversaries in terms of chips - but the US also plans to extend tech and area info-denial to space, cyber, avionics and military equipment.

It’s another Cold War - but this time it is about technology and ‘data denial’.

Well, China, with its centralized economy, will throw money and brainpower, into creating its own, ‘non-dollar sphere’, supply lines: for semi-conductors; for components – both for civil and military use. It will take time, but the solution will come.

Clearly, one consequence of this new arms race between the US - and China and Russia - is that specialized, and thinly-populated supply lines will have to be disentangled, and made anew, each in its own separate sphere: that is, on one hand, within the NATO-dollar sphere, and on the other, in the non-dollar sphere, led by China and Russia.

And not only will there be this physical supply-line disentanglement and separation, but should the US persist with its Huawei leverage tactic of ‘War on Terror’-style ‘rendition’ of foreign businessmen, or business women, alleged to have breached any US broad spectrum tech sanctions, there will have to be a disentangling of mixed boardrooms to avoid exposing company officials to individual arrest and prosecution. Limitations on company officers’ travel, where their business spans spheres, is already happening (as a result of the attempted rendition of Meng Wahzhou - and in order to avoid being caught up in tit-for-tat, retribution).

The bifurcation of the global economy was already in process. This stemmed firstly from America’s geo-political financial sanctions regime (i.e. Treasury Wars) – and the consequent attempts by targeted states to de-couple from the dollar sphere. The ‘war hawks’ surrounding the President are now inventing a whole new swathe of ‘tech crimes’ for sanctioning – ostensibly to give Trump oven more of his much-desired negotiating ‘leverage’. Clearly the hawks are using the ‘leverage’ pretext, to up-the-ante against China, Russia and its allies – for far wider ambitions than just giving the President more ‘cards in his hand’: Perhaps rather, to re-set the entire power-balance between America versus China and Russia.

The obvious and inevitable consequence has been an accelerating financial separation from the dollar sphere; and the development of a non-dollar architecture. De-dollarisation in a word.

Effectively, the US seems prepared to burn-down its reserve-currency status, to ‘save’ itself - to ‘Make America Rich Again’ (MARA), and to hobble China’s rise. And while burning down dollar-hegemony, the Administration is burning its own ‘global order’ too: attenuating it from the ‘global’ - down to a reduced sphere of US tech and security allies, facing China and the non-West. The domestic consequences for America will be felt in the new (for Americans) frustration of finding it harder to finance itself, in the manner in which it has grown accustomed, over the last 70 years, or so.

Peter Schiff, CEO and Chief Global Strategist of Euro Pacific Capital, says that (https://www.zerohedge.com/news/2018-12-12/peter-schiff-american-standard-living-its-going-collapse):


“The dollar – [the US] having the reserve currency, [is placing that] status … in jeopardy. And I don’t think the world likes giving America this kind of power that we can impose our own rules and demand that the entire world live by it. So, I think this has a much bigger and broader ramifications other than what’s going on in the stock market today. I think long-term, this is going to undermine the dollar, and its role as a reserve currency. And when that goes, so does the American standard of living: because it’s going to collapse.”

“People think we have the upper hand because we have this huge trade deficit with China. But I think it’s the other way. I think the fact that they supply us with all this merchandise that our economy needs, and the fact that they hold a lot of our bonds [debt], and continue to lend us a lot of money so we can live beyond our means - they’re the ones, I think, that call the tunes, and we have to dance to it.”

This tech and data new Cold War will polarise the global economy into spheres, and already it is polarising it politically, into a new ‘with us, or against us’ American paradigm. Politico notes (https://www.politico.eu/article/telecoms-donald-trump-war-on-huawei-zte-splits-europe/):


“The Trump administration's global campaign against telecom giant Huawei is pitting Europe against itself - over China. In the midst of a ballooning U.S.-China trade conflict, Washington has spent the past few months pressing its EU allies via its ambassadors to take a stronger stance against Chinese telecom vendors such as Huawei and ZTE.

The American push…is exposing fault-lines between U.S. allies in Europe as well as the so-called "Five Eyes" intelligence community — which have largely followed the U.S. lead — and others that resist the American pressure, by stopping short of calling out Chinese tech.

On the other side there is Germany, which wants proof from the United States that Huawei poses a security risk, as well as France, Portugal and a slew of central and eastern EU nations.

[B]The increasingly divergent attitudes show how Donald Trump is forcing allies to take sides in a global dispute and measure their economic interests — often deeply embedded with the Chinese vendors — against the value of a security alliance with Washington.”

The potential for accelerated de-dollarisation is one aspect, but there is another potential flaw inherent to the wholesale repatriation of supply-lines. US corporate earnings have ballooned over the last two decades. Part of this earnings hike stemmed from ‘easy’ liquidity, and ‘easy’ credit; but a major element owed to cost-cutting -- that is to say, off-shoring elements of higher-cost US production (because of wage levels, regulatory costs and employee entitlements) to lower wage, less regulated states. The coming bifurcation of the global economy has therefore, as its inevitable consequence, the repatriation of lower-cost production (in China and elsewhere) to a now higher-cost, and more highly regulated, US and European environment.

Perhaps this is a good thing -- but for sure it means costs and prices will rise in the US and America, and it means that corporate business models will be impaired as they de- off-shore. Americans’ standards of living will decline further (as Peter Schiff foretells).

The alienation and disgruntlement of America’s ‘deplorables’ and Europe’s ‘Yellow Vests’ is evidently a profound problem – and one that will not be solved by a new Cold War. The roots to our present discontents lie precisely with the ‘easy’ liquidity, and the ‘easy’ credit paradigm, which centrifuged-out societies into the asset owning 10% and into the non-asset holding 90% of society, and which degraded so the sense of societal well-being and security.

Of course this discontent can really only be resolved by addressing the question of our hyper-financialised economic paradigm – which is not something the élites will, or want, to ‘touch’.
From: http://www.conflictsforum.org/2018/americas-technology-and-sanctions-war-will-end-by-bifurcating-the-global-economy/

[silvanelf]

...What if ... the trade war is in reality an already ongoing process of economic decoupling between US and China?...

Thanks Silvanelf, that's an important wider context.

And your question and articles you shared remind me of a piece written by Alastair Crooke published 18 December 2018:


America’s Technology and Sanctions War Will End, by Bifurcating the Global Economy
Alastair Crooke, Strategic Culture Foundation, 18 Dec 2018

[...]

From: http://www.conflictsforum.org/2018/americas-technology-and-sanctions-war-will-end-by-bifurcating-the-global-economy/


That article is excellent! It raises some interesting questions and I'm still reading other articles about these issues.

For example, Huawei's 5G technology seems to play an important role in the conflict between the US and China. It is not just a conflict about patents or tariffs, it looks more like a conflict about spheres of influence on a technological level.


Secretary Pompeo, in his recent European tour, came close to giving Europeans an ultimatum: ‘Include Chinese 5G technology in your state infrastructure – and you will lose having any American technology alongside it’ – With us (against China), or (with China) against ‘us’. Revised US foreign investment screening and export control laws, especially as applied to ‘emerging and foundational technologies’, ultimately will break significant linkages between the United States and China.

https://www.strategic-culture.org/news/2019/02/18/dire-unintended-consequences-of-trump-maga-war-on-china/


Huawei offers to tie both arms behind the back-so the West can compete!

Huawei is the dominant global 5G player, it offers to sell its core technology and share its 5G base stations around the world, with the country that had the founder’s daughter, Meng Wanzhou, kidnapped and imprisoned (https://www.scmp.com/news/china/diplomacy/article/3009440/huaweis-meng-wanzhou-back-court-us-pushes-extradite-her-bank)?

Whaaaaat? It’s true. Huawei founder Ren Zhengfei says he is ready to sell Huawei’s 5G tech to Western buyers (https://www.scmp.com/tech/big-tech/article/3026861/ren-zhengfei-says-he-ready-sell-huaweis-5g-tech-western-buyer). He clearly means Apple. In April, he offered to sell it its 5G chip, which Apple sorely needs to remain relevant in global mobile tech (https://www.marketwatch.com/story/huawei-reportedly-open-to-selling-5g-chips-to-apple-2019-04-14). Apple’s CEO, Tim Cook, who is a very astute businessman indeed, didn’t seem to bite, at least publicly, as I’m sure the Western deep state would crush the deal, as is explained why, below.

http://thesaker.is/huawei-offers-to-tie-both-arms-behind-the-back-so-the-west-can-compete/

[Cara]

Thanks silvanelf. Yes, that Alastair Crooke article (http://www.conflictsforum.org/2018/americas-technology-and-sanctions-war-will-end-by-bifurcating-the-global-economy/) is really good for its expansive viewpoint.

I agree that the moves against Chinese tech firms ZTE and now Huawei are a big part of this “game”. Whatever it is that these two companies have created it must be quite a significant threat to the players who are orchestrating things within the US as they seem quite okay to see collateral damage in US agriculture etc.

[Cara]

This is a useful summary of the state of play in the space sector.


Private Investment in Space Blasts Off
by Sarah Feldman ,Oct 7, 2019
Space Investment

Space Week runs through Thursday, an international week where science and technology are celebrated. NASA is dealing with some more terrestrial problems, though. The agency is gearing up to secure over $22 billion from Congress next year to realize the Trump administration’s goal of putting U.S. astronauts back on the moon. Even with these funding woes and sky-high aspirations, NASA’s annual budget dwarfs the amount of private investment being channeled into space ventures (https://www.statista.com/topics/4724/venture-capital-worldwide/).

