Us policy – Alg A http://alg-a.com/ Sun, 08 May 2022 19:45:04 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://alg-a.com/wp-content/uploads/2021/10/icon-6-120x120.png Us policy – Alg A http://alg-a.com/ 32 32 BSP must brace for US policy tightening – analysts https://alg-a.com/bsp-must-brace-for-us-policy-tightening-analysts/ Thu, 05 May 2022 16:32:25 +0000 https://alg-a.com/bsp-must-brace-for-us-policy-tightening-analysts/ Reuters By Luz Wendy T. Noble, Journalist The BANGKO Sentral ng Pilipinas (BSP) should be ready to act as the US Federal Reserve is poised for further rate hikes this year and domestic inflation is expected to remain elevated over the coming months. The Fed’s 50 basis point rate hike, coupled with a possible reduction […]]]>
Reuters

By Luz Wendy T. Noble, Journalist

The BANGKO Sentral ng Pilipinas (BSP) should be ready to act as the US Federal Reserve is poised for further rate hikes this year and domestic inflation is expected to remain elevated over the coming months.

The Fed’s 50 basis point rate hike, coupled with a possible reduction in a $9 trillion portfolio of assets, reflects its ‘seriousness’ in tackling four-decade high inflation in the states States, said former BSP Deputy Governor Diwa C. Guinigundo. .

“For investors and credit rating agencies monitoring interest rates differentials across countries, that the U.S. Fed’s decision could encourage more capital flin the US, away from some emerging markets with lower real interest rates,” Guinigundo said in a Viber message.

“Although our local real interest rate is higher, other factors are also taken into account, such as growth prospects, currency movements and political prognoses,” he added.

Sophia Ng, analyst at Mitsubishi UFJ Bank Global Markets Research, also sees the possibility of capital flight, but said it might be more manageable for the Philippines.

“The saving grace for the Philippines, in my view, is the relatively low foreign participation in the stock and bond markets compared to other emerging economies in Asia, which means that the downward pressure on the peso from the exit potential capitalflows is likely to be more modest than other AXJ currencies (Asia excluding Japan) which are more sensitive to portfolio outflows,” Ms Ng said in an email.

With central banks now also having to deal with inflation risks caused by the Russian-Ukrainian war, when to start policy tightening has become more crucial, experts said.

“I don’t want to preempt future BSP moves, but these decisive actions by the US Fed should make all other central banks think about the question of timing,” Guinigundo said.

“A slight token move can assure the market that monetary policy is aware of the situation and doing something,” he added.

Bank of the Philippines Chief Economist Emilio S. Neri, Jr. said the Fed’s latest statements strengthen the case for BSP to stand by given that the Fed ” seems to be still far behind the curve” in terms of policy tightening to fight inflation.

Mr Neri said central banks, including the Fed, which had initially deemed inflation risks to be “transient” last year may now have to increase aggressively over the next six to 18 months due to the rising import bill. for oil, the rise in commodity prices.

“BSP may need to take preventive action, such as raising rates between meetings to avoid the consequences of getting more surprises from the US central bank,” Neri said in a Viber message.

He said an exitflfund flow combined with faster inflation will affect the strength of the peso.

The local unit closed strong 11.5 centavos at 52.385 pesos on Thursday from 52.50 pesos on Wednesday, based on data from the Philippine Bankers Association. However, the peso weakened 2.7% from its late 2020 finish of P50,999.

The Fed tightening comes at a time whenflin the Philippines, which should prompt the central bank to prepare a monetary policy response, said Security Bank Corp. chief economist Robert Dan J. Roces.

Headline inflation accelerated to a three-year high of 4.9% in April as the costs of food, utilities and transportation continued to rise.

“With locals inflation well above target and on track to remain so, the buildup of price pressures will require preemptive control from monetary authorities,” Roces said in a Viber message.

He expects the BSP to start raising rates by around 25 basis points in the second quarter, followed by three more increases of 25 basis points in the third and fourth quarters of 2022.

The BSP expects inflation to exceed the 2-4% target at 4.3% for 2022.

The Monetary Council has kept its key rate at a historically low level of 2% since November 2020 to support the recovery of the economy.

BSP Governor Benjamin E. Diokno said last month that he could consider a rate hike by June, when more data on economic growth and employment becomes available to prove the recovery is stronger. solid.

The Monetary Board will conduct its next policy review on May 19.

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The glaring contradictions of US policy in Ukraine and the MENA region https://alg-a.com/the-glaring-contradictions-of-us-policy-in-ukraine-and-the-mena-region/ Tue, 03 May 2022 09:53:54 +0000 https://alg-a.com/the-glaring-contradictions-of-us-policy-in-ukraine-and-the-mena-region/ Washington sends weapons to Europe to fight for democracy, while American weapons to Arab autocrats help defeat the struggle for freedom, writes Emile Nakhleh. US Secretary of State Antony Blinken and Saudi Foreign Minister Prince Faisal bin Farhan at the State Department in Washington, DC on October 14, 2021. [Getty] The Biden administration is right […]]]>

Washington sends weapons to Europe to fight for democracy, while American weapons to Arab autocrats help defeat the struggle for freedom, writes Emile Nakhleh.

US Secretary of State Antony Blinken and Saudi Foreign Minister Prince Faisal bin Farhan at the State Department in Washington, DC on October 14, 2021. [Getty]

The Biden administration is right to respond to reported Russian atrocities by arming Ukraine to defend itself, and is equally justified in assiduously avoiding a direct military confrontation with Putin’s Russia.

However, while the Russian war in Ukraine has had an economic and political impact on the Middle East, Middle Eastern audiences see several glaring contradictions in President Biden’s approach to the two regions.

In Ukraine, he poured billions of dollars in weapons of all kinds to help President Volodymyr Zelensky defend his country in his battle for democracy and freedom and the rejection of Putin’s dictatorship and inhuman war. In the Middle East, by contrast, Washington has sold billions in arms to Arab dictators despite their abysmal human rights record and suppressed civil liberties for their peoples.

