Source: MarketWatch

To understand the post-COVID-19 world that is coming, there is one important human statistic we must bear in mind: 330 million people live in the U.S.; 1.4 billion in China and approximately 6 billion in the rest of the world. These 6 billion, who live in 191 countries, have begun preparing themselves for the US-China geopolitical contest. Their choices will determine who will win. 

For most Americans, the contest is a no-brainer. Given a choice between a freedom-loving democratic U.S. and an oppressive Communist China, the 6 billion would choose U.S. Indeed many aspects of the U.S. remain more appealing: great universities (for example, Harvard and Yale); Broadway and Hollywood. Yet declining powers can also retain their cultural attractions. Witness the U.K. with Cambridge and Oxford, Shakespeare and Jane Austen. 

The elites who run these 191 countries have been mostly educated in Western-style universities. They have learned to apply the cold calculus of reason to work out cost-benefit analyses of what both the U.S. and China have to offer them. Sentiments won’t play a role here. They have to decide at the end of the day which country, the U.S. or China, will improve their citizens’ living conditions. 

Africa is a prime example. African leaders have studied East Asian economic success stories and learned from them. Trade, not aid, spurs economic growth. China is now the world’s largest trading power; its total trade is $4.43 trillion compared to $3.89 trillion for the U.S. To boost trade within Africa, first-rate infrastructure is needed. China is now the world’s infrastructure superpower, building badly-needed ports, railways, roads, and power stations in Africa. These projects include the megaport at Bagamoyo, Tanzaniya and the Addis Ababa-Djibouti Railway, which is the first fully-electrified cross-border railway in Africa. Paul Kagame, president of Rwanda, has said: “The Chinese bring what Africa needs: investment and money for governments and companies.” Here’s one leading indicator. When China convenes China-Africa summit meetings, all African leaders turn up. 

It’s commonly believed that China is sucking all these poor countries into a debt-trap. A peer-reviewed academic study found this perception to be untrue. In a 2019 research paper, Johns Hopkins professor Deborah Brautigam concluded that most of these countries voluntarily signed on to these loans and had positive experiences working with China. Brautigam writes, “The evidence so far, including the Sri Lankan case, shows that the drumbeat of alarm about Chinese banks’ funding of infrastructure across the BRI and beyond is overblown.” She continues, “…a large number of people have favorable opinions of China as an economic model and consider China an attractive partner for their development.

For example, in 2014, 65% in Kenya, 67% in Ghana and 85% in Africa’s most populous country, Nigeria, held favorable views of China.” Hence, when China launched its Belt and Road Initiative (BRI), to build infrastructure from Central Asia to Africa (and even to Latin America), most countries signed on. Yes, China has made mistakes with BRI. Mahathir bin Mohamad protested against its terms when he became Prime Minister of Malaysia in 2018. However the deal was quietly renegotiated, and Mahathir became one of the key opening speakers of the BRI Summit in Beijing in 2019.  

Italy is another leading indicator of how the world is turning. It’s a member of the G-7, the core group of the Western club. Its economy is ailing. China has stepped up to offer new investment in Italy. Former Italian Minister of Economy and Finance Giovanni Tria has called Chinese investments “a circle virtuous, satisfying and diffuse growth” and referred to them as “a train that Italy cannot afford to miss.” Now, COVID-19 has given China-Italy relations a major boost. While its fellow EU members initially balked at helping Italy, China responded almost immediately, sending 31 tons of much-needed medical equipment, pulmonary ventilators, face masks and protective suits.

In previous disasters, such as the 2004 Boxing Day Tsunami that hit Indonesia, the U.S. was the first to arrive with aid. China offered little. With COVID-19, the roles have reversed. The 6 billion people outside the U.S. and China are genuinely shocked to see the sharp contrast between the competent responses of China and the incompetent responses of the U.S. They would agree with the assessment of the World Health Organization: “China’s bold approach to contain the rapid spread of this new respiratory pathogen has changed the course of a rapidly escalating and deadly epidemic”.

Equally importantly, a leading Western medical journal, The Lancet, published an open letter from leading medical and public health professionals also praising China’s response, noting that efforts made by “scientists, public health professionals, and medical professionals of China… [were] remarkable.”

Yet all of this doesn’t mean that the vast majority of countries will abandon the U.S. and join China’s camp. Far from it. Most countries want to maintain good ties with both powers, they just don’t want to be forced to choose. If China offers good and cheap 5G technology from Huawei, for example, most countries (including U.S. allies such as the U.K., Germany and France) want the freedom to choose the best technology or their telecommunications infrastructure. So when the U.S. imposes sanctions on countries buying from Huawei, it’s causing problems with friends.

