Issue #4

Is this a new cold war with US and China as two opposing pillars?

The deepening US China fault lines will have a huge impact on the world we live in. The virus has brought the question of economic interdependence in focus. Trade war between the two countries was one of the top concern while entering 2020. Proxy battles are now being fought on Student Visas and what not. This is one of the lowest point in US China relations.

Biggest shift has come around Hong Kong’s National Security Law. This makes criticism of China’s Communist Party a punishable by law. It brings it completely within Chinese sphere of influence. This move has been though divisive. On one hand are countries clearly within China’s sphere of influence. On another we have the new Inter Parliamentary Alliance on China. Many of them are dropping extradition relation with Hong Kong. 

Australia is another country within the sphere of influence of China. Its trade balance is heavily skewed than any other countries but is connected more politically and philosophically with other western countries. Australia significantly increased their defence budget recently.

There is another storm brewing between UK and Huawei. The British government will not allow Telecom companies to buy any new Huawei products and all operational one’s to be stripped off by 2027. Which comes after new US sanctions which will push chip manufacturing to China for Huawei making them vulnerable.

In Canada there are growing concern of Cyber espionage. With a recent report of how China deploys its cyber espionage apparatus to weaken and compete with other major western conglomerate. A case in point is Nortel. 

UK and silently Taiwan are offering Visas and residency to those who want to move away from Hong Kong. There is a fear of growing taxes from 15% to 45% in Hong Kong which may push other foreigners out.

Cold wars are cold because it represent small battles, not military conflict fought in other arenas. But it’s not that there hasn’t been new increased militarism. Border skirmishes with India recently was a first in decades in which 20 Indian soldiers lost their life. This could be just China distracting the world. It is trying to pushing its military buttons and test all waters. As a retaliation India banned 59 apps  including WeChat and TikTok. A third of their total downloads come from India. India is one place where many are advocating greater investment. FoxConn is going to invest $1 billion in India. Clearly a quiet move by Apple to navigate away from China. 

Scarier though is South China Sea. Japanese have called recent Chinese advances and posturing a serious threat greater than Nuclear armed North Korea. US in response recently dispatched two aircraft carrier. Beijing’s claims in South China sea are unlawful against all international treaty and conventions and clearly represent bullying. 

But is this an Ideological conflict like Cold War? 

In some ways whatever the nature of this conflict. This clearly is an unwinding of global interconnectedness. So much of this is about how we do business, clearly marked by the first salvos.