The Biden administration presents its support for Ukraine’s freedom of choice and the values ​​it stands for in the global context of universal values, but has refrained, for political calculations, from extending the same mantle of freedom and freedom in the Middle East.

“The Biden administration presents its support for Ukraine’s freedom of choice and the values ​​it stands for in the global context of universal values, but has refrained, for political calculations, from extending the same mantle of freedom and freedom in the Middle East”

President Biden and his Secretary of State Antony Blinken are feverishly trying to convince Washington’s closest allies and the largest recipients of US weapons in the region to openly and forcefully condemn Putin’s acts of terror in Ukraine.

As a reward for their support, the Biden administration has turned a blind eye to Arab peoples’ demands for justice and freedom.

Yet these diplomatic efforts have shown little, if any, success. Saudi Arabia, the United Arab Emirates, Israel and others balked at the US anti-Putin campaign in the region.

Dubai remains the playground of Russian billionaire oligarchs. Turkey also welcomes Russian super yachts to its ports. The Saudi-Russian economic and diplomatic court is becoming increasingly visible on the world stage despite US pleas to the contrary.

The promise President Biden made when he took office early last year about the centrality of human rights to his platform has all but faded away. It continues to pamper dictators in the Middle East with no tangible regard, beyond rhetoric, for human rights, civil liberties and democracy. Middle Eastern audiences may not be wealthy or influential, but they’re smart enough to see what’s going on.

As a friend of mine in the Middle East told me recently, he and his compatriots see very little difference in attitude toward Arab dictators between the presidencies of Trump and Biden. Trump used both rhetoric and actions to get close to Arab autocrats, Biden used soft power (rhetoric) to extol the virtues of democratic values, but extended hard power support to those same dictators.

Arms sales and military aid worth billions of dollars continue to flow to Saudi Arabia, the United Arab Emirates, Bahrain, Egypt and other Arab and non-Arab countries in the region , regardless of their serial human rights violations, whether in Saudi Arabia, Egypt, the United Arab Emirates or the Palestinian West Bank and Gaza. The continuing human tragedy in Yemen is just one example of the glaring contradictions in Washington’s approach to the two regions.

The ongoing massive injection of US weapons into Ukraine will hopefully help the Ukrainian military defeat Russian aggression. Huge US arms sales and aid to Arab countries, on the other hand, will enable Arab autocrats to defeat their own people’s struggle for freedom and human dignity.

Moral outrage over Putin’s brutality in Ukraine drives Biden’s mission there and underpins a global sense of hope that a war-weary Zelensky will win over a ruthless neighbor.

Arab publics and pro-freedom activists see no hope that a victory in Ukraine will limit their continued repression. A Ukrainian victory with American help will likely, and should, create a moral dilemma for the Biden administration over Washington’s stance on human rights in the Arab world.

If it is true that Ukraine is being invaded by a foreign power and Arab countries are being violated by their own regimes, it does not matter whether human rights and democratic values ​​are being trampled on by a foreign dictator or by a native.

This dichotomy should not escape US leaders as they pursue a new strategic paradigm in a post-Ukrainian war Middle East. Fig leaves such as the so-called Abraham Accords and the gradual rapprochement between Israel and the Gulf Arab regimes cannot and should not erase the contradiction between the United States’ costly and deep commitment to human rights. rights in Ukraine and their lukewarm (mostly rhetorical) advocacy for democratic values ​​in Arab countries.

“If it is true that Ukraine is being invaded by a foreign power and the Arab countries are being violated by their own regimes, it does not matter whether human rights and democratic values ​​are being violated by a foreign dictator or by a native dictator”

As Arab regimes lose their primacy as key players in the region and are replaced by three non-Arab states – Israel, Turkey and Iran – they tend to enact more repressive laws and practices to suppress their peoples. These regimes mistakenly equate their loss of regional influence with increased repression at home.

Short-sighted, they suppress the ingenuity, creativity and yearning for freedom of their peoples, thereby reducing the ability of these countries to grow economically and innovate technologically.

If creativity and innovation are allowed to emerge, they could enable Arab societies to move forward. Arab peoples, from Lebanon to Algeria, see their countries in a downward economic spiral with scant access to business, technology, scientific innovation and growth. If they were part of the governing process, they could help their leaders regain their lost regional influence and prestige. Conversely, such influence could not be co-opted by endemic tyranny.

The recent meeting of Arab foreign ministers in a six-party summit with the US secretary of state and the Israeli foreign minister in southern Israel reflected an alignment against something or certain countries – for example, Iran and the Houthis – but not for a specific strategic objective that could benefit the peoples of the region.

Nor did the gathering represent major Arab states like Iraq, Saudi Arabia or Algeria for example. Interestingly, Egypt’s participation in the summit was a second thought lest it be sidelined by the hype of Arab-Israeli rapprochement.

The Arab foreign ministers’ transactional meeting fell short of Washington’s demands for a tougher stance against Putin’s war in Ukraine or the humanitarian catastrophe in Yemen, Syria and Gaza. From an Arab perspective, an unpleasant reality emerged from the gathering: Israel is the real power in the Arab Middle East – economically, militarily, technologically and now diplomatically.

With US military support, Ukraine stands a good chance of resisting and potentially defeating Russian aggression. The universal ideal of freedom and democracy to which the peoples of the world aspire – whether in Ukraine, Myanmar, Taiwan, Saudi Arabia, Egypt or Palestine – must be supported and defended on principle and not on cynical political calculations. This ideal is indivisible, non-selective; global and not regional; and principle-based, not subject to political negotiation.

The high moral course that the Biden administration has followed in Ukraine should become the guiding principle of America’s relationship with regimes in the Middle East. The pursuit of political interests should not trump the administration’s genuine commitment to democratic ideals in its dealings with Arab regimes.