The funding NASA (https://aerospace.csis.org/data/history-nasa-budget/) has received in the 21st-century totals around $381 billion, while private investment over the past two decades is just over $17 billion. Despite that clear advantage, private investment in space (https://www.statista.com/topics/5049/space-exploration/) has taken off in recent years, increasing close to 400 percent over the past decade (https://brycetech.com/downloads/Bryce_Start_Up_Space_2019.pdf), while NASA’s budget has largely flatlined. NASA’s budget is much smaller than it once was. In the 1960s, during the heart of the Cold War space race, NASA received a budget worth about $50 billion in today’s dollars.

Private investments and commercial projects have tried to find their footing among the stars. Private ventures into space have increased astronomically since the beginning of the 21st century.

Infographic: Private Investment in Space Blasts Off | Statista
https://infographic.statista.com/normal/chartoftheday_15654_private_investment_in_space_blasts_off_n.jpg
Description

This chart shows private and public investment in space over the course of the 21st century.

Download Chart (https://infographic.statista.com/normal/chartoftheday_15654_private_investment_in_space_blasts_off_n.jpg)
From: https://www.statista.com/chart/amp/15654/private-investment-in-space-blasts-off/?__twitter_impression=true

~~~

A question: will we soon see modern, space equivalents of the British East India company? Or are those players already on the stage?

[Cara]

Is there a hydrogen economy developing? There have been a several articles in the news on this lately:

Nordstream supplies to Europe:

Nord Stream 2 Gas Pipeline May Be Used for Shipping Hydrogen in Future - Eurogas

BRUSSELS (Sputnik) - The Nord Stream 2 pipeline for carrying gas from Russia to Europe may also be used for shipping hydrogen in future, Eurogas Secretary General James Watson said.

"Regarding Nord Stream 2 in particularly I am interested because my understanding from speaking with people from Gazprom is that they could also in the future use it to ship hydrogen. So, instead of just shipping natural gas, Nord Stream 2 can carry 80% of hydrogen. I believe that in the European Union we have a strong decarbonization agenda, and at some point hydrogen is likely to replace natural gas in parts of our system," Watson said.

Eurogas is an association representing the European gas wholesale, retail and distribution sectors. It was founded in 1990 and is comprised of 47 companies and associations from 21 countries.

The Nord Stream 2 pipeline is a joint venture of Russia’s Gazprom and five European companies. The pipeline is expected to be completed by the end of this year and to carry an annual 1.9 trillion cubic feet of natural gas from Russia to Europe.

Nord Stream 2 is set to pass through the territories of Denmark, Finland, Germany, Russia and Sweden. Denmark remains the only country that has not given its consent to the construction so far.
From: https://sputniknews.com/amp/europe/201910021076941862-nord-stream-2-gas-pipeline-may-be-used-for-shipping-hydrogen-in-future---eurogas/?__twitter_impression=true

And in Germany:

Germany should aim to be a leader in hydrogen technology - minister
Vera Eckert, Published 12 Hours Ago

* Germany aims to cut carbon emissions by 55% by 2030
* Berlin set to miss 2020 target for emission cuts
* Hydrogen as a commercial fuel faces challenges

FRANKFURT, Oct 9 (Reuters) - Germany should aim to be a leader in technologies needed to make and utilize hydrogen, which offers a green alternative to fossil fuels in the shift towards a low carbon economy, the economy minister said on Wednesday.

The government has been pushing renewables and other technologies to help cut Germany's carbon emissions by 55% of their 1990 level by 2030 and by 80% to 95% by 2050. But it is already set to miss a target of a 40% cut in emissions by 2020.

"We have to set the course so that Germany becomes the No. 1 in the world in hydrogen technologies," Economy Minister Peter Altmaier said in a statement.

"Now is the time for hydrogen and the technologies that are necessary for it," he said after a meeting in Berlin to discuss Germany's 2030 targets and its strategy for hydrogen usage.

Hydrogen gas has long been viewed as a potential alternative to fossil fuels because it emits water when it burns in oxygen rather than CO2, the greenhouse gas that coal, oil and natural gas emit.

But there are challenges to using hydrogen. Although the gas can be produced from water by electrolysis, this requires large amounts of electricity which Germany mostly generates from fossil fuels, although Berlin is expanding sources.

Germany aims to use more natural gas, which produces less greenhouse gas emissions than coal or oil, as a transition fuel in the shift towards a low carbon economy.

Existing infrastructure for natural gas, such as pipelines and storage tanks, could also be used for hydrogen, if the fuel became available in commercial quantities, analysts say.

Pipeline operators have said the German network could be slowly adjusted so that it carries 10% hydrogen and 90% natural gas by 2030, rising to 20% to 30% hydrogen in the longer term, helping reduce emissions from gas combustion.

Germany has pilot projects to test ways to produce hydrogen from water using electrolysis but these are not yet commercially viable. Major industries have also been working on projects that could use hydrogen as fuel in manufacturing.

To encourage hydrogen usage, the Economy Ministry has proposed creating European and international certification for hydrogen technologies, exploring ways to market those technologies and seeking partner countries. (Reporting by Vera Eckert; Editing by Edmund Blair)
From: https://www.cnbc.com/amp/2019/10/09/reuters-america-germany-should-aim-to-be-a-leader-in-hydrogen-technology--minister.html?__twitter_impression=true

And Germany’s Siemens invests in Australia:

Siemens Backs Mega Green Power Hydrogen Project in Australia

James Thornhill, October 8, 2019, 7:23 AM GMT+4

Siemens AG is partnering on a 5,000-megawatt combined solar and wind farm in Western Australia that will produce renewable hydrogen for potential export to Asia.

The Murchison facility will use Siemens’ electrolyser technology to convert power from the solar and wind units into hydrogen, it said in a joint statement with developer Hydrogen Renewables Australia. The project’s location, north of the coastal town of Kalbarri, makes it “one of the most cost-effective” spots in Australia to produce clean energy, according to the statement.

HRA has six years to scale up the project to enable exports to Japan and South Korea, ramping up to full capacity by 2028, when it could be supplying as much as 10% of Asia’s hydrogen demand, Chief Executive Officer Terry Kallis said by phone. Total investment is seen at about A$10 billion ($6.75 billion).

Murchison is the latest in a string of hydrogen projects announced in Australia recently, as the country looks to develop the fuel for potential export into Japan and South Korea. A government report in 2018 found that the industry could be worth over $1 billion to the economy annually by 2030.

“Australia has potential like no other country in the world for hydrogen production and export, as long as we act upon the opportunity quickly,” said Siemens Australia Pacific CEO Jeff Connolly.

The project will be developed in stages. The first is a demonstration phase providing hydrogen for transport fuels. The second will involve blending with natural gas in the nearby Dampier-to-Bunbury pipeline. The third will be an expansion to produce hydrogen for Asian markets.

HRA has held preliminary talks with the state and federal governments, and will start a consultation process with local stakeholders in November.
From: https://www.bloomberg.com/news/articles/2019-10-08/siemens-backs-mega-green-power-hydrogen-project-in-australia

And in China:

China’s Father of Electric Cars Says Hydrogen Is the Future

His vision to make China an electric-vehicle powerhouse revolutionized the global auto industry, cementing a move away from the combustion engine. Now, Wan Gang says get ready for the next game-changing moment.

The world’s biggest car market is set to embrace hydrogen fuel-cell vehicles the way it did EVs, Wan, who’s been called the father of China’s electric-car movement, said in a rare interview in Beijing on June 9.

...

“We should look into establishing a hydrogen society,” said Wan, 66, who’s now a vice chairman of China’s national advisory body for policy making, a role that ranks higher than a minister and gives him a voice in the nation’s future planning. “We need to move further toward fuel cells.”

That means the government will commit resources to developing such vehicles, he said. While China plans to phase out the long-time subsidy program for the maturing EV industry next year, government funding for fuel-cell vehicles may stay in place to some extent, Wan said.

Shares of some hydrogen-related companies rose. Jiangsu Huachang Chemical Co., which develops hydrogen pumping stations, advanced by the 10% daily limit on Thursday in Shenzhen. Shanghai Tongji Science & Technology Industrial Co. and Lanzhou Great Wall Electrical Co., which are both invested in the fuel-cell vehicle industry, also rose in Shanghai.

...

China is promoting the adoption of hydrogen vehicles in selected trial regions as it sets up an ecosystem that includes hydrogen production, storage, transportation and refueling, Wan said. Long-range commercial vehicles aren’t currently well-suited to run on batteries alone because of weight and range constraints, according to a BNEF report last month. Fuel cells would be a good bet should the government ease restrictions on hydrogen-refueling infrastructure....
From and continues: https://www.bloomberg.com/news/articles/2019-06-12/china-s-father-of-electric-cars-thinks-hydrogen-is-the-future

~~~

A coordinated effort?

The somewhat orchestrated media coverage could indicate some behind the scenes work from a public relations team. And if so, who is paying the PR team?

[Cara]

This is from the UK’s Financial Times so it has its own bias and narrative to spin. It is the mouthpiece for a certain power and money set. It is also written as editorial rather than news reporting, so can be viewed perhaps as a pronouncement on what this particular establishment thinks.