Freedom to choose what is best for one’s own country is a demand that many friends of the U.S. are calling for. India and Turkey want to be free to choose S-400 missiles from Russia; Indonesia wants to buy Sukhoi jet fighters. Similarly, the U.K., France and Germany want the freedom to trade with Iran through INSTEX, a special clearing mechanism they set up to facilitate trade with Iran.

The U.S. can still recover a lot of influence it enjoyed in the world. Vast reservoirs of goodwill towards the U.S. remain, for example, among the 10 ASEAN nations of Southeast Asia. Indeed, two of them, Philippines and Thailand, are “technically” treaty allies with the U.S. Yet there is no doubt that both of these countries are now closer to China than to the U.S. All 10 ASEAN countries do more trade with China than with the U.S. To balance this, the stock of U.S. investment in ASEAN countries is far greater. Indeed, America’s total investment in ASEAN of $328 billion is far more than what it has invested in India, China, Japan and Korea combined. By contrast, the Chinese investment in ASEAN is about $150 billion.

The 10 ASEAN countries, like the 181 other countries, don’t want to be caught in a zero-sum geopolitical contest between the U.S. and China. Quite reasonably, they want to keep their options open. With skillful diplomacy, the U.S. can still win the game. Sadly, the art of diplomacy has been lost in Washington D.C. This has created a massive opening that China has taken full advantage of, on its way to victory over the post COVID-19 world.

Source: The Hill

At a dark moment of World War II, in August 1942, British Prime Minister Winston Churchill flew to Moscow to have dinner with Soviet Premier Joseph Stalin. The ideological gap between them was far greater than the gap between the U.S. and China today. Yet Churchill didn’t hesitate to cooperate with Stalin. Why not? 

An old strategic adage holds that in any great war, one should focus on the main battlefield and not get distracted by secondary issues. The great Prussian military theorist Carl von Clausewitz wrote, “The talent of the strategist is to identify the decisive point and to concentrate everything on it, removing forces from secondary fronts and ignoring lesser objectives.” U.S. Secretary of State Mike Pompeo, who graduated first in his class from West Point, should know this strategic adage well. 

Today, if Churchill were leading America’s war against a pandemic, he would advise focusing on the main battlefront, COVID-19, rather than getting distracted by the ongoing geopolitical contest with China. Indeed, just as he dined with Stalin, Churchill would advise America to cooperate with China. Sadly, few voices in America are recommending such Churchillian wisdom. 

Only President Trump, with his usual flair for unusual moves, could put in a phone call to Chinese President Xi Jinping on March 27. Yet, at the same time, the Trump administration has been sending contradictory signals. Its campaign against Huawei has not abated; the Trump administration is considering additional measures to restrict the supply of chips to the Chinese technology giant. On March 27, President Trump also signed a law obliging Washington to raise global support for Taiwan, a direct slap in the face for Beijing. Churchill, if he were alive today, would disapprove of these contradictory approaches. He would have said, “Focus on the main battlefront.” 

America is about to get a huge spike in COVID-19 cases. Indeed, America now has more cases than any other country in the world. More dangerously, the number of fatalities could run to as high as 200,000 to 1.7 million, as per projections based on Centers for Disease Control and Prevention (CDC) scenarios. America desperately needs masks, ventilators, gowns, gloves and other personal protective equipment (PPE) for health care personnel and other workers.

On March 29, a plane from Shanghai landed at JFK Airport in New York, carrying 12 million gloves, 130,000 N95 masks, 1.7 million surgical masks, 50,000 gowns, 130,000 hand-sanitizer units and 36,000 thermometers. Yet, these amounts are a drop in the ocean; America needs much more now. Even France has ordered a billion masks, a vast majority of them from China. 

Instead of relying on domestic commercial channels, the U.S. government should work with the Chinese government. To foster such effective government-to-government cooperation, a few simple steps need to be taken. The first is to stop insulting China; it was unwise, for example, for the Trump administration to try to persuade the G-7 countries to call COVID-19 the “Wuhan virus.” The main lesson we should take away from this massive global outbreak is that all 7.5 billion inhabitants of Planet Earth have become like the passengers on the ill-fated cruise ship off Japan, the Diamond Princess: Our destinies, especially our health destinies, are intertwined. We have to work together to solve this crisis. It’s not smart to argue about who sprung the leak when a boat is sinking; what matters is how we respond to it. A clear signal from the Trump administration that it will stop scapegoating China will calm countries and markets all around the world, including the U.S.

