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Kalum Pupeter

Just Hatched
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Kalum Pupeter said:
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https://twitter.com/i/web/status/1986401672252244270

They have already inserted so-called “poison pill” provisions into the North American trade framework (USMCA) in 2020 with Mexico and Canada, targeting the PRC. Just a week ago, similar clauses were added to trade agreements with Malaysia and Cambodia. This will not end here, and the PRC should think (and act) about how to respond to these increasingly aggressive moves by the United States to constrain its foreign trade space and infringe upon the trade sovereignty of nations around the world for its malicious hegemonic intents.
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US-Malaysia trade pact's 'poison pill' targeting China sparks backlash​

Opposition lawmaker calls terms imposed by Washington a 'surrender'

SINGAPORE -- The U.S. has included a "poison pill" clause in its trade deal with Malaysia that is widely seen as preventing the Southeast Asian nation from signing a separate deal with China, sparking criticism over infringement on national sovereignty. The agreement,
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in October, lets the U.S. unilaterally terminate the pact if Malaysia enters into an agreement with a country that threatens "essential" American interests. The text does not identify such a country, but is widely believed to be aimed at China.

Malaysian Prime Minister Anwar Ibrahim defended the trade deal when questioned about it in Parliament on Nov. 4. "This is not a matter of surrender, or betrayal, or a new form of colonization," Anwar said. The Trump administration signed a similar agreement with Cambodia, and the provision could be included in trade deals with Thailand and Vietnam.

Many Southeast Asian countries pursue neutral diplomacy. The U.S., however, aims to prevent countries in the region from drawing closer to China. Anwar and U.S. President Donald Trump signed the Agreement on Reciprocal Trade during Trump's visit for the Association of Southeast Asian Nations summit. The deal lowers "reciprocal" American tariffs on goods from Malaysia from 25% to 19%. But in Malaysia, the government is widely thought to have been pushed into a deal favorable to the U.S.

Most of the demands in the agreement come from the American side, the text shows. Malaysia agrees to reduce or eliminate tariffs on a wide range of imports from the U.S., including agricultural and chemical products. Malaysia also commits to purchasing Boeing aircraft.
Particularly contentious is the clause regarding third countries. This states that if Malaysia "enters into a new bilateral free trade agreement or preferential economic agreement with a country that jeopardizes essential U.S. interests," then the U.S. may terminate the trade deal with Malaysia and reinstitute the higher tariffs.

The pact also makes clear that if the U.S. adopts its own import restrictions on a third country, then Malaysia is expected to put in place similar measures against that country if the U.S. deems doing so essential to economic and national security. Azmin Ali of the Pribumi Bersatu Malaysia opposition party criticized the agreement as "anything but reciprocal." "It is a surrender," said Azmin, who argued that "Malaysia gives away too much control over its economy."

China is all but certain to be one of the unidentified third countries alluded to in the Malaysia-U.S. agreement. The trade deal contains "poison pill provisions," wrote Simon Evenett, professor of geopolitics and strategy at Switzerland's IMD Business School, in a report. "These provisions amount to loyalty tests and should be seen in the context of intensifying U.S.-China competition for global influence," Evenett argued.

The term "poison pill" refers to a company's takeover defense. Evenett likened a U.S. attempt at preventing Malaysia from drawing closer to China to a corporate takeover defense. The U.S. trade agreement with Japan does not include an explicit poison pill clause. But a September executive order by Trump says he can "modify this order as necessary" if Japan fails to make good on its commitments.

The U.S., wary of deepening ties between trading partners and China, has sought similar provisions in past trade deals.
The U.S.-Mexico-Canada Agreement, signed during the first Trump administration in 2018, says that if any party enters into a free trade agreement with a "non-market country," then the other parties can terminate the agreement.

This provision is believed to be preventing Canada from signing a free trade agreement with China. It is likely informing Canada's and Mexico's hesitance to let China join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
On the other hand, China is ASEAN's largest trading partner, and many nations in the bloc have tried to pursue relations with both the U.S. and China. Language that would antagonize Beijing risks upsetting this delicate regional balance.