It points to the “turning inwards” of the US as being a phenomenon that exists outside of president Trump. Questions that spring to mind are:

Is this establishment now resigned to the US’s changed style of engagement with the world?
Is this an indication that at least some part of the Anglo part of the Anglo American alliance is set to find new alliances?



America’s retreat will outlast Donald Trump
Until now, the security of Europe and east Asia has depended on US leadership

Philip Stephens, October 10, 2019 4:00 am

https://www.ft.com/__origami/service/image/v2/images/raw/http%3A%2F%2Fcom.ft.imagepublish.upp-prod-eu.s3.amazonaws.com%2Fa828fa16-eb2e-11e9-85f4-d00e5018f061?source=google-amp&fit=scale-down&width=500
© FT montage/Getty

Beijing’s display of martial might on the 70th anniversary of Communist rule (https://www.ft.com/content/61dd3fd2-e38f-11e9-b8e0-026e07cbe5b4) was a sobering moment. The line-up of sophisticated weaponry, including a new intercontinental ballistic missile, said a good deal about China’s great power ambitions (https://www.ft.com/content/d45119de-e11f-11e9-b112-9624ec9edc59). Europe was looking the other way as the tanks trundled through Tiananmen Square. For now, second-guessing the fortunes of US president Donald Trump is the only game in town.

Mr Trump has broken the rhythm of history. We expect threats to the established order to come from rising powers. China is no different, though it has become very big, very fast. The assault on the postwar Pax Americana, however, has been led by, well, America. When Europeans fret about another war breaking out they have usually been looking at Mr Trump’s Twitter account.

The White House decision to pull US troops out of northern Syria (https://www.ft.com/content/2b4158fc-e8fb-11e9-85f4-d00e5018f061) and leave their Kurdish allies to face an invading Turkish army fits this bill. The Kurds (https://www.ft.com/content/871c10c2-e9c3-11e9-85f4-d00e5018f061) have been the west’s most reliable allies in the fight against Isis and other jihadi groups. Mr Trump has decided that America owes them nothing. Washington, its allies are reminded again, cannot be trusted. How will things look when Isis fighters start breaking out of the detention centres that are at present guarded by the Kurds?

There is little purpose in searching for a grand strategy in Mr Trump’s foreign policy. His worldview is shaped by a set of emotional impulses. Looking for a framework is like searching for symmetrical patterns in a bowl of spaghetti.

This is the president, after all, who lionises North Korea’s Kim Jong Un, a dictator upon whom he once threatened to rain “fire and fury”. Iran’s Hassan Rouhani has replaced him in the line of fire. But you never know. Would anyone be that surprised if the Iranian leader tipped up as a guest at the White House?

We do know that Mr Trump starts from an assumption that the US can do as it pleases. Multilateralism is a globalist plot against the US, and trade sanctions are a good way to browbeat friends and adversaries alike. In the manner of Queen Victoria’s Lord Palmerston, the president has no time for permanent alliances. More encouragingly, although Mr Trump is careless about inflaming global tensions, he is wary of wars of choice.

With the odd exception — Israel and Hungary come to mind — “America First” is the very definition of dangerous for most friends and allies. The security of Europe and east Asia has been embedded in alliance and treaty systems operating under US leadership. Prosperity has rested on multilateral rules designed mostly in Washington.

Take away the glue of a US security guarantee and the systems begin to dissolve. Russia and China loom larger as regional threats, and allies are more likely to fight among themselves — witness the escalating dispute between Japan and South Korea about war reparations. Remove US backing for international trade rules and globalisation (https://www.ft.com/content/8f67815e-aa07-11e9-984c-fac8325aaa04) begins to go into reverse.

So no one should be surprised by the fierce foreign attention focused on the drama now unfolding in Washington. For most nations the biggest geopolitical event already visible on the near horizon is the 2020 US presidential election. Were the European foreign policy establishment to be given a single wish to make the world a safer place, it would be Mr Trump’s departure.

Watching Joe Biden and Elizabeth Warren in the Democratic debates, Europeans had allowed resignation to set in. Mr Biden’s time had passed; Ms Warren, a social democrat by European lights, seemed too leftish for the US. Maybe a second term for Mr Trump was preordained. That would give him the time to finish off the postwar order.

The impeachment proceedings, centred on Mr Trump’s attempts to strong-arm the president of Ukraine, have lifted spirits. Even if the Senate cannot be persuaded to convict the president, the process of disclosure and his increasingly erratic pronouncements could lose him the White House. Couldn’t it? Ms Warren lately seems to be shrugging off the charges that she is a dangerous Marxist. Perhaps impeachment is the get-out-of-jail-free card.

Real life, sadly, is not like that. Most Europeans will tell you that the world has had a Trump problem, not an American one. To the extent that this president’s behaviour has been uniquely capricious, they have a point. But the clock cannot be turned back to an era that was passing before Mr Trump reached the White House.

The Pax Americana was lost to the flames of Afghanistan and Iraq, to the economic weaknesses exposed by the global financial crisis, and to the unprecedented speed of China’s rise. Barack Obama understood this when he sought to recast US leadership as that of a convening power. Mr Trump’s bellicose unilateralism has greatly accelerated America’s retreat, but the direction of travel had already been set.

The world should be safer without Mr Trump. But, to my mind, three things can be said with confidence about his successor. The next president — she or he, in 2020 or 2024 — will not halt the country’s turn inwards. The protectionist tilt will harden, above all when it comes to technology-rich industries. And the US will be far more attentive to vital national interests before expending blood and treasure overseas. Impeachment, successful or otherwise, will not solve anyone else’s problems.
From: https://amp.ft.com/content/f34fa1ee-eaa1-11e9-a240-3b065ef5fc55?segmentId=6132a895-e068-7ddc-4cec-a1abfa5c8378&__twitter_impression=true

[amor]

Small countries, Islands and any countries which are not the main world traders have been permanently shafted by the NWO Trade Agreement which President Trump correctly said is the worst deal ever made. These countries as well as the United States have had their manufacturing hands tied behind their backs so that their economies would fail and all the fancy verbiage of the banking industry would be waiting there to shovel them into the IMF's clutches. Give away the right to print and control your own currency and you are dead. As for Crypto-currencies, that is the same as being blindfolded and marched over a cliff. Further more, I know of a country in the clutches of "The Bankers" where even the few fruits they grow for their population have been deliberately crippled by introduced diseases. They have been "discouraged" from growing their own food by sending in outside grocery firms to provide the people food they should be growing themselves. All this to send up the foreign exchange debt of the country which has now landed in the hands of the IMF. Vast numbers of the formerly employed are now unemployed in a climate of hugely inflated prices since everything must be imported. If anyone wonders about my rage, only because I cannot think of a worse word, against "the bankers" it is because I would like to get my hands on them for the global misery they are causing.

[amor]

Dear Cara: You have done an interesting piece of writing above. I personally back Mr. Trump 100% in America First because it is crystal clear to me that the Globalists have plotted to destroy it so that they can bring forth their ROTTEN GLOBALIST PLOT OF MURDER. As for China and its new showcase city with its hive of skyscrapers, I do believe that is all Globalist foreign capital being spent in China to promote, along with the video I saw about the Smart Phone Currency they are using, the banning of CASH. People have resisted governments which are organized from the top down where the RIGHTS of people have been effectively removed either by total dictatorship or the dictatorship of technology intended to assign us the status of chickens awaiting slaughter without reprieve. I believe you have heard of the CHIP? Well I understand the technology is a lot more comprehensive and advanced than most people can even imagine. Once taken, you are an obedient zombie under total physical, mental and spiritual control. Who will be the first idiot to volunteer?

[Cara]

Dear Cara: You have done an interesting piece of writing above. I personally back Mr. Trump 100% in America First because it is crystal clear to me that the Globalists have plotted to destroy it so that they can bring forth their ROTTEN GLOBALIST PLOT OF MURDER. As for China and its new showcase city with its hive of skyscrapers, I do believe that is all Globalist foreign capital being spent in China to promote, along with the video I saw about the Smart Phone Currency they are using, the banning of CASH. People have resisted governments which are organized from the top down where the RIGHTS of people have been effectively removed either by total dictatorship or the dictatorship of technology intended to assign us the status of chickens awaiting slaughter without reprieve. I believe you have heard of the CHIP? Well I understand the technology is a lot more comprehensive and advanced than most people can even imagine. Once taken, you are an obedient zombie under total physical, mental and spiritual control. Who will be the first idiot to volunteer?

Hi amor,

Thanks for your comments. I'd like to clarify that the article above post (http://projectavalon.net/forum4/showthread.php?108184-The-Changing-Emerging-Global-Landscape&p=1318113&viewfull=1#post1318113) was in the Financial Times and written by Philip Stephens.

Cheers,
Cara

[Jayke]

https://larouchepub.com/eiw/public/unlisted/2019/eirv46n42-20191025/bmkde98_65-jhyrfrDE_LL/4642-vladimir_putin_global_problems.html?utm_source=sendinblue&utm_campaign=EIR__October_25&utm_medium=email


Oct. 19—The following is a slightly abridged version of the speech delivered by Russian President Vladimir Putin on Oct. 3, 2019, at the final plenary session of the 16th meeting of the Valdai International Discussion Club, in Sochi, Russia. The speech is followed by a few selected questions and answers. The session was attended by Ilham Aliyev, President of Azerbaijan; King Abdullah II, of Jordan; Kassym-Jomart Tokaev, President of Kazakhstan; Rodrigo Duterte, President of the Philippines; and many other international guests and dignitaries.

