Roberto Abraham Scaruffi

Sunday, 21 March 2010

Weekly Report from Taiwan Security Research (Mar. 21, 2010)
For full text, click on the title or visit the TSR web page at taiwansecurity.org

Dear readers: The database page "Internationalization of RMB" has been renamed "Exchange Rates and Internationalization of RMB," which will also keep track of China's exchange rate policies.  KL  

Disputes over China's Currency Policy

Taking on China By Paul Krugman
(New York Times, Mar. 15, 2010) Tensions are rising over Chinese economic policy, and rightly so: China’s policy of keeping its currency, the renminbi, undervalued has become a significant drag on global economic recovery. Something must be done.

China Uses Rules on Global Trade to Its Advantage By Keith Bradsher (New York Times, Mar. 15, 2010) With China’s exports soaring, even as other major economies struggle to recover from the recession, evidence is mounting that Beijing is skillfully using inconsistencies in international trade rules to spur its own economy at the expense of others.

(Editorial, New York Times, Mar. 17, 2010) The drumbeat of complaints in Washington about China’s manipulation of its currency might lead one to think that this is just an American problem. It isn’t.
(Reuters, Mar. 17, 2010) China said it "could not be any clearer" in its repeated commitment to a stable exchange rate after the U.S. Congress threatened to levy duties on some Chinese exports if it fails to revalue its currency.


(Reuters, Mar. 18, 2010) China faces important negotiations over its exchange rate in coming weeks, the U.S. ambassador to China said, adding that it was not just the United States that wanted action on the Chinese yuan.


(Reuters, Mar. 19, 2010) A range of Chinese officials have spoken about the controversial currency policy over the past few weeks. Management of the yuan is shrouded in secrecy, but the comments have exposed the outlines of different schools of thought in the government.

Cross-Strait Issues

(Taipei Times, Mar. 21, 2010) The Taiwan Solidarity Union (TSU) yesterday launched a signature drive for a referendum against the government’s proposed economic cooperation framework agreement with China.

U.S.-China Engagement

(New York Times, Mar. 15, 2010) The Chinese authorities have warned major partners of Google’s China-based search engine that they must comply with censorship laws even if Google does not, an industry expert with knowledge of the notice said.

In China, Google Users Worry They May Lose an Engine of Progress By John Pomfret (Washington Post, Mar. 20, 2010) To many here, the Jan. 12 announcement foreshadowed Google's demise in China -- and the end of something else: the notion that China would continue to slowly evolve as a more tolerant nation.

(Reuters, Mar. 14, 2010) The United States is to blame for strains between Beijing and Washington and should take steps to repair ties, Chinese Premier Wen Jiabao said, indicating the two powers have not overcome a recent rough patch.
Newly Powerful China Defies Western Nations with Remarks, Policies By John Pomfret (Washington Post, Mar. 15, 2010) China's government has embraced an increasingly anti-Western tone in recent months and is adopting policies across a wide spectrum that reflect a heightened fear of foreign influence.

(Project Syndicate, Mar. 16, 2010) The overconfidence in foreign policy, combined with insecurity in domestic affairs, may combine to explain the change in Chinese behavior in the latter part of last year. If so, China is making a serious miscalculation.

A China-U.S. Reckoning By Nouriel Roubini, Rachel Ziemba and Adam Towle (Forbes, Mar. 18, 2010) The fault lines in the U.S.-China relationship have been increasingly exposed in recent weeks, with rhetorical barbs exchanged on many issues, especially exchange rates.
Paper in China Sets off Alarms in U.S. By John Markoff and David Barboza (New York Times, Mar. 21, 2010) The incident shows that in an atmosphere already charged with hostility between the United States and China over cybersecurity issues, including large-scale attacks on computer networks, even a misunderstanding has the potential to escalate tension and set off an overreaction.

Military Balance and Arms Sales
Taiwan’s Navy: Still in Command of the Sea? By James Holmes and Toshi Yoshihara (China Brief 10(6), Jamestown Foundation, Mar. 18, 2010) Taipei’s vision of offensive sea control appears less and less tenable, and Beijing knows it. Chinese naval thinkers have shrewdly and accurately taken the Taiwan Navy’s measure.

(Bangkok Post, Mar. 19, 2010) The United States left open the possibility of further arms sales to Taiwan, with a senior official saying that China's military buildup was aimed squarely at the self-governing island. China-Taiwan: Recent Economic, Political and Military Developments Across the Strait and Implications for the United States

Taiwan's Domestic Issues and Foreign Relations

(United Daily News, Mar. 19, 2010) If voted today, DPP’s Su Tseng-chang will claim 38% of the ballots against Ma Ying-jeou’s 29%.


(CNA, Mar. 17, 2010) The top U.S. envoy to Taiwan said that the United States is still looking for a full implementation of a beef import deal signed with Taiwan last October.

China's Rise and Domestic Issues

(Wall Street Journal, Mar. 16, 2010) The World Bank urged China's government to take more measures to cool its economy and head off inflation, as the bank expects the country's economic growth to accelerate to 9.5% this year.


(New York Times, Mar. 18, 2010) Companies — and their engineers — are being drawn here more and more as China develops a high-tech economy that increasingly competes directly with the United States.


(AP, Mar. 19, 2010) There is a vibrant community of tech-savvy users who can easily hop over the "Great Firewall." They are a minority of the 384 million people online in China but among the most vocal: young, educated, liberal-minded and unafraid of questioning the Communist government.
Official in China Says Western-Style Democracy Won’t Take Root There (New York Times, Mar. 21, 2010) A Chinese legislative official has said that China will not adopt Western-style democracy.

Regional Issues
Anticipating Obama’s Visit to Indonesia and Australia By Andrew MacIntyre (PacNet #10, Pacific Forum, CSIS, Mar. 12, 2010) Along with the surges of goodwill that will greet Obama in both Indonesia and Australia, there will also be opportunities to advance common causes in the region and globally.
Strategic Implications of China’s Access to the Rajin Port By Russell Hsiao (China Brief 10(6), Jamestown Foundation, Mar. 18, 2010) North Korean authorities are currently studying a proposal to grant a 10 year extension to China's lease of Rajin Port, which is located strategically on the border of North Korea and Russia, close to the mouth of the Tumen river basin and the Sea of Japan.
Xinjiang—Where China’s Worry Interests the World By Christopher M. Clarke (YaleGlobal, Mar. 19, 2010) Xinjiang is likely to remain a sore spot for Beijing as it worries about pressure from all sides regionally and tries to dampen unrest internally.
Asia-Pacific Security: Community, Concert or What? By Amitav Acharya (PacNet #11, Pacific Forum, CSIS, Mar. 12, 2010) I argue that while a concert recognizes the de facto inequality of nations and is useful in regulating relations among the great powers themselves, it is likely to fail if it tries to manage the Asia-Pacific region as a great power club.

(New York Times, Mar. 20, 2010) While exports to the United States might rebound this year, in the long run the decline in American demand and the growing importance of China represent a fundamental shift in the geopolitics of oil.
Posted by Roberto Abraham Scaruffi at 19:07