China

Tensions rise in the South China Sea
China and the US clashed over the South China Sea at a defence forum last weekend, amid island-building by Beijing and increased naval and air patrols by the US. Gideon Rachman discusses the escalating tensions with Geoff Dyer, the FT’s Washington correspondent and former Beijing bureau chief, and James Crabtree, contributing editor.

By Gideon Rachman

Politics in the west are so dramatic at the moment that China can look relatively staid and stable by comparison. But that impression is deceptive. Xi Jinping is taking his country in radical and risky new directions.

By Gideon Rachman
When judging forecasts about 2016, beware of the “continuity bias”. This is the temptation to assume that this year will be a bit like last year — only more so. In fact, recent political history suggests that the events that define a year tend to be the big surprises and sudden discontinuities (call them “black swans” or “unknown unknowns”, if you must).

By Gideon Rachman
In 2015, a sense of unease and foreboding seemed to settle on all the world’s major power centres. From Beijing to Washington, Berlin to Brasília, Moscow to Tokyo — governments, media and citizens were jumpy and embattled.

By Gideon Rachman
Nothing can separate us. We are one family”. So said Xi Jinping after becoming the first president of China to shake hands with a president of Taiwan. The meeting between Mr Xi and Ma Ying-jeou was undoubtedly historic.

UK rolls out the red carpet for China

President Xi Jinping’s state visit to the UK has featured all the pomp and circumstance the UK can muster. Has it cemented the UK’s place as a prosperous best friend to China in the West or has Britain bowed too deeply to an authoritarian regime? Joshua Chaffin puts the question to Jamil Anderlini and Demetri Sevastopulo.

By Gideon Rachman
American and Chinese presidents do not really know how to talk to each other. They are like computers running on different operating systems.” That was the verdict once offered to me by a US official, who has watched many US-China summits from close quarters.

Australian politics is so cut-throat and brutal that it is easy to treat it simply as a spectator sport – without much wider international significance. But that would be a mistake. The fall of Tony Abbott and his replacement as prime minister by Malcolm Turnbull may well herald a shift in Australian foreign policy that will be noticed in Beijing, Tokyo and Washington.

Put simply, Turnbull is likely to take a softer line on China. Abbott was a firm supporter of America’s pivot to Asia and the effort to push back against Chinese territorial ambitions. But Turnbull seems to be more sceptical. The evidence for his scepticism is set out, in this informative post from the Lowy Interpreter. It is interesting, in particular, that Turnbull has sympathetically reviewed the work of Hugh White, an Australian academic who has argued that the US should do more to accommodate a rising China – and that the alternative might be a catastrophic war. Read more

Barack Obama’s first trip to Beijing as president in 2009 took place at a moment of great weakness in the US during a deep recession, and apparent strength in China, which had rapidly engineered a return to growth.

The roles seem oddly reversed ahead of Xi Jinping’s state visit to Washington later this month. In contrast with steady if unspectacular US growth, Chinese leaders are struggling on multiple fronts, to calm a wobbly stock market and maintain output in a slowing economy. Read more

By Gideon Rachman
The gigantic military parade that will pass through Beijing on Thursday is meant to be all about the past. But, inevitably, many in the Asia-Pacific region will see it as a disturbing message about the future.

How risky is China’s volatility for the global economy?
The impact of China’s stock market volatility has been felt around the world this week. Martin Sandbu is joined by the FT’s economics editor Chris Giles, and US economics editor Sam Fleming, to discus show risky this is for the health of the global economy.

China’s renminbi devaluation
China this week stunned financial markets with the biggest devaluation of the renminbi in two decades, only to intervene to stop the slide. Was it a move towards liberalisation or a desperate bid to halt the country’s economic slowdown? Ben Hall discusses the move and its consequences with James Kynge and Gabriel Wildau.

