The result is a war in which the heaviest economic consequences are being absorbed by those with the least influence over how it ends. That is not an unintended side effect. It reflects how modern conflict now interacts with an interconnected global system.

A war that moves through systems

The violence of the war may be concentrated in the Gulf, but the disruption is not. Pressure around the , which carries a substantial share of global oil and liquefied natural gas, is already translating into broader instability. Insurance premiums for shipping have . have been adjusted or delayed. Even limited disruptions have forced rerouting through longer and more expensive corridors. Energy markets have responded with volatility that reflects not only current supply risks, but uncertainty about how far escalation could extend.

These effects are not linear. They move through the same channels that sustain the global economy. Energy flows, maritime logistics, financial markets and supply chains react simultaneously, but unevenly. A disruption at one point in the system propagates outward, reshaping conditions elsewhere.

The Gulf states are encountering the first layer of this pressure. Infrastructure, once treated as secure, is now exposed. Oil facilities, ports and shipping terminals are at increasing risk. More critically, , which provide the majority of potable water in several Gulf countries, have emerged as potential vulnerabilities. Any sustained disruption to these systems would not only affect economic output but also the basic functioning of daily life.

These states are not directing the war, but they cannot distance themselves from it. Their exposure is structural, rooted in geography and infrastructure. Beyond the Gulf, the effects become less visible but more complex.

South and Southeast Asia are absorbing the next layer of impact. Countries such as , which rely heavily on imported energy, are particularly sensitive to even modest price increases. Currency pressure intensifies as import costs rise; inflation begins to move; governments face difficult trade-offs between stabilizing prices and maintaining fiscal discipline. These pressures do not appear all at once; they build gradually, often unnoticed at first.

Recent movements in global have already begun to translate into higher domestic costs across several Asian economies. Airlines face rising fuel expenses, manufacturing sectors dependent on energy inputs adjust output and households encounter rising costs that are not immediately traceable to the conflict, but are directly linked to it.

There is also a human dimension that remains largely overlooked. Millions of from South Asia are employed across the Gulf. Their income supports families and local economies back home. As uncertainty increases, their position becomes more precarious. Flight routes are disrupted; insurance premiums increase; mobility becomes more constrained at the very moment when flexibility is most needed. They are not participants in the conflict. Yet they are embedded within its consequences.

Further east, the constraints tighten. Japan and South Korea sit at the far end of the same energy chain, but with far less flexibility. Their dependence on Middle Eastern energy imports is not marginal; it is structural. A significant portion of their oil imports passes through the same contested maritime routes. When supply tightens, they are forced into competition for alternative sources, often at higher cost.

This has immediate effects: Industrial output begins to slow, petrochemical production adjusts, and financial markets react to uncertainty in input costs and output expectations. What begins as an energy shock extends into industrial and financial systems. The war is not expanding geographically in the traditional sense; it is expanding through systems.

The economies that carry the burden

The most consequential aspect of this dynamic is not simply the scale of disruption, but its distribution. The countries bearing the greatest economic pressure are not those setting the conflict¡¯s trajectory. They are not determining strategy or shaping escalation. Yet their economies, infrastructure and populations are directly exposed to the consequences. What emerges from this is a structural imbalance that is difficult to correct.

The US, despite its central role, is relatively insulated from the immediate energy shock. As a major energy producer, it experiences price fluctuations differently. Domestic pressure exists, but it does not threaten systemic stability in the same way. Iran, for its part, is already operating under long-term economic constraints. Additional pressure intensifies existing challenges, but does not fundamentally alter the conditions under which it operates. Israel¡¯s exposure is primarily security-driven, rather than rooted in systemic economic vulnerability of the same kind.

The most severe pressures are concentrated elsewhere. They are felt most acutely in economies that are deeply integrated into global systems, but lack the capacity to shape them. This is where the situation becomes more complex than it initially appears.

If energy prices continue to rise, governments across affected regions will be forced to respond. Subsidies may be expanded; strategic reserves may be drawn down; emergency fiscal measures may be introduced to stabilize domestic conditions. These responses are not cost-free; they shift pressure into financial systems.

Several large Asian economies hold substantial foreign-currency reserves, including . In periods of sustained stress, the liquidation of such assets can serve as a tool for maintaining domestic stability. If undertaken at scale, these actions would transmit pressure into global financial markets, affecting borrowing costs, liquidity and investment conditions.

A regional conflict begins to generate global financial consequences. At that point, the distinction between participant and observer begins to weaken.

A system that redistributes risk

What is unfolding is not simply economic disruption. It is a redistribution of risk across an interconnected system. Energy markets are beginning to fragment, as different regions experience different price pressures and supply constraints. are adjusting, but not uniformly. Some states are able to absorb shocks through reserves and diversification. Others face more immediate constraints. The longer the conflict persists, the more these differences widen.

Recent developments suggest that even limited escalation can have disproportionate effects. Temporary disruptions to shipping routes have already extended delivery times and increased costs. Insurance markets have adjusted faster than physical supply, amplifying the economic impact. Financial markets are reacting not only to current conditions, but to the possibility of further escalation.

Over time, this begins to resemble a feedback loop. Uncertainty drives cost. Cost drives policy response. Policy response introduces new distortions. The system does not stabilize quickly. It adjusts, but unevenly and often with delay. This is not a temporary disturbance that will dissipate once the conflict slows. It reflects a deeper shift in how war interacts with global systems. Conflict is no longer contained by geography. It is transmitted through connectivity.

The wrong economies

The countries most exposed to the economic consequences are not the ones making strategic decisions or defining objectives. Yet they are the ones managing inflation, stabilizing currencies, protecting supply chains and absorbing social pressure. They carry the cost without controlling the cause. This is increasingly how modern conflict operates. Power is exercised in one place. Consequences are distributed across many. The further a country is from the center of decision-making, the more likely it is to experience the conflict as an external shock rather than a controllable process. And the longer the war continues, the more entrenched this pattern becomes.

Wars are still fought between states, but their effects are no longer confined to them. They move through the systems that connect economies, societies and markets. And in that movement, the burden does not fall where power is concentrated; it falls where exposure is greatest. That is why this war is not just reshaping the balance of power; it is reshaping the distribution of vulnerability. And in doing so, it is placing the heaviest burden on the economies least able to shape the outcome.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The Iran War Is Breaking the Wrong Economies appeared first on 51³Ô¹Ï.

Despite this enormous potential, Indonesia faces a persistent threat that continues to undermine its economic strength and maritime sovereignty. One of the most serious challenges is the practice of Illegal, Unreported and Unregulated (IUU) Fishing. This activity has become a major concern for marine governance and fishery sustainability in the region.

For many people, IUU Fishing is often understood simply as the theft of fish by foreign vessels. Such a perception, however, oversimplifies the problem. In reality, IUU Fishing represents a multidimensional issue that involves economic losses, environmental degradation, violations of maritime sovereignty and connections to transnational organized crime.

Massive economic losses

From an economic perspective, the impact of IUU Fishing on Indonesia is extremely significant. National losses are estimated to range from ($1.7 billion) to Indonesian rupiah ($5.9 billion) annually. Earlier estimates from ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ Supreme Audit Agency suggested that the potential losses could reach as high as Indonesian rupiah ($17 billion) per year.

These figures demonstrate that IUU Fishing is far more than an ordinary illegal activity. It represents the extraction of natural resources without contributing any economic benefit to the state. Fish caught through illegal operations are not recorded in official fishery statistics and are not subject to taxes or landing fees.

In many cases, the catch is transported directly overseas without passing through Indonesian fishing ports. This situation deprives the country of potential non-tax state revenue and eliminates opportunities for domestic value-added activities in fish ports. Practices such as illegal transshipment at sea prevent catches from entering national supply chains, thereby reducing for local fish processing industries.

The economic consequences are also felt directly by small-scale fishers. Large industrial vessels that operate illegally create an uneven competition with traditional fishing communities. In several cases, such conditions have and intimidation against local fishers.

Threats to marine resource sustainability

Beyond economic losses, IUU Fishing also poses a serious threat to the sustainability of marine resources. Unregulated fishing pressure accelerates overfishing and leads to significant declines in fish stocks. Such pressures can disrupt marine ecosystems and weaken the resilience of fishery resources.

and unreported catches are estimated to result in substantial losses of marine resources each year, with some estimates suggesting figures of up to tons annually. Losses of this magnitude not only harm the fisheries sector but also disturb the ecological balance of marine environments.

The situation is further aggravated by the use of destructive fishing methods such as blast fishing, cyanide poisoning and trawl fishing. These practices have caused extensive damage to marine habitats. Reports indicate that around 33.82% of ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ have experienced degradation due to fishing activities.

Fish is also one of the main sources of protein for many Indonesian communities. Declining fish stocks, therefore, have direct implications for national food security. Reduced fish availability may increase the risk of nutritional deficiencies in coastal and .

In a broader global context, the degradation of ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ marine resources carries international implications. Indonesian waters form part of important migration routes and habitats for globally traded fish species. Declining productivity in these waters may therefore influence seafood supply stability in international markets.

Violations of maritime sovereignty

IUU Fishing also represents a direct violation of ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ maritime sovereignty. Many foreign vessels illegally enter ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ Exclusive Economic Zone and conduct fishing operations without permits. Such activities undermine the authority of the state over its own maritime territory.

To evade detection, these vessels often disable their Vessel Monitoring System or manipulate ship documentation. Some vessels also engage in double flagging by changing and registration. These strategies make enforcement more complicated and reduce the effectiveness of monitoring systems.

Law enforcement at sea also faces institutional challenges. In Indonesia, at least seven agencies share authority over maritime law enforcement. These include the Indonesian Navy, the National Police, the Ministry of Marine Affairs and Fisheries and the Indonesian Maritime Security Agency.

The overlapping responsibilities of these institutions often create coordination challenges in the field. Such institutional fragmentation may open opportunities for illegal operators to in enforcement. As a result, IUU Fishing continues to persist despite regulatory efforts.

Links to transnational organized crime

Over time, IUU Fishing has evolved beyond a simple violation. The practice increasingly operates as part of transnational organized crime networks that threaten and . These networks frequently operate across national borders and utilize complex logistical structures.

Criminal involvement in illegal fishing operations often includes labor exploitation and human trafficking. Such practices further increase in maritime regions.

In addition, illegal fishing operators often rely on document manipulation and vessel identity changes to conceal ownership and evade monitoring systems. These methods complicate law enforcement efforts to identify the structures behind illegal fishing operations.

Illegal transshipment at sea is another key mechanism used in these networks. This activity allows vessels to transfer catches offshore in order to avoid customs inspections and sanitary regulations. As a result, illegally caught fish can be and mixed with legally caught products in global seafood markets.

Investigations into IUU Fishing operations have also revealed connections to other crimes such as and drug trafficking. These activities often rely on the same distribution networks operating across international waters. Empirical studies indicate that this form of transversal criminality involves thousands of violations globally and includes hundreds of industrial fishing vessels linked to corporate entities across .

Legal challenges further complicate efforts to prosecute the masterminds behind these networks. Fishery regulations frequently impose penalties only on vessel crews rather than targeting the corporate actors responsible for organizing illegal operations. Jurisdictional ambiguity in the high seas also to obscure the origin of catches before landing them in port.

This situation not only threatens marine ecosystems but also worsens the vulnerability of coastal communities that depend heavily on fishery resources. The continued exploitation of marine resources through illegal activities food security and undermining sustainable fishery governance.

Strengthening ocean governance

In response to these challenges, Indonesia has implemented policies based on three main pillars: sovereignty, sustainability and welfare. One of the most widely known policies is the sinking of illegal fishing vessels. This measure was designed to create a deterrent effect against illegal fishing operators.

The policy has contributed to a temporary reduction in certain types of violations. However, combating IUU Fishing requires more than symbolic enforcement actions. Strengthening through technology remains essential.

Improved coordination among maritime enforcement institutions is also necessary. Institutional integration would help close enforcement gaps that illegal fishing operators frequently exploit. Effective governance requires collaboration across agencies responsible for maritime security.

International cooperation is equally important. Because IUU Fishing networks operate across borders, regional collaboration in maritime surveillance and fishery governance is essential. Data sharing, coordinated patrols and supply chain transparency can significantly strengthen enforcement efforts.

IUU fishing and the challenge of achieving the SDGs

Ultimately, IUU Fishing is not merely a fishery management problem. It is an issue that intersects with economic development, environmental protection, maritime security and human rights. In the context of global sustainability, the persistence of IUU Fishing also directly undermines the achievement of several (SDGs).

Unchecked illegal fishing threatens SDG 14 (Life Below Water) by accelerating the depletion of marine resources and damaging critical ocean ecosystems. At the same time, declining fish stocks and the loss of fishery income weaken coastal livelihoods and undermine SDG 1 (No Poverty) and SDG 2 (Zero Hunger), particularly for communities that rely heavily on fisheries as a primary source of food and income.

The human rights dimension of IUU Fishing further highlights its relevance to SDG 8 (Decent Work and Economic Growth) and SDG 16 (Peace, Justice and Strong Institutions). Illegal fishing operations are frequently linked to labor exploitation, human trafficking and weak maritime governance, which undermine fair labor conditions and effective law enforcement in maritime sectors.

Addressing IUU Fishing should therefore go beyond enforcement alone. It requires strengthening governance systems, improving transparency in fish supply chains and reinforcing in maritime territories. In this context, combating IUU Fishing is also part of safeguarding national sovereignty and institutional integrity.

At a time when global marine resources are under increasing pressure, ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ ability to tackle IUU Fishing will play an important role in advancing the global sustainability agenda. Effective action against IUU Fishing can contribute not only to ocean conservation but also to food security, equitable economic development and stronger institutions across the Indo¨CPacific region.

[ edited this piece]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post IUU Fishing: A Devastating Threat to Indonesia and the World appeared first on 51³Ô¹Ï.

Although the global transition to renewables is gaining momentum, the energy crisis during the Iran war has underscored a basic lesson: Oil and gas remain indispensable for a while, and no serious energy policy can neglect security, redundancy and resilience during the long years of this expected transition.

