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A woman in a protective suit walks past a shop as COVID outbreaks continue in Shanghai, China.
What We're Watching: China's COVID shenanigans, Oz olive branch, Peru vs. Mexico, Twitter succession
Counting China’s COVID deaths
In recent weeks, China has announced an abrupt about-face on its zero-COVID policy, which imposed tough (and economically costly) restrictions on freedom of movement inside China for the past three years. Despite predictions that a sudden end to existing COVID rules could contribute to one million deaths, the state has lifted lockdowns, ended many testing and quarantine requirements, and halted contact-tracing systems. For a government that works hard to persuade its people that it protected them from the COVID carnage in Western democracies, it’s a big risk. How to keep the number of COVID deaths down? Just redefine what counts as a COVID death. Going forward, only those with COVID who die of pneumonia or respiratory failure will be counted as COVID fatalities. (The US counts any death to which the virus contributed as a COVID death.) China’s change will make it much harder for Chinese health officials to properly allocate resources to respond to COVID spikes, and more infections will create mutations that generate new variants that cross borders. Officials in many countries, including the US, have argued over how to define a COVID death, but the question is especially sensitive in an under-vaccinated country of 1.4 billion people.
Australia tries to repair China trade ties
“Australia’s approach is to cooperate where we can, disagree where we must and engage in the national interest,” Australia’s Foreign Minister Penny Wong said before touching down in Beijing for a meeting on Wednesday with her Chinese counterpart Wang Yi. It’s the first time a high-ranking Australian official has visited the mainland since 2019 due to extremely tense bilateral relations. Wong reiterated that the meeting itself was a triumph given that diplomatic ties were all but frozen until new Aussie PM Anthony Albanese was elected in May, promising to reestablish dialogue with China. While no major public breakthroughs were announced on trade impediments, Beijing and Canberra vowed to establish a consistent high-level dialogue. Why has the mood been so grim? Well, President Xi Jinping is especially peeved at Canberra for joining US efforts to build a bulwark against China in the Asia Pacific by joining alliances including the Quad and AUKUS. Things got particularly bad in 2020 when Australia backed calls for an international investigation into the origins of COVID-19, prompting Beijing to impose devastating tariffs and bans on Australian exports. The Albanese government is keen to fix that, given that key Aussie exports – like wine – have plunged due to Chinese tariffs.
Peru clashes with Mexico as political crisis deepens
Peru has ordered the Mexican ambassador to leave the country after Mexico City granted asylum to the family of leftist President Pedro Castillo, who was recently arrested for trying to dissolve Congress and stage a coup. Simply put: Peru is a hot mess. Castillo, a former rural school teacher with no prior political experience, was accused of corruption and ineptitude and faced multiple impeachments since coming to office last year. Castillo's wife is also being investigated for partaking in alleged corrupt activities. Peru’s government, now led by Dina Boluarte, recently declared a state of emergency to manage mounting social unrest that’s led to at least 26 deaths. Crucially, Mexico isn’t the only state criticizing Lima. Fellow leftist regimes in Argentina, Colombia, and Bolivia released a joint statement expressing concern over Castillo’s “undemocratic harassment.” Meanwhile, Peruvians continue to protest, with some calling for new elections and others demanding Castillo be released. While Peru’s Congress is set to greenlight early elections, they wouldn’t take place until April 2024. That’s unlikely to placate the angry masses.
What We're Ignoring: Whoever becomes the new Twitter boss
After 57.5% of Twitter users voted for him to step down as CEO in an online poll, Elon Musk now says he'll do it ... once he finds the right person to replace him. Hmmm. But even if he does, any incoming Twitter boss won't have as much free rein over the social platform as its mega-rich owner, who still plans to run the tech side. More importantly, why drop $44 billion on buying Twitter to let someone else call the shots? The poll result likely gave Musk the perfect excuse to get out but still do whatever he wants by pulling the strings behind the scenes so he won't face so much blowback. The problem is that whoever steps into his shoes, none of the Twitter fights that Musk has started over hate speech moderation or who gets verified will likely be resolved anytime soon. Unless, of course, the new CEO is Snoop Dogg, who clearly wants the job and would certainly make Twitter anything but boring.