In this speech, President Putin has defined a necessary approach to international relations that should be heeded by all people of good will in the world. To put it in American terms, what Putin describes as the approach to be taken is a “Community of Principle among Perfectly Sovereign Nations.” This is a world without hegemonies, but also a world not simply reduced to individual competing interests; it is, rather, a new order of national sovereignty and cooperation beneficial to all.

As Putin emphasizes, it was the collaboration between Presidents Trump and Putin in Syria which was crucial to resolving that catastrophe. This demonstrates what is possible when nations work together. The new set of relations among nations that is emerging can potentially lead to an unprecedented era of peace and economic development.

(Subheads have been added)





Putin: “Your Majesty King Abdullah, Mr. Aliyev, Mr. Tokaev, Mr. Duterte, friends, ladies and gentlemen. . . .

This time, the hosts have come up with a truly inexhaustible and, I would say, fascinating topic which is “The East and the Role of Asia,” as the world’s largest and most populated region. Relations between Russia and the Asian states, which have always been of particular importance to us, I believe, are of interest to everyone. The nature of Russia’s relations with Asia is dictated not only by today’s realities, but by history as well.

India and China, Egypt and Iran, Turkey and Japan, the countries of Central and Southeast Asia are heirs to great ancient civilizations, which gave humankind unique knowledge and technology, as well as discoveries in medicine, mathematics, culture and the arts.

Asia has always aroused special feelings among intellectuals and creative people, it seemed a little mysterious and mystical, and was considered a source of spiritual strength and wisdom, perhaps not always fully understood, but invariably interesting.


https://larouchepub.com/graphics/2019/4642/Pushkin_Aleksandr.jpg
Portrait by Vasily Tropinin
Alexander Pushkin

In Russia, the bright colors of the East inspired many of our writers, poets, artists and musicians, specifically Pushkin, Rimsky-Korsakov, Arsenyev, Vereshchagin, Kandinsky and Roerich. The Russian people, and not only Russians, know these names.

Today, Asia, throughout its vast reach from the Maghreb and the Middle East all the way to East and Southeast Asia, is regaining its natural place in international affairs, which is commensurate with its great heritage and today’s undoubtedly vast and growing potential.

The positions of the Asian states are becoming stronger in all areas, but mainly in the economy. The region already accounts for over a third of the gross world product. Living standards are improving at a higher pace than the global average. The most advanced technology is being introduced. The unprecedented scale of integration processes and globalization are drawing both individual countries and entire adjacent sub-regions to Asia.

While demonstrating impressive examples of progress, the Asian nations still preserve their unique features and traditions. They remember their roots and prove in their forward progress that the principles of state sovereignty do not contradict openness and globalization, that sustainable development can be based on independence and self-sufficiency rather than their mandatory renunciation, and that growing national economic and humanitarian potential requires political identity.

. . . [T]he Asian states are striving to play a bigger role in world politics. This is an absolutely natural process. They uphold their own opinions on key international issues, treasure their independence and hope that their objectively increasing influence will be recognized. We believe this is only fair and meets the realities of today and tomorrow.

Incidentally, at one time, Asia’s awakening, as it is called, and the national and cultural revival of its states, played an enormous role in the democratization of international ties. Today, it is obvious that global problems cannot be resolved without Asia. Of course, it is possible to try to do this with momentum and based on past experience, but the legitimacy, and most importantly, the practical value of such approaches, which are presented as global and universal, will be questionable.

The world has become multi-polar and, hence more complicated largely owing to the Asian countries. But, as I have said, multi-polarity as such is not a cure-all. Nor does it mean that urgent problems will disappear by themselves.



https://larouchepub.com/graphics/2019/4642/putin_valdai_10-3-19.jpg
kremlin.ru
Vladimir Putin addresses the plenary of the 16th Annual Meeting of the Valdai International Discussion Club on October 3, 2019.

Time for Outside-the-Box Steps

The authors of the annual Valdai Club report insist, and we have just heard this, that we have entered an era with no world order whatsoever. This has been practically voiced right now. Yes, such a scenario is indeed possible. But it is fraught with many threats; we are all aware of that. I would like to hope that however complicated the relations between countries, however dangerous the legal lacunae might be, such as in nuclear and missile weapons areas, the world order, based on the key role of international law, will be transformed, but it will remain. We will all be working to protect it. A different way is obviously fraught with global calamities for practically all of humanity.

The world system is undoubtedly multi-faceted and complicated and unprecedentedly interconnected at that. Everyone has their own objective interests that do not always coincide with those of others; this is also evident. But there is a feeling of common responsibility. Ultimately, I hope, no, actually, I do not doubt that there is also common sense, a striving for security.

This is why we cannot do without a systemic world order. But we also need both flexibility and, let me add, non-linearity, which would not mean a rejection of the system but the capability to arrange a complex process rooted in realities, which presupposes the ability to consider various cultural and value systems, the need to act together, dismissing stereotypes and geopolitical clichés. This is the only way to effectively solve the challenges on the global, regional, and national levels.

We have such examples before our eyes. Those of you who attended the 2015 Valdai Club meeting may remember that at virtually the very same time the decision was taken on Russia’s operation in Syria. Let me be straightforward: not everyone, including the experts in the audience back then, believed it could bring a positive result. On the contrary, they were very skeptical about it, and many of them asked questions about why it was necessary. They asked if we understood what sort of a hornets’ nest we would get into, whereas some foreign partners, I do not mean those experts present here, I mean just foreign partners with whom we collaborate in the global arena, were also trying to interfere, to resist.

But I would like to draw your attention to the essence of what has been done, and above all, of course, I mean what has been done for our country, as I represent its interests. We defeated the terrorist international that was actually winning on Syrian territory, and we prevented the return, the infiltration of hundreds and later, perhaps, thousands of armed cut-throats into our country and neighboring countries with whom we have a visa-free regime, our borders are transparent.

Most of Syria was freed from terrorists within several years, and the level of violence has drastically decreased. In conjunction with our Astana format partners and with the support of the UN, we managed to launch an intra-Syrian political process and to establish close working contacts with Iran, Turkey, Israel, Saudi Arabia, Jordan and other countries of the Middle East, as well as the United States. Colleagues, you will agree that it was difficult to even imagine such a complicated diplomatic alignment with the participation of very different states with very different emotions towards each other even a few years ago. But now this is a fait accompli, and we managed to do it.

The Syrian Settlement as a Model

We think the Syrian settlement can become a model for resolving regional crises where diplomatic mechanisms will be used in the vast majority of cases. The use of force is an extreme and forced exception. Indeed, in Syria, we were faced with an attempt to create a terrorist quasi-state with an actual—I am saying this without any exaggeration—an actual terrorist army.

Occasionally, many new and chronic problems and crises look too tangled and even approaching them is a problem. But, I repeat, now is the time for outside-the-box steps and actions. In Syria, Russia and its partners (of course, we could never have done this alone) managed to do a lot while adhering to and following norms of international law, respecting sovereignty and thinking primarily about the life, safety and interests of the people.

I am convinced that these approaches can be used to resolve other existing problems in the world, including in Asia, such as for example, the situation on the Korean Peninsula, which has long been in a clinch.


https://larouchepub.com/graphics/2019/4642/trump_kim_3_6-30-19.jpg
White House
President Donald Trump and North Korean leader Kim Jong Un shake hands across the Military Demarcation Line between the two Koreas on June 30, 2019.

In this regard, notably, as soon as the United States decided to have a direct conversation with the Democratic People’s Republic of Korea, without preliminary formalities and conventions, abandoning the usual, sometimes very rude, even insulting, rhetoric, the hope for a peaceful settlement immediately appeared.

Of course, we understand and see that there are still many unresolved problems and a long way to go. But there is movement in the right direction. We must give credit to President Trump’s courage and ability to take outside-the-box steps. Indeed, for many decades, U.S. presidents ignored the DPRK and saw it as an outcast. Mr. Trump was able to take a historic step, overcome the “demarcation line” of misunderstanding and alienation, meet with Kim Jong-un and begin the negotiating process.

Let me repeat: the most complicated conflicts, such as the Palestinian-Israeli and Afghani or the situation around the Iran nuclear deal, can and must be resolved on the principles of mutual cooperation, respect, recognition of all the parties’ interests and rejection of any kind of blinkers or philosophy of blocs.

In this context, let me remind you that this was Russia’s logic this July, when it presented the concept of providing collective security in the Persian Gulf area. I believe the idea is still important, considering the tense and unpredictable situation there.

We suggest that the accumulated prejudices and mutual pretenses must be pushed aside, and a security and cooperation organization be created in the region almost from scratch. In addition to Western countries, Russia, China, the U.S., the EU, India and other interested countries could join as observers.

A New Global Concert of Development

Ladies and gentlemen, of course, economic cooperation, which opens real prospects for sustainable long-term development for everyone, is the basis of equal political relations aimed at the future, including between Asian countries.

Let me use transport interconnection as an example. It is impossible to develop trade and industrial cooperation and establish mutual exchanges in any other sphere without an up-to-date road, sea and railway infrastructure. We should think together how to speed up the establishment of such a Eurasian transportation framework, a real network of latitudinal and longitudinal trading routes.

