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What does increased attention from Moscow mean for Asia?

Posted By Travis B. Kupp, Thursday, May 21, 2020

Travis Kupp, a member of our Emerging Fellows program inspects Russia’s attention towards Asia in his fifth blog post. The views expressed are those of the author and not necessarily those of the APF or its other members.


In 2018, former Putin aide Vladislav Surkov wrote that "Russia's epic journey toward the West … [after] numerous fruitless attempts to become part of western civilization" had concluded. If this in indeed true, then the nation’s borders dictate that increased interest in Asia, from the Black Sea to the Sea of Japan, is likely over the coming decades.

 

China’s future as a great power and its reach west through the Belt and Road Initiative (BRI) threaten Russia’s influence in the region as a whole. Cooperation between China and Russia in the Western and Central Asian states could be a regional stabilizing force if economic and security agendas can be harmonized. On the other hand, these agendas could lead to flashpoints along Russia’s entire southern border if integration is resisted. Either way, Moscow’s game in Asia will assuredly affect the nation’s identity and regional alignment into the future.

 

Russia is keenly aware of its need to have a non-hostile relationship with China. While it is possible that a more complete alliance could form, the mid-20th century psychology of great power politics remains alive and well in Moscow. It is therefore more likely that the coming decades will see a warm-yet-wary relationship emerge with Beijing. In this future, Russia will play a careful game of reinforcing its security and economic partnerships with China while engaging in bilateral relationships with India and Southeast Asian nations as a hedge. Russia will also take advantage of its natural gift as the wide belt of land that separates China and all other nations to its South from direct access to the Arctic.

 

As interest in the northern pole heats up and Siberia becomes more inhabitable, Russia will likely take full advantage of the desire for influence in the region. Moscow may begin to welcome an increasing number of immigrants from India and elsewhere into its Far East in order to balance out the increasing presence of Chinese workers and reap the rewards of diverse labor force. This could in time start to tip the scales of economic power in Russia’s favor. However, at least in the coming few years, Moscow will be more focused on holding its ground as an energy enabler and economic beneficiary of the Chinese powerhouse.

 

Without friendly relations between Russia and China, Western and Central Asia could become a hotter geo-economic, if not literal, warzone. Chinese political influence through the BRI buildout could lead a threatened Moscow to push neighbors like Kazakhstan to pick a side. This is a future in which Asia’s middle increasingly resents the exploitative mindset of its behemoth neighbors, resists integration into this different flavor of globalization, and descends into fracture and volatility. Weakened economic relationships along its southern border, along with the need to secure it, could force a reluctant Russian reunion with Europe. However, Moscow will not be keen on making the concessions to the West that would likely be necessary.

 

Asia has long been a key arena of Russian foreign policy but is likely to now become the primary focus as an Asian Century looms. It remains unclear what course this future will follow, whether more cooperative or competitive. Cultural differences will continue to be a wedge between still-European Moscow and its southeastern neighbors, but over time an alignment of values could add fuel to the fire of Asia’s global growth. On the other hand, mismanagement of this partnership could serve to ignite conflicts in the unstable Central and Western Asian region. Regardless, if an Asian Century is inevitable, Russia may come to belong more and more to the continent over the next few decades.

 

© Travis Kupp 2020

Tags:  Asia  China  Russia 

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Could trade deals deliver a more unified Asia?

Posted By Travis B. Kupp, Monday, April 20, 2020

Travis Kupp, a member of our Emerging Fellows program checks the possibility of a unified Asia through trade ties in his fourth blog post. The views expressed are those of the author and not necessarily those of the APF or its other members.

 

Globalization is not on the decline, but it is evolving. Developments over the last two decades—including a financial crisis and a pandemic—have accelerated the change in economic relationships between and within all regions of the world. Trade with neighbors, in particular, have come into the spotlight as nations narrow their focus. Asia is no exception. Over the coming years, China and India will be playing an economic game with the rest of the continent that could lead to Asian unity or heightened distrust and paranoia. Deep trade integration could bring a form of economic unity to Asia that would totally eclipse Western markets.