There’s one other simple step that Churchill would advise the U.S. to take: President Trump should announce that he will immediately rescind all the tariff and non-tariff measures he has imposed on China, with the understanding that China will do the same. This may not lead to a major boost in trade or economic growth immediately. It will, however, send a powerful signal to the markets that when COVID-19 begins to retreat, both the economic growth and the international trade will bounce back faster.

President Trump will lose nothing today from making such an announcement. And he could extend it further by withdrawing all threats to raise tariffs on allies such as the European Union, Japan, Canada and Mexico. The markets will take note of these soothing measures. We all feel nostalgic for the world we enjoyed a few months ago. By sending signals that the world is going to return to the status quo ante, we will build up confidence in the future that will come when COVID-19 recedes, as it surely will.

When we return to the status quo ante, we may well return once again to a resumption of the U.S.-China geopolitical contest. Before America does so again, however, it may wish to heed the advice of its own strategic thinkers, like Henry Kissinger and George Kennan. It was unwise of America to plunge headlong into a geopolitical contest against China without first working out a comprehensive long-term strategy, as I argue in the book, “Has China Won?”

If America presses the “pause” button on the U.S.-China geopolitical contest now, as Churchill would advise it to do, this pause should provide American strategic thinkers the time to ponder all the dimensions of this contest before plunging in again. It also would provide Americans an opportunity to discover where the rest of the world stands on this issue. During the Cold War, all of Europe enthusiastically supported America. Today, it is unclear that Europe would do so: Some Italians in Rome played the Chinese National Anthem on public loudspeakers, and Serbia’s president cried and kissed the Chinese flag, after urgently needed medical supplies arrived in both countries from China; in Spain, citizens trended “Gracias China” on Twitter to thank China for sending medical supplies and personnel; the French foreign minister expressed his gratitude to China for providing much-needed medical supplies, including surgical masks, protective suits and gloves.

This doesn’t mean that all will be lost for America in this geopolitical contest. It only means that America will have to emulate the wisdom of great strategic thinkers, like Churchill, Kissinger and Kennan — and think hard before making its next, critical moves. 

Source: The Straits Times

The coronavirus pandemic has underlined the importance of supporting multilateral organisations like the World Health Organisation, rather than progressively weakening them

Humanity is supposed to be the most intelligent species on planet Earth. This species has just received, through Covid-19, one of its biggest shocks since World War II.

Thousands are dying daily, not through war or famine (the usual causes) but through a new disease caused by a novel coronavirus that has effectively left humanity defenceless. No cure or vaccine is immediately available.

The rapid spread of Covid-19 also confirms that all of humanity now live in the same boat, a boat akin to the ill-fated Diamond Princess stuck off Japan.

The big question that humanity now faces is a simple one: Is it intelligent enough to learn the big lessons from Covid-19 and, if necessary, make massive U-turns from current policies? In theory, we can. In practice, I fear that we will fail.

This essay will discuss one concrete example: multilateralism. Multilateralism sounds boring. To explain it simply, let’s return to the boat analogy. If we 7.5 billion people are now stuck together on a virus-infected cruise ship, does it make sense to clean and scrub only our personal cabins while ignoring the corridors and air wells outside, through which the virus travels?

The answer is clearly no. Yet, this is what we have been doing. In the developed world, we have been protecting our own countries while neglecting the global routes through which the virus travels. Since we are now in the same boat, humanity has to take care of the global boat as a whole.

Fortunately, after 1945, the West took the lead in setting up a family of global governance institutions, centred on the United Nations, like the World Health Organisation (WHO), to improve global governance. However, in recent decades, the West has been systematically weakening global multilateral institutions, including the WHO.

The essay will discuss the WHO, to illustrate the folly of undermining multilateral institutions. Its primary objective “is the attainment by all people of the highest possible level of health”. A noble goal.

Yet, the real value of the WHO kicks in when health crises break out. It provides the only effective forum for states to cooperate against global health challenges. Hence, it played a leading role in the eradication of smallpox, the near-eradication of polio and the development of an Ebola vaccine. For the most intelligent species on planet Earth, it’s a no-brainer to strengthen, not weaken, the WHO.

Sadly, the Western countries contrive to deny that they have been weakening multilateral institutions, including the WHO. This denial is very dangerous for the West. If it continues denying that it has weakened institutions like the WHO, it cannot make a U-turn and begin rejuvenating and strengthening them. Hence, the first step that the West needs to take is to engage in deep self-reflection on what it has done to organisations like the WHO.