Dr. Emile Nakhleh was a senior intelligence officer and director of the Political Islam Strategic Analysis Program at the Central Intelligence Agency. He is a Fellow of the Council on Foreign Relations, Research Professor and Director of the Global and National Security Policy Institute at the University of New Mexico, and author of A Necessary Engagement: Reinventing America’s Relations with the Muslim World and Bahrain: Political Development in a modernizing state.

Follow him on Twitter: @e_nakhleh

This article originally appeared on Responsible Statecraft.

The views expressed in this article remain those of the author and do not necessarily represent those of The New Arab, its editorial board or its staff.

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Experts assess current US policy towards China, impacts of Hong Kong and Taiwan https://alg-a.com/experts-assess-current-us-policy-towards-china-impacts-of-hong-kong-and-taiwan/ Wed, 20 Apr 2022 07:00:00 +0000 https://alg-a.com/experts-assess-current-us-policy-towards-china-impacts-of-hong-kong-and-taiwan/ HOUSTON, April 20, 2022 – In partnership with the George HW Bush Foundation for U.S.-China Relations, Asia Society Texas hosted a webcast on international relations and how Hong Kong and Taiwan would address the future US policy toward China. Moderator David Firesteinfirst president and CEO of the Bush China Foundation, spoke with Elisabeth Freund Laruschairman […]]]>

HOUSTON, April 20, 2022 – In partnership with the George HW Bush Foundation for U.S.-China Relations, Asia Society Texas hosted a webcast on international relations and how Hong Kong and Taiwan would address the future US policy toward China. Moderator David Firesteinfirst president and CEO of the Bush China Foundation, spoke with Elisabeth Freund Laruschairman of E Larus Consulting LLC and professor emeritus of political science at the University of Mary Washington; Hans Stockton, dean of the division of social and behavioral sciences and global studies at the University of St. Thomas; and Rick Waters, Deputy Under Secretary of State for China, Taiwan and Mongolia in the Bureau of East Asian and Pacific Affairs. The discussion focused on current US policy toward Hong Kong and Taiwan, the impact of developments in Hong Kong and Ukraine on sentiment in Taiwan toward mainland China, and the future of US-China relations.

Overview of current US policy toward Hong Kong and Taiwan

Deputy Assistant Secretary Waters began by providing an overview of overall U.S. policy toward Taiwan and Hong Kong, noting that the U.S.-Taiwanese relationship is guided by the Taiwan Relations Act, the Three Joint Communiques, and the six insurances. The United States’ goal is to maintain a stable environment that “would allow dialogue to take place without coercion.” Regarding Hong Kong, DAS Waters noted that US policy is guided by the Hong Kong Policy Act, which had been the basis of policy since Britain’s handover in 1999 and outlined differential treatment of Hong Kong and mainland China. . However, he said the passage of the 2020 National Security Law in Hong Kong showed that Hong Kong no longer had enough smugness from Beijing to deserve differential treatment. He cited diminishing freedoms, increasing risks to the rule of law, shrinking civil society and growing restrictions on rights and freedoms in Hong Kong due to the law.

Larus added that these concerns have impacted how American businesses view Hong Kong and, in combination with the city’s strict COVID quarantine policies at the start of the pandemic, drove nearly 25% of Americans from the town to consider leaving town. She expects the combined problems to lead to more foreign companies – including Americans – leaving Hong Kong, especially with the bipartisan political focus in the United States on the national security risk of supply chains. who depend on hostile nations.

Taiwan’s response to developments in Hong Kong and Ukraine

Stockton added that the passage of the national security law in Hong Kong also marked the end of the “one country, two systems” era, and also reinforced for the citizens of Taiwan that such a policy is not is not an option. He pointed to Taiwan’s last presidential election in 2020, where the Democratic Progressive Party lagged in the polls before developments in Hong Kong boosted incumbent President Tsai Ing-Wen’s campaign and her message to remain independent from Beijing. . Still, Stockton warned that while Taiwanese people are skittish about reunification, the largest group of respondents favor the status quo, meaning a pragmatic relationship that includes economic engagement with the mainland. Trade between Taiwan and mainland China increased by 25% in 2021.

Even though Taiwanese citizens increasingly identify as Taiwanese rather than Chinese, according to Larus, reflecting a robust development of Taiwanese nationalism and identity in recent years, she noted that authorities in Beijing view the issue of reunification of Taiwan as untouchable. “It was not what the Taiwanese wanted; this is what has to happen,” she said of Beijing’s view.

However, panelists did not think the chances of a conflagration across the strait were particularly high – and in fact may have diminished following Russia’s invasion of Ukraine. Stockton noted that the Chinese, learning from Russia, might recalibrate any assumptions that mass firepower would lead to quick victory and instead take longer to consume intelligence. Larus added that Chinese President Xi Jinping is unlikely to do anything before the Party Congress in October when he begins his unprecedented third term, but after that she said it would make sense to gauge the sentiment of cross-strait relations through the results of upcoming elections in Taiwan.

Look to the future of the US-China relationship

Assessing the future of US-China relations, Larus acknowledged that the relationship is likely to cool amid growing anti-China sentiment in Congress. Stockton said the barometer will be the final form of the America Competes Act and what the language of the legislation will signal. He also indicated that there is an ongoing debate over whether US policy toward Taiwan will remain one of “strategic ambiguity” or move toward “strategic clarity.” Finally, Stockton noted that the nature of Sino-Russian relations will also influence US policy toward China.

Deputy Assistant Secretary Waters remained more optimistic about the desirability of collaboration with China – whether on North Korea, climate change or Afghanistan – and said: “When our interests line up, we just find that we will do things together.” For example, he said, the U.S. government still issues visas to Chinese students because exchanges remain essential for U.S.-China bilateral relations, as well as U.S. own interests. Nonetheless, he stressed the importance of building at home and strengthening relationships with key allies and partners.


