Eurasian integration meets America First
Frantic speculation about the end of the American century is idle. What matters is the facts, which spell out progressive, and inexorable, integration across much of the world
Crucial developments in Washington, Brussels, Virginia and St. Petersburg these last few days may offer us serious clues on where we are now heading – geopolitically and geoeconomically.
Let’s start with a neo-apocalyptic stream of analysis ruling that President Trump pulling out of the Paris climate accords has plunged the West into a conflict deeper than any since WWII.
What was described as a “historic blunder” by one of the negotiators of the Paris accords also managed to draw a powerful rebuke – and in English, too – from French President Emmanuel Macron.
German chancellor Angela Merkel, at the G7 in Taormina, had already warned Trump that “the field would be left to the Chinese” in case of a US pull out.
And indeed that came as a heavenly PR coup for Chinese Premier Li Keqiang, who met with Merkel in Berlin and a gaggle of Eurocrats in Brussels.
China is the EU’s second-biggest trading partner after the US. A joint communiqué – their first ever on public policy – at the China-EU summit declared climate change “an imperative more than ever.” Beijing and Brussels pledged to cut back on fossil fuels, develop additional green technology, and help raise US$100 billion a year by 2020 to help the Global South cut emissions.
For Beijing, leadership in the fight against climate change now translates as an unprecedented accumulation of political capital. Add to that its ambitious expanse New Silk Roads project – which has been renamed the Belt and Road Initiative (BRI) – and we have China positioning itself to lead on both the multilateral and environmental fronts.
This happens as China’s own emissions have been falling since 2013 – in parallel with installing enough solar panels to cover three football pitches every single hour of the year. China may remain the world’s leading polluter, but at the same time it advances inexorably as the world’s top manufacturer, developer and exporter of renewable energy.
As the New Silk Roads spread their infrastructural tentacles towards the EU, Chinese investment is bound to shoot up way beyond the €35 billion for 2016.
For Beijing, leadership in the fight against climate change now translates as an unprecedented accumulation of political capital
Beijing is a stickler for deeper European integration, and regards the EU as a potential multipolar competitor to the US. In Berlin, Li Keqiang, who “expects the EU to remain united, stable and prosperous,”, extolled the synchronicity between Made in China 2025 – which is basically about innovation-driven manufacturing – and Germany’s Industry 4.0 – which is about tech manufacturing based on cyber-physical systems, the Internet of Things (IoT) and cloud computing.
Slowly but surely we may be seeing the lineaments of a Beijing-Brussels “comprehensive strategic partnership” envisioned by Chinese strategists since the early 2000s.
Or – in a more alarmist vein from a Western point of view – what we have is China closing the innovation gap with Europe by 2020. Diplomats admit trade reports included in the latest Business Confidence Survey by the EU Chamber of Commerce in China plunged European Commissioners into a state of panic.
The bottom line is that the EU cannot bypass the New Silk Roads’ gigantic, transcontinental infrastructural investment orbit. Beijing may not regard Brussels as a serious geopolitical player, but it does relish the EU going after US leadership in global trade.
Not by accident, Merkel is treading a parallel road. In Taormina, we had a sort of G-6 against Trump. At the G-20 in Hamburg next month, Berlin wants to regiment 19 nations against Trump.
A “global community” drama
Meanwhile, also last week the Bilderberg group was holding its famously secretive annual get together at a Marriott hotel in Chantilly, Virginia – not that far from the White House.
Here’s the list of participants. The chairman, Henri de Castries, is no less than one of the key masterminds of the Macron phenomenon.
One of the meeting’s discussion panels was titled “The Trump Administration: A progress report.” Unfortunately Bilderberg’s strict code of secrecy does not allow mere mortals to share his insights, but Henry Kissinger – who recently met with Trump to talk Russia – was there.
Comic relief at Bilderberg was, presumably, to be had from the heads of four of the world’s Top Ten financial services giants – AXA, Allianz, ING and Santander – asking “Can globalization be slowed down?.” One wonders if they kept their faces straight.
And then there was a panel on China, with Cui Tiankai, the Chinese ambassador to the US, sitting side by side with the US commerce secretary, the US national security adviser, a couple of senators, two former heads of the CIA, heads of the Carlyle Group and KKR – and, last but not least, Eric Schmidt, executive chairman of Alphabet, Google’s holding company, who had just been to China.
Finally, on the other side of the pond, the St. Petersburg International Economic forum (SPIEF) was all action – and no secrecy.
Investor Jim Rogers declared that “in many ways the sanctions against Russia have helped Russia. It has made Russia an agricultural boom. It is a very, very strong growth industry right now. It pushed the Russians together with the Asians.”
On the Eurasian integration front, President Putin stressed that “in a week, we will formalize India’s full-fledged accession to the SCO.” Russia has always supported India’s entry to the Shanghai Cooperation Organization.
And there’s more to come. China has declared its full support to Iran’s membership of the SCO – to be discussed in detail at the pact’s summit this week in Astana, Kazakhstan, with President Xi Jinping in attendance. And China is also ready to consider any application from NATO member Turkey, whose president, Tayyip Erdogan, has said he’s all for it.
“In many ways the sanctions against Russia have helped Russia. It pushed the Russians together with the Asians”
Putin also sent a clear, subtle message on BRICS: “This organization was actually born here in St. Petersburg. At first, there were the three of us – Russia, China and India – but then Brazil and South Africa joined in. We believe that this is a very important platform to harmonize our positions.”
Crucially, the President of the BRICS’ New Development Bank (NDB), K. V. Kamath, added: “There is consensus between BRICS countries that we should increase the use of local currencies.”
St. Petersburg established that a free trade zone agreement between the Eurasian Economic Union (EEU) and India may be signed within two years. In parallel, the Eurasian Development Bank (EDB) has started financing projects turned down by the European Bank for Reconstruction and Development (EBRD), according to the EDB’s CEO, Dmitry Pankin.
On the energy front, in 2014 Gazprom and China National Petroleum Corporation (CNPC) signed a ground-breaking US$400 billion 30-year framework to deliver 38 billion cubic meters of Russian gas to China annually. Gazprom will approve the final terms of this supply by the end of 2017, according to CEO Aleksey Miller. And of course another pipeline – the Power of Siberia-2 – will also be built, delivering another 30 billion cubic meters of Russian gas.
On the bilateral front, what Macron had earlier hinted at during his Versailles meeting with Putin translated in St. Petersburg as a Russia-France Business Roundtable.
And at SPIEF’s Russia-US Business Dialogue Panel, Putin could not be more clear-cut. “We will do our best to make business in Russia worthwhile for our American partners.”
Frantic speculation about the end of the American century, or the US no longer acting as “leader of the free world”, is idle. What matters is that most of the facts above spell out progressive, and inexorable, Eurasian integration, from Russia-China deals to EU-China cooperation.
As for the Trump doctrine, arguably it has been detailed, in full, for the first time in the Wall Street Journal. “The President embarked on his first foreign trip with a clear-eyed outlook that the world is not a ‘global community’ but an arena where nations, nongovernmental actors and businesses engage and compete for advantage. We bring to this forum unmatched military, political, economic, cultural and moral strength. Rather than deny this elemental nature of international affairs, we embrace it.”
So the battle lines are drawn; Eurasia integration must learn how to deal with America First.