The West has weakened the WHO in three ways; I have documented them in great detail in The Great Convergence, a book I wrote that was published in 2013.

First, the West starved the WHO of reliable long-term mandatory funding. This used to account for 62 per cent of its budget in 1970-1971. In 2017, it collapsed to 18 per cent. Why is this significant? The WHO can recruit long-term health inspectors and scientists only from mandatory funding, not voluntary contributions that vary from year to year.

The second way was to focus on biomedicine, with its focus on individual behaviour, instead of social medicine. But understanding individual behaviour is not enough to counter epidemics like Covid-19 that spread faster if we don’t take care of social conditions.

The third way was to dilute the role of the WHO and favour institutions like the World Bank, which is controlled by the West. The World Bank’s lending on health went from roughly half of the WHO budget in 1984 to more than 2-1/2 times bigger by 1996.

Giving more money to the World Bank should appear unobjectionable. However, as Professor Kelley Lee, professor of global health governance at Simon Fraser University, has documented in her book on the WHO, “for the WHO, it has meant a bypassing of its role as the lead UN health agency”.

In a health emergency, like Covid-19, the WHO can help us. The World Bank cannot. As Prof Lee says, during the severe acute respiratory syndrome crisis of 2002-2003, the “WHO’s worldwide mobilisation of scientists to identify and genetically sequence the infectious agent was especially impressive”.

So, given the critical importance of the WHO in fighting pandemics, why did the West starve it of mandatory long-term funding?

The ironic truth is that this was not even the result of a careful and comprehensive evaluation of the long-term strategic interests of the West. Instead, the policy was driven by “bean counters” who only wanted to save money.

They were also driven by short-term selfish interest – by making the WHO dependent on voluntary contributions from the West, the Western countries could get the WHO to focus on areas of interest to the West, which makes up only 12 per cent of the world’s population.

Yet, in undermining the ability of the WHO to improve conditions in the remaining 88 per cent, the West was essentially shooting itself in the foot as its own destiny, especially in health, is tied directly to the well-being of the rest, as demonstrated by Covid-19.

We are all in the same boat.

Can the West make a U-turn?

Yes it can. In some ways it has. One of the most eloquent spokesmen in favour of multilateralism is President Emmanuel Macron of France.

He has said: “In the current state of the world, there is nothing more effective than multilateralism. Why? Because all our challenges are global, such as terrorism, migration, global warming and regulation of the digital sector. All these issues can only be addressed globally, and multilaterally. Each time we consent to circumvent multilateralism, we hand victory to the law of the strongest.”

If he gave the same speech today, he would have mentioned Covid-19 first.

Words matter. Deeds matter more. To demonstrate its commitment to strengthening multilateralism, the West can reverse the ratio of mandatory versus voluntary funding of the WHO. Mandatory funding must go back to 70 per cent or more because voluntary funding goes up and down and the WHO cannot rely on that to build long-term scientific capabilities.

When I served as Singapore’s Ambassador to the UN, I saw how ferociously some ambassadors of Western countries fought to contribute less (on the basis of a UN formula where rich countries pay more in absolute terms and poor countries pay less). They would fight to save one or two million dollars. How much has the global economy lost as a result of Covid-19? We have lost trillions of dollars.

Trillions versus millions! Very little money is needed to strengthen the WHO. For example, the European Union countries contributed US$150 million (S$214 million) to the WHO in fiscal year 2018. This amount is just 0.09 per cent of the budget of the European Commission, or one-tenth of 1 per cent.

This makes the tragedy of Covid-19 even sadder. It would literally take “peanuts” to save and strengthen the WHO.

So where does all this leave us on the issue of multilateralism?

In the short run, we can only despair. Turning around entrenched habits in the West cannot be done overnight.

In the long run, we can be confident that a new global consensus will emerge that all of us now live together in a small interdependent boat, like the passengers of the ill-fated Diamond Princess cruise ship did.

On such a global boat, it makes no sense to clean only our cabins when the boat is infected. The only way we can protect our own cabin is by coming together to take care of the boat as a whole.

Over time, we can only hope that the wiser voices of the West will be heeded and a more enlightened policy of supporting multilateral institutions, like the WHO, will prevail. After all, enlightened self-interest, if nothing else, dictates that it must adopt a multilateral stance towards global challenges.

As friends of the West, we should work with and encourage them to speak out more. We should tell them that the fate of the human species depends on our ability to make essential U-turns and work together to strengthen, not weaken, institutions of good governance, like the WHO.

This will be a key litmus test to assess whether humanity is truly the most intelligent species on planet Earth.