 

The rise of the Association of Southeast Asian Nations (ASEAN) is a signal of what could be realized across the continent. The regional organization has come to develop relationships with other Asian and Pacific nations, including China and later India. As the geographic scope of partnership has increased, so has the complexity of pursuing common interests in light of imbalanced power. India’s recent decision to not participate in ASEAN’s proposed Regional Comprehensive Economic Partnership (RCEP) is indicative of these limits. India is an attractive market for exports but has concerns that the terms of RCEP could result in a flood of imports, especially from China, harming its domestic industry and agriculture. While India’s economy continues to experience strong growth relative to the rest of the world, it is not yet capable of competing directly with its advanced Eastern neighbor in the trade arena.

 

In one possible future, India’s growth outpaces China and it makes the necessary structural changes and infrastructure investments to dramatically increase its exports. These developments occur while the encircling Belt and Road Initiative (BRI) struggles through a decelerated Chinese economy and underwhelming returns on its massive foreign investments. India takes advantage of these trends to strengthen its trade relationships in both Southeast and Central Asia, creating a new balance of geo-economic power in the region. China reluctantly recognizes this new state of the world, scales back its assertiveness to avoid military conflict, and becomes a more amenable partner in a broader trade union across the continent.

 

In another future, India’s infrastructure remains inadequate to take advantage of its demographic and economic growth lead. The BRI successfully draws Central Asian nations closer into China’s orbit of influence, heightening tensions with interested neighbors Russia and India. China uses RCEP as a lever to increase pressure on Japan, Vietnam, and others with respect to its territorial disputes. Nations across Asia face a difficult choice whether to cave to Chinese pressure or face the economic consequences of their trade sanctions. The rest of world seeks to better balance its flow of trade with China while taking a careful approach to relationships in the rest of Asia, mostly seeking less risky deals closer to home. What unity exists in this future Asia is predicated on whether you are under Chinese economic influence or not.

 

Trade integration promotes peace, but it does not erase borders nor national interests. While disputes about exactly where some Asian nations begin and end may not be settled anytime soon, successful strengthening of trade agreements could lead to unprecedented regional integration and stability. While unanticipated events in the coming decades could accelerate the balance of power in favor of China or India, what is certain is that trade relationships with these two nations will be a determining factor for Asia’s future. The way these regional economic alliances develop will either create a newfound unity or an uneasiness felt around the globe.

 

© Travis Kupp 2020

Tags:  Asia  China  trade 

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How prepared is Asia for its changing demographics?

Posted By Travis B. Kupp, Friday, March 27, 2020

Travis Kupp, a member of our Emerging Fellows program checks the preparedness of Asia for demographic changes in his third post for our EF blog. The views expressed are those of the author and not necessarily those of the APF or its other members.

 

Among the most significant determinants of an Asian Century is demographics. The expectations and behaviors of a nation’s people—driven in part by attributes that can be measured in aggregate, like age—influence economic performance and political dynamics. Projected declines in the working age populations in East Asia present a major challenge to maintaining their gravitas. Meanwhile, the rest of the continent generally has a much better outlook, at least in terms of potentially productive youth. Immigration policies that succeed in overcoming ideological intolerance may be the key to sustaining Asia’s rise to global dominance.

 

Japan is a preview of what could potentially happen at a different scale for its neighbors. The archipelago nation is now selling more adult diapers than baby diapers in supermarkets. The increased spending on healthcare that comes with this age demographic inversion is unsustainable with a simultaneously shrinking workforce and tax base. Japan recognizes that efforts to raise its fertility rate will not be sufficient to address the problems already emerging. Longevity of life is coming to also mean longevity of work-life well beyond the age of 60. Automation of care is being developed, where possible, to lower the costs of the ballooning system. It is yet to be seen whether this will be a successful formula for saving the nation’s economy.

 

China is taking a different approach. Demographic data shows their working population shrinking and the trend portends a net population decline starting as soon as 2032. Like Japan, China has started offering cash bonuses and subsidies to encourage more births, but it is unlikely that this will be enough to cover the dearth of young people to care for the elderly in the short term. Nor will automation of such services soon be ready to take on the task at scale. Instead, China is bolstering its economy by moving the value chain from the Middle Kingdom to tributary states in Central, South, and Southeast Asia through its Belt and Road Initiative. In a time of national economic war, however, it is not unthinkable that some of these target states may attempt to limit the extent to which others draw on their resources.