What We're Watching: Australia-China tension rising
For Beijing, there is thunder Down Under. Tensions between Australia and China just keep rising. After China responded to Aussie requests for a COVID investigation by imposing devastating tariffs and unofficial bans on Australian exports in 2020, Oz is pushing back hard now. Canberra on Friday accused China of “economic coercion,” while cybersecurity officials publicly confirmed malicious attacks against Australia by Chinese spy services working with Chinese telecom giant Huawei. The Aussies also say Chinese intelligence vessels are snooping around in Australia’s Exclusive Economic Zone. These accompany several clearly pro-American moves this year: the Aussies have signed on to AUKUS, an exclusive military club with Washington and London that gives them access to unprecedented weapons tech, are allowing the buildup of US military infrastructure (read, bases) on its soil, and joined America in a diplomatic boycott of the 2022 Beijing Winter Olympics. But the Australians are taking the tensions directly to China’s neighborhood, too. Canberra just signed a $770 million weapons deal with South Korea, including tech to build Howitzers — really, really big artillery guns. And even though the spat between the two continues, there is evidence that Australia, though heavily dependent on trade with China, is successfully pushing for diversity in trade partnerships.
Chile's President-elect Gabriel Boric celebrates with supporters after winning the presidential election in Santiago, Chile, December 19, 2021.
What We’re Watching: Chile’s new prez, Manchin sinks Biden’s agenda, Russian NATO wishlist, Australia vs China, Afghan trust fund
Boric wins in Chile. In the end, it wasn’t even close. Faced with two diametrically opposed choices for president in Sunday’s presidential runoff, more than 55 percent of Chilean voters went with leftwinger Gabriel Boric instead of his far-right opponent José Antonio Kast. The ten-point gap was so wide that Kast conceded before the count was even done. Boric, 35, now becomes the youngest president of any major nation in the world. Elected just two years after mass protests over inequality shook what was one of Latin America’s most reliably boring and prosperous countries, Boric has promised to raise taxes in order to boost social spending, nationalize the pension system, and expand the rights of indigenous Chileans. But with the country’s legislature evenly split between parties of the left and the center-right, the new president will likely have to compromise on his sweeping pledge to make Chile the land where neoliberalism “goes to its grave.”
Joe sinks Joe. It looks like US President Joe Biden has come to the end of the road with his $1.75 trillion Build Back Better Plan, now that Sen. Joe Manchin (D-WV) has announced flatly he’ll vote “no.” With the Senate split 50-50, Biden needs every Democrat vote in the chamber. The White House haggled with Manchin for months — “dancin’ for Manchin”, you might say. Biden even cut the proposed spending in half. But the moderate Manchin said he still “couldn’t get there” because of concerns about the deficit, and further stoking already high inflation. Republicans, of course, are ecstatic, because passing BBB is Biden's key pitch for Americans to vote for Democrats in next year's midterms and re-elect him (or another Democrat in his place) in 2024. It's not too late to reach a fresh compromise on the bill, but the longer the Dems keep squabbling, the longer their odds of retaining control of Congress next November.
Russia makes its demands. With 100,000 Russian troops at the Ukrainian border, Moscow released a bombshell list of demands for the “West” on Friday. Among other things, NATO must relinquish any right ever to expand further eastward, and must stop sending its troops or ships anywhere that could conceivably threaten Russia. What’s more, the Russians are impatient: they want the US to discuss these proposals right now. The US is happy to talk, but won’t give the Kremlin a veto over the choices that sovereign nations want to make about their own security alliances. The Ukrainians, naturally, agree, and on Monday President Volodymyr Zelenskiy will meet with his counterparts from Poland and Lithuania to emphasize the point. We’re watching to see what the US comes back with — one version of a maximalist response would look like this — and what, precisely, Russia is prepared to do if it doesn't like what it sees.