Therefore, a sound energy policy should pursue renewable energy while strengthening energy security. Strategic stocks, resilient pipelines, alternative routes and reliable firm power, such as nuclear, still matter because governments do not manage energy systems in theory. They manage them in the midst of shocks, shortages and war.

A chokepoint shock that markets cannot innovate away overnight

In 2025, around 20 million barrels per day of crude oil and petroleum products moved through the . That was roughly a quarter of the world¡¯s seaborne oil trade, and around 80% of it was destined for Asia. These numbers explain why the Iran War is not a regional event for energy markets. When Hormuz closed, the shock spread immediately through oil prices, insurance costs and physical supply, especially for Asian importers.

For months, many analysts had already warned that if a US and Israeli attack on Iran began, Tehran¡¯s greatest leverage would be the Strait of Hormuz. Yet despite that, the Trump administration openly that it did not expect Iran to close the strait. That was not simply a miscalculation. It was a serious policy failure that ignored an obvious strategic risk.

As the war has continued, fuel supply problems have begun to emerge, including shortages in gasoline and petroleum . Some Asian have stopped external sales, and prices have surged globally. In the US, the average gasoline price rose by nearly after the war began, while over oil export restrictions resurfaced and sanctions on were eased.

Meanwhile, the US has continued to threaten that keeping Hormuz closed would carry heavy consequences for Iran. Yet despite threats, potential and emergency measures, no truly reliable solution has emerged. That is why the search for alternatives has accelerated. The decision by the International Energy Agency (IEA) and its member countries to coordinate a emergency stock release in March was important, but such a measure only buys time. If , it cannot substitute for real supply security. Because no government can replace a chokepoint-scale flow with brand-new infrastructure or a fully transformed vehicle fleet in a matter of months. That is why governments need a balanced approach that pushes decarbonization forward while also building buffers and alternatives for future crises.

Fossil fuels remain the base of the system

The uncomfortable baseline is that the global economy still runs mostly on fossil fuels. In 2024, fossil fuels still accounted for of the global energy mix, which means that oil, gas and coal remain the foundation of the system even as cleaner sources expand. This structural fact shows that the world still moves goods, powers industry, heats buildings and supports global trade through fossil-based systems.

The same pattern is visible in the gas trade. Liquefied natural gas (LNG) is not a marginal fuel in today¡¯s economy. GIIGNL reports tonnes of global LNG trade in 2024. And these volumes matter because crises rarely hit only crude oil. Disruption also affects refined products, gas logistics, petrochemicals, shipping networks and industrial production.

In other words, even a strong renewable build-out does not instantly eliminate dependence on oil, gas and the global infrastructure that moves them. Pretending otherwise only sets governments up for policy panic when the next shock arrives.

Renewables are growing, but the denominator is huge

None of this is an argument against renewables. It is an argument for realism about scale. For example, the transition is real, especially in the electricity sector. In 2024, renewables provided of global electricity generation. But the broader economy changes much more slowly. Modern renewables accounted for only of global total final energy consumption in 2022, which shows how difficult it is to decarbonize heat, heavy industry and transport at the system level.?

Transport is a good sign of this gap between fast growth and limited total impact. Global electric car exceeded 17 million in 2024, yet the total electric car fleet reached only about 58 million, or roughly 4% of the global passenger car fleet.

Even the clean energy build-out still depends on carbon-intensive industrial production today. Around of global steel relies heavily on coal. In other words, electrification and renewables are expanding fast, but the denominator is so large that the overlap period will be long. For years to come, energy security planning will have to assume that societies need both cleaner systems and conventional fuels at the same time.

Security tools that work in a crisis

In the short run, the first tool available in a crisis is emergency stocks. That is exactly why they exist, as can be seen in the IEA¡¯s largest coordinated stock release in March. But emergency stocks are a bridge, not a new supply system. The more important question is what happens when a disruption lasts longer.

This brings us to pipelines and alternative routes. Existing bypass capacity around Hormuz remains limited relative to the scale of normal flows. The IEA estimates that only barrels per day can be redirected through existing pipelines. The main examples are Saudi Arabia¡¯s from Abqaiq to Yanbu, which provides access to the Red Sea, and the United Arab Emirates¡¯ Abu Dhabi crude oil to Fujairah, which bypasses Hormuz by reaching the Gulf of Oman. Their value is not theoretical. During the current war, Saudi exports from Yanbu rose to nearly 4 million barrels per day as volumes were rerouted away from the Strait of Hormuz.?

Another example, although far too small to replace Hormuz and not directly located in the Gulf, is Iraq¡¯s northern export route through the Iraq-Turkey pipeline, which ends at Ceyhan on the Mediterranean. After being largely inactive for the past two years, the pipeline resumed operations in March at around per day, with plans to increase flows toward 250,000 barrels per day.

These volumes are still too small to bypass Hormuz, but that is not the point. Countries with alternatives can better absorb shocks. Countries with only one route cannot. Optionality is not a luxury in energy security. It is one of its basic conditions. Pipelines, LNG terminals, storage, multiple entry points and diversified contracts all improve resilience because they reduce the cost of disruption and increase bargaining power in a crisis.

Nuclear is still part of the balance

Another important part of a balanced policy is firm, low-carbon power that does not depend on daily fuel shipments through contested sea lanes. That is where nuclear still matters. Europe¡¯s recent energy experience, first with Russian supply risk and now with the shock created by the Iran war, has pushed many leaders to see energy policy not only as a climate issue but as a strategic one. This is why the debate around nuclear has returned so strongly.

In 2024, nuclear power plants in 12 EU countries produced of the EU¡¯s electricity. That is not a marginal share. It is a major pillar of supply security as well as decarbonization. The political debate in Europe reflects this reality. In March 2026, President of the European Commission Ursula von der Leyen said that Europe¡¯s decision to let nuclear power¡¯s share fall from about one third of electricity generation in 1990 to around 15% today was a ¡°.¡±

Germany illustrates the same tension. Even after shutting its reactors, debate continues over whether some nuclear capacity if price pressures and import dependence worsen. The implication is not that every country must expand nuclear power. It is that removing firm options before credible replacements are fully in place raises the cost of every geopolitical shock and makes policy reversals more likely when a crisis hits.

As prices rise and import dependence becomes more politically costly, arguments for rethinking earlier decisions return. That alone shows the issue remains alive whenever security and affordability come under pressure.

Build the future, but defend the present

The clean energy transition is moving, especially in electricity. But the Iran War is a blunt reminder that energy systems change more slowly than geopolitics. States should invest aggressively in renewables, grids, storage and electrification because these reduce dependence on imported fuels over time. But they also need a security portfolio for the overlap years.

That portfolio should include strategic stocks that can be released quickly, diversified supply chains for LNG and refined products, resilient routes that bypass chokepoints where possible and reliable firm power where politically viable. It also means maintaining and modernizing pipelines and interconnectors, not as an alternative to decarbonization, but as insurance during an unstable transition.

The central policy inference is simple. Build the future, but do not leave the present undefended.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The Iran War Is a Reminder: Decarbonize Fast, But Do Not Gamble with Energy Security appeared first on 51³Ô¹Ï.

Atul sets the framework at the outset:

So, as usual, we¡¯ll have a three-part structure. We are going to first ask the question: What are these tensions? Then we are going to pose the question: Why do we have these tensions? And then we will pose the third question: What could happen next? We will paint some scenarios.

Those three questions ¡ª what, why and what next ¡ª shape the entire conversation. What appears at first glance to be another People¡¯s Liberation Army (PLA) drill at the end of 2025 becomes an examination of sovereignty and legitimacy of Chinese claims over Taiwan as well as the evolving balance of power between a rising China and a still-dominant US.

What: rising military and political tensions

These tensions are both military and political. Atul and Glenn begin by outlining the former.

At the end of 2025, the PLA staged a massive display of force around Taiwan. The exercise, titled Justice Mission 2025, included ten hours of live-fire drills and effectively encircled the island. It took place just 11 days after Washington approved an $11 billion arms sale to Taiwan, the largest deal to date between Washington and the Taiwanese capital of Taipei.

On December 30, the PLA¡¯s Eastern Theater Command conducted a second consecutive day of large-scale operations involving army, naval, air and rocket forces. Taiwan¡¯s Defense Ministry reported that it ¡°detected 130 Chinese military aircraft and 14 naval vessels.¡± Of a total of 130 sorties, 90 entered Taiwan¡¯s northern, central, southwestern and eastern air defense identification zone (ADIZ). For defense forces, ADIZ functions as an early warning system ¡ª though in a strait only 160 kilometers wide, reaction time is barely a few minutes.

Taiwanese President Lai Ching-te condemned the drills as undermining regional stability through military intimidation. Chinese Foreign Minister Wang Yi criticized Taiwan for continuous provocations, rebuked Japan¡¯s leadership for openly challenging China¡¯s territorial sovereignty and denounced the $11 billion US arms sale.

In some ways, the political tensions are more important. Since Xi Jinping became president in 2012, China¡¯s tone on Taiwan has shifted. Before Xi, China was aggressively pursuing economic integration with Taiwan and boosting travel between the countries. Its goal was to achieve de facto integration over time. Since Xi took over, China has engaged in increasing levels of military confrontation and adopted a much more nationalistic tone on political integration. 

Under Xi, China has adopted increasingly aggressive policies in the South and East China Seas and in Tibet. Beijing has also stepped up harassment of Chinese students in obscure Australian or American universities, as well as engaged in a shrill ¡°wolf warrior¡± diplomacy that confronts anyone who says anything out of harmony with China¡¯s Taiwan policy. In recent years, Xi has dialled down this aggressive diplomacy, but the Chinese Communist Party (CCP) takes an increasingly hardline stance on Taiwan. 

After saber-rattling against Taiwan, China eased its show of force. Both sides have now signaled interest in stabilizing relations ahead of a planned ¡°Grand Summit¡± between Xi Jinping and US President Donald Trump this April. At his Florida Mar-a-Lago, Trump responded to news about Taiwan with characteristic nonchalance, saying he has a ¡°great relationship¡± with Xi. ¡°Nothing worries me,¡± said Trump.

The immediate danger, Glenn argues, is not a Chinese invasion of Taiwan. The real danger concerns the standard of behavior, which China has successfully shifted. The normalization of Beijing¡¯s coercive behavior ¡ª the steady shifting of what counts as routine ¡ª has resulted in a gradual erosion of Taiwan¡¯s de facto sovereignty. 

Why: history ¡ª bitter legacy of a brutal civil war on Mainland China

To answer the second question, Atul and Glenn turn to history.

The roots of the China-Taiwan tensions lie in the Chinese Civil War, which lasted from August 1, 1927, to December 10, 1949. CCP and the Kuomintang (KMT) fought a brutal civil war for control of China. The KMT, founded by the revolutionary Sun Yat-sen in 1894 and reorganized in 1911, ruled Mainland China, which was then known as the Republic of China (ROC). General Chiang Kai-shek succeeded Sun as the KMT leader, but, bit by bit, he lost on the battlefield, and the KMT lost public support. Why?  

American journalist Theodore White¡¯s reporting answers the question. He captures the story of the civil war in one grotesque scene: White observed miles and miles of dead Chinese peasants on the roadside, as the KMT forces marched to oppose the Communists. They had died to a significant extent not from war but due to KMT corruption, which caused mass starvation. In addition, the KMT, for all its sincere, visceral hostility to the West ¡ª KMT leaders were often true nationalists ¡ª was tainted as the pawn of the imperial powers. Therefore, KMT leaders could never really escape the perception that they were corrupt warlords beholden to the colonial, exploitative gweilo (foreigner). Meanwhile, the communists, who were equally if not more ruthless, were identified with helping the peasants, not the ruling elites, and were not gweilo-tainted in the minds of peasants. End of story.

At the end of 1949, Mainland China under the CCP became the People¡¯s Republic of China (PRC) as the KMT retreated to Taiwan, which now became the Republic of China (ROC). Both the PRC and ROC claimed to be the legitimate state for all the Chinese people. Both believed in the One China policy and reunification. The CCP wanted to assimilate the ROC into the PRC. The KMT thought that one day the PRC would crumble and the ROC would include Mainland China.

Why: history ¡ª another bitter legacy on a small island

Since 1949, the KMT has ruled Taiwan, but never quite forgotten its past. In 1894, Sun had founded the party in Honolulu, Hawaii, as the Revive China Society. In 1919, he reformed the party in 1919 in the Shanghai French Concession and renamed it the KMT. Chiang, Sun¡¯s brother-in-law, succeeded him as leader. Known as Generalissimo, Chiang reunited China after his Northern Expedition against regional warlords from 1926 to 1928. Yet, as mentioned earlier, Chiang¡¯s star faded, and the KMT decamped to China. Chiang was the de facto dictator until his death in 1975, and the KMT ruled Taiwan as a one-party state till 1987. 

Chiang¡¯s son, Chiang Ching-kuo, succeeded him. Chiang Junior lifted martial law and the ban on opposition parties. In 1988, Lee Teng-hui succeeded the Chiang family as president and continued democratic reforms. He won the first direct presidential election in 2016. Chen Shui-bian succeeded Lee by winning the 2000 presidential election. Chen ended 72 years of KMT presidencies, but the party later reclaimed power eight years later with the landslide victory of Ma Ying-jeou in the 2008 presidential election. The KMT lost the presidency and its legislative majority in the 2016 elections, but remains a force in Taiwanese politics. The party won a legislative plurality in the 2024 elections.

Today, Chen¡¯s Democratic Progressive Party (DPP) is the center-left force in Taiwanese politics. Founded in 1986 by Hsu Hsin-liang, Roger Hsieh and Lin Shui-chuan, a year prior to the end of martial law, the DPP is a strong advocate of human rights and opposes authoritarianism. President Lai Ching-te is the third DPP president. Chen was the first DPP president who held office from 2000 to 2008, and Tsai Ing-wen was the second one who held power from 2008 to 2016.

