By John Gooding, Digital Editor at the Lowy Institute and Associate Editor at The Interpreter.
Following last week’s publication of Making the most of the G20, by Tristram Sainsbury and Hannah Wurf, The Interpreter this week hosted a discussion on Australia’s approach to global economic governance.
Reserve Bank Governor of Australia Glenn Stevens argued it was clearly in both Australia’s and the world’s interests to contribute to the global economic policy agenda:
Beyond pure self-interest, international engagement is an inherently and, arguably, increasingly worthwhile objective. International engagement can improve policy formulation in response to both global crises — for example, the coordinated G20 policy response to the global financial crisis — and common structural challenges, such as population ageing, structural reform, climate change and economic inequality.
Australian Ambassador to the US Joe Hockey wrote of the new challenges facing the global economy:
In my role as Australian Ambassador to the United States of America, I am witnessing firsthand the policy debate on free trade. America is divided and too few policy leaders are willing to defend a principle of free trade that has helped make America prosperous (and great) for the last 98 years.
We continue to face turbulent days ahead because extraordinary policy decisions of recent years have created the need for extraordinary countermeasures in the future.
Former Treasurer of Australia Wayne Swan warned of the dangers of a global economic slowdown, and called on international bodies to act:
The IMF has just published its sixteenth downgrade in global growth since January 2012. The current complacency for global policy-makers, including the Australian government, sends a shiver up my spine. I feel like they are determined to sleepwalk into a burning house.
Minister for Revenue and Financial Services Kelly O’Dwyer emphasised the role Australia’s economic record played in ensuring its place in formulating global economic policy:
Despite being relatively small and remote, we are leaders and partners alongside the world’s largest economies. In global forums, where the challenges of an unsettled present and an uncertain future loom large, we have a seat at the table and a voice in the conversation, not only because of the size of our economy but also because of our strong economic policy record.
And Lowy Institute Nonresident Fellow Mike Callaghan called for Australia to broaden its approach to international economic governance:
Australia should not be dewy-eyed about the G20 and see it as the only outlet for international economic engagement. If Australia wants to influence international economic developments, it has to try harder in its bilateral relations with other countries as well as in all international organisations and forums. Concerns over the lack of effectiveness of the G20 (along with growing unease with some of its members) could see the emergence of a smaller grouping of key economies.
This week The Interpreter published a two-part photo essay by Arzan Tarapore of the Karakoram Highway, which links China and Pakistan and is undergoing a major reconstruction. In part one, Tarapore examined the highway itself:
The Karakoram Highway snakes its way through the region known as 'the roof of the world,' at the junction of several of the highest mountain ranges in the world, including the Pamirs, Hindu Kush, Kunlun, and Karakoram ranges. It follows one of the paths of the ancient silk road, along which precious commodities, as well as art, Buddhism and Islam, were transmitted between China and Central and South Asia.
In part two, Tarapore focused on the communities living along the highway on the Chinese side of the border:
The temporary propaganda billboards that festooned construction sites along the Highway were typical of Xinjiang as a whole, where propaganda is more heavy-handed than in major metropolitan centres in 'inland' China. The propaganda pictured here typifies many of the themes we observed in Xinjiang: extolling the promised economic and social benefits of the New Silk Road projects, celebrating China's partnership with Pakistan, and praising the 'civilising' mission of the Communist Party.
On the other side of the country, Lowell Bautista highlighted the sheer weight of the Permanent Court of Arbitration ruling in favour of Philippines in its dispute with China over the South China Sea:
Significant moments in history never follow the path of least resistance. They are often memorable at least partly because they were won at great cost.
Such is the case for the overwhelming legal and moral victory that the Philippines secured last month with the tribunal award in the compulsory arbitration case filed by the Philippines against China under Annex VII of the United Nations Convention on the Law of the Sea (UNCLOS) over what Manila can now proudly call its West Philippine Sea (referred to elsewhere as the South China Sea).
After Australia supported the arbitration ruling, China’s Global Times published a scathing editorial warning Australia that it would be an ideal target to warn and to strike were it to venture into the South China Sea. Peter Cai examined the relationship between Beijing and the paper:
We should object to insulting editorials from the Global Times. But we should also be aware that any discussion of editorial positions which, in the end, lack real substance and are not the voice of government, also plays into the hands of the newspaper which prides itself on its ability to rile foreigners.
Meanwhile, China is facing a Catch-22 on the Korean Peninsula, writes Nicholas Welsh:
The question now is whether China will continue to pull away from Pyongyang or try to rekindle their relationship post-THAAD. Neither case looks capable of defusing tensions on the peninsula in the short term, so Chinese decision-makers will have to base a difficult choice on the potential long-term benefits for a future shrouded in uncertainty.
If China were a democracy, how would Xi Jinping pitch his performance to the voting public? Kerry Brown hypothesised:
Were Xi to be standing simply on his prowess as an economist, he would be in trouble.
But of course politics anywhere is about much more than GDP. There are three areas where he would stake a bid for reappointment: success in foreign policy, success in fighting corruption, and success in getting a better deal for the emerging urban middle class in China.
Australia's Department of Foreign Affairs and Trade’s new secretary was announced last month as Frances Adamson, former Ambassador to China. Susan Harris-Rimmer:
This is a radical appointment that deserves deeper reflection in three key and very positive areas of reform.
And finally, Sarah Frankel covered what looks like the end of the line for Kevin Rudd’s bid to be UN secretary-general:
It was an unexpected twist for UN watchers, including myself, who have spent more time debating Rudd’s campaign strategy and which of the veto-wielding permanent five members of the UN Security Council might block his bid, rather than questioning the support of his own government.