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China lockdowns could lead to more US policy action, Fed’s Kashkari says https://alg-a.com/china-lockdowns-could-lead-to-more-us-policy-action-feds-kashkari-says/ Wed, 20 Apr 2022 01:44:00 +0000 https://alg-a.com/china-lockdowns-could-lead-to-more-us-policy-action-feds-kashkari-says/ Federal Reserve Bank of Minneapolis President Neel Kashkari speaks during an interview in New York, U.S., March 29, 2019. REUTERS/Shannon Stapleton Join now for FREE unlimited access to Reuters.com Register April 19 (Reuters) – If lockdowns in China aimed at containing COVID-19 cause further disruptions to global supply chains, the Federal Reserve will need to […]]]>

Federal Reserve Bank of Minneapolis President Neel Kashkari speaks during an interview in New York, U.S., March 29, 2019. REUTERS/Shannon Stapleton

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April 19 (Reuters) – If lockdowns in China aimed at containing COVID-19 cause further disruptions to global supply chains, the Federal Reserve will need to take even more aggressive action to bring down “far too high” inflation , said Minneapolis Fed President Neel Kashkari. said Tuesday.

Speaking at an event at Luther College in Decorah, Iowa, Kashkari said that in the best-case scenario, the pandemic fades into the background, supply chains recover and more supply comes back online.

That would help reduce upward pressure on consumer prices, which rose 8.5% in March, the fastest pace since late 1981.

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If that doesn’t happen, Kashkari said, “then our job will become more difficult … and we will have to do more, through our monetary policy tools, to bring down inflation.”

The Fed began raising interest rates last month and is expected to step up its rate hikes from next month to slow demand for goods and services and rebalance it with constrained supply.

Just six months ago, Kashkari thought inflation would come down on its own without the Fed tightening monetary policy; he has since joined the rest of his central bank colleagues in believing the Fed needs a series of rate hikes this year to get the job done.

But Kashkari’s remarks underscored how the US central bank’s success in fighting inflation depends on forces beyond its control.

Other Fed policymakers have also touched on this theme repeatedly over the past few weeks, not only because of China’s lockdowns, but also because of Russia’s invasion of Ukraine which has boosted world energy and food prices.

Both drive up inflation, but could also pinch economic activity. The International Monetary Fund this week lowered its forecast for global growth in 2022 to 3.6% from an earlier estimate of 4.4%.

How the U.S. economy performs over the coming year will depend “on the virus, it will depend on what happens in Ukraine,” Kashkari said. “These are giant elephants that will also determine what happens to our economy.”

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Reporting by Ann Saphir; Editing by Jacqueline Wong

Our standards: The Thomson Reuters Trust Principles.

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Yen hits 20-year low against dollar amid Japan-US policy gap https://alg-a.com/yen-hits-20-year-low-against-dollar-amid-japan-us-policy-gap/ Wed, 13 Apr 2022 07:58:59 +0000 https://alg-a.com/yen-hits-20-year-low-against-dollar-amid-japan-us-policy-gap/ The yen hit its lowest level against the dollar in two decades on Wednesday, extending recent declines as the gap widens between Japan’s ultra-loose monetary policy and the Fed’s tightening in the United States. Although it is traditionally considered a safe-haven currency, uncertainty fueled by Russia’s war in Ukraine did not cause the yen to […]]]>

The yen hit its lowest level against the dollar in two decades on Wednesday, extending recent declines as the gap widens between Japan’s ultra-loose monetary policy and the Fed’s tightening in the United States.

Although it is traditionally considered a safe-haven currency, uncertainty fueled by Russia’s war in Ukraine did not cause the yen to strengthen.

Instead, moves by the U.S. Federal Reserve toward more aggressive policy and the shock of rising oil prices in Japan — a major importer of fossil fuels — pushed the currency lower, analysts said.

A dollar bought ¥126 in the afternoon – the lowest rate since 2002.

“The Japanese yen has been one of the weakest currencies in the world this year,” Dutch banking group ING said in a recent commentary.

“Driver of the rally was the perfect storm of a hawkish Federal Reserve, a dovish Bank of Japan (BOJ) and Japan’s negative terms-of-trade shock as a major importer of fossil fuels.”

The yen had already lost 10% of its value against the dollar in 2021 after four years of constant strengthening.

The US central bank adopted a hawkish tone as it embarked on an aggressive tightening course, pushing up US Treasury yields which strengthened the dollar against the yen.

Earlier on Wednesday, Bank of Japan Governor Haruhiko Kuroda said the bank would maintain its monetary easing policies in a bid to meet its long-held 2% inflation target.

“Given the economic and price situation, the Bank of Japan will seek to meet its inflation target of 2% … through resiliently continuing its current strong monetary easing,” he said.

Swiss bank UBS said a weaker yen would likely hurt the purchasing power of Japanese households and domestically-oriented small businesses that will face higher import costs.

“The government is offering tax supports and will most likely expand the supports. We believe that JPY buying intervention is possible if the pace of depreciation is considered too fast,” he said in a note.

“We can not completely deny the possibility that the BOJ adjusts its policy to deal with public criticism” on the depreciation of the yen, said UBS, noting that the bank under Kuroda “was quite flexible and pragmatic in the past” .

Prime Minister Fumio Kishida did not comment directly on the fall of the yen when questioned on Tuesday, but stressed the importance of exchange rate stability.

“I will refrain from commenting on the level of exchange rates, but their stability is important and I think rapid fluctuations are not desirable,” he said.

Finance Minister Shunichi Suzuki also said earlier on Wednesday that the yen’s rapid movements were “undesirable” and warned that the government was closely monitoring the currency’s movements.

“Exchange rates move on a variety of factors, not just the U.S.-Japan interest rate differential,” Suzuki said, when asked if the outlook for higher Stable US interest rates and the bank to continue Japan’s ultralow interest rate policy were accelerating the yen’s fall.

“It is important that exchange rates move in a stable manner,” he said.