Of course, Russia is open to this joint work and is already implementing several joint projects, such as the North-South trading route from Europe via Russia to the Caspian Region, Central Asia, Iran and India. Another route, Europe-West China, will connect Russian Baltic ports with Yellow Sea ports.


https://larouchepub.com/graphics/2019/4642/port_of_sabetta.jpg
CC/Tuomas Romu
The Russian nuclear-powered icebreaker Vaygach (left) escorting the bulk cargo carrier Pavel Vavilov from the port of Sabetta on the Yamel Peninsula on April 3, 2015.

There is one more prospective route, the Arctic-Siberia-Asia. The idea is to connect ports along the Northern Sea Route with ports of the Pacific and Indian oceans via roads in East Siberia and central Eurasia. In order to implement this and add the missing links, we intend to speed up the construction of railways around the port in Sabetta (it is located in the north of Russia, on the Yamal Peninsula), to accelerate and complete the construction of the entire Northern Latitudinal Railway project complex as well as the construction of the Kuragino-Kyzyl railway (Kyzyl is located in the Republic of Tyva in eastern Russia) to later connect it to the railway network of Mongolia, China and other countries in the region. We are ready to work with all interested parties on this initiative, which is significant for the whole of Eurasia.

It is obvious to us that diversity within a nation is normal. It teaches both patience and tolerance in the true meaning of these words, and the ability to understand and accept different opinions, traditions and ways of life rather than impose our model as an axiom. We believe our experience can be useful for many of our partners.

With regard to the world in general, since all nations are obviously different, uniformity and universalization are impossible by default. A system is required whereby different values, ideas and traditions can co-exist, interact and mutually enrich one another while retaining and highlighting their peculiarities and differences. . . .


https://larouchepub.com/graphics/2019/4642/trans_mongolian_railroad.jpg
CC/Pierre André Leclercq
The Trans-Mongolian Railway negotiates a curve in the Gobi Desert, September 2011.

So, in the 19th century they used to refer to a “Concert of Powers.” The time has come to talk in terms of a global “concert” of development models, interests, cultures and traditions where the sound of each instrument is crucial, inextricable and valuable, and for the music to be played harmoniously rather than performed with discordant notes, a cacophony. It is crucial to consider the opinions and interests of all the participants in international life. Let me reiterate. Truly mutually respectful, pragmatic and consequently solid relations can only be built between independent and sovereign states.

Russia is sincerely committed to this approach and pursues a positive agenda. We stand for strict compliance with international law and enhancing mutual confidence and respect. We are building interstate relations and communication on fair and democratic foundations with an emphasis on the UN Charter.

Our country is focused on stepping up security and stability, on fighting international terrorism and other threats and challenges. We act for the sake of establishing—including in Asia—a system of equal and indivisible security resting on far-ranging and collective work.

Incidentally, the Russia-Africa Summit will be held here, in Sochi, in three weeks. We are prepared to propose to our African colleagues and friends a broad agenda of equal interaction covering many different areas—the economy, energy, transport, education and the environment.

Russia’s Resurrection

In conclusion, I would like to divert from the main topic and tell you something, which, just the same, is related to it. I would like to say that it was almost 20 years ago—just before the year 2000—that my article, “Russia at the Turn of the Millennium,” was published. The analysis of global affairs and development prospects it then offered seems to me to have generally matched reality.


https://larouchepub.com/graphics/2019/4642/russia_street_vendors.jpg
EIRNS/Connor Soules
Street vendors in St. Petersburg, Russia in November 1999.

Indeed, in the 1990s, Russia lived through one of the hardest periods in its history. In addition to the deep political, economic and social crisis in the country, we found ourselves exposed to aggression by international terrorism. At the time, Russia drew close to a very dangerous line and if it had crossed it, it would have faced the worst thing for any nation and country, which is the break-up and disintegration of the state. The threat was in the air and the majority of people were aware of it.

Of course, back then we could—the threat was absolutely real—plunge into the abyss of a large-scale civil war and be stripped of national unity and sovereignty, ending up on the periphery of global politics. It was only thanks to patriotism, bravery, and the rare ability of the Russian and other peoples living in the country to bear the hardships and work hard so that Russia could move back from this dangerous line.

Of course, there are things that could have been done differently and better during these 20 years. But we have gained unique experience, and I believe there is demand for it around the world. Before we came into this room, my colleagues and I discussed one of the most important issues today—terrorism.

Indeed, we in Russia still have to address plenty of issues. At the same time, due to political stability and the efforts of the whole nation, Russia has not only recovered and continues to grow stronger economically and socially, it confidently ranks among the leading, authoritative and responsible countries. Our country complies in full with its obligations as one of the guardians of the existing world order. I am sure this will continue in the future. This will be even more effective if we work together.

Thank you very much for your attention.”

* * * *

President Putin’s speech was followed by a lengthy discussion period. We present here a few selected questions and answers.






Mikhail Pogrebinsky: I am from Ukraine, and our country is going through troubled times. I have a question for President Putin.

This year was marked by a big electoral cycle, we have had a “reset” of both legislative and executive powers. The elections and polls reveal that public opinion favors stability and a peaceful settlement in the east of the country.

The new authorities are trying to take the first steps, somewhat cautiously, towards a search for peace. But they are so timid that they raise doubts about their resolve and ability to arrive at the logical completion of the process.

Do you see any political forces in Ukraine—perhaps you can name them—that can act as drivers of this process of political settlement?

Vladimir Putin: . . . [R]egarding the new leader’s efforts for a settlement in the southeast of the country. I do not know how strong are those who are against a settlement, especially based on the Minsk agreements. Thus the public’s interest in a settlement is obvious.


https://larouchepub.com/graphics/2019/4642/Zelensky_Volodymyr_2019.jpg
The Presidential Admin. of Ukraine/Mykola Lazarenko
Volodymyr Zelensky walking to the presidential office in Kiev, following his inauguration as President of Ukraine on May 20, 2019.

I think Mr. Zelensky won the [Presidential] election so convincingly primarily because of that interest. People in Ukraine are waiting for this issue to be resolved. And if he has enough political courage and strength to complete it, I think he will assert himself as an honest politician, brave and capable of pursuing the decisions made.

I think he is sincerely willing to do that, it is his sincere conviction, at least his striving. It is hard for me to say if he is able to stand up to those who oppose the process, but we do see some hesitation.

It seems inevitable that he will need to look for compromise, come to terms with the whole nation, with all members of society regardless of their point of view. However, he still has to follow up on election promises he gave to the majority of the Ukrainian people.

Tatiana Kastoueva-Jean: Good afternoon, my name is Tatiana Kastoueva-Jean. I am an analyst at the French Institute of International Relations in Paris.

Mr. President, I have a question for you. At the beginning of your speech, you proposed outlining the shape of the future and talking about it. One serious subject, of course, is global warming, climate change. . . .

As for Russia, it seems to me that there has always been such a duality in relations, even in the doctrines, because Russian Environmental Security Doctrine says the right things, while the Economic Security Doctrine through 2025 says that green economic development is a threat and has risks for the Russian economy, and it is clear why: because oil and gas represent a very high percent of exports.

It’s the same thing, the same duality in the reasons for explaining climate change. Is it the result of human activity, or is it part of the Earth’s global cycles?

. . . Do you think that Russia put an end to these doubts, hesitations and questions by ratifying this agreement? Will a new socioeconomic development paradigm emerge now at the domestic and external global levels? Will this topic be a unifying measure, or the cause of further division?

Vladimir Putin: As for the uniformity of approaches and evaluations, we will probably never reach this. Indeed, experts in various fields who somehow try to answer the question about the causes of climate change do not give unambiguous answers to the causes of climate change.

There are different opinions, I have heard them. Some say there is some global change in space that affects the Earth, so from time to time huge changes like this take place on our planet. I sailed along the Lena River in our country and saw high banks with deposits containing the remains of obviously ancient tropical mammals, which lived in tropical seas. I am talking about the Lena River, its stretch north of the Arctic Circle. It means back then the climate there was like this. Well, were there any anthropogenic emissions at the time? Of course, not. You see, there is no answer.

Just the same, my position is that if the human race is responsible for climate change, even in the slightest degree, and this climate change has grave implications, and if we can do something to, at least, slow down this process and avoid its negative consequences, we must spare no effort. This is our position. Despite all disagreements, we will support the international efforts to combat climate change. . . .

Fyodor Lukyanov: Angela Stent and Jill Dougherty would like to ask the President about this, and actually this question can be addressed to all participants as well. The situation in the United States is rather complicated at the moment and has become particularly so in the past week.

It is hard to understand what is happening there, with domestic policy issues clearly dominating. Is it possible to build relations in such condition at all? Or maybe we should wait?


https://larouchepub.com/graphics/2019/4642/putin_vladimir_valdai_10-3-19_2.jpg
[B]kremlin.ru
Vladimir Putin at the plenary session of the 16th Meeting of the Valdai International Discussion Club on October 3, 2019.

Vladimir Putin: As regards the developments in the United States—how can we cooperate with them when they are so engaged in their domestic political affairs? Obviously, this is always the case during an election campaign, and the United States is no exception. But this domestic political race has got a little over the top. I do not think this has ever occurred in the history of the United States before.

But life goes on, and we should factor in the current domestic situation there. But it is simply not possible to steer clear of such a global power as the United States. We intend to do as much as the U.S. itself is ready for.

Vitaly Naumkin: In conclusion, I would like to ask the last one.

