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CUSEF Express

CUSEF Express - January 13, 2023

2023-01-13
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U.S., Japan sign 2+2 agreement before summit

  • The statement devoted half a section to China, calling China “the greatest strategic challenge in the Indo-Pacific region and beyond.” It said the U.S. and Japan have “serious concern” over “China’s foreign policy seeks to reshape the international order to its benefit.” The countries accused China of its activities in the East China Sea and the South China Sea and raised concern about Russia’s “growing and provocative strategic military cooperation with China.”
  • The ministers signed the document before Prime Minister Fumio Kishida’s visit to the U.S. Kishida will meet with President Joe Biden today. Security and economic issues will be the main topics in their discussion.
  • Japan updated three key military documents — National Security Strategy (NSS) (Ja/En), National Defense Program Guidelines (NDPG) (Ja), and Mid-Term Defense Program (MTDP) in December, in a move that some say signaling a depart from its defense-only principle. The U.S. Department of State welcomed the move.

Biden planning more targeted China investment controls

  • The U.S. administration is mulling over a targeted executive order to restrict American investment in China’s semiconductors, quantum computing, and artificial intelligence industries, Axios reported. The executive order, which could take months to realize, would likely exclude the biotechnology and batteries industries.

Kerry, Xie hold video talks

  • China’s top climate envoy Xie Zhenhua held a video meeting with his U.S. counterpart John Kerry on Wednesday, according to a short notice (Zh) from China’s Ministry of Ecology and Environment. The two sides discussed a consensus President Xi Jinping and President Biden reached in Bali in November and multilateral cooperation on tackling climate change.

NATO, EU upgrade cooperation

  • NATO and the EU signed their third Joint Declaration of cooperation on Tuesday, saying that “China’s growing assertiveness and policies present challenges that we need to address.” European Council President Charles Michel, European Commission President Ursula von der Leyen, and NATO Secretary General Jens Stoltenberg, who signed the declaration, pledged to take their partnership “to the next level.”
  • It was the first time that such a declaration mentioned China and Russia directly. The first NATO-EU Joint Declaration was signed in July 2016, when hybrid threats, referring to military and non-military means combined, emerged as a prominent security concern. In July 2018, the allies signed their second Joint Declaration, which is, in general, a continuation of the previous one.
  • It is noteworthy that in the first two declarations, the content regarding decision-making autonomy appeared at the beginning of the documents. However, such content was moved to the end of the third joint declaration, where “shared value” was highlighted in the first paragraph. The latest declaration also emphasized “transparency,” which the allies started to single out as “crucial” in the second declaration. Asked whether strategic autonomy was “dead,” Michel said, “NATO’s Strategic Concept complements, supports, and is consistent with the EU’s [military] document, the Strategic Compass.” “Strategic autonomy does not say that you do not cooperate, you cooperate with like-minded partners,” Von der Leyen said.

House targets China over SPR sales

  • The U.S. House passed a bill with a 331-97 vote on Thursday to prohibit the country’s Strategic Petroleum Reserve (SPR) from being sold to China. All votes against the bill were from Democrats. The new chair of the House Energy and Commerce Committee Cathy McMorris Rodgers (R-WA) introduced the bill on January 9, soon after the Representatives of the 118th House were sworn in.
  • President Biden released 180 million barrels from the SPR last year to bring down the oil prices that soared due to the Ukraine war. However, the SPR oil only accounted for 2% of the oil the U.S. sold to China, said Frank Pallone (D-NJ), the ranking Democrat of Rodgers’s committee. Pallone, who opposed the bill, said the Republicans were “skirting around” the issue and “scared of Big Oil’s wrath.”
  • The bill is largely a declaration of position. To become a law, it still needs to go through the Democratic majority Senate, where it has less chance to pass. Even if it does, the impact on the bilateral oil trade is limited. In 2021, China imported more than 230 million barrels of oil.

Commentaries of the day

Chinese experts on U.S.-Japan talks: Shi Yinhong from Renmin University and Liu Jiangyong from Tsinghua University answered questions from the SCMP about the recent “2+2” talks between the U.S. and Japan. The Global Times interviewed Da Zhigang from the Heilongjiang Provincial Academy of Social Sciences and Li Haidong from the China Foreign Affairs University about the same issue. They saw more trouble coming for regional stability.

From the readers

  • Here is today’s question: How has the war in Ukraine affected China-EU relations?
  • Response to the newsletter content and comments on other issues related to China-U.S. relations are also welcome.

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