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To be effective, US policy on the PRC must be implemented early and often https://alg-a.com/to-be-effective-us-policy-on-the-prc-must-be-implemented-early-and-often/ Sat, 09 Apr 2022 19:42:29 +0000 https://alg-a.com/to-be-effective-us-policy-on-the-prc-must-be-implemented-early-and-often/ “Great powers are expected to uphold their commitments to international rules and standards even if those rules run counter to that country’s interests – credibility is more important. Second, to be effective, the policy must be constantly repeated. April 8 marked the 10th anniversary of the start of the Scarborough Shoal clash between China and […]]]>

“Great powers are expected to uphold their commitments to international rules and standards even if those rules run counter to that country’s interests – credibility is more important. Second, to be effective, the policy must be constantly repeated.

April 8 marked the 10th anniversary of the start of the Scarborough Shoal clash between China and the Philippines in the South China Sea. A decade later, and despite an international court ruling against Beijing, the People’s Liberation Army has extended, deepened and strengthened its grip on the region, including turning several islands into full-fledged military bases.
In this edition of Indo-Pacific: Behind the Headlines, we speak with David R. Stilwell, U.S. Assistant Secretary of State for the Office of East Asian and Pacific Affairs (EAP) June 2019 in early 2021. He served in the Air Force for 35 years, rising to the rank of brigadier general and served as Asia advisor to the Chairman of the Joint Chiefs of Staff. He has also flown fighter jets and served as director of the China Strategic Focus Group at the US Indo-Pacific Command from 2017 to 2019. He served in the Indo-Pacific, including as a defense attaché in Beijing, and speaks Korean, Mandarin and a little Japanese.
Q: In 2015, Party Secretary Xi Jinping stood next to President Obama in the Rose Garden and publicly stated that he had no intention of militarizing the artificial islands he had just built in the Sea of Southern China. But last month, INDOPACOM commander ADM Aqualino said they were fully militarised. What happened?
A: Xi Jinping’s statement in 2015 received a lot of attention, in part because it is rare for a Chinese leader to make such a clear public statement and also because of the PRC’s illegal activities at Scarborough Shoals three years prior. You will recall that in 2012, PRC government vessels forcibly evicted Filipino fishermen from Scarborough and have occupied it ever since. Scarborough is 200 km from the Philippines, inside Manila’s Exclusive Economic Zone (EEZ), and 469 km from China.
After that, between 2012 and 2015, Beijing destroyed incredible amounts of pristine coral reef to create seven artificial islands on disputed features, which, as ADM Aqualino noted, became military bases. The parallels between the PRC’s actions in the South China Sea and those of Russia in Ukraine are hard to miss. Rather than resolving differences through dialogue with fellow claimants Vietnam, Malaysia, Brunei and the Philippines, Beijing has resorted to force.

David Stilwell with Aung San Suu Kyi.

Q: Are Beijing’s claims legitimate?
A: It’s a complicated question, but there are ways to determine the legitimacy of competing claims without resorting to the behavior of the strongest. China is a very active signatory to the United Nations Convention on the Law of the Sea (UNCLOS), as is the Philippines. UNCLOS has an arbitration mechanism called the International Tribunal for the Law of the Sea (ITLOS) to which all signatories have agreed to submit in the event of a dispute. In 2015, the Philippines took their case to ITLOS, suing the PRC for its actions in Scarborough and elsewhere, and won.
The core of the case is the concept of exclusive economic zones – a maritime space extending up to 200 nautical miles from sovereign territory – in which all fish and mineral resources belong to that country. Beijing does not recognize others’ EEZs in the South China Sea (although it requires others to respect its EEZs everywhere else); instead, it claims all maritime space within its ill-defined “9-dash line” covering roughly 80% of the South China Sea.
In 2016, ITLOS ruled in favor of Manila, ruling that China’s maritime claims were illegal, that some of its territorial claims were also illegal, and that Beijing was required to compensate Manila for illegal actions in Scarborough and elsewhere. Beijing has so far ignored this outcome, despite joining UNCLOS.
Q: The Philippines is an ally of the United States. What has the United States done to support Manila through all of this?
A: Until just under two years ago, US policy was “to take no position on the validity of individual claims” while insisting that disputes be resolved peacefully. Then, in July 2020, Secretary of State Mike Pompeo announced a South China Sea maritime policy update that aligns the United States with the 2016 ITLOS award, denying the 9-dash line claims. from China. Given that the international body responsible for setting maritime standards had concluded that the EEZs of states in the region should be respected, it made perfect sense to change US policy accordingly.
Feedback on the change has been positive, and Beijing’s response has been muted. As a signatory to UNCLOS, what could they say? Interestingly, Beijing’s language on the Arctic Ocean is almost exactly the same as our position on the South China Sea (and other disputed maritime spaces). But Beijing’s insistence on Arctic access puts it at odds with Moscow, which also maintains excessive claims to the Arctic Ocean.
Two lessons emerge. First, great powers are expected to uphold their commitments to international rules and norms even if those rules run counter to that country’s interests – credibility is more important. Second, to be effective, the policy must be constantly repeated.
Q: If the United States has made official written political commitments, why do we have to repeat them constantly?
A: Unlike strategy (i.e. national security strategy), politics does not have the same formality, detail, or permanence. This could be because politics is usually political discourse, broad and ambiguous language to maximize flexibility. When I was an apprentice diplomat at the United States Embassy in Beijing (defense attaché), it was disappointing to see how bilateral meetings were characterized by the same tedious and time-consuming recitation of the same points that we heard during from the last meeting.
The PRC would lay out its boilerplate complaints of the three obstacles, and we would come back with examples of the PRC’s repeated failure to live up to its commitments, such as honoring UNCLOS or PLA interceptors maintaining a safe distance from our aircraft operating in the international airspace.
It’s a funny thing about politics, if you announce it once and then shut up, the conclusion is that the commitment to politics is on the decline. Others will be prompted to mount a challenge in order to avoid it. The Syrian Red Line Policy Statement of 2012 is a negative example of this: the policy was announced, but US responses to Syrian challenges were unconvincing, signaling to Damascus that it could use low risk chemical weapons.
Secretary Pompeo’s political announcement in July 2020 supporting UNCLOS and denying Beijing’s excessive maritime claims is a positive example. Continued verbal support for this policy change from the Biden administration reinforces U.S. commitment to the new policy and reassures ASEAN seekers. And it had an effect; Beijing has abandoned policy statements claiming all maritime space inside the 9-Dash line and now speaks in terms of territorial claims – the four island groups of Pratas Islands, Paracel Islands, Spratly Islands and Macclesfield Bank (and surrounding waters). This appears to be Beijing’s new policy stance, which is also ambiguous, maximizing flexibility.
Finally, more than words, US actions are the best demonstration of continued support for the policy – ​​hitting a Syrian air base that used chemical weapons against the Syrian people with 57 Tomahawk missiles in May 2017 is a good example. Closer to home, ADM Aqualino continues to support past commitments to “fly, navigate and operate wherever international law permits.” In this case, it would be within the South China Sea international air and seaspace as defined by UNCLOS.