During these four days, we have discussed various issues related to the current state of the world order and made a firm conclusion that it is undergoing a crisis and the future global order will be established with an increasing role of Asian countries.

How do you see this future global order?

Vladimir Putin: The existing system of international relations, international institutions and structures took shape following World War II as its result. The situation around the globe is changing drastically, both in Europe and on the American continent, with new rapidly growing and developing players, as well as in Africa, and, of course, Asia.

For the existing system and its institutions to last, it has to correspond to the realities of the ever-changing world. I believe that we must not destroy what has been created in the past decades, but should gradually transform it and adapt it to these realities, with due consideration of the growing power and prospects of Asia’s development in general and certain Asian countries in particular. They certainly have the right to and must take the place they deserve in global politics and international affairs.

[TomKat]

Relevant to the post above is a book written by David Korten in 1995 and republished in 2015: When Corporations Rule the World
https://upload.wikimedia.org/wikipedia/en/thumb/d/da/WCRWIIcoverart.gif/220px-WCRWIIcoverart.gif

[ .... ]

Here is a web version of the book (I think the 1995 version): http://www.thirdworldtraveler.com/Korten/WhenCorpsRuleWorld_Korten.html

Yes, highly recommended. I read it from cover to cover back in 2002, and it really made quite an impact. :thumbsup:

Brings to mind free trade advocate Thomas Friedman's best-selling book, The World Is Flat.

But I agree with Ian Hunter:
"There's too much information but not enough to go on
I think I liked it better when the world was round"

https://youtu.be/Ki620ZxtlMU

[Jayke]

The “Great Green Wall of China”?

In an effort to clean up air pollution, China have been utilising 60,000 soldiers to plant 12 Billion trees a year.
This is huge if it turns out to be true and the NASA satellite images can be verified. Greening the Mongolian desert!

lECxeRzJ2sY

[Cara]

An update on the shifting sands of the Middle East. This article by Alastair Crooke highlights some of the wider drivers and implications.

I recommend it.


The ‘War’ for the Future of Middle East

Alastair Crooke
November 4, 2019

Oh, oh, here we are again! In 1967, it was then the ‘threat’ of the standing Arab Armies (and the ensuing six-day war on Egypt and Syria); in 1980, it was Iran (and the ensuing Iraqi war on Iran); in 1996, it was David Wurmser with his Coping with Crumbling States (flowing on from the infamous Clean Break policy strategy paper) which at that time targeted secular-Arab nationalist states, excoriated both as “crumbling relics of the ‘evil’ USSR” and inherently hostile to Israel, too; and in the 2003 and 2006 wars, it was Saddam Hussein firstly; and then Hezbollah that threatened the safety of the West’s civilizational ‘outpost’ in the Middle East.

And here we are once more, Israel cannot safely ‘live’ in a region containing a militant Hezbollah.

Not surprisingly, the Russian Ambassador in Beirut, Alexander Zasypkin, quickly recognized this all too familiar pattern: Speaking with al-Akhbar (https://www.al-akhbar.com/Politics/277558) on 9 October in Beirut (more than a week before the protests in Beirut erupted), the Ambassador dismissed the prospect of any easing of regional tensions; but rather identified the economic crisis that has been building for years in Lebanon as the ‘peg’ on which the US and its allies might sow chaos in Lebanon (and in Iraq’s parallel economic calamity), to strike at Hezbollah and the Hash’d A-Sha’abi — Israel’s and America’s adversaries in the region.

Why now? Because what happened to Aramco on 14 September has shocked both Israel (https://www.ynetnews.com/articles/0,7340,L-5608965,00.html) and America (https://www.stripes.com/news/middle-east/saudi-wealth-and-weaponry-still-can-t-guarantee-oil-s-protection-1.599227): the former Commander of the Israeli Air Force wrote recently (https://www.ynetnews.com/articles/0,7340,L-5608965,00.html), “recent events are forcing Israel to recalculate its path as it navigates events. The technological abilities of Iran and its various proxies has reached a level at which they can now alter the balance of power around the world”. Not only could neither state identify the modus operando to the strikes (even now); but worse, neither had any answer to the technological feat the strikes plainly represented. In fact, the lack of any available ‘answer’ prompted one leading western defense analyst to suggest that Saudi should buy Russian Pantsir missiles (https://www.stripes.com/news/middle-east/saudi-wealth-and-weaponry-still-can-t-guarantee-oil-s-protection-1.599227) rather than American air defenses.

And worse. For Israel, the Aramco shock arrived precisely at the moment that the US began its withdrawal (https://www.maariv.co.il/news/politics/Article-723243) of its ‘comfort security blanket’ from the region – leaving Israel (and Gulf States) on their own – and now vulnerable to technology they never expected their adversaries to possess. Israelis – and particularly its PM – though always conscious to the hypothetical possibility, never thought withdrawal actually would happen, and never during the term (https://www.al-monitor.com/pulse/originals/2019/10/israel-netanyahu-iran-war-general-soleimani-saudia-us-trump.html) of the Trump Administration.

This has left Israel completely knocked, and at sixes-and sevens. It has turned strategy on its head, with the former Israeli Air Force Commander (mentioned above) speculating on Israel’s uncomfortable options (https://www.ynetnews.com/articles/0,7340,L-5608965,00.html) – going forward – and even postulating whether Israel now needed to open a channel to Iran. This latter option, of course, would be culturally abhorrent to most Israelis. They would prefer a bold, out-of-the-blue, Israeli paradigm ‘game-changer’ (i.e. such as happened in 1967) to any outreach to Iran. This is the real danger.

It is unlikely that the stirring of protests in Lebanon and Iraq are somehow a direct response to the above: but rather, more likely, they lie with old plans (including the recently leaked strategy paper for countering Iran, presented by MbS to the White House), and with the regular strategic meetings held between Mossad and the US National Security Council, under the chairmanship of John Bolton.

Whatever the specific parentage, the ‘playbook’ is quite familiar: spark a popular ‘democratic’ dissent (based on genuine grievances); craft messaging and a press campaign that polarizes the population, and which turns their anger away from generalized discontent towards targeting specific enemies (in this case Hezbollah, President Aoun and FM Gebran Bassil (whose sympathies with Hezbollah and President Assad make him a prime target, especially as heir-apparent to the leadership of the majority of Christians). The aim – as always – is to drive a wedge between Hezbollah and the Army, and between Hezbollah and the Lebanese people.

It began when, during his meeting with President Aoun in March 2019, US Secretary of State, Mike Pompeo reportedly presented an ultimatum: Contain Hezbollah or expect unprecedented consequences, including sanctions and the loss of US aid. Leaked reports suggest that Pompeo subsequently brought ally, PM Hariri into the picture of the planned disturbances when Hariri and his wife hosted Secretary Pompeo and his wife for a lunch banquet at Hariri’s ranch near Washington at the end of the Lebanese premier’s August visit to the US.

As the Lebanese demonstrations began, reports of an ‘operations room’ in Beirut managing and analyzing the protests, and of large scale funding by Gulf states proliferated; but for reasons that are not clear, the protests faltered. The Army which originally stood curiously aloof, finally engaged in clearing the streets, and returning some semblance of normality – and the Central Bank governor’s strangely alarmist forecasts of imminent financial collapse were countered by other financial experts presenting a less frightening picture.

It seems that neither in Lebanon or in Iraq will US objectives finally be achieved (i.e. Hizbullah and Hash’d A-Sha’abi emasculated). In Iraq, this may be a less certain outcome however, and the potential risks the US is running in fomenting chaos much greater, should Iraq slip into anarchy. The loss of Iraq’s 5 million barrels/day of crude would crater the market for crude – and in these economically febrile times, this might be enough to tip the global economy into recession.

But that would be ‘small beer’ compared to the risk that the US is running in tempting ‘The Fates’ over a regional war that reaches Israel.

But is there a wider message connecting these Middle East protests with those erupting across Latin America? One analyst has coined the term for this era, as an Age of Anger disgorging from “serial geysers” of discontent across the globe (http://thesaker.is/burn-neoliberalism-burn/) from Equador to Chile to Egypt. His theme is that neoliberalism is everywhere – literally – burning.

We have noted before, how the US sought to leverage the unique consequences arising from two World Wars, and the debt burden that they bequeathed, to award itself dollar hegemony, as well the truly exceptional ability to issue fiat credit across the globe at no cost to the US (the US simply ‘printed’ its fiat credit). US financial institutions could splurge credit around the world, at virtually no cost – and live off the rent which those investments returned. But ultimately that came at a price: The limitation – to being the global rentier – has become evident through disparities of wealth, and through the incremental impoverishment of the American middle classes that the concomitant off-shoring brought about. Well-paid jobs evaporated, even as America’s financialised banking balance sheet ballooned across the globe.

But there was perhaps another aspect to this present Age of Anger. It is TINA: ‘There is no alternative’. Not because of an absence of potentiality – but because alternatives were crushed. At the end of two World Wars, there was an understanding of the need for a different way-of-being; an end to the earlier era of servitude; a new society; a new social contract. But it was short-lived.

And – long story, short – that post-war longing for ‘fairness’ (whatever that meant) has been squeezed dry; ‘other politics or economics’ of whatever colour, has been derided as ‘fake news’ – and in the wake of the 2008 great financial crisis, all sorts of safety-nets were sacrificed, and private wealth ‘appropriated’ for the purpose of the re-building of bank balance sheets, preserving the integrity of debt, and for keeping interest rates low. People became ‘individuals’ – on their own – to sort out their own austerity. Is it then, that people now are feeling both impoverished materially by that austerity, and impoverished humanly by their new era servitude?