Meanwhile, China seeks to fortify relations with Southeast Asia. The Asian power already has a free trade agreement with ASEAN and seeks to expand it. China has also applied to join the CPTPP, a multilateral agreement that includes Malaysia and Vietnam. The exit provisions serve as a "built-in deterrent to 'hedging' via new China-linked agreements," said Samirul Ariff Othman, senior consultant at Global Asia Consulting. But the extent to which they will be enforced may hinge on how the U.S. implements the trade agreement.

"I think we have to see if there will be further de-escalation of the trade tensions to see how the agreement in Malaysia is enforced," said Adib Zalkapli, managing director at Viewfinder Global Affairs.

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plawolf

plawolf

Lieutenant General
dingyibvs said:
IMO many people are missing China's grand strategy. If people understand where Xi is coming from, all the moves China has made in the past few years would make sense.

1) It starts with China's assessment that the West is declining and China is rising. To "win", China just has to maintain the current trajectory and outlast the West.

2) The current trajectory will inevitably cause some hardship in the West and lead to push back. As such, China needs to be prepared for a full-scale, full-spectrum (financial, industrial, military, informational, everything) conflict against the entire West (that's the US and all its allies). This is not so that it has to fight and win one, but to prevent a full scale conflict in the first place. Think of it like a MAD.

3) To accomplish this, China has worked to ensure full-spectrum resilience. RMB internationalization, CIPS, popping RE bubble, BRI, tech indigenization, preventing outsourcing of "older" industries, military/nuclear build out, GFW, etc. all needs to be looked at in this lens rather than the narrow lens of economic or territorial gains.

4) The key to victory is point number 1, i.e. maintaining the current trajectory. If an actual full-scale conflict breaks out, victory is no longer assured and there's a high likelihood of there being no victors at all. As such, the response to all provocations in general is to demonstrate the ability for MAD and nudge all parties involved to maintain the status quo.

Use these points to guide your analyses and everything will make more sense. Why doesn't China just nip the European manufacturing right now? Because it's well on track to nip itself. They're not gonna find an alternative to Nexperia China in weeks or months or in all likelihood ever before the European auto industry go bust from a general lack of competitiveness. China just needs to demonstrate that it can cause the destruction now, and let the Europeans pressure each other so the day of their destruction can come later rather than sooner. Sowing disunity is more important than causing short term destruction. One leads to a hastening of the current trends which favor China, the other can lead to a full scale conflict for which history has proven there are always many unknowns.
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I think you are broadly on the right lines, but missing one fundamental paradigm shift. You still think full scale conflict could be avoided, whereas I think it’s now inevitable.

Western arrogance and pathology basically guarantee it. The Dutch response is sadly typical that even after you have demonstrated your utter and complete dominance over them, they will just not quit unless and until you actually do obliterate them in combat.

China seems to agree, as it’s taking actual concrete steps to prepare for all our war instead of just to prevent it. The only key question now is timing.

I think China wants to delay the conflict for at least 5 years more, time enough to complete their current military modernisation plans and also get key next gen platforms operational deployed in meaningful numbers.

But the west also sees that the longer term trends are not in their favour, so you have elements within the west that are actively pushing for war asap. The Dutch move, everything the European Commission does that is related to China, Japan’s return to fascism etc. It’s all part of the same accelerating trend of preparing western populations for war against China. They want to paint China as the source of all of the west’s woes, so the people will by themselves conclude that they need war with China to turn their economies and lives around. As such, I think it’s probably unrealistic to expect China to be able to delay this conflict for longer than 10 years.

This mis-match in time scales is why there are such contrasting and reversed official reactions by the Chinese and Dutch sides over the Nexperia issue. The Dutch are unrepentant and literally saying they will do it all again while China is the one going out of its way to save the EU from the consequences of its own actions. This is because China is walking a very tight balancing act. Respond too lightly and it risks open season on its overseas assets where every western nation thinks they can revert to their true piratical selves and steal what they can grab for no real consequence. But respond too harshly and it could trigger a new Great Depression and mass unemployment in the west and hasten the western populace opinion shaping exercise to prepare for total war against China.

China wants to de-industrialise the west, including the EU. But slowly, not all at once unless and until it wants to basically go to war immediately, since war is a very likely outcome of the kind of economic devastation the Dutch seem hell bent on triggering.
 
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