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TSX slips to 3-week low as Fed minutes weigh on sentiment https://alg-a.com/tsx-slips-to-3-week-low-as-fed-minutes-weigh-on-sentiment/ Wed, 06 Apr 2022 14:48:45 +0000 https://alg-a.com/tsx-slips-to-3-week-low-as-fed-minutes-weigh-on-sentiment/ The Toronto Stock Exchange’s S&P/TSX Composite Index ended down 142.23 points, or 0.7%, at 21,788.60, its lowest closing level since March 17. U.S. stock markets also fell after minutes from the Federal Reserve’s March meeting revealed plans for how the central bank plans to reduce its bond holdings. “It’s a bad mood. The stock market […]]]>

The Toronto Stock Exchange’s S&P/TSX Composite Index ended down 142.23 points, or 0.7%, at 21,788.60, its lowest closing level since March 17.

U.S. stock markets also fell after minutes from the Federal Reserve’s March meeting revealed plans for how the central bank plans to reduce its bond holdings.

“It’s a bad mood. The stock market doesn’t like rising interest rates, too high inflation, recession and war,” said Barry Schwartz, portfolio manager at Baskin Financial Services.

Russian forces bombarded Ukrainian towns as the United States imposed more sanctions after killings of civilians widely condemned as war crimes and Ukraine’s president called for a decisive Western response amid divisions in Europe.

The technology sector was the biggest decline among the 11 major sectors in Canada, with a decline of 3.3%. Higher interest rates reduce the value to investors of future cash flows that technology and other high-growth sectors are expected to produce.

Energy fell 1.5% due to falling oil prices. U.S. crude oil futures settled down 5.6% to $96.23 a barrel after major consuming nations said they would release oil from reserves to counter tighter supply .

The heavily weighted Financials group lost nearly 1% less, while Industrials ended down 0.8%.

(Reporting by Fergal Smith; Additional reporting by Devik Jain in Bengaluru; Editing by Grant McCool)

By Fergal Smith

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US ambassador to NATO says there is no US policy on regime change in Russia https://alg-a.com/us-ambassador-to-nato-says-there-is-no-us-policy-on-regime-change-in-russia/ Sun, 27 Mar 2022 19:24:00 +0000 https://alg-a.com/us-ambassador-to-nato-says-there-is-no-us-policy-on-regime-change-in-russia/ US President Joe Biden delivers a speech at the Royal Castle in Warsaw, Poland on March 26. (Brendan Smialowski/AFP/Getty Images) The administration of US President Joe Biden continued on Sunday to clean up his off-the-cuff remark that Vladimir Putin “cannot stay in power”, made on his last day in Europe. Julianne Smith, the US ambassador […]]]>
US President Joe Biden delivers a speech at the Royal Castle in Warsaw, Poland on March 26. (Brendan Smialowski/AFP/Getty Images)

The administration of US President Joe Biden continued on Sunday to clean up his off-the-cuff remark that Vladimir Putin “cannot stay in power”, made on his last day in Europe.

Julianne Smith, the US ambassador to NATO, called Biden’s startling comments a “principled human response”, after spending the day witnessing the tragedies of war, when he visited hundreds of Ukrainian refugees, in an interview Sunday with CNN’s Dana Bash. on the “State of the Union”.

“He went to the National Stadium in Warsaw and literally met hundreds of Ukrainians. He heard their heroic stories as they fled Ukraine following Russia’s brutal war in Ukraine. At the time, I think it was a principled human reaction to the stories he heard that day.”

Yet, Smith said, “the United States has no policy of regime change in Russia, period.”

His comments come hours after Secretary of State Antony Blinken also tried to downplay the president’s remarks while in Israel, saying, “I think the president, the White House, argued last night that, quite simply, President Putin cannot be empowered to wage war or engage in aggression against Ukraine or anyone else”.

Asked by Bash to clarify whether the United States thinks Putin should stay in power, Smith pivoted to the White House talking point that “the entire administration, including the president, believes we can’t empower Putin at this time to wage war in Ukraine or to continue such acts”. of aggression.”

Smith did not agree that White House officials’ rapid response to the president’s comments shows his aides are undermining him on the world stage, but instead said officials “feel good” about the instant trip. Of the president.