The Middle East may pass through today’s present crises (or not), but be aware that, in their despair in Latin America, the ‘there is no alternative’ meme is becoming reason for protestors ‘to burn the system down’. That is what happens when alternatives are foreclosed (albeit in the interests of preserving ‘us’ from system collapse).
From: https://www.strategic-culture.org/news/2019/11/04/the-war-for-the-future-of-middle-east/

[Jayke]

Ray Dalio from Bridgewater hedge fund gives his reasoning for why he believes a global financial paradigm shift is imminent:

https://media.licdn.com/dms/image/C4D12AQHljw-ZJ0Jk4A/article-cover_image-shrink_600_2000/0?e=1578528000&v=beta&t=2tSPu9MOjSXKda-RstgNjZ-_53sVSgYmtAhg28qaFMI

===========

https://www.linkedin.com/pulse/world-has-gone-mad-system-broken-ray-dalio/





The World Has Gone Mad and the System Is Broken
Published on November 5, 2019

I say these things because:

Money is free for those who are creditworthy because the investors who are giving it to them are willing to get back less than they give. More specifically investors lending to those who are creditworthy will accept very low or negative interest rates and won’t require having their principal paid back for the foreseeable future. They are doing this because they have an enormous amount of money to invest that has been, and continues to be, pushed on them by central banks that are buying financial assets in their futile attempts to push economic activity and inflation up.

The reason that this money that is being pushed on investors isn’t pushing growth and inflation much higher is that the investors who are getting it want to invest it rather than spend it. This dynamic is creating a “pushing on a string” dynamic that has happened many times before in history (though not in our lifetimes) and was thoroughly explained in my book Principles for Navigating Big Debt Crises. As a result of this dynamic, the prices of financial assets have gone way up and the future expected returns have gone way down while economic growth and inflation remain sluggish. Those big price rises and the resulting low expected returns are not just true for bonds; they are equally true for equities, private equity, and venture capital, though these assets’ low expected returns are not as apparent as they are for bond investments because these equity-like investments don’t have stated returns the way bonds do. As a result, their expected returns are left to investors’ imaginations. Because investors have so much money to invest and because of past success stories of stocks of revolutionary technology companies doing so well, more companies than at any time since the dot-com bubble don’t have to make profits or even have clear paths to making profits to sell their stock because they can instead sell their dreams to those investors who are flush with money and borrowing power. There is now so much money wanting to buy these dreams that in some cases venture capital investors are pushing money onto startups that don’t want more money because they already have more than enough; but the investors are threatening to harm these companies by providing enormous support to their startup competitors if they don’t take the money. This pushing of money onto investors is understandable because these investment managers, especially venture capital and private equity investment managers, now have large piles of committed and uninvested cash that they need to invest in order to meet their promises to their clients and collect their fees.

At the same time, large government deficits exist and will almost certainly increase substantially, which will require huge amounts of more debt to be sold by governments—amounts that cannot naturally be absorbed without driving up interest rates at a time when an interest rate rise would be devastating for markets and economies because the world is so leveraged long. Where will the money come from to buy these bonds and fund these deficits? It will almost certainly come from central banks, which will buy the debt that is produced with freshly printed money. This whole dynamic in which sound finance is being thrown out the window will continue and probably accelerate, especially in the reserve currency countries and their currencies—i.e., in the US, Europe, and Japan, and in the dollar, euro, and yen.

At the same time, pension and healthcare liability payments will increasingly be coming due while many of those who are obligated to pay them don’t have enough money to meet their obligations. Right now many pension funds that have investments that are intended to meet their pension obligations use assumed returns that are agreed to with their regulators. They are typically much higher (around 7%) than the market returns that are built into the pricing and that are likely to be produced. As a result, many of those who have the obligations to deliver the money to pay these pensions are unlikely to have enough money to meet their obligations. Those who are recipients of these benefits and expecting these commitments to be adhered to are typically teachers and other government employees who are also being squeezed by budget cuts. They are unlikely to quietly accept having their benefits cut. While pension obligations at least have some funding, most healthcare obligations are funded on a pay-as-you-go basis, and because of the shifting demographics in which fewer earners are having to support a larger population of baby boomers needing healthcare, there isn’t enough money to fund these obligations either. Since there isn’t enough money to fund these pension and healthcare obligations, there will likely be an ugly battle to determine how much of the gap will be bridged by 1) cutting benefits, 2) raising taxes, and 3) printing money (which would have to be done at the federal level and pass to those at the state level who need it). This will exacerbate the wealth gap battle. While none of these three paths are good, printing money is the easiest path because it is the most hidden way of creating a wealth transfer and it tends to make asset prices rise. After all, debt and other financial obligations that are denominated in the amount of money owed only require the debtors to deliver money; because there are no limitations made on the amounts of money that can be printed or the value of that money, it is the easiest path. The big risk of this path is that it threatens the viability of the three major world reserve currencies as viable storeholds of wealth. At the same time, if policy makers can’t monetize these obligations, then the rich/poor battle over how much expenses should be cut and how much taxes should be raised will be much worse. As a result rich capitalists will increasingly move to places in which the wealth gaps and conflicts are less severe and government officials in those losing these big tax payers will increasingly try to find ways to trap them.

At the same time as money is essentially free for those who have money and creditworthiness, it is essentially unavailable to those who don’t have money and creditworthiness, which contributes to the rising wealth, opportunity, and political gaps. Also contributing to these gaps are the technological advances that investors and the entrepreneurs that I previously mentioned are excited by in the ways I described, and that also replace workers with machines. Because the “trickle-down” process of having money at the top trickle down to workers and others by improving their earnings and creditworthiness is not working, the system of making capitalism work well for most people is broken.
This set of circumstances is unsustainable and certainly can no longer be pushed as it has been pushed since 2008. That is why I believe that the world is approaching a big paradigm shift.
========

[Cara]

Not so much about the changing landscape, more about the consistency of the problems, these are excerpts from an interview with former Soviet president Mikhail Gorbachev.

1192543326190415884

Well worth watching, only 8 minutes.

[Cara]

Financial and economic institutions are getting in on the climate change policy programme:

1192847935601618944

Here’s the agenda for the conference linked in the tweet above:

The Economics of Climate Change
Friday, November 8, 2019

This conference will bring together researchers from around the globe to discuss quantifying the climate risk faced by households, firms, and the financial system; measuring the economic costs and consequences of climate change; accounting for the effects of climate change on financial asset prices; and understanding the potential implications of climate change for monetary, supervisory, and trade policy.

Conference attendance is by invitation only; presentations will be livestreamed on this page the day of the conference starting at 8:45 a.m. PT. All times listed are Pacific Time Zone and approximate.


Agenda with approximate livestream times (pdf, 102 kb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/2019-economics-of-climate-change-agenda.pdf).

Welcome and Introduction: 8:45–9:00 a.m.
Mary C. Daly, President and CEO, Federal Reserve Bank of San Francisco

Read speech: Why Climate Change Matters to Us (https://www.frbsf.org/our-district/press/presidents-speeches/mary-c-daly/2019/november/why-climate-change-matters-to-us/)

Session 1 Chair:
Glenn D. Rudebusch, Federal Reserve Bank of San Francisco

Session 1A: 9:00–9:25 a.m.
Labor Supply in a Warmer World: The Impact of Climate Change on the Global Workforce
Presenter: Solomon Hsiang, University of California, Berkeley
Discussant: David Card, University of California, Berkeley

Session 1B: 9:37–10:02 a.m.
Long-Term Macroeconomic Effects of Climate Change: A Cross-Country Analysis
Presenter: M. Hashem Pesaran, University of Southern California
Discussant: Francis X. Diebold, University of Pennsylvania

Download paper (pdf, 2 mb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-2-2019-11-8-Pesaran-9AM-2nd-paper.pdf)

Session 2 Chair:
Galina B. Hale, Federal Reserve Bank of San Francisco

Session 2A: 10:45–11:10 a.m.
Integrated Assessment in a Multi-region World with Multiple Energy Sources and Endogenous Technical Change
Presenter: Conny Olovsson, Central Bank of Sweden (Sveriges Riksbank)
Discussant: Larry Karp, University of California, Berkeley

Download paper (pdf, 470 kb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-3-2019-11-8-Olovsson-1045AM-1st-paper.pdf)

Session 2B: 11:22–11:47 a.m.
On the Implications of Pollution for the Measurement of Output, Volatility, and the Natural Interest Rate
Presenter: Nicholas Z. Muller, Carnegie Mellon University
Discussant: François Gourio, Federal Reserve Bank of Chicago

Download paper (pdf, 1 mb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-4-2019-11-8-Muller-1045AM-2nd-paper.pdf)

Session 3 Chair:
Sylvain Leduc, Federal Reserve Bank of San Francisco

Session 3A: 1:00–1:25 p.m.
Climate Change Risk
Presenter: Dana Kiku, University of Illinois
Discussant: Thomas Mertens, Federal Reserve Bank of San Francisco

Download paper (pdf, 752 kb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-5-2019-11-8-Kiku-1PM-1st-paper.pdf)

Session 3B: 1:37–2:02 p.m.
Carbon Risk
Presenter: Ryan Riordan, Queens University
Discussant: Harrison Hong, Columbia University