 

Migration will increasingly be a flashpoint as Asian demographics change. Cultural similarities make Southeast Asia the clearest option from which China and Japan could draw human capital, or at least extract the output. China is adamant that newcomers assimilate to their norms, an approach that may need to be loosened in light of its expanding global reach. India’s government, particularly in the case of Muslims, seems determined to reject even its own over ideological differences. West and Central Asia have growing populations that could strengthen the Asian position but are better poised to bolster Russian and European populations, even though immigration policies in both destinations are lacking. All of these tensions will escalate if regimes do not adapt quickly enough to the inevitable changes in their constituencies.

 

Asian nations, on the whole, are unprepared for what lies ahead demographically. Economic and social policies are slowly and insufficiently trying to adapt to a future in which families are small and the old outnumber the young. Regimes attempting to unilaterally solve for these shifts without sufficient regard for pressures beyond their centralized control, like accelerated migration, will face the most serious challenge. While some nations may have more reason to be optimistic, they will need to be ready to compete to keep their workforce from migrating to other more attractive markets. If an Asian Century does come to pass, one thing is certain: it will be with a populace that looks quite different than the one we know today.

 

© Travis Kupp 2020

Tags:  Asia  China  demographics 

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Are Asia’s economic growth and expansion sustainable?

Posted By Travis B. Kupp, Thursday, February 27, 2020

Travis Kupp, a member of our Emerging Fellows program checks the sustainability of Asia’s economic growth in his second post for our EF blog. The views expressed are those of the author and not necessarily those of the APF or its other members.

 

What goes up must come down, or so they say. Asian economies have expanded over the last half-century, especially in the South and East, positioning the continent as the modern leader of global economic growth. Much of the rest of the continent has an imminent opportunity to benefit from this success in exchange for certain concessions. Regardless, the region must now discover how to make this position sustainable in two senses: maintaining its trajectory while weathering societal and political change and addressing the impacts of increased consumption on the environment. Contrary to popular belief, there exists no technological silver bullet to solve for this conundrum.

 

China is the posterchild of Asia’s economic potential. Since opening up to the world in the 1970s, its growing production and trade has lifted hundreds of millions out of poverty leading to a massive increase in standard of living and therefore, critically, consumption. India is on a similar course. In both countries, the rise in disposable income for these many millions has created an extremely attractive market for goods and services along with a favorable financial climate for entrepreneurship. A wealthier and better educated populace has led naturally to a rise in more skilled labor and associated jobs. Southeast Asia is set to reap the benefits of this shift as demand for its low-end manufacturing increases.

 

Asia’s growth has led to regional integration and a vast realignment of international economic alliances. If geo-economics is in fact war by other means, then China is rapidly becoming one of the most battle-hardened nations on earth. The state is simultaneously flexing its influence through the Belt and Road Initiative (BRI), so called “trade wars,” and other significant foreign investments while learning from its mistakes in each area. The BRI may project the benefits of East Asia’s growth more intensely into the Central and Western Asian nations. Then again, it could also entangle China in far-flung conflicts to protect its investments if it does not carefully manage its relationships, especially with its neighbor India.

 

The central importance of China to Asia’s economic hopes presents a major systemic risk. The rest of Asia, and much of the world, has become to varying degrees vulnerable to abrupt changes in the nation. Over the next decade, for instance, China needs to find a solution to its population’s declining birth rate and increased life expectancy. A more favorable policy toward immigrants could help mitigate this looming crisis but may require or introduce societal liberalization that could be politically destabilizing. Sudden regime change, however triggered, would create a significant hurdle to sustained economic growth across the region.

 

The deeper existential risk lies in the impact of growth on the environment. While modern technologies have made significant strides toward lessening the ills of industry, they are unlikely to keep pace with the increasing demand for goods. Environmental concerns only influence consumption patterns in wealthy nations to the extent that they are economically viable to the consumer and do not compromise standards of living. The question then becomes whether the ruling parties of Asian nation states are prepared to sacrifice their economic gains in the name of environmental stewardship. The broad multilateral cooperation required to effectively mitigate climate change and environmental degradation makes it is possible, and dangerously plausible, that continued development may ultimately win out.