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Executive Order Launches Comprehensive U.S. Digital Asset Policy and Action Plan | BakerHotelier https://alg-a.com/executive-order-launches-comprehensive-u-s-digital-asset-policy-and-action-plan-bakerhotelier/ Fri, 18 Mar 2022 20:48:45 +0000 https://alg-a.com/executive-order-launches-comprehensive-u-s-digital-asset-policy-and-action-plan-bakerhotelier/ Take away food The Executive Order on Ensuring Responsible Development of Digital Assets (EO) recognizes the significant impact that cryptocurrencies, digital assets and blockchain technology have had and will have on financial services and acknowledges that the United States has an interest in promoting responsible innovation and mitigating risk in these new markets. The OE […]]]>

Take away food

  • The Executive Order on Ensuring Responsible Development of Digital Assets (EO) recognizes the significant impact that cryptocurrencies, digital assets and blockchain technology have had and will have on financial services and acknowledges that the United States has an interest in promoting responsible innovation and mitigating risk in these new markets.
  • The OE expresses the intention of the United States to develop a coordinated federal approach to understanding the opportunities and risks of digital assets and regulating digital assets.
  • The EO calls for research to explore potential options for designing and deploying a US central bank digital currency (CBDC) if deemed to be in the national interest.
  • The EO defines the following terms: blockchain, central bank digital currency, cryptocurrencies, digital assets and stablecoins.
  • The EO directs multiple agencies to assess the impact of digital assets and possibly strengthen investor and market protections, which may lead to increased enforcement actions against companies that operate in these markets.

Overview

On March 9, 2022, President Joe Biden signed the Executive Order on ensuring responsible development of digital assets (EO) and the White House published a correspondent fact sheet summarizing the main related policy objectives. As discussed in more detail below, this is a historic moment for the US cryptocurrency market.

Goals

The OE defines a national policy for digital assets, with six key objectives:

1. Protection of consumers, businesses and investors

Consumer protection is a priority. The EO states that digital assets create new and increased risks of certain crimes and other violations of law, breaches of privacy and data, unfair and abusive acts or practices and other cyber incidents faced by consumers, investors and businesses, and it focuses largely on the need for monitoring, standards and consumer protection. (Art. 2(a) and 5(a).)

2. Financial stability and systemic risk mitigation

Digital asset companies should be regulated. The EO notes that some digital asset trading platforms and service providers operate outside of the US regulatory regime and clarifies that they, as well as digital asset issuers and intermediaries, should be regulated as “Traditional market infrastructures and financial companies”. (Art. 2(b).)

3. Mitigate national security and illicit finance risks

Digital assets can pose significant illicit financial risks. The EO states that digital assets can be used for criminal purposes such as money laundering, terrorism and proliferation financing, fraud and theft schemes, corruption, cybercrime and ransomware, narcotics, human trafficking and circumvention of U.S. and foreign financial sanctions. (Art. 2(c) and 7(a).)

Regulation and enforcement are key. The OE calls for a significant increase in regulatory, oversight and enforcement measures to mitigate illicit finance and national security risks. (Art. 7(a).)

More controls and accountability are needed. The OE notes the growth of “decentralized financial ecosystems, peer-to-peer payment activities, and obfuscated blockchain ledgers” and advocates for the development of controls and accountability to “mitigate illicit finance and national security risks” and “ to promote high standards for transparency, confidentiality and security. (Art. 2(c).)

4. Promoting U.S. Leadership and Competitiveness in the Global Financial System

The United States will seek international cooperation. According to the EO, “[u]Even regulation, supervision and compliance between jurisdictions create opportunities for arbitrage and increase risks to financial stability and the protection of consumers, investors, businesses and markets” in the United States and abroad . For example, the OE notes that “[i]Insufficient AML/CFT [anti-money laundering/combating the financing of terrorism] regulation, supervision, and enforcement by other countries challenges the ability of the United States to investigate illicit digital asset transaction streams that frequently jump overseas, as is often the case in ransomware payments and other cybercrime-related money laundering. (Art. 8(i).)

5. Promotion of financial inclusion

Calls for fair and affordable financial services. The EO discusses the need for safe, affordable, and accessible financial services, and to mitigate the disparate impact of financial innovations on Americans. (Art. 2(e) and 5(a).)

6. Guarantee responsible innovation

Calls for regulation to ensure responsible innovation. “The United States has an interest in ensuring that digital asset technologies and the digital payments ecosystem are developed, designed, and implemented in a responsible manner, including privacy and security” and “defending[s] against illegal logging and reduces negative impacts on the climate. (Art. 2(f).)

Leave “responsible innovation” undefined. The EO leaves open the questions of what “responsible innovation” means and who decides whether this standard is met.

CBDC USA

The United States will seriously evaluate a CBDC. “[The] The administration places the utmost urgency on research and development efforts into potential options for designing and deploying a CBDC in the United States. These efforts should include… actions necessary to launch a CBDC in the United States if deemed to be in the national interest. (Sec. 4(a)(i).) The EO also urges the Federal Reserve to continue its research and development efforts with CBDCs and develop a plan to support government action related to these efforts.

Inter-agency reports

The OE orders various US agencies and interagency groups to submit numerous reports within 90, 120, 180, or 210 days regarding digital assets. The reports generally address CBDCs, economic and consumer opportunities and risks of digital assets, and combating illicit activities involving digital assets. You will find details of the reports here.

Key definitions

The EO provides definitions of the following terms: blockchain, central bank digital currency, cryptocurrency, digital assets, and stablecoins. Of particular note are the definitions of cryptocurrencies and digital assets.

According to the OE, cryptocurrency “refers to a digital asset, which may be a medium of exchange” and which is backed by cryptography. This definition appears to be similar to the definition of “convertible virtual currencies” set forth by the US Financial Crimes Enforcement Network.[1]

In contrast, the EO defines digital assets as “all CBDCs, regardless of technology used” and specifically includes cryptocurrencies and stablecoins in the definition of digital assets. The definition states that “regardless of the label used, a digital asset may be, among other things, a security, commodity, derivative or other financial product”. This broad definition appears to focus on CBDCs and assets that fall under the regulatory authority of the United States Securities and Exchange Commission and/or the United States Commodity Futures Trading Commission.

Conclusion

EO has been considered a game changer for digital assets and blockchain technology. Specifically, some commentators hope that a comprehensive federal approach will help streamline regulation and minimize potential overlapping jurisdictions that could stifle innovation. Other commentators worry that many time-consuming studies, as noted in the OE, will lead to long delays in establishing a coordinated regulatory regime. The BakerHostetler Blockchain Technologies and Digital Assets team has members in all of our major groups, and our attorneys have extensive experience in all areas of the blockchain and cryptocurrency markets, including investigations, securities law securities, commodities law, BSA/AML compliance, taxation, confidentiality. , transactions, advertising law, intellectual property and technology design, as well as government affairs, public policy and advocacy with federal departments and agencies and Congress. Do not hesitate to contact one of our experienced professionals if you have any questions regarding this alert.