Download paper (pdf, 2 mb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-6-2019-11-8-Riordan-1PM-2nd-paper.pdf)

Session 4 Chair:
Òscar Jordà, Federal Reserve Bank of San Francisco

Session 4A: 2:40–3:05 p.m.
A Run on Oil: Climate Policy, Stranded Assets, and Asset Prices
Presenter: Michael Barnett, Arizona State University
Discussant: Robert Ready, University of Oregon

Download paper (pdf, 4 mb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-7-2019-11-8-Barnett-240PM-1st-paper.pdf)

Session 4B: 3:17–3:42 p.m.
The Environmental Bias of Trade Policy
Presenter: Joseph S. Shapiro, University of California, Berkeley
Discussant: Katheryn Russ, University of California, Davis

Download paper (pdf, 2 mb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-8-2019-11-8-Shapiro-240PM-2nd-paper.pdf)

Session 5 Chair:
Glenn D. Rudebusch, Federal Reserve Bank of San Francisco

Session 5A: 4:20–4:45 p.m.
The Systemic Risk of Climate Policy
Presenter: Stephie Fried, Arizona State University
Discussant: Tony Smith, Yale University

Download paper (pdf, 2 mb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-9-2019-11-8-Fried-420PM-1st-paper.pdf)

Session 5B: 4:57–5:22 p.m.
Climate Change: Macroeconomic Impact and Implications for Monetary Policy
Presenter: Sandra Batten, Bank of England
Discussant: Warwick McKibbin, Australian National University

Download paper (pdf, 1 mb) (https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/files/Paper-10-2019-11-8-Batten-420PM-2nd-paper.pdf)

Closing Remarks: 5:35–5:45 p.m.
Lael Brainard, Governor, Federal Reserve Board

Session 6: 7:15–7:55 p.m.
Introduction
Glenn D. Rudebusch, Federal Reserve Bank of San Francisco

Dinner Speaker
Frank Elderson, Member of the Governing Board, Netherlands Central Bank (De Nederlandsche Bank, DNB) and Chairman, Network for Greening the Financial System (NGFS)
From: https://www.frbsf.org/economic-research/events/2019/november/economics-of-climate-change/

[Cara]

It seems we might be seeing some rapprochement in relations between Europe and Russia. This is not the case for all counties but certainly some of them.

~~~

As posted here (http://projectavalon.net/forum4/showthread.php?108755-Trade-Currency-and-Economic-War-Sanctions-Tariffs-Market-Sell-offs-etc.&p=1321452&viewfull=1#post1321452), here (http://projectavalon.net/forum4/showthread.php?108755-Trade-Currency-and-Economic-War-Sanctions-Tariffs-Market-Sell-offs-etc.&p=1321845&viewfull=1#post1321845) and here (http://projectavalon.net/forum4/showthread.php?108755-Trade-Currency-and-Economic-War-Sanctions-Tariffs-Market-Sell-offs-etc.&p=1323513&viewfull=1#post1323513), the Nordstream 2 gas pipeline now has approval from Denmark and Germany has passed legislation to “create” some conditions to make it easier to implement.

Also recently there have been some financial moves made by Russian organisations to support the Euro. For example, Novatek issued a statement that going forward, most contracts would be in Euros:

Russia's largest producer of liquefied natural gas Novatek also said on Thursday it had switched to euros in most of its contracts...
From: https://www.marketscreener.com/NK-ROSNEFT-PAO-6498688/news/Rosneft-switches-contracts-to-euros-from-dollars-due-to-U-S-sanctions-29449686/

~~~

Now we have French President Macron presiding over a meeting between new Ukrainian President Zelensky and Russian President Putin:

1195525954392584193


M. K. Bhadrakumar
@BhadraPunchline
Light at end of tunnel? It was coming but stunning when it actually appears! Kudos to Macron. Gaullism on march? Snub to Pompeo after recent tirade against Russia at Berlin. But Trump himself is on board, who sees no vital US interests at stake in Ukraine.
https://news.yahoo.com/france-host-putin-zelensky-bid-end-ukraine-conflict-172047314.html


The article:


France to host Putin, Zelensky in bid to end Ukraine conflict

Paris (AFP) - Russian President Vladimir Putin will meet his Ukranian counterpart Volodymyr Zelensky in Paris on December 9 for their first face-to-face encounter, seeking to end the half-decade conflict in Ukraine, the French presidency said Friday.

The leaders will join French President Emmanuel Macron and German Chancellor Angela Merkel for the four-way summit aimed at resolving the conflict in the east of Ukraine, where pro-Moscow separatists have declared breakaway regions, the Elysee Palace said.

Macron, who has been spearheading a drive for peace in Ukraine, had hoped to host the summit in September but it was held up by numerous obstacles that highlighted the difficulty of resolving the conflict.

The Elysee said there had been "major progress" recently in talks between the sides, which had allowed troops to pull back from some key conflict areas.

The presidency said the meeting "will allow the opening of a new series of steps to put in place the Minsk agreements" of 2014 and 2015 which sought to end the conflict, but have yet to be properly implemented.

The Ukrainian presidency confirmed the date of the meeting, adding that Macron has spoken to Zelensky by telephone.

...
From and continues: https://news.yahoo.com/france-host-putin-zelensky-bid-end-ukraine-conflict-172047314.html

~~~

Of course there is a back story here: apparently Zelensky’s main backer, Kolomoisky, has “changed sides”. See for instance this narrative in Bloomberg:

https://www.bloomberg.com/opinion/articles/2019-11-14/ukrainian-billionaire-warns-ukraine-may-turn-to-putin?srnd=opinion

I’m not sure sure it’s quite the “movie script” being portrayed here.

[Cara]

This may well be very significant. China and South Korea have signed a defense agreement.


China signs defence agreement with South Korea as US angers Seoul with demand for $5bn troop payment

Julian Ryall
18 NOVEMBER 2019 • 2:05 PM

The defence ministers of South Korea and China have agreed to develop their security ties to ensure stability in north-east Asia, the latest indication that Washington’s long-standing alliances in the region are fraying.

On the sidelines of regional security talks in Bangkok on Sunday, Jeong Kyeong-doo, the South Korean minister of defence, and his Chinese counterpart, Wei Fenghe, agreed to set up more military hotlines and to push ahead with a visit by Mr Jeong to China next year to “foster bilateral exchanges and cooperation in defence”, South Korea’s defence ministry said.

Seoul’s announcement coincided with growing resentment at the $5 billion (£3.9bn) annual fee that Washington is demanding to keep 28,500 US troops in South Korea.

That figure is a sharp increase from the $923 million that Seoul paid this year, which was an 8 per cent increase on the previous year.

https://www.telegraph.co.uk/content/dam/news/2019/11/18/TELEMMGLPICT000216010945_trans%2B%2BejMVNjZ2Bv6EA7I5e4mELy5twttbUiN55rbZOKJP4mY.jpeg
Seoul's decision to terminate the intelligence sharing pact with Japan risks sending the "wrong message", said General Robert B. Abrams, commander of United States Forces Korea Credit: STAFF SGT. MARCUS BUTLER/UNITED STATES FORCES KOREA/AFP via Getty Images

An editorial in Monday’s edition of The Korea Times warned that the security alliance between the two countries “may fall apart due to Washington’s blatantly excessive demands”.

Mr Trump has previously threatened to withdraw US troops if his demands are not met, with the editorial accusing the president of regarding the Korea-US mutual defence treaty “as a property deal to make money”.

The vast majority of Koreans agree, with a recent survey by the Korea Institute for National Reunification showing that 96 per cent of people are opposed to Seoul paying more for the US military presence.

There is also irritation at the pressure that Washington is applying to the South to make Seoul sign an extension to a three-way agreement on sharing military information with the US and Japan.

The General Security of Military Information Agreement is due to expire at midnight on November 23 and South Korea insists that it will only agree to an extension if Japan cancels restrictions on exports of chemicals critical to the South’s microchip industry.

Japan is widely believed to have imposed the restrictions as the latest incident in its troubled relationship with South Korea, which includes the issue of compensation for labourers put to work during Japan’s colonial rule of the Korean Peninsula.

The two nations' defence ministers held discussions with Mark Esper, the US defence secretary, at the weekend but hopes that a breakthrough might materialise came to nothing.

Just days before an agreement designed to protect the allies from North Korean belligerence runs out, Tokyo and Seoul merely reiterated their long-held positions.

The US demanded in July that Japan pay $8 billion a year to keep 54,000 US military personnel in the country, Foreign Policy reported late last week.

Tokyo currently contributes $2 billion a year to US military costs in Japan.

“This kind of demand, not only the exorbitant number, but the way it is being done, could trigger anti-Americanism”, Bruce Klinger, an analyst at the Heritage Foundation think tank, told Foreign Policy.

“If you weaken alliances, and potentially decrease deterrence and US troop presence, that benefits North Korea, China and Russia, who see the potential for reduced US influence and support for our allies”.

Daniel Pinkston, a professor of international relations at the Seoul campus of Troy University, was more blunt in his assessment.

“It’s just extortion”, he told The Telegraph. “It’s little more than a mob boss going around and demanding protection money. The numbers that the US is demanding are politically impossible for Seoul and Tokyo to swallow and that is just fuelling resentment."
From: https://www.telegraph.co.uk/news/2019/11/18/china-signs-defence-agreement-south-korea-us-angers-seoul-demand/amp/