 

Asian economic leadership has an uncertain future, but the outlook is not without hope. Even if the Chinese engine of Asia’s economic miracle stalls and internal and external political realignment ensues, it is possible that this could usher in a wave of more sustainable growth, in both senses of the word. New policies, rather than technologies, to address shifting demographics and a changing global climate are likely to be the key deciding factors of what future unfolds. Asia’s economy may have room to grow yet.

 

© Travis Kupp 2020

Tags:  Asia  economics  sustainability 

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What is Asia’s role on the global stage?

Posted By Travis B. Kupp, Friday, January 24, 2020

Travis Kupp, a member of our Emerging Fellows program initiates publishing a series of blog posts to inspect the widespread assumption that Asia is the rising star of this century. This is his first post in our EF blog. The views expressed are those of the author and not necessarily those of the APF or its other members.

 

Many eyes lately seem to be on Asia, and with good reason. Over the last 30 years, few regions of the world have transformed as dramatically as the Asian continent. Its rise in global economic, political, and cultural influence a difficult reality to ignore. However, Asia is anything but a monolith and there is no guarantee that the next 30 years will unfold as a continuation of recent tendencies. The future of the continent will depend on how its constituent powers navigate their differences in light of forces largely beyond their individual control.

 

Where Asia was once, in eyes of the West, nothing more than the Eastern shore of the Aegean Sea, Europe and the world have come to better understand the significance of this third of the planet's total land area. The first millennium and a half of the common era saw Asian civilizations push the geographical limits of their ambition and develop the most important trade routes of Afro-Eurasia. Then came the centuries of Western colonialism and exploitation. Not until the tumultuous wars of the 20th century did much of the continent gradually emancipate from foreign hegemony and regain control of its destiny, though in a vastly different international playing field. The legacy of unbridled resource extraction, imposed ideologies, and poorly drawn borderlines left by alien governments challenges Asia to the present day.

 

From this starting position, the nations of Asia have stepped into the 21st century on different paths. Today, East Asia continues to emerge with China as an overwhelming center of gravity and North Korea as a potential radical force. The Southeast is taking the spotlight for low-end manufacturing and export growth. India still struggles with its neighbor Pakistan, the key to future of the South. West Asia, which makes up a large part of the Middle East, is redefining its identity for a post-oil future. Central Asia, meanwhile, sits at the literal crossroads of Russia and China with the potential to benefit tremendously from the latter’s Belt and Road Initiative. The majority of the Asian population resides in nations that have managed to integrate into the functioning core of the globalized world, namely in India, China, and few of their neighbors. Whether Southeast, West, and Central Asia follow suit, however, remains to be seen and is far from guaranteed.

 

Headlines of a flourishing Asia, on some metrics, mask the fact that this development has not been geographically homogenous nor is it entirely stable. Already the sustainability of broad economic growth is under question, especially considering the global environmental dynamics at play. China’s long reach West across land and South across sea has raised alarms locally and internationally, triggering realignment in trade and security relationships. The future holds additional challenges for the continent in the form of demographic changes driven by aging populations, and migration and more border disputes as resources become scarce and the effects of climate change intensify. All this in a part of the world where regionalism has historically had a distinctly different flavor from a European or an African Union, which begs the question of whether thinking of Asia as a unit is even a fruitful exercise.

 

The urgent global attention given to Asia is warranted. Each part of the continent has transformed uniquely in recent decades with ambitions of economic growth, political control, or technological superiority. Whether any given ethnic or ideological group in the region is able to manifest these dreams or not, the interaction of those pursuits with the environment and the world order—even if less connected or cooperative in some scenarios—will be a significant determining factor in the futures of all other nation-states. Though its future is uncertain, what plays out in Asia over the coming three decades will have decisive and lasting impact on planetary systems and the fate of humanity.

 

© Travis Kupp 2020

Tags:  Asia  China  global powers 

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