[1] FIN-2019-G001 (“virtual currency” refers to a medium of exchange that may function as currency but does not have all of the attributes of “real” currency, as defined in 31 CFR § 1010.100 (m), including legal tender status … [convertible virtual currency] is a type of virtual currency that either has an equivalent value as currency or acts as a substitute for currency, and is therefore a type of “value that substitutes for currency”. »

[View source.]

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Israeli settlement growth continues despite hostile US policy https://alg-a.com/israeli-settlement-growth-continues-despite-hostile-us-policy/ Thu, 10 Mar 2022 13:31:00 +0000 https://alg-a.com/israeli-settlement-growth-continues-despite-hostile-us-policy/ The growth of Israel’s West Bank Jewish population has accelerated over the past year, figures released Thursday by a pro-settler group show, despite renewed US pressure to curb construction on the territory the Palestinians want for a future State. Figures show that a wave of settlements initiated when US President Donald Trump was in power […]]]>

The growth of Israel’s West Bank Jewish population has accelerated over the past year, figures released Thursday by a pro-settler group show, despite renewed US pressure to curb construction on the territory the Palestinians want for a future State.

Figures show that a wave of settlements initiated when US President Donald Trump was in power shows no signs of abating. Trump has provided unprecedented support for Israel’s claims to land seized during the war, reversing decades of US policy.

5 צפייה בגלריה

חצי חצי ג'ו ביידן ודונלד טראמפ

Donald TrumpJoe Biden

(Photo: AFP)

President Joe Biden’s administration has reverted to the previous approach, criticizing settlement expansion as an obstacle to resolving the conflict. But Israel has continued to build and expand settlements, and major road projects are expected to bring even more Jews to the territory.

The statistics, compiled by WestBankJewishPopulationStats.com and based on official figures, show the Jewish population grew to 490,493 as of January 30, an increase of nearly 3.2% over 13 months. The population has increased by 16.5% since the group started compiling statistics in 2017, it says.

Israel’s overall annual growth rate, by comparison, is around 1.7%. In 2020, the last year of the Trump administration, which has also seen repeated coronavirus lockdowns, the Jewish population in the West Bank grew by 2.6%, according to the group.

“There’s an awful lot of construction going on,” said its CEO, Baruch Gordon, including in his community of Beit El, just outside the West Bank city of Ramallah, where the Palestinian Authority is headquartered.

5 צפייה בגלריה

בניה בבית אלבניה בבית אל

Colony building

(Photo: EPA)

“Right now, there are 350 units under construction that will probably be finished within a year, a year and a half. So when that happens, it will increase the size of our city by about 25%,” he said.

The Jewish population in the West Bank tends to be younger and more religious, with a higher average birth rate. Many Israelis are drawn to state-subsidized settlements for their quality of life. They resemble suburbs or small towns and offer lower housing prices than Israel’s crowded and increasingly unaffordable cities. The pandemic might have made settlements even more attractive.

“Just like in America, people left Manhattan and went to the suburbs and found they could live in more open spaces, and the same is happening in Israel,” Gordon said.

Its figures do not include East Jerusalem, which Israel annexed in an internationally unrecognized move, and which is now home to more than 200,000 Jews. The West Bank and East Jerusalem together are home to some 3 million Palestinians.

5 צפייה בגלריה

בניה בבית אלבניה בבית אל

Construction of Israeli settlements

(Photo: EPA)

Israel captured both territories from Jordan, as well as Gaza, in the 1967 Six-Day War. others, and make the creation of a viable state almost impossible. Settlements have expanded under every Israeli government, even at the height of the peace process in the 1990s.

There have been no serious peace negotiations for more than a decade, and Israel’s current prime minister, Naftali Bennett, is a former West Bank settlement leader opposed to a Palestinian state. Israel’s political system is dominated by pro-settler parties that view the West Bank as the biblical and historical heartland of the Jewish people.

The international community still sees a two-state solution as the only realistic way to resolve the century-old conflict, but it has failed to prompt Israel to end its presence in the territory – now well into its sixth. decade.

Hagit Ofran, an expert with the anti-settlement monitor Peace Now, says the population figures are an imprecise measure of growth because they reflect the higher birth rate and people moving into homes built after years of planning. and approval.

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מעלה אדומיםמעלה אדומים

Ma’ale Adumim Colony

(Photo: Reuters)

She says that while American pressure appears to have succeeded in suspending some of the more controversial colonization projects, the whole enterprise is proceeding in the same way as it always has, with several projects gradually progressing and new houses and roads under construction.

“The Americans, as far as I know, are trying to stop it and have had very limited success,” she said.

The seemingly permanent military presence has led three well-known human rights groups to conclude that Israel is committing the international crime of apartheid by systematically denying Palestinians equal rights. Israel rejects these accusations as an attack on its very existence as a Jewish-majority state.

The increasingly authoritarian and unpopular Palestinian Authority, established by agreements with Israel in the 1990s, administers parts of the West Bank, while the Islamic militant group Hamas controls Gaza, from where Israel has withdrawn its troops and its Jewish civilians in 2005.

5 צפייה בגלריה

בניה בברוכיןבניה בברוכין

Colony building

(Photo: AP)

Israel’s current government, which draws on support from parties across the political spectrum, is committed to preserving the status quo, without settlement freezes or formal annexation. He also took steps to improve the economic conditions of the Palestinians.

But Ofran says that in practice, pro-settler ministers and other officials do as they please, and the government does damage control when called upon.

“The foreign secretary is getting phone calls from Americans, or whatever, and all of a sudden the government has to do something about it,” she said.

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