For Beijing, there is thunder Down Under. Tensions between Australia and China just keep rising. After China responded to Aussie requests for a COVID investigation by imposing devastating tariffs and unofficial bans on Australian exports in 2020, Oz is pushing back hard now. Canberra on Friday accused China of “economic coercion,” while cybersecurity officials publicly confirmed malicious attacks against Australia by Chinese spy services working with Chinese telecom giant Huawei. The Aussies also say Chinese intelligence vessels are snooping around in Australia’s Exclusive Economic Zone. These accompany several clearly pro-American moves this year: the Aussies have signed on to AUKUS, an exclusive military club with Washington and London that gives them access to unprecedented weapons tech, are allowing the buildup of US military infrastructure (read, bases) on its soil, and joined America in a diplomatic boycott of the 2022 Beijing Winter Olympics. But the Australians are taking the tensions directly to China’s neighborhood, too. Canberra just signed a $770 million weapons deal with South Korea, including tech to build Howitzers — really, really big artillery guns. And even though the spat between the two continues, there is evidence that Australia, while heavily dependent on trade with China, is successfully pushing for diversity in trade partnerships.
An Islamic trust fund for Afghanistan. They didn’t officially recognize the Taliban government. They didn’t even allow the Taliban’s foreign minister to appear in the official group photograph. But foreign ministers from the 57-member Organization of Islamic Cooperation, the second-largest intergovernmental organization after the UN, met in Islamabad on Sunday and pledged to set up a trust fund to address the worsening humanitarian crisis in Afghanistan. Neither the exact amount of the fund nor the contributions by member countries was released, but may not match the $4.5 billion that the UN has appealed for aid to Afghanistan amid warnings that the Afghan economy is in a free-fall, with 23 million facing starvation. The lead organization of the fund will be the Islamic Development Bank, the OIC’s in-house global lender.What We’re Watching: China vs Australia, Kashmir talks, EU’s Putin FOMO
China-Australia trade row continues: In the newest installment of the deepening row between China and Australia, Beijing has launched a complaint against Canberra at the World Trade Organization over tariffs placed on three Chinese exports: wind towers, railway wheels and stainless-steel sinks. Australia says it was caught off-guard by China's suit — the tariffs have been in place since 2014, 2015, and 2019 — and that Beijing didn't go through the regular WTO channels nor pursue bilateral talks before filing the complaint. It's the latest move in a game of tit-for-tat: last year, Beijing slapped tariffs on Australian products like wine and barley, a massive blow to Australia's export-reliant economy. Since the Chinese crackdown on Australian wine, sales have fallen from AU$1.1 billion ($840 million) to just AU$20 million, prompting Australia to recently challenge Beijing's move at the WTO. China-Australia relations have become increasingly fraught over a range of issues including trade, Chinese spying, 5G, and Australia's call for a global probe into the origins of the pandemic.
Is India going to change tack on Kashmir? Leaders of pro-India political parties in Kashmir are meeting with Prime Minister Narendra Modi for the first time since India revoked Kashmir's autonomy almost two years ago. The talks are a sign that Modi may be open to partially restoring the special self-governing status of India's only Muslim-majority territory, which since August 2019 has been ruled directly from Delhi. But, why now? Foreign considerations play a big role. First, restoring Kashmir's autonomy would help to continue a wider India-Pakistan thaw. The two sides recently signed a ceasefire agreement in Kashmir, a territory that they've fought three wars over. Second, the looming US withdrawal from Afghanistan is making India nervous: if, as expected, the Taliban take power again, they could provide haven for Kashmiri separatists eager to attack India.
The EU has Putin FOMO: Joe Biden's summit with Vladimir Putin last week went well enough that now European leaders want to have a go of their own. French President Emmanuel Macron and German Chancellor Angela Merkel on Wednesday proposed a direct EU meeting with the Russian president for the first time in more than seven years, while also threatening more sanctions if Russia continues to challenge European interests and values. The EU is much closer, both geographically and economically, to Russia than the US is, so there's lots to talk about. But the proposal, which evidently blindsided other EU leaders, has exposed divisions within the bloc. Some EU member states — in particular perennial Russia-hawks Poland and the Baltic states — oppose giving Putin the pleasure of a meeting while Russia still occupies Crimea, harbors cybercriminals, spreads disinformation, and stifles dissent. Others, echoing Biden's reasoning, say it's better to speak directly and frankly than not. Can Merkel and Macron get enough of their fellow EU leaders to agree? Putin is watching, and so are we.