  • Angela Merkel is taking her revenge on Greek prime minister Alexis Tsipras by insisting there can be no more talks on the country’s debt crisis until after its referendum on the bailout on Sunday
  • After China’s main stock index fell by 5 per cent yesterday, investors are blaming the share collapse on the securities regulator and the shadowy world of margin lending
  • An Egyptian soap opera set in a neighbourhood in old Cairo circa 1948 offers an empthatic portrayal of the Jewish community – and casts Islamists as the bad guys
  • Yes? No? Greek Voters Are Perplexed by a Momentous Referendum (New York Times)
  • In Ramadi, the Islamic State settles in, fixing roads and restoring electricity (Washington Post)

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Satellite image of man-made islands in the South China Sea

This week I have had the pleasure of escaping from Europe’s obsession with the Greek crisis and travelling to Sydney for the Australia-UK Asia dialogue, which is taking place at the Lowy Institute – Australia’s leading foreign-policy think-tank. The idea is to bring together British and Australian experts to discuss trends in Asia – and, it is hoped, to form common views and approaches. But, after the first day of discussion, I was left wondering whether the “tyranny of distance” may ensure that the Brits and the Australians will struggle to form a common view.

It is not so much a difference of interpretation, between the two sides, as a gap in urgency. For the Australians, the rise of China overshadows all other issues and raises fundamental questions about the role and future of their country – as an outpost of the west in the southern Pacific, with a rising China to the north. For the moment, however, the British can still treat the rise of China as a second-order issue – while policymakers in London obsess about Europe and keep a wary eye on Russia and the Middle East. Read more

  • Greece cannot lose by rejecting this week’s final offer from international creditors – and leaving the eurozone would achieve a better outcome for its economy, argues Wolfgang Münchau
  • Foreign companies are finding ways of circumventing economic sanctions on Russia, enabling the provision of goods and services like banking to blacklisted entities
  • As the government in Athens fast runs out of money – and nervous depositors pull cash from the country’s banks – there is growing talk of the extraordinary use of capital controls in Greece
  • A documentary shows how the poorly-trained and equipped Kurdish peshmerga forces are the international coalition’s only reliable boots on the ground in northern Iraq (Vice Media)
  • A Chinese entrepreneur who took just 19 days to build a 57-storey tower says he has triggered a construction revolution. And his dreams soar far, far higher (BBC)

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By Richard McGregor in Washington

In the confrontational atmosphere pitting Beijing against Washington and its allies in Asia, it is often forgotten that China and much of the west were allies in the region’s defining wartime struggle, fighting their then mutual foe, Japan.

In September, Beijing is planning a massive military parade to remind the west and the rest of the world of that moment, the 70th anniversary of Japan’s surrender in the Pacific War. As commemorations go, it promises to be an awkward occasion. Read more

There are drawbacks to being a satirist from a deeply authoritarian state. Exile is a frequent consequence. But it has its advantages.

“I’m really blessed as an Iranian comedian,” Kambiz Hosseini told the audience of democrats, dissidents and defectors who gathered this week in Norway for the annual Oslo Freedom Forum (or “Davos for dissidents”). “There’s no shortage of material for me.” Read more

By Gideon Rachman
Why is Barack Obama so desperate to secure a Trans-Pacific Partnership trade deal? The long-winded official answer is that the US president thinks that it would break down barriers between 12 leading Pacific economies and so increase prosperity. The short, real, answer is: China.

  © Getty Images

Have the US and its allies in Asia reached a tipping point in their relations with China? The question posed by US China scholar, David Lampton, in a speech in Shanghai in March looks disturbingly prescient after a whirl of diplomatic and security offensives in recent weeks in the region.

The US and Japan substantially upgraded their defence alliance in a high profile summit meeting in Washington earlier this month. Japan, in turn, held its first naval exercises with Vietnam and the Philippines in the South China Sea. This week, the US announced (and then later denied) it would station B-1 bombers in northern Australia, also with an eye on balancing China in the region.

Then, just in time for John Kerry’s weekend visit to Beijing, the Pentagon made it known it was contemplating limited military options in the form of naval patrols and surveillance flights in contested areas in the South China Sea to reinforce its opposition to Chinese actions. Read more

Obama seeks to cement Japan ties
Siona Jenkins, Gideon Rachman and Lindsay Whipp discuss the Japanese prime minister’s visit to Washington as the US seeks to cement defence and trade ties with Japan, a key ally in its bid to push back against growing Chinese influence in Asia.