The DPP¡¯s roots lie in the Tangwai movement, which opposed the KMT¡¯s one-party authoritarian rule. The movement opposed the ¡°party-state¡± system and gathered force in the mid-1970s and early 1980s. In 1979, the same year in which the US ceased its recognition of the ROC, conflict between authorities and the tangwai again turned violent in the Kaohsiung Incident. Also known as the Formosa Incident, the Meilidao Incident or the Formosa Magazine incident, this was a crackdown on pro-democracy demonstrations that occurred in Kaohsiung on December 10, 1979. Note that the KMT imposed martial law from 1949 to 1987. In fact, the KMT rule from 1949 to 1992 has come to be known as the White Terror. This terror is held to have only ended in 1992 when the criminal code changed and the Taiwanese could no longer be prosecuted for ¡°anti-state activities.¡±

Having lost a bitter civil war to the CCP, the KMT had an anti-communist ideology. It ruled Taiwan through martial law and curtailed civil liberties. Many of the founding members of the DPP suffered greatly at the hands of the KMT. Today, the DPP is a nationalist party that advocates strengthening Taiwanese identity, opposes pan-Chinese nationalism of both the KMT and the CCP, and criticizes China¡¯s claims of sovereignty over Taiwan as a new form of colonialism and imperialism. Unsurprisingly, the DPP harbors bitter memories of KMT martial rule from 1949 to 1987.

Given the country¡¯s past, Taiwanese politics is famously fractious. The Legislative Yuan, as the Taiwanese parliament is called, has been an arena for punching, hair pulling, and the throwing of plastic bottles and water balloons over the years. In one particularly heated fight in July 2017, legislators lifted up and threw chairs at each other as they argued over an infrastructure spending bill. In 2020, legislators threw pig guts and exchanged blows amid a heated row over pork imports from the US.

Right now, the DPP has the presidency while the KMT controls the legislature. The current official position of the DPP is that the ROC is an independent and sovereign country. Its territory consists of Taiwan and the surrounding smaller islands whose sovereignty derives only from the ROC citizens. The DPP¡¯s philosophy of self-determination is based on the 1999 ¡°Resolution on Taiwan’s Future.¡± The party considers Taiwan an independent nation and finds a formal declaration of independence unnecessary.

Why: tricky question of nationalism and legitimacy

For decades, both the CCP and KMT claimed to be the real representatives of the Chinese people. Both followed the One China policy because they fought a battle for legitimacy and sought to emerge as the unifying force in Chinese politics. 

Over time, the KMT has lost power and evolved into a vibrant Taiwanese democracy. In contrast, the CCP is stuck to its old dogma in an authoritarian system where Mao Zedong seized power through the barrel of a gun.

The core of the CCP¡¯s legitimacy rests on three planks. First, the party offers hundreds of millions of Chinese high economic growth, greater prosperity and rising living standards. Second, the CCP is the standard bearer of Chinese nationalism, which is seen as an antidote to the century of humiliation when foreigners invaded and exploited China. Third, the CCP seeks to absorb Taiwan and reunify China. As a one-party state, the CCP-led PRC sees the ROC multiparty democracy in Taiwan as a threat. 

In fact, the absorption of Taiwan is an article of faith for the CCP. This Taiwan obsession is, in part, irrational. After all, on what rational basis can the CCP claim to be a single-party ruling elite? Be this as it may, Xi has clearly chosen to prioritize Taiwan since he came to power in 2012. Unification would be the apotheosis of two of the CCP¡¯s pillars of legitimacy since 1949. Xi has played the nationalism card with increasing vigor, and now even the CCP sometimes struggles to control the nationalist surges it foments. Even as a DPP-led Taiwan has become increasingly independent-minded, the CCP-led China has become ever more intransigent.

Why: equally tricky question of sovereignty and great power politics

When the CCP set up the PRC in 1949, it sought to independence or any prospect of independence, as well as any potential foreign intervention in Taiwan. The CCP was not entirely successful. The First Taiwan Strait Crisis of 1954¨C55 was an unsuccessful attempt by the PRC to deter the US from signing a mutual defense treaty with the KMT government. The Second Taiwan Strait Crisis of 1958 followed soon after. The PLA bombarded Kinmen, and the US deployed a US aircraft carrier Essex and other naval vessels to the Taiwan Straits.

The Department of Defense recommended and pushed hard for a ¡°massive retaliation¡± doctrine. This involved the use of nuclear weapons in the event China invaded Quemoy (as Kinmen was known then) and Matsu. US President Dwight D. Eisenhower never conveyed this threat to China, and his response was conventional. He used naval force alone. The ¡°massive retaliation¡± doctrine later changed to a policy of graduated response under President John F. Kennedy.

The Third Taiwan Strait Crisis of 1995¨C96 occurred nearly 40 years later. The Chinese wanted to express disapproval of Taiwanese President Lee Teng-hui¡¯s visit to the US. More importantly, the US acknowledged (but did not endorse) the PRC¡¯s One China policy in 1979. Since then, the US policy has been not to take a position on Taiwan¡¯s sovereignty and regard its ultimate status as undetermined. 

In 1979, President Jimmy Carter also signed into law the Taiwan Relations Act (TRA), which commits the US to ¡°make available to Taiwan such defense articles and defense services in such quantity as may be necessary to enable Taiwan to maintain a sufficient self-defense capability.¡± The TRA also obligates the US to maintain the capacity ¡°to resist any resort to force or other forms of coercion that would jeopardize the security, or social or economic system, of the people of Taiwan.¡± Note that the TRA, however, does not obligate the US to come to Taiwan¡¯s defense, and for decades, US presidents have refused to say whether they would intervene on Taiwan¡¯s behalf ¡ª a policy known as strategic ambiguity.  

In May 2022, President Joe Biden signaled a change in this policy, saying that the US had a commitment to come to Taiwan¡¯s defense. He made at least three similar comments since 2021 ¡ª a move from strategic ambiguity to strategic clarity. Seemingly underscoring the changed US policy, Speaker of the House of Representatives Nancy Pelosi visited Taipei in early August 2022 and met with President Tsai Ing-wen of the DPP, the dominant political force of the 21st century, as well as democracy and human rights activists.

In response, the PLA launched a four-day military drill and surrounded Taiwan, simulating a blockade. The live-fire exercises were more extensive than those performed during the Third Taiwan Strait Crisis. Chinese military aircraft crossed the median line over 300 times during the demonstration and continue to cross it on a near-daily basis, effectively erasing the status quo. The CCP applied additional pressure through sanctions, halted exports and cyberattacks.

After Pelosi¡¯s visit, several other US delegations visited Taiwan. Tsai met with Pelosi¡¯s successor, Speaker of the House of Representatives Kevin McCarthy, on a stopover in the US. In response, China has intensified threatening air maneuvers, flying more frequently and closer to Taiwan, and Chinese warships have increasingly joined in the movements.

The end-of-2025 PLA exercises are part of a recent pattern. The PLA has increased military activities near Taiwan in recent years. It increasingly sends jets into Taiwan¡¯s ADIZ as a show of force. Cyberattacks have increased. In 2020, the Chinese attacked ten Taiwanese government agencies to steal information. 

The US Department of Defense¡¯s 2021 Military Power Report highlighted China¡¯s prioritization of ¡°joint long-range precision strikes across domains, increasingly sophisticated space, counterspace, and cyber capabilities, and accelerating the large-scale expansion of its nuclear forces.¡± Moreover, China has integrated emerging technology into its military strategy through an approach known as ¡°intelligentized¡± warfare.

Atul and Glenn also mention a key economic and strategic fact: Taiwan is the leading global producer of advanced semiconductors. Taiwan Semiconductor Manufacturing Company (TSMC) produces 65% of the world¡¯s semiconductors and 90% of the most advanced chips. If conflict between China and Taiwan were to break out, global supply chains would be severely disrupted. The US would be severely affected. A potential conflict in the Taiwan Strait also has implications for the territorial dispute between China and Japan in the East China Sea. The PRC views the Senkaku/Diaoyu Islands as a part of ¡°Taiwan province¡± and may seek to take the islands during a conflict. Atul mentions that he has covered China-Japan tensions in great detail, which erupted in 2025 after Beijing made a big deal of the Japanese prime minister¡¯s comments in parliament.

Given China¡¯s increasing aggressiveness, Washington has acted to contain Beijing. Before Biden took office, the first Trump administration sold more than $18 billion in arms to Taiwan and eliminated long-standing restrictions on US diplomatic engagement with Taiwanese officials in 2020. US officials now acknowledge that a small but expanding contingent of Marines has been secretly training Taiwan¡¯s forces since at least 2021. Tensions between China and the US over Taiwan amount to a classic security dilemma: both are taking actions they view as defensive, which the opposing side views as escalatory. The Thucydides Trap, a term that refers to the high possibility of ruling and rising powers clashing, is trickiest over Taiwan.

What could happen next: three scenarios

Atul and Glenn tease out three scenarios for the future. The first scenario is conservative and extrapolates the status quo. Deterrence proves to be successful after sustained increased effort by Taiwan, the US, Japan and arguably the international community. The goal would be to increase the costs of a Chinese attack on Taiwan, deterring Beijing from military conquest. The status quo would also persist if China softens its demands. This could only happen after Xi has left office. 

In the first scenario, Taiwan continues its de facto independence in the name of ¡°one country, two systems.¡± The world remains as we know it, and eventual de facto reunification is contingent on China¡¯s political evolution.

The second scenario is moderate and envisages China continuing its slow increase in economic, political and military pressure on Taiwan. The US and other powers fail to demonstrate a commitment to defend Taiwan. Without American leadership, other powers do not come to the rescue of Taiwan, and international support slowly becomes less effective. China continues to extend its influence over Taiwan even as the Taiwanese continue their paradigmatic shift decisively away from being a part of China. Taiwan becomes the Ukraine of the Orient. In this world, Taiwan progressively loses de facto sovereignty, and China achieves de facto reunification. 

The third scenario is aggressive and imagines China taking decisive military action against Taiwan. The result would be uncertain and depend on both the PLA¡¯s ability to conquer Taiwan as well as the Taiwanese forces to defend Taiwan. Hundreds of thousands would die. Taiwan is hilly, the PLA is not battle-tested, its senior officers have just been purged, and the local population would be restive even if China conquered the island. Taiwan¡¯s porcupine strategy might work just as Vietnam gave China a bloody nose in 1979.

The clock is ticking for China. The Chinese century may be difficult to achieve with the demographic balloon fizzing away. China is getting smaller every year at an accelerating pace and will be hundreds of millions smaller in a few decades. Arguably, the time to act for China is now. 

If China acts and invades Taiwan, that would be a disaster. Even as the military result may be uncertain, China¡¯s attack on Taiwan would unleash an international economic tsunami. Trade would plummet, currencies would crash and GDP rates would crater. Taiwan is critical to the global economy as the world¡¯s primary producer of advanced semiconductors, fabricating over 90% of the most cutting-edge chips used in AI, smartphones and defense systems. Led by TSMC, it controls roughly 63% of the total foundry market. As a top-20 global economy and major exporter of electronics, Taiwan¡¯s technological, manufacturing and trade output is essential to the global tech supply chain, which would be severely disrupted.

A Chinese version of the Anaconda plan of the Mainland wrapping around Taiwan and swallowing the island is more rational, but leaders have made rash decisions in similar situations. Atul and Glenn wish that leaders on all sides make wise choices, cheekily invoking the gods and goddesses of myths from around the world to smile upon mere mortals.

The views expressed in this article/podcast are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post China¨CTaiwan Tensions ¡ª Civil War Legacies and Geopolitical Chess appeared first on 51³Ô¹Ï.

Their significance is linked to that of maritime transport itself, which represents the fundamental bloodstream of global trade. This transport carries of the world¡¯s trade by volume, carrying vital crude oil and other raw materials, semi-processed goods or finished products. As such, it plays a fundamental role within international supply chains.

Different kinds of maritime routes

Maritime routes man-made or natural. Among the first group are the Panama and the Suez canals. Within the second, among others, are the Hormuz, Malacca or Gibraltar straits. In both cases, they represent funnels of high strategic significance. Some more than others, of course. Indeed, according to their strategic importance, they can be divided into primary and secondary chokepoints. The former refers to connectors that, if disrupted, could seriously impair global trade. The latter, on the contrary, represent support maritime passages that entail significant detours in the event of disruption. The best example of a primary chokepoint is the Strait of Hormuz, while the Strait of Taiwan, the Sunda Strait (between the islands of Java and Sumatra) or the Dover Strait are examples of secondary ones.

The top four

The top four maritime routes (or chokepoints) are the Strait of Hormuz, the Strait of Malacca, the Suez Canal and the Panama Canal. The first of them represents the compulsory crossing pathway between the Persian Gulf and the Indian Ocean. Beyond being a very important merchandise transit route, representing of the global seaborne trade, it is one of the world¡¯s two main energy chokepoints. It is indeed the inescapable transit route for 20 to 21 million barrels of oil per day, representing of global oil consumption and 25% to 30% of global seaborne oil trade. At the same time, it is the passage route for 20% of the global liquified natural gas (LNG) trade. Some of the world¡¯s largest hydrocarbons exporters ¡ª Saudi Arabia, Iran, Iraq, Kuwait, Qatar and the United Arab Emirates (UAE) ¡ª rely on this route, as do the largest Asian consumers: China, India, Japan and South Korea.

The connects the Indian Ocean to the South China Sea (in the Pacific Ocean). It is the route through which 30% of global trade and 23.7 million barrels of oil pass daily. This includes two-thirds of China¡¯s trade volume and around 80% of its energy imports. It is between the island of Sumatra (Indonesia) and the Malay Peninsula (Malaysia and Singapore). Around 29% of the global seaborne oil trade passes through the Strait of Malacca. In fact, to reduce its critical reliance on the Strait of Malacca, China has a major energy corridor through Myanmar. A corridor consisting of two parallel pipelines transporting crude oil and natural gas from the Indian Ocean coast of Myanmar to Southwestern China.

The , on its part, connects the Mediterranean Sea with the Red Sea, which leads to the Indian Ocean. Between 12% and 15% of worldwide trade and about 30% of global container traffic transits this route. Roughly 9% of the global seaborne oil flows (about 9.2 million oil barrels a day) and 8% of liquified natural gas (LNG) volumes use this route.

The connects the Pacific and the Atlantic oceans. About 5% of global marine trade passes through it. Meanwhile, barrels of oil per day pass through this waterway. However, while the Suez Canal allowed for the transit of supertankers of up to 200 thousand tons, the Panama Canal was limited to 65 thousand tons and to a configuration adapted to its particular standards. The so-called Panamax standards. Since 2014, as a result of the expansion of the canal, the standard has applied, substantially increasing both capacity and tonnage ¡ª now reaching 120,000 tons.

Other maritime routes

In addition to the aforementioned big four maritime routes, the Cape of Good Hope and the Strait of Magellan must also be mentioned. While the former connects the Atlantic and the Indian oceans at the South of the African continent, the latter links the Pacific and the Atlantic oceans through the Southern seas of South America. The Cape of Good Hope has much greater strategic significance, not only because the economic emergence of China and the Indo-Pacific sphere has enhanced its relevance, but also because the Strait of Magellan has lost much of its significance in the last few decades. This was a result of the 1980s transcontinental , which allowed for the massive transport of containers between the US¡¯s East and West coasts.

However, the Strait of Magellan could have better days ahead if climate change keeps affecting the Panama Canal. Indeed, lack of has hampered canal operations in recent years. In 2023, the El Ni?o climate phenomenon, which impacted rainfall, caused water levels to plunge in the lakes that feed the canal, leading to a forced reduction in vessel crossings.

Of much relevance, as well, are the Strait of Gibraltar, the Turkish straits (Bosphorus and Dardanelles) and the Danish straits (Kattegat and Skagerrak). They respectively connect the Atlantic Ocean and the Mediterranean Sea, the Mediterranean Sea and the Black Sea (through the Sea of Marmara), and the Baltic Sea with the North Sea. 

As a result of global warming, two additional major maritime routes are opening in the Arctic ¡ª the North-East route (bordering Canada) and the North-West route (bordering Russia). While they are considered interior waters by both Canada and Russia, the US asserts that they are international straits conferring open transit rights. The US, indeed, both countries¡¯ claims as illegitimate. The geopolitical and economic significance of the Arctic routes may be enormous, as they could represent new active passages between the Atlantic and the Pacific oceans. This would diminish the geostrategic importance of the Strait of Malacca and, as a consequence, that of Singapore as a maritime hub.

Highly sensitive geopolitical spots

Needless to say, in addition to their economic relevance, or precisely because of it, maritime routes are highly sensitive geopolitical spots. The Suez Canal has a longstanding history in this regard. In 1956, after Egypt¡¯s President Gamal Abdel Nasser the canal, an invasion by Britain, France and Israel took place. For several months, the canal remained closed, significantly disrupting global shipping and trade. Ten years later, in 1967, the Suez Canal was again closed, as it became the frontline between the combatant forces of Israel and Egypt, during the . Following the conflict, this waterway remained shut for eight years, adding around 8,000 to 10,000 kilometers to trade shipping routes that depended on the canal.?

At the opposite end of the waterway that connects with the Suez Canal ¡ª in the Southern tip of the Red Sea that joins the Indian Ocean ¡ª there have also been recent problems. In the Bab el-Mandeb Strait and the Gulf of Aden, the Iranian-backed Houthis of Yemen have been commercial shipping since the end of 2023. This is in retaliation for Israel¡¯s war in Gaza.

Although the Strait of Malacca is not a contentious international spot, its adjacent South China Sea remains one of the world¡¯s most disputed maritime areas. Stepping over the claims of several South East Asian countries, as well as over the normative of the on the Law of the Sea and the jurisprudence of the International Court of Justice, China asserts its rights over 90% of the South China Sea.

Moreover, in 2010, Chinese Foreign Minister Yang Jiechi that the sea represented a ¡°core national interest¡± for his country, while telling his Southeast Asian counterparts at an Association of Southeast Asian Nations (ASEAN) meeting that ¡°China is a big country and other countries are small countries, and that¡¯s just a fact.¡± Additionally, in order to assert control over this waterway, China has built and militarized to the teeth 27 within it.

China¡¯s claims are not only rejected by its South China Sea neighbors but also by the US and a significant part of the international community. The US and many Western nations assert a right of free passage through this sea, challenging China¡¯s claim by periodically sailing its warships through it. Although 80% of China¡¯s crude oil imports and the bulk of its exports sail through this waterway, the same happens to Japan, South Korea and Taiwan. Moreover, it is a vital trade route for the 620 million people who inhabit Southeast Asian countries. A trade of more than takes place annually in those waters, representing more than one-third of the world¡¯s maritime traffic.

The Panama Canal has also become a sensitive geopolitical spot in recent times. By asserting American rights under the Monroe Doctrine, US President Donald Trump has to take it, while forcing Chinese interests out of the canal. Indeed, Hong Kong¡¯s company CK Hutchinson, which controlled two ports within it, was as a result of Washington¡¯s pressure and forced to sell such assets to the American BlackRock group. However, the represented by Trump¡¯s threat of taking possession of the Panama Canal has not disappeared.

Geopolitical significance of the Strait of Hormuz

The previous geopolitical issues provide the background for the current state of belligerence in the Strait of Hormuz. America¡¯s bombardment of Iran, being the result of a war of choice, led to what should have been anticipated ¡ª Tehran¡¯s blockade of the strait. This has led to an in oil prices that, amid fluctuations, have reached up to 40% above pre-crisis levels, while halting about 20% of global oil and liquified natural gas flows. This makes the current crisis even worse than the two oil shocks of the 1970s put together.

This situation had its antecedent in the so-called Tanker War of 1984¨C1988, a critical phase of the , during which both sides targeted oil shipping in the Persian Gulf. As a result of Iraq¡¯s attacks on Iranian oil exports, Iran retaliated by targeting not only Iraqi shipping but also neutral vessels. Over 400 oil tankers and commercial ships were struck during that period, making the targeting of civil shipping a tool of war. More recently, as mentioned before, the Houthis carried out attacks on commercial shipping in the Red Sea, in retaliation for events in Gaza.

Both cases show a worrisome pattern of maritime insecurity. Within it, state and nonstate actors exploit maritime chokepoints to exert pressure on global energy flows as an instrument of war. Maritime routes represent the ideal setting for asymmetric warfare, as they allow for weaker actors to exploit geography, cheaper technology and economic vulnerability to inflict maximum damage. Whereas in sea or on land, narrow paths have always been the perfect spot for the few to successfully confront the many. A good historical example in this regard dates back to 480 BC, when King Leonidas¡¯s 300 Spartan hoplites stopped for several days hundreds of thousands of Persian invaders, at the Pass of .

Current events in the Strait of Hormuz have become a perfect example of both the paramount importance and the extreme vulnerability of maritime routes. Especially so when there are no alternative routes involved, as in this case. Contrary to the closure of the Suez Canal in the 1960s and 1970s, which had an optional, although much longer shipping route around the Southern tip of Africa, the Strait of Hormuz presents no alternative. There is no other waterway, indeed, to go in or out of the Persian Gulf.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The Strait of Hormuz and the Significance of Maritime Routes appeared first on 51³Ô¹Ï.

It was a civics textbook written for 14-year-olds with a chapter titled ¡°The Role of the Judiciary in Our Society.¡± Among other positive aspects of the judiciary, it discussed judicial backlog and corruption. It cited data and actual quotes from former judges. But the Court ordered a complete ban: seizure of physical copies, removal of digital versions, which one can access and prohibition on publication ¡°through electronic media or alternative titles.¡±

Chief Justice Surya Kant described it as a ¡°deep-rooted, well-orchestrated conspiracy¡± to malign the Judiciary, where ¡°they fired a gunshot, judiciary is bleeding today.¡± Supposedly, a schoolbook is enough to make the judiciary bleed.

If the institution is so fragile that a book chapter can injure it, then the actual health of this institution is in dire conditions. This is truly a watershed moment because the Judiciary, for the second time in Indian history, decided that its institutional comfort mattered more than our constitutional rights.

But first, I will talk about the legality of as measured against the Constitution and contempt laws. But I really want to talk about the institutional dishonesty and cowardice being shown: the wholesale misrepresentation of what the chapter actually says by the Court; the language the Chief Justice has used; the role of the Bar in triggering this whole episode; and how representative institutions are kowtowing and falling in line without a word of resistance.

The Supreme Court cannot ban a book or blacklist a person

Let¡¯s see the legality of this order. It is important to note that the Supreme Court has not invoked contempt proceedings. They have not pointed to a specific defamatory falsehood and required its correction. It issued, from its own bench, a blanket order completely banning a textbook chapter. Such suppression and prior restraint, the Court itself has ruled unconstitutional .

However, talking from first principles, Article 19(2) of the Constitution permits restrictions on speech only through a ¡°law¡± made by the ¡°State.¡± Courts have long established that judicial decisions constitute ¡°law¡± for the purposes of Article 19, and that the judiciary constitute ¡°State¡± for the purposes of Part III violations. The logical conclusion from this is that the judiciary, in all its might, does not have the power to directly restrict speech.

When the Court engages in this unique form of judicial censorship, it bypasses the Parliament and the representative government completely. As Professor of law has pointed out, such actions ensure ¡°that the deliberative process envisaged by the Constitution when it requires the State to ¡®make a law¡¯ under Article 19(2) is rendered chimerical.¡± The Supreme Court only has the power of judicial review. But they have now inserted themselves into both roles simultaneously: restricting speech as if it¡¯s the Parliament and reviewing that restriction, too.

This is just judicial power-brokering where they have turned the machinery made to protect the rights of the citizen to protect their own reputation.

The Court has also that even temporary digital restrictions can have far-reaching chilling effects on speech. But clearly, this does not apply to the Court, it seems. Last year, the very same that free speech should be measured by the ¡°standards of reasonable, strong-minded, firm and courageous men, and not those of weak and vacillating minds, nor of those who scent danger in every hostile point of view.¡± They have failed their own test in a spectacular fashion. It is honestly so puzzling how forgetful and hypocritical this Court is when the critics shine a spotlight on it.

But, on March 11, the Court passed which went even further. The Court barred the three authors of the chapters (Professors Michel Danino, Suparna Diwakar and Alok Prasanna Kumar) from work associated with any publicly funded curriculum.

The Court said that it had ¡°no reason to doubt¡± they had ¡°deliberately knowingly misrepresented the facts.¡± The Court said this even before the authors filed their response. The punishment was delivered, and the invitation to respond came after.

has named this Order for what it is: a judicial bill of attainder. During the in England, the legislature sometimes assumed judicial powers and passed laws known as . These laws declared individuals or groups guilty of misconduct or crimes and imposed punishment without a trial.

When the US broke away from England, bills of attainder were under Article I, Section 9 of the Constitution. This stopped the practice of ¡°trial by legislature,¡± and furthered the separation of powers in the Constitution. President James Madison simply explained the need for their abolition in . He said that these ¡°Bills of attainder ¡­ are contrary to the first principles of the social compact,¡± because modern society agreed that punishment should follow the . This very Court has previously held similar ex-post laws .

What the Supreme Court has now done is take the form of the bill of attainder and clothe it in judicial power. They are punishing by decree, without explicit statutory charges being mentioned, without any law, and without a hearing.

As a measure of caution, the order does invite the three authors to ¡°approach this court for seeking modification after tendering their response.¡± But this is against Article 21 of the Constitution and the procedural guarantees therein. It delivers the punishment first, then invites the individual to explain why they should not be punished. As Bhatia , ¡°if a government department fired an employee and then issued a show-cause notice, the Supreme Court would strike it down for violating administrative law.¡± Then how can the Court do the same?

It is genuinely sad that these three authors, who wrote that ¡°the Supreme Court is the watchdog of democracy¡± and that citizens must have ¡°confidence¡± that the judiciary will protect their rights, have now been punished by the very institution they had praised.

Who needs contempt laws? Magic court powers are enough

The question of contempt powers needs to be examined, especially since the Court is not invoking that power in this case. This is very odd.

Under the Contempt of Courts , Section 2(c) defines criminal contempt as any act that ¡°scandalises, or tends to scandalise, or lowers or tends to lower the authority of any court.¡± This definition is undoubtedly capacious. The word ¡°tends¡± does not require actual interference with justice; even the possibility of it is enough. Section 5 provides a defense for ¡°fair criticism¡± of a finally decided case, and the 2006 amendment allows truth as a defense if the person can show they were acting in the public interest. But the test is left to the court itself to determine whether the criticism was ¡°fair.¡±

It is an odd system where the Court, which has been ¡°scandalized,¡± is the judge in its own cause, going against the principles of (the rule against bias and the right to a fair hearing). It also has clear chilling effects on freedom of speech and expression. And precisely this was the reason why the UK, the US and many other modern democracies have deemed such laws as , except for India.

But there are those who say that without such laws, the judiciary will lose its reputation. Justice H.R. Khanna, the one judge who had the spine to dissent during the Emergency, directly: ¡°Contempt of court should not be used as a means to uphold our own dignity. This must rely on surer foundation ¡­ We must rely on our conduct itself to be its own vindication.¡±

The UK, from which we adopted the Contempt of Courts Act, saw its last in 1931. In 2018, a , ironically headed by a former judge, set out to find whether such an archaic provision should be abolished. They said no. In all honesty, these provisions are a , which does not, in the least bit, ensure the dignity of our court. And its broadness leaves to silence the critics of the Court.

But here is the deeper problem. The Court has imposed punitive measures that go beyond anything provided for in contempt laws. And the contempt law is already too far. Section 12 of the Contempt of Courts Act provided that a contempt will be ¡°punished with simple imprisonment for a term which may extend to six months, or with a fine which may extend to two thousand rupees, or with both.¡± There is no other punishment for contempt.

But, through their March 11 Order, the Court effectively blacklisted these authors. That, too, without initiating any contempt proceedings or even hearing them. The Supreme Court has conjured up powers from thin air, detached from any statutory or constitutional basis, and has extinguished their Article 19(1)(g) right to practice their profession effectively.

How is any of this possible? Only Justice Surya Kant knows. As one of my professors puts it, this is an example of ¡°cosmic level thinking.¡±

Blatant misrepresentations of facts

Thanks to , we still have access to the National Council of Educational Research and Training (NCERT) chapter. We also have the order. Let¡¯s see what the Court actually said versus what the .

The 18-page-long chapter opens with an epigraph from the former US Supreme Court Justice William O. Douglas: ¡°The judiciary is in a high sense the guardian of the conscience of the people as well as the law of the land.¡±

It opens with the Preamble to the Constitution of India, which promises social, economic and political justice, and that justice ¡°is the cornerstone of all societies.¡± It goes on to explain the three-tier court structure, criminal versus civil cases, the role of tribunals, the consumer forum system and other relevant concepts. It also brings to attention various landmark cases of the Supreme Court. For example, the Supreme Court¡¯s striking down of Section 66A of the IT Act and the Electoral bonds scheme as a victory of free speech and democratic accountability. It also profiles the doyen of the Bench, Justice Kuldip Singh, as the ¡°Green Judge,¡± whose usage of public interest litigation protected the Taj Mahal from industrial pollution and the Ganga from tannery effluents.

It then cited constituent assembly member Madabhushi Ananthasayanam Ayyangar, who said:

This [Supreme Court] is the institution which will preserve those rights and secure to every citizen the rights that have been given to him under the Constitution ¡­ The Supreme Court is the watchdog of democracy. It is the eye and the guardian of the citizens¡¯ rights

Approximately 14-pages into the chapter, it addresses ¡°Challenges Faced by the Judicial System.¡± In it, they discuss the case backlog and pending cases. They also discuss efforts at judicial reform: mobile courts, criminal law reforms, mediation mechanisms. And then, in the penultimate subsection, it has two paragraphs of around 350 words titled ¡°Corruption in the Judiciary.¡± These paragraphs open by explaining the Bangalore Principles of Judicial Conduct and the internal complaints mechanism (CPGRAMS), and noting that between 2017 and 2021, over 1,600 complaints were received alleging judicial or institutional misconduct.

They then quote directly a statement made by the then Chief Justice of India (CJI) Bhushan Ramkrishna Gavai himself:

Sadly, there have been instances of corruption and misconduct that have surfaced even within the judiciary. Such occurrences inevitably have a negative impact on public confidence … The path to rebuilding this trust lies in the swift, decisive, and transparent action taken to address and resolve these issues… Transparency and accountability are democratic virtues.

The chapter¡¯s own summary section lists several positive takeaways: that the judiciary is one of the three pillars of government; that it ensures justice is served and laws are made within the constitutional framework; that citizens must have confidence that their rights will be protected; and that citizens have a role in helping the judiciary by bringing social concerns to its notice.

Let¡¯s see what the Supreme Court said about this chapter in its Order:

Paragraph 6 of the states that the chapter ¡°washes off with one stroke of the pen, the illustrious history associated with the Supreme Court, the High Courts and the District Courts¡± and ¡°conspicuously omits the substantive contributions made by these institutions towards the preservation of our democratic fabric.¡± As I mentioned earlier, the chapter profiles Justice Kuldip Singh. It cites the Supreme Court¡¯s free speech victories. It quotes constituent assembly members on the Supreme Court as ¡°the watchdog of democracy.¡± Are these not celebrations of the Supreme Court, its judges and its contributions?

Paragraph 6 of the Order also states that the chapter ¡°fails to acknowledge the imperative role the Judiciary undertakes in upholding Constitutional Morality and the Basic Structure Doctrine.¡± 

First of all, bringing in explicitly legal and jurisprudential doctrines for Class VIII students studying basic social sciences is a bit too much. But, in words that could not be any more similar, the chapter does say that ¡°the judiciary ensures that laws and policies made by the executive are within the framework of the Constitution¡± and that ¡°without a strong and fair judiciary, democracy cannot survive.¡± If this is not an acknowledgement of the judiciary¡¯s role in upholding the Constitution, then what would satisfy the Court?

Paragraph 7 of the Order states that the chapter ¡°chooses not to delve into any of the transformative initiatives and measures pioneered by this Court towards overhauling legal aid mechanisms and streamlining the ease of access to justice.¡± The chapter explicitly mentions Public Interest Litigation. It explicitly mentions the National Judicial Data Grid. It explicitly mentions mobile courts, mediation and the government¡¯s procedural reform measures. Are these not mentions of ¡°legal aid mechanisms¡± and ¡°ease of access to justice¡±?

Paragraph 10 of the Order states that young students ¡°lack the perspicacity to appreciate the manifold and onerous responsibilities that are discharged by the judiciary on a day-to-day basis.¡± The Court has decided, in its grand old wisdom, that eighth graders, who are doing algebra and learning refractions, are simply too dumb to handle a basic civics chapter that spends 14 pages praising the judiciary and two paragraphs acknowledging its flaws.

The Court¡¯s order is an outrage against a chapter where there is supposedly only criticism and no praise. But such a chapter does not even exist. The chapter that actually exists praises the judiciary more than enough and, in the spirit of honesty, briefly mentions that the judiciary also has some problems.

There is corruption in the judiciary at all levels

Out of an 18-page chapter and the 350-word section titled ¡°Corruption in the Judiciary,¡± other than the quote from Gavai, there is exactly one sentence that actually asserts any form of corruption in the judiciary: ¡°Nevertheless, people do experience corruption at various levels of the judiciary. For the poor and the disadvantaged, this can worsen the issue of access to justice.¡±

I am not making this up. This is what made the Supreme Court bleed. The rest of the section is just explaining the judicial code of conduct, data from the grievance redressal process and how impeachment works. But sure, all this is very dangerous material. 

But the important question is whether this is an objective statement? Is there corruption at various levels of the judiciary? Short answer: Yes. That is what the data says.

The data on judicial corruption in India is not hard to find. It is literally everywhere. I made a of such news reports in 10 minutes.

Data from shows that over 45% of Indians believe the judiciary is corrupt, which is a view also shared by . In the 2024 , India scored 38 out of 100 and ranked 96th out of 180 countries, in the same bracket as nations the Court would find deeply unflattering to be compared with. These are not abstract data points.

In 2010, a former Law Minister in a Supreme Court filing that eight of the previous 16 Chief Justices of India were corrupt. In 2014, former Supreme Court judge Markandey Katju that three former CJIs made improper compromises to protect a corrupt High Court judge. Both Katju and former Union Law Minister Shanti Bhushan faced . No one conclusively disproved either allegation. In an , when it was asked, ¡°Are bribes for bail endemic now?¡± another former CJI, Vishweshwar Nath Khare, said the following:

There is no doubt about it. It is rampant. Corruption in the lower courts is no secret. Sometimes, in the high court as well, cases of corruption have surfaced, but in my experience while I was in the Supreme Court, I have not witnessed anything similar. In the lower courts, it¡¯s alleged that everything comes for a price. Rates are fixed for quick divorce, bail and other favourable verdicts. Cases in the media glare, constantly scrutinised, are different. Otherwise, it is very difficult for the common man. There are huge time gaps between hearings. Years are spent to get an order from the lower courts.

Is this not literally what was said in the chapter? In Paragraph 2 of the Order, the CJI said that the authors were ¡°picking a few words from the statement of a former Chief Justice of India, suggesting that the judiciary itself has acknowledged the lack of transparency, accountability and institutional corruption.¡± Suggesting? Suggesting how? It is not a suggestion. It is literally a quote from the former CJI. You cannot quote someone and be accused of suggesting what they said. And from what we have seen, the Judiciary indeed has acknowledged all these problems. Well, what do they do about it?

Parliament has a judge in India. Not for the lack of trying. Because under both the , 1968, and the opaque in-house , it is so cumbersome.

This is the usual process for removing a corrupt judge in India. First, you need 100 Lok Sabha Members of Parliament (MPs) or 50 Rajya Sabha MPs to sign a motion. Then, a three-member committee investigates. If they find the judge guilty, both Houses of Parliament must pass the motion by a two-thirds majority in the same session. Then the President removes the judge. You can an emergency and suspend the fundamental rights of 1.4 billion people for less.

But even this has a caveat. When cases came close to impeachment, the before the motion passed. There is a sinister reason for this, too.

For example, Justice Soumitra Sen , the Rajya Sabha the impeachment motion and he resigned before the Lok Sabha could vote. In a 2012 Right to Information , it was found that he walked away with full post-retirement benefits because no constitutional provision barred him from keeping them. Justice Paul Daniel Dinakaran had assets beyond his known sources of income, the Rajya Sabha an impeachment motion, and he, too, resigned mid-inquiry and with benefits. Justice Narayan Shukla was found by the Supreme Court¡¯s own in-house inquiry to have credibly a bribe. He refused to resign. His judicial work was withdrawn. He sat at home for over a year collecting his until he retired in 2020.

Sen, Shuka and Dinakaran are not anomalies. They fit a long, documented pattern. The backlog of pending cases means litigants bribe just to get a hearing date; the inefficiency feeds the corruption. And in those rare instances when corruption is found, the provide these judges with . It is a win-win situation for them.

More recently, a fire at Justice Yashwant Varma¡¯s residence turned up a large stack of . As one usually does. But the impeachment proceedings have , which will be taken to its natural conclusion: his resignation with full benefits. We literally have the of the burnt cash. I don¡¯t know what else to say. And to blacklist these authors for mentioning real problems is purely vindictive and a pathetic waste of public resources and time.

The more the judiciary tries to suppress discussion of its failures, the more distrust it generates. A strong institution answers its critics, and the weak one bans schoolbooks and witch-hunts academics. Maybe the contempt jurisdiction was purposefully not invoked because, if it were, it would be clear that what these authors said was the truth. One cannot be contemptuous if they speak the truth.

At this instance, I am reminded of this fitting by Justice Antonin Scalia of the US Supreme Court, wherein he said:

This Court has not been shy to enforce the First Amendment in recent terms. It has accorded robust protection to depictions of animal torture, sale of violent video games to children, and lies about having won military medals. Who would have thought that the same Court would today exert such heroic efforts to save so plain an abridgement of the freedom of speech? It is no great mystery what is going on here. The judges of this Court, like the judges of the Supreme Court of Florida who promulgated Canon 7C(1), evidently consider the preservation of public respect for the courts a policy objective of the highest order. So it is¡ªbut so too are preventing animal torture, protecting the innocence of children, and honoring valiant soldiers. The Court did not relax the Constitution¡¯s guarantee of freedom of speech when legislatures pursued those goals; it should not relax the guarantee when the Supreme Court of Florida pursues this one. The First Amendment is not abridged for the benefit of the Brotherhood of the Robe. I respectfully dissent.

These in-house secret procedures, the resignation escapes, the weaponization of judicial proceedings, are just the ¡°Brotherhood of the Robe¡± in full action.

Language of the Supreme Court or tyrants? Both

Sociolinguistics has that language can be a tool of social control, and that its use shapes how a society understands itself and its institutions.

When the highest court speaks, it is providing an example of what authority sounds like. It is teaching our society how power talks. This is true regardless of whether the specific words carry legal force. The words of the Chief Justice clearly have ¡°social¡± consequences, too. Their mere rhetoric can determine what citizens believe they are allowed to say, think, and question. Such asymmetry demands some discipline in their language. This Court has completely abandoned it.

Thanks to some , we have a rough transcript of the proceedings. These were the words of the CJI Surya Kant in an open court: ¡°We need to find out who is responsible. Heads must roll ¡­ There must be a deeper probe into this issue. Who are the persons behind this? We want to know. We won’t close the case.¡±

On September 25, 1930, at the Supreme Court in Leipzig, German Dictator used this precise vocabulary, ¡°heads will roll in the sand,¡± to threaten his political opponents once ¡°the Fascists have taken over control of the German nation and inaugurated the day of reckoning.¡± This is not the precedent they want.

But it continues its language of retribution and revenge. During the March 11 hearing, the CJI further : ¡°Some elements have acted and reacted irresponsibly on social media. We firmly believe in catching the bull by the horns¡­ No one will be spared ¡­ Even if they are hiding outside the country, I will not spare them.¡±

The Court has also directed the Union government to identify websites and individuals who had posted critical commentary, so that ¡°action could be taken in accordance with law.¡± What law? No one knows. Just a demand for names. This kind of blanket blacklisting and witch-hunting is judicial .

But, I am not at all suggesting that CJI Surya Kant wants what Hitler or US Senator Joe McCarthy wanted. What I am pointing out is something simpler and more important: Language has its own history, and institutions do get measured by the vocabulary they choose. When a constitutional court speaks like this, the institution is projecting fear. It does not produce respect. Even in the rare instances where it does, it is not the kind of respect that will last long. 

Such harsh language against its critics creates a chilling effect. People actually fall silent. Journalists and Academics self-censor their reports. Slowly, the marketplace of ideas would narrow to nothing, and then it would die. Because the Court sponsored its killing.

The Prime Minister abdicated his constitutional responsibilities

On June 9, 2024, Prime Minister (PM) Narendra Modi stood before the nation, placed his hand on the Constitution of India, and for a . He swore:

I will bear true faith and allegiance to the Constitution of India as by law established, that I will uphold the sovereignty and integrity of India, that I will faithfully and conscientiously discharge my duties as a Prime Minister for the Union and that I will do right to all manner of people in accordance with the Constitution and the law, without fear or favour, affection or ill-will.

After the court passed the order, Modi reportedly his displeasure and directed that ¡°accountability be fixed for those who had approved the offending chapter.¡± Soon after, Education Minister Dharmendra Pradhan that ¡°the moment it came to our notice, we issued directions to withdraw the book and stop its distribution. We have the utmost respect for the judiciary, and there was no intent to disrespect the judiciary.¡±

Maybe the words are sincere to show compliance. But this is not what the Constitution requires. The PM and the Education Minister have taken an oath to the Constitution, not to the judiciary. When the elected head of the executive responds with such docility, against an ever-encroaching judiciary, one has to ask: What, exactly, does he believe he was elected to do?

I am not asking the government to revolt. But the Constitution does not expect them to simply stand by either. It requires you to ¡°do right to all manner of people in accordance with the Constitution and the law.¡± When the judiciary goes against the Constitution, as it has here, one must resist with firmness through proper constitutional channels. That is why you are required to take an oath. This is not some ¡°cosmic level thinking.¡± There is behind the moral and political obligations that an oath demands.

The last time India saw the executive and judiciary moving hand in hand against the Constitution was in 1975. When PM Indira Gandhi declared the and suspended civil rights. This Court institutional comfort over the liberty of citizens. The Court did not have the spine to stand up to the executive when it mattered the most. And it was the closest India ever came to the of constitutional governance.

That time, it was a judiciary unwilling to resist the executive. This time, it is an executive who is unwilling to defend our right to speak the truth against a ¡°dictatorial judiciary.¡± The executive exists as one of three coequal branches. Today, they have decided to publicly castrate themselves before another.

How the Bar assisted the Court in this witch hunt

There is a final disgrace that I want to name, because it has been too carefully avoided in most commentary.

This whole issue was created out of thin air, on February 25, 2026, by two of India¡¯s most prominent senior advocates: Kapil Sibal and Abhishek Manu Singhvi. There was no concerned citizen or civil society group that petitioned the Court to look into this matter. Maybe because we know that what was written was true. Or maybe because all of us have better things to do.

But, according to , these two men appeared before the Chief Justice¡¯s bench and, with a newspaper article about the NCERT chapter, expressed their shock at its contents and literally invited the court to act. They primed the Court in this witch hunt. Let this sink in for a moment.

Kapil Sibal is a veteran politician, former Union Minister for Law and Justice, current Rajya Sabha member and one of the most experienced constitutional lawyers at the Indian Bar. Abhishek Manu Singhvi is his near-peer: a senior advocate, former Additional Solicitor General and a current parliamentarian.

These are their . Mr Sibal said that ¡°the reference to ¡®corruption¡¯, particularly in relation to the judiciary, seemed deliberate.¡± Mr Singhvi added that: ¡°It is as if there is no corruption in other organs of governance ¡ª Ministers, bureaucrats, the police, politicians.¡± And here¡¯s the thing: If they actually read the book, as some have done, the book does criticize everyone. There are cartoons of election candidates hurling abuse, getting caught by the police with bundles of cash. They also mention the pending criminal cases against legislators. The judiciary got the same treatment as everybody else.

That is not the end. The current Solicitor General of India, Tushar Mehta, was also doing in this witch hunt. As the Counsel for the Union Government, he said that: ¡°these people would never work with the UGC or any ministry. We stand by the institution. No one will get away scot-free.¡± He was so into this witch hunt that he was offended on behalf of the Court. He said, ¡°The entire chapter will be revised. There is another part about pendency ¡­ justice delayed is justice denied. We can¡¯t teach that justice is denied.¡±

What more can I say? Can we not teach the truth to kids anymore? Should education just contain approved knowledge? Is that even education or just propaganda?

The sad truth is that these doyens of the Bar, as we call them in Madras, walked into the Supreme Court, with half-baked knowledge, and triggered one of the most sweeping acts of educational censorship in history.

But their actions were driven by something simpler: members of a professional guild protecting the guild¡¯s reputation. In a lecture on the rule of law, Justice H.R. Khanna that ¡°there can, indeed, be no greater indication of the decay in the rule of law than a docile Bar.¡± This Bar has been worse than docile. It has gone hand in hand with the executive and judiciary, waging war against our right to free speech and expression. This is the ¡°Brotherhood of the Robe¡± in action again.

The apotheosis of the Judiciary has to stop

To speak of the Supreme Court as some beyond all reproach and criticism is to confuse an institution of men with gods. Institutions can be wrong. Institutions can be corrupt. And when an institution begins to ban the books that say so, you are no longer in a republic. You are in a theocracy of robes.

Citizens must understand that the judiciary is not a sacred temple. It is a governmental institution created by a constitution to protect our rights, funded by taxes paid by the people, and accountable to the people and our Constitution. It deserves respect. But respect is not given on faith. It is earned through conduct. All this kowtowing from the executive and the Bar is just idol worship of an institution that is slowly ceasing to deserve respect and faith.

There is a reason that democracies insist on the separation of powers. Because, without checks and balances, each branch will eventually prefer its own comfort over its true purpose. The historical record is clear about what happens when judiciaries lose this sense of proportion. In , after the 2016 coup attempt, over 4000 judges had to be removed or suspended on suspicion of links to the 2015 failed coup attempt. Similar stuff happened in , too.

But what we learn from history is that we do not learn from history. The pattern is always the same: The institution conflates criticism of itself with an attack on the state and uses state power to respond to the criticism. Each time, it begins with something small. A textbook. A social media post. A professor or a student who spoke some impolite truth. Something heretical to their theocracy.

What remains

These past few days have told us more about the Supreme Court as an institution than the textbook ever could.

It tells us that a chapter which mostly praises the judiciary, profiles a great judge, celebrates landmark judgements and calls the Court ¡°the watchdog of democracy,¡± is nothing but a ¡°deep-rooted conspiracy.¡± It tells us that quoting a former Chief Justice¡¯s words on corruption is ¡°deliberate misrepresentation.¡±

It tells us that the fundamental rights of three academics can be extinguished without any statutory or constitutional basis and without a full hearing. It tells us that critics can be listed and witch-hunted even from abroad. It tells us that the Court¡¯s own free speech rulings apply to everyone except the Court.

It also tells something about the broader institutional cowardice on display. It tells us that the Prime Minister thinks institutional dignity matters more than educated discourse. And that three of the most powerful lawyers in the country were perfectly comfortable priming a bench against a textbook they hadn¡¯t fully read.

The bench that struck down ADM Jabalpur understood that self-correction is the mark of a healthy institution. The bells, once rung, do not unring easily. But there is still time for the Court to restore itself. The order may be revoked; the individuals may yet be heard fully and fairly. 

And look, this isn¡¯t just about a textbook. The question belongs to all those who read something and ask whether they¡¯re actually allowed to have an opinion about it. How long will we wait before this Court remembers what it is?

It is not a god. It is not a monarch. It is not beyond reproach or truth.

And if we do not speak now, we must forever hold our peace.

[Rishi A. Kumar first published this piece on .]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The Supreme Court of India Has No Spine appeared first on 51³Ô¹Ï.

¡ª US President

Agriculture has long been, and remains, central to Chinese civilization; it is as crucial to China¡¯s future as any other single factor.

China 9% of the world¡¯s arable land while supporting 20% of the world¡¯s population, 50% less arable land per capita than the US. Between 2010 and 2020, China lost 15 million hectares of agricultural land to urbanization, an area larger than England. Urbanization, infrastructure and industry claim a further one million hectares each year. China has only 7% of the world¡¯s freshwater, 65% of which is used for agriculture:

We used to question China for storing so much grain until Trump¡¯s trade war in 2018. It accelerated the West¡¯s retreat from globalised trade, and we saw how vulnerable China was, and its obsession with food security began to make sense. Now the situation is even worse. China has trading partners, but no real allies, and the US is pressuring its many allies to help it keep a lid on China. Not many people know of China¡¯s history of natural disasters and famines. It has no choice but to increase its productivity and find reliable global suppliers.

¡ª US agricultural official in Shenzhen

Between 1959 and 1961, an estimated 30 to 45 million Chinese people in a famine resulting from Leader Mao Zedong¡¯s Great Leap Forward. Hundreds of millions of farmers were diverted from growing food to working in makeshift, mostly inefficient village furnaces, striving to increase steel output. Spoons and pots were melted down to meet quotas. At the same time, the state tried to expand agricultural production by breaking in unsuitable land.

Chinese agricultural officials experimented with schemes such as ¡°,¡± which involved planting seeds a meter below ground in the irrational belief they would produce hardier, higher-yielding crops. This was combined with ¡°close planting,¡± a pseudoagronomic Soviet theory of clumping crops close together to increase yields. Widespread crop failures resulted. The Chinese Government also confiscated grain for storage, in part to demonstrate to the US and USSR that its mass rural collectivization was effective. Millions starved to death, many at the gates of full granaries.

Westerners with no experience of hunger, let alone famine, are unlikely to understand why the Chinese Government stores such large reserves and why people focus so much on food in their daily lives. Most Chinese families have a relative who suffered from poor nutrition at some point in their lives or know of someone who starved to death.

The government understands that a core foundation of its power and legitimacy lies in, at a minimum, being able to feed the people.

Private risk, public good

Extreme straightness is as bad as crookedness. Extreme cleverness is as bad as folly. Extreme fluency is as bad as stammering.

¡ª Chinese philosopher Lao Zi, 5th century BCE

In the late , a handful of Anhui farmers, risking imprisonment or even death, triggered China¡¯s economic reforms by growing crops to meet market demand rather than just fulfilling state-mandated quotas. In doing so, they challenged what had become a core principle of communist agricultural theory: strictly planned, collectivized farming. Leader Deng Xiaoping subsequently endorsed the Anhui farmers¡¯ initiative, dubbing it the . To this day, the state¡¯s agricultural development strategies, aimed at securing China¡¯s future sustenance and security, are based on the Anhui farmers¡¯ principles of assessing supply and demand and ensuring investment returns. Today¡¯s private sector relies on the fact that local officials ¡ª on whom farmers depend for credit and the application of market regulations and commercial law ¡ª will ultimately respect the free market.

The state has a mixed track record in its attempts to mitigate risks, ensure commercial and social stability, and drive economic growth. Some decisions have appeared to make sense in the long term, but resulted in catastrophic commercial losses in the short term. In the quest for greater independence and food security, many agricultural subsectors are oversupply and deflation, including the berry, beef and dairy sectors. While these sectors are in the process of recovering, the damage inflicted on producers and farmers has been severe. Local officials must find a way to balance their longer-term mission of improving sustainable supply and resilience with the need to deliver short-term growth key performance indicators (KPIs) to their superiors, or risk failing at both.

Both Chinese and foreign analysts often attribute radical changes in the Chinese economy to single choices by powerful individuals like Deng, or today, President Xi Jinping. While these leaders have had the vision, and at times courage, to own often radical trends, the initiatives have invariably come from the grassroots of the economy.

Sufficiency

China has learned much from the past, and is ten years into an agricultural revolution that is reshaping international markets. China cannot become totally independent in many food categories; it currently buys of globally traded soya beans (100 million tonnes) and 25% of globally traded wheat (250 million tonnes) annually, more than the combined harvests of Britain, Germany and France. But China is working hard to reduce the degree of its dependence.

The positive impact of Chinese demand on food-exporting nations is already profound. Yet no food supplier to China can take its place in the market for granted. The Chinese government has been assessing the agricultural sectors most dependent on foreign imports, while expanding domestic production where possible to reduce that dependence, particularly in dairy and beef, as well as in animal feed such as alfalfa and soya beans. This effort to diversify away from the coercive, tariff-prone West has been ongoing since US President Donald Trump¡¯s first term and what China understood to be a clear and worrying trend of deglobalization.

Some of China¡¯s trading partners that enjoy preferential market access through free trade agreements ¡ª such as Australia and New Zealand ¡ª and others hoping to gain better access, like the UK, continue to align themselves with Washington and support American attempts to contain China. Small nations like New Zealand and even middle powers like Australia would be better off avoiding military alignment altogether, or risk alienating both great powers.

Global exporters dominant in domestic Chinese food sectors should be prepared to see their primacy challenged as Beijing deploys the same private-public sector partnerships it applied in its technology sectors to stimulate growth and forge greater autonomy. Beijing is trying to boost not only local production, but also support local companies establishing premium brands to serve the needs of the rapidly growing middle class. It is partly a matter of face for the government and the Chinese people that their best products and brands are world-class.

With the exception of staples such as bananas and citrus fruit, global fruit demand was sluggish in 2025, which drove all major producing regions to increase exports to China. This exacerbated existing Chinese domestic oversupply of high-end fruits such as blueberries and cherries, yet amid that disruption, established brands such as Driscoll¡¯s held their position as market leaders. Few fruit exporters to China have put in the time and investment needed to establish their brands, and many have underestimated the burgeoning power of local competitors.

Consumer rule

The pandemic accelerated the shift in food distribution from traditional retail to online sales. Online distributors¡¯ share of retail sales grew 30% in first-tier cities from 2021 to 2023. Most food exporters to China without teams in the market lost share and brand equity to competitors, both domestic and foreign. Companies need sufficient resources not only to manage distributors but also to make independent assessments of market demand and pricing, observe retailers and engage selectively with consumers.

The Chinese market no longer delivers quick profits and sales surges to new entrants as it once did, and has become more sophisticated and competitive than many foreign companies understand. The opportunities, particularly in the food and beverage sectors, are still good but take patience, resources and deep consumer insights to realize.

Our board wants a measure of predictability so they can plan more effectively, but China is so dynamic and tough to forecast. The key is to be flexible and quick to adapt. Our management come to China frequently, and even then it is hard for them to put themselves in the minds of our consumers or competitors. Local teams need to have the resources to know their consumers, adapt to changes and have confidence that their parent companies will respect the need for swift decision-making.

¡ª Sales manager, foreign produce company in Shanghai

African growers have begun taking counterseasonal advantage to sell fruit to China since Beijing all tariffs on African produce from the continent¡¯s less-developed countries. Driscoll¡¯s Zimbabwean-sourced blueberries commanded premium prices this year and helped the brand towards a more certain position to offer a 12-month supply ¡ª a necessary strategy to endure heavy local competition in the Chinese season.

Beijing identified apples, grapes, citrus (particularly navel oranges) and kiwifruit as categories for local government assistance in the next Five-Year Plan. The choice of kiwifruit was a surprise as the category is so much smaller than the other fruit mentioned, but it is indigenous to China and recognized as a nutrient-dense ¡°superfood.¡±

Imported kiwifruit will come under increased pressure as local supply expands and local competitors challenge foreign plant variety rights while asserting China¡¯s indigenous claims to a number of original cultivars. The need is deepening for all suppliers of scale to be able to offer fruit over their off-season and maintain their brands. Companies must either procure or grow their varieties in China to protect existing sales and compete with those who will have fruit on shelves.

Farmer robots

Whoever controls food controls the people.

¡ª Mao Zedong, 1963

Driven not only by a need for food security but also by a dwindling rural labor force, China is applying some of the world¡¯s most advanced farming techniques. Many are not of its own invention, but most are being commercialized at a scale that few markets have been able to meet to date. Chinese farmers deploy ten times the number of drones in agriculture than their US counterparts.

Privately-owned Shouguang Vegetable and Food Industry Group in Shandong produces nine million tonnes of vegetables per annum from 600,000 greenhouses, covering 60,000 hectares, dominating supply to Beijing, Shanghai and a significant portion of northern China. Between 2015 and 2025, China spent on agrotechnology the equivalent cost of building 53 Three Gorges Dams: $1 trillion. In Fujian, one hydroponic and aeroponic factory farm uses 95% less water than traditional farms and yields 10,000 tonnes of vegetables, 400 times that of traditional farming per hectare per annum. It employs 15 people. Vertical farming of this kind grew 40% in 2025 and is forecast to expand by over 12% for each of the next five years, and will come to characterize produce supply to China¡¯s wealthier cities in the future.

Global producers need not only to consider the impact of China¡¯s increasing agricultural prowess in respect of Chinese companies competing in domestic markets, but also these companies¡¯ impact on markets around the world. Toughened by unremitting local and interprovincial competition, Chinese entrepreneurs in the food industry will soon make themselves felt in global markets.

Collaboration rather than protectionism is key for foreign companies wishing to maintain their domestic and global markets and expand within China. Where collaboration is not possible, foreign firms need to become sufficiently local to compete. US and German companies were early leaders in foreign investment in China in the first three decades following China¡¯s reopening because they invested and formed strong partnerships. In the middle of the last decade, they began to fall behind Chinese competitors, due to domestic political and strategic impediments in their home markets, combined with an inability to grasp the impact of Chinese long-term industrial planning.

China¡¯s need, foreign investors¡¯ gain: knowledge and technology

China¡¯s lack of arable land and freshwater sets hard limitations, and Chinese businesspeople are constantly seeking to acquire new technology and know-how. It is a mistake for foreign investors to resign themselves to the idea that they cannot participate and compete in China now. Some harbor outdated views that intellectual property is widely stolen with little legal recourse. On the contrary, Chinese entrepreneurs and scientists have created a great deal of intellectual property in recent decades, spawning a commensurate legal and, by global standards, thorough arbitration system.

This evolution has finally established a credible basis for engaging China not only as a market for products, but also as a venue for structured collaboration around technology and know-how. Such business is unlikely to encounter the stiffening domestic competition felt in product sales, aligns with Chinese policy objectives and presents stable, long-term opportunities for profit generation.

Despite the unprecedented pace of China¡¯s agricultural revolution, much of Chinese agriculture and horticulture remains technologically backward, with horticulture in particular often taking place in remote, hilly and even mountainous regions that are ill-suited to the application of the unmanned vehicles and robotic systems in which China has specialized. Foreign companies may find excellent opportunities in places that lie outside of China¡¯s wealthiest cities, but still in the hearts of markets where demand is strong, and partnerships are welcomed.

The West is rich in agricultural technology and biotechnology, and, equipped with AI tools, will develop further each year. In many fields, the West is still more advanced than China. Coupled with building fresh food brands in China, Western companies need to consider how best to invest their technology and know-how in order to participate in and profit from China¡¯s ongoing agricultural and consumer revolution.

[ first published this piece as a business report.]

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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According to the Geneva Centre for Security Policy (GCSP), the international system is undergoing ¡°intensified fragmentation and geopolitical polarisation¡± as competition among China, Russia and the US reshapes the global order. In this context, the behavior of states that are neither great powers nor small, dependent states is crucial to systemic stability.

Why the middle matters

Middle powers matter because they offer more than geographic or economic weight; they constitute a relational space that sustains cooperation even when the largest actors retreat into rivalry. 

Middle powers are not solely defined by material capacity but by their strategic behavior, which explains that these states ¡°leverage their resources through selective leadership, niche diplomacy and active engagement in specific issue areas.¡± Their influence arises not from overwhelming force but from credible, flexible diplomacy embedded in international networks.

Yet middle power behavior cannot be purely transactional. Unlike great powers, which can absorb reputational costs through sheer weight, middle powers depend on a consistent record of principled engagement ¡ª the moment their positions appear for sale, their value as mediators and bridge-builders evaporates. Strategic flexibility is only credible when it rests on stable principles.

Notably, some of the most effective middle power actors ¡ª Norway, Qatar, Singapore and Switzerland ¡ª formally present themselves as small states, yet their diplomatic footprint tells a different story. 

This capacity to function between poles gives middle powers a unique stake in stability ¡ª they thrive not by domination but by preserving openness and predictability in a world where rivalry threatens to narrow options for all.

The pressure to choose ¡ª and the value of autonomy

Great power rivalry today extends beyond security to trade, technology and supply chains. The pressure on other states to align is real. Yet for most, alignment is neither simple nor costless.

Kazakhstan, for example, openly maintains relations with Russia, China, the EU and the US ¡ª not out of indecision, but as deliberate diversification that enhances its strategic autonomy and flexibility. As Thomas Greminger, the author of the GCSP brief, explains, this diversification gives such states greater agency while preserving room to maneuver amid competing pressures. And, T¨¹rkiye offers an even sharper illustration: a NATO member that nonetheless purchased Russia¡¯s S-400 missile system, demonstrating that strategic autonomy is exercised not only outside alliances, but sometimes in deliberate tension with them. 

Scholars describe this as ¡°flexilateralism¡± ¡ª shifting coalitions across different issues and configurations ¡ª or simply ¡°multialignment,¡± where a state maintains simultaneous partnerships across rival blocs without fully committing to any.

Autonomy in this sense is not neutrality in a moral vacuum but a careful exercise of agency ¡ª preserving space for diplomacy, cooperation and engagement across rival blocs.

When geography constrains

Geography shapes middle power behavior, but does not determine it. A strategic location between major powers can amplify diplomatic options ¡ª Kazakhstan¡¯s position at the crossroads of Russia, China and Central Asia sharpens rather than limits its multivector diplomacy, while Qatar¡¯s contested neighborhood has pushed it toward mediation and strategic connectivity as survival tools. But geography can also become a trap.

Countries wedged between Russia and the West ¡ª Armenia, Azerbaijan, Belarus, Georgia, Moldova, Ukraine ¡ª cannot exercise middle power agency in the same way; their contested position pushes them toward bandwagoning rather than bridge-building. The difference between a middle power and an ¡°in-between country¡± is ultimately less about location than about the political space available to make independent choices.

Communication when giants drift apart

As great powers communicate less directly, middle powers often keep vital conversations alive.

The GCSP Policy Brief highlights that middle powers deploy a range of diplomatic strategies ¡ª including bridge-building, coalition formation and mediation ¡ª to bring parties into dialogue and cooperation. It points specifically to cases like Oman and Qatar playing roles in regional mediation, facilitating negotiations between actors that might otherwise lack direct channels.

This kind of facilitation rarely makes headlines. But preventing escalation matters. When crises do not escalate into conflict, when lines of communication hold even loosely, fragmentation is contained.

Coalitions without camps

Global institutions are under strain. Consensus is harder to achieve. Formal mechanisms stagnate.

In response, middle powers are forging issue-based coalitions that sidestep rigid bloc politics. Rather than insisting on universal agreements that exclude major disagreements, these coalitions generate functional cooperation on shared risks ¡ª climate, health, food security and technology governance.

The GCSP brief notes that by forming ad hoc alliances and working collectively, middle powers can help ¡°repair, adapt and stabilise the international order¡± precisely through these narrower but productive agendas.

This cooperation does not require full alignment on all strategic questions; it is rooted in practical outcomes and shared interests in avoiding collapse into zero-sum rivalry.

Greminger¡¯s most concrete proposal points in exactly this direction. During the Cold War, a group of neutral and nonaligned states ¡ª the so-called ¡°N+N¡± ¡ª played a quiet but decisive role in facilitating dialogue between NATO and the Warsaw Pact, contributing to the stable European security order that emerged from the Helsinki Process. He asks whether a similar coalition might be needed today: Should the current Ukraine conflict move toward settlement, reconstructing a European security order will require more than deterrence ¡ª it will need committed, credible states willing to facilitate risk reduction, confidence-building and arms control. Could that coalition include middle powers like Kazakhstan, Norway and T¨¹rkiye alongside traditional neutrals like Austria, Ireland, Malta and Switzerland, with Germany and Italy as cooperative security anchors? The question is deliberately open, but the precedent is real.

Economic connectivity as a stabilizing force

In a fragmented world, economic interdependence is not just a driver of prosperity. It is a buffer against division.

Middle powers often act as connectors, integrating regional trade networks and hosting platforms for economic cooperation. Financial and logistical corridors, middle powers help build complicated efforts to draw hard bloc lines in the global economy, reducing incentives for complete decoupling.

Even outside the GCSP brief, analysts note that middle powers can exercise influence by mobilizing coalitions and exploiting opportunities where great powers are indifferent or immobilized, essentially shaping cooperative spaces where larger players otherwise struggle to do so.

The risks of erosion

Stabilizing the middle is no guarantee. Strategic autonomy can be squeezed by coercive tactics. Economic levers can become tools of political pressure. Domestic politics may harden into pro-alignment rhetoric.

Here, the GCSP brief highlights that middle powers¡¯ agency depends not just on capacity but on political commitment and diplomatic skill, observing that countries like Norway, Qatar and Switzerland combine principled engagement with reputational credibility to act as effective bridge-builders.

These dual attributes ¡ª conviction and craft ¡ª are what allow middle powers to operate as stabilizers in fractured environments.

Holding the system together

The international system need not collapse, and rivalry among great powers will surely continue. Yet the degree of fragmentation the world ultimately experiences will depend not only on the behavior of the largest states, but on whether enough mid-level states sustain cooperation, connectivity and dialogue.

In this sense, middle powers do not just fill gaps left by great power abstention. They actively shape the contours of the emerging order ¡ª not by opposing or neutralizing superpowers, but by keeping diplomatic and institutional space open.

As the GCSP brief illustrates, middle powers are uniquely positioned to contribute to stability precisely because they do not seek domination but manageable, predictable cooperation in an unpredictable world.

Their success is not a function of overwhelming force, but of relational influence ¡ª a blend of credibility, commitment and strategic autonomy. Yet realizing this potential is not automatic. It requires coordinated action, long-term vision and the willingness to lead on principled yet pragmatic agendas. In this sense, the resurgence of middle powers may be the most viable path to sustaining a rules-based international order in an increasingly fragmented and multipolar world, if they choose to act collectively and in time.

[This is an op-ed, summarized version of the publication for the GCSP, where you can find all the sources.]

Roberta Campani had some follow-up questions for the author, which he answered. You can find their exchange below:

1. On Escalation and Structural Change

Roberta Campani: Your policy brief describes a fragmented but still manageable international order. Do the recent US-Israeli strikes on Iran represent a qualitative shift from fragmentation to open confrontation? Has the structural environment for middle powers fundamentally changed?

Thomas Greminger: The recent US-Israeli strikes on Iran have only further strengthened our perception of a polarized and fragmented world order where great powers choose to follow what they perceive to be their interests without any consideration of international law. This is not to say that I wouldn¡¯t condemn the way the Iranian regime has been treating its population. So, I see a further erosion of international law with unpredictable repercussions on regional stability and the global economy, but no fundamental changes of the structural environment for middle powers.

2. On Credibility and Negotiation

Roberta Campani: When major powers signal openness to negotiations and then rapidly escalate militarily, how does that affect the credibility of diplomacy itself? Does such behavior narrow the space in which middle powers can operate as mediators?

Thomas Greminger: It undermines the credibility of diplomacy and, more specifically, conflict mediation. Just imagine that the Omani Minister of Foreign Affairs, tasked to mediate between the US and Iran, was still reporting in Washington on what he perceived to be fairly successful negotiations in Geneva, when the decision to attack militarily was taken. Compare my comments to the :

3. On Strategic Autonomy Under Pressure

Roberta Campani: You argue that middle powers rely on strategic autonomy and diversified partnerships. In moments of acute crisis, does the pressure to align intensify to a point where autonomy becomes unsustainable? How resilient is the ¡°middle¡± under coercive conditions?

Thomas Greminger: Yes, this may well happen. We have, for instance, witnessed several cases where middle powers came under US tariff pressure and felt obliged to offer major concessions. I believe that resilience can be strengthened through regional alliances that offer stronger bargaining power.

4. On International Law and Norms

Roberta Campani: Many middle powers anchor their diplomacy in multilateral norms and international law. If great powers appear willing to bypass or reinterpret these frameworks, does that weaken the normative foundations on which the middle power agency rests?

Thomas Greminger: It does. At the same time, middle powers have an intrinsic interest to preserve and rebuild a predictable, rules-based international order because they don¡¯t dispose of the might necessary to impose right. The good news is that they can still rely on a large majority of states that continue to believe in international law. There is also still a large majority of states that continue to believe in addressing global challenges through international cooperation.

5. On the Risk of Systemic Fragmentation

Roberta Campani: Is the greater danger today the rivalry itself ¡ª or the erosion of trust in diplomatic signaling and institutional commitments? In other words, what threatens the middle more: power politics or unpredictability?

Thomas Greminger: I believe it is easier for middle powers to adapt to power politics that remain stable and thereby predictable over a certain time, as we have seen in the 19th century, than having to deal with the high degree of unpredictability that marks current times.

6. On Collective Action Among Middle Powers

Roberta Campani: Your brief hints at coordination among middle powers. Do you see realistic prospects for collective middle-power initiatives in de-escalation or crisis mediation in the current environment?

Thomas Greminger: We are seeing some initial signs of such alliances. An example is regional powers aligning in response to the war in Gaza. It is true that many mini-lateral structures have popped up in recent years that address specific challenges in a pragmatic, ad-hoc way, but most of them actually serve great power interests. Clearly, middle powers would have to aim for such alliances much more systematically. This would often also imply readiness to overcome regional differences.

7. On Switzerland¡¯s Role

Roberta Campani: Given Switzerland¡¯s diplomatic tradition and your own background, do you see particular responsibilities or opportunities for neutral or non-aligned states in preventing further fragmentation?

Thomas Greminger: Yes, absolutely! At the same time, Swiss foreign policy is very busy regulating its long-term relationship with the EU, dealing with the repercussions caused by the wars in Europe and in the Middle East, and responding to the challenges of the neomercantilist trade policies of one of its most important trade partners. There is therefore a need for a lot of political leadership and commitment for exploiting the opportunities offered to middle powers like Switzerland. It would like other middle powers also to look for creating new cross-regional alliances, perhaps similar to the Human Security Network operating successfully some 25 years ago.

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The Agency of Middle Powers in a Fragmented and Polarized World appeared first on 51³Ô¹Ï.

To the world¡¯s shock, Iran¡¯s Supreme Leader, Ayatollah Ali Khamenei, perished. Iran¡¯s future is now plunged into a state of uncertainty. The country has countered with on strategic locations across the Middle East, including some US facilities in Bahrain, Kuwait, Iraq and the United Arab Emirates (UAE).

As a tiny country, Taiwan¡¯s government worries about these tensions. Meanwhile, the Taiwanese people find themselves in a tight situation as the Chinese navy the island. US intelligence and several think tanks that China will invade Taiwan by 2027 by multiple military units from any spot. After the delayed special defense budget meeting, Taiwan¡¯s Legislative Yuan approved the $40 billion purchase of armed units ¡ª mostly from the United States ¡ª to upgrade the country¡¯s readiness to face China.

In his speech, Taiwanese President Lai Ching-te to allocate 3% of GDP to military expenditure and to reach 5% of GDP in 2030.

The new turbulence in the Middle East has significantly impacted Taiwan¡¯s position as a global player. Although Taiwan is far away from that region geographically, Lai ensures that Taiwan¡¯s interests are protected, at least for its citizens, economy and political awareness. In response to the catastrophe, he expressed in closely monitoring the situation and taking precautionary measures.

People first

Taiwan should not be recognized as a sovereign country by all members of the United Nations. As of early 2026, only 12 countries, primarily located in the Pacific, formally it. In terms of political influence, Taiwan lacks the capacity to act as a ¡°peacemaker¡± like Qatar or Norway, which have established experience in mediation.

The rising tensions are a clear indication for Taiwan to enter a state of heightened alert, necessitating an awareness of its precarious position. Taiwan must confront the stark reality of its situation. Compared to the key players involved in the current turmoil, including the US, Israel, Iran and others, Taiwan has significantly limited offensive capabilities. This creates an asymmetrical power dynamic.

Taiwan must urgently prioritize protecting its citizens. This requires effective coordination and communication among Taiwan¡¯s non-diplomatic offices in the Middle East. The Ministry of Foreign Affairs has that 3,000 Taiwanese individuals in the region are safe. Additionally, the Taiwanese government has no immediate plans to its nationals from the Middle East, as Iran¡¯s retaliatory actions have primarily targeted US sites. However, given the volatility, the Taiwanese government should take further steps to ensure its citizens¡¯ safety.

Global economic fallout

The Iranian government is now shipping through the Strait of Hormuz. This strategic waterway serves as a vital maritime route for international trade, connecting the Middle East to Europe. The blockade would significantly disrupt the maritime route, as vessels bound for Europe would need to around the Cape of Good Hope at the southern tip of South Africa. That takes longer and incurs higher operating costs.

This change of trade routes will likely affect the Taiwanese economy. of its oil is sourced from the Middle East, primarily due to its high sulfur content. Trade relations between Taiwan and Middle Eastern countries have been on the rise, with oil imports representing of Taiwan¡¯s total imports. Therefore, the significant dependence on that oil hurts Taiwan¡¯s energy needs.

State-owned oil suppliers CPC Corporation, Taiwan, and Formosa Petrochemical Corporation have announced an increase in fuel prices. Gasoline prices will soon by $0.20 New Taiwan dollar (less than $0.01) per liter, while diesel prices will increase by $0.40 ($0.01) per liter.

The situation also poses a risk to Taiwan¡¯s investment landscape. While Taiwan may carry less political clout, it experienced an ¡°¡± from the 1950s to the 1980s. The Taiwan Semiconductor Manufacturing Company stands as the world¡¯s leading producer of advanced technology, responsible for 90% of global production.

In the era of the Fourth Industrial Revolution, countries worldwide are compelled to embrace technology to foster progress across all sectors. In the Middle East, Taiwan has technological defense, such as drones, naval systems and surveillance equipment, to countries like Saudi Arabia and the UAE.

What Taiwan needs

As a country under pressure from multiple sides, Taiwan needs to be ready to face global complexity. It requires a ¡°watching and preparing¡± approach, pursuing adaptive policies aligned with national measures to ensure that Taiwan remains responsive to the evolving geopolitical landscape.

In response to these tensions, Taiwan¡¯s national interest lies in safeguarding its people and upholding economic resilience. The country needs to implement decisive strategies that bolster economic stability and growth. Doing so would reinforce its position amidst geopolitical uncertainties.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post Taiwan Watches and Prepares Amid Global Uncertainty appeared first on 51³Ô¹Ï.

The economic consequences are immediate. Oil prices have already jumped as markets price in the risk of supply disruption and prolonged instability. Analysts that a prolonged conflict could push oil prices above $100 per barrel and intensify inflation across import-dependent economies.

For Indonesia, the war presents a clear danger. The country still relies heavily on imported crude oil and refined fuels. When global prices surge, ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ fiscal burden through fuel subsidies and higher import bills. Yet crises often create opportunities for structural change. The current oil shock could become a catalyst for Indonesia to accelerate its long-delayed energy transition.

A global oil crisis should not be treated only as a short-term emergency. It should also be treated as a catalyst for a faster shift toward cleaner, more resilient energy systems. Indonesia, as well as the rest of the world, must invest in this change now before it is too late.

Renewable energy expansion

The most immediate step is electrification. ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ transport and logistics sectors remain deeply on diesel fuel. Trucks, buses and delivery fleets vast amounts of imported petroleum. Electrifying these systems would reduce exposure to global oil volatility. Electric buses for urban transport, electric freight corridors for logistics and electric two-wheelers for urban mobility could significantly reduce oil demand. When electricity increasingly comes from renewable sources, the economic benefits multiply.

The power sector is equally important. Many regions across Indonesia still on diesel-fueled generators, particularly in remote islands. This diesel-based electricity generation is expensive and heavily reliant on fuel logistics. Replacing these plants with renewable systems would deliver immediate gains.

Indonesia also has enormous renewable energy . Solar energy alone could reach around 100 gigawatts through the large-scale deployment of panels across the archipelago. Wind energy has the potential to provide roughly 154.6 gigawatts of capacity, with hydropower resources potentially contributing another 89.3 gigawatts. The technology and human resources already exist; what remains is decisive government policy.

A major renewable expansion would also reduce the burden of energy subsidies. Diesel imports expose the state budget to global price spikes, and renewable energy systems operate without fuel imports once installed. The result is more predictable electricity costs and greater fiscal stability.

Government policy should therefore focus on accelerating investment in renewable energy, particularly in the power sector. Fiscal incentives can support the installation of solar panels, wind turbines and hydropower plants. Tax credits, concessional financing and long-term power purchase agreements would attract both domestic and international investors.

Indonesia has already set a target of at least renewable energy in the national energy mix. That level should be seen as a minimum threshold rather than a ceiling. The higher the renewable share, the stronger ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ buffer against external shocks such as oil price spikes. However, not all policy responses move in that direction.

The environmental and energy security trade-offs

One frequently proposed response to rising oil prices is expanding biodiesel blending mandates. The idea of moving toward B50 ¡ª a 50% palm oil biodiesel blend with diesel fuel ¡ª is often as a solution to energy security. However, it is not an ideal solution, as palm oil blending still relies on petroleum diesel. The system continues to depend on imported fossil fuels. That is the policy¡¯s fundamental weakness. Blending reduces diesel demand, but it does not eliminate it.

Environmental consequences also deserve attention. Expanding palm oil plantations can worsen deforestation and ecological degradation. The recent flooding in parts of Sumatra has already raised concerns about the loss of natural water absorption areas linked to plantation expansion. Several companies whose permits were revoked were connected to plantation related environmental violations.

Further expansion of plantations could create new risks. In Papua, large-scale palm oil development raises fears of land conflicts with local communities and further deforestation. A cleaner strategy lies elsewhere: Solar farms, wind projects and hydropower installations reduce fossil fuel demand without triggering the environmental tradeoffs associated with large-scale plantation expansion.

Indonesia should also strengthen its international commitments to move away from fossil fuels. Joining the Fossil Fuel Non-Proliferation would provide a clear roadmap to reduce dependence on crude oil while accelerating investment in renewable energy systems.

The time to diversify

The war in the Middle East is a geopolitical crisis with global consequences. Oil prices are rising sharply; trade routes remain unstable; import-dependent countries are starting to feel the pressure. For Indonesia, the lesson is straightforward: Energy security cannot depend on imported fossil fuels vulnerable to distant conflicts.

The current war may destabilize energy markets, but it may also provide the political urgency needed to accelerate ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ transition toward renewable power. Crises often force choices that normal politics would otherwise delay, and Indonesia now faces one of those moments. The only question now is whether Indonesia will seize this opportunity to diversify its energy supply or remain dependent on oil.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The Middle East War Could Finally Push Indonesia Toward Renewable Energy appeared first on 51³Ô¹Ï.

The collapse of China¡¯s Iranian oil ecosystem

Iran supplied about 13% of all the crude oil China imported by sea last year, with more than percent of Iran¡¯s total oil exports flowing to Chinese refineries ¡ª most of it to smaller ¡°¡± operations along the coast that had quietly built their business models around sanctioned, discounted barrels. That ecosystem has now collapsed.

Chinese refiners have been pushed into global spot markets where they must compete for replacement oil at war-inflated prices, settling transactions in US dollars under close international scrutiny. The yuan-denominated shadow trade that sustained both Iran¡¯s economy and Beijing¡¯s dedollarization ambitions is gone, possibly forever.

Beijing spent the better part of a decade for precisely this kind of disruption ¡ª diversifying suppliers, building strategic reserves, accelerating its domestic renewables buildout, and establishing alternative pipeline routes through Central Asia and Russia. China will absorb this, but what it cannot so easily absorb is the lesson that the war broadcasts to every country that has built its security around a partnership with Beijing.

The limits of China¡¯s partnership model

The 25-year comprehensive strategic partnership between China and Iran, in 2021, was supposed to be the flagship of Beijing¡¯s alternative world order ¡ª proof that countries could anchor their futures to China rather than to Washington¡¯s alliance system. Iran was to receive investment, integration into Chinese-led institutions such as the BRICS and the Shanghai Cooperation Organization, and de facto diplomatic cover through its association with Beijing. In exchange, Beijing took advantage of cheap oil ¡ª a critical node in the Belt and Road Initiative¡¯s overland corridors, and a geopolitical buffer against American power projection in the Gulf.

The problem is that China¡¯s version of partnership comes without a security guarantee. True to form, this has always been Beijing¡¯s calculated position ¡ª no entangling alliances, no forward military commitments, no meaningful positions that are not skewed to Beijing¡¯s advantage and no risk of being dragged into someone else¡¯s war.

Chinese analysts defend this as strategic wisdom, arguing it gives Beijing maximum flexibility and avoids the type of overstretch that has degraded American power. In practice, it means that when the US and Israel launched Operation Epic Fury, China¡¯s comprehensive ¡°strategic partner¡± had no one to call.

Strategic messaging meets strategic reality

Beijing¡¯s defenders will note that intervening militarily was never a realistic option. China is not going to fight the US over Iran. The issue is whether Beijing¡¯s entire framework for challenging American dominance ¡ª the Global Security Initiative, proclamations about a multipolar world order in which China is prominent, and solemn declarations that ¡°the East is rising¡± and that China stands for peace ¡ª means anything when tested by violence. The answer is no.

There is also the question of what China may have inadvertently contributed to the war¡¯s timing. that Beijing was supplying Iran with carrier-killer missiles ¡ª weapons that would have taken months to deploy but whose transfer narrowed the window for any diplomatic resolution ¡ª suggest that China¡¯s deliberate ratcheting up the heat may have accelerated the crisis it sought to avoid. It was a profound strategic miscalculation: China helped make the war more likely while lacking either the will or the means to prevent it.

Beijing¡¯s Calculus: business with Washington

For Chinese President Xi Jinping, the immediate calculus is clear. He is prioritizing the upcoming with US President Donald Trump in Beijing. He is protecting the trade truce that has given China room to breathe during a period of acute economic pressure. He is choosing business with America over solidarity with Iran. While being rational, it is also exactly what Washington always suspected China would do when forced to choose.

The longer game is harder to read. China will likely seek to expand its economic presence in Iran once the dust settles, positioning itself for the reconstruction contracts and the oil access that will eventually reemerge ¡ª just as it did following the end of the Iraq War. Beijing is already framing its restraint as proof of responsible statecraft ¡ª in contrast to American militarism.

But the countries that matter most to Chinese grand strategy ¡ª Saudi Arabia, the Gulf states, the emerging economies of Southeast Asia and Africa, and the Global South more generally ¡ª are watching. They are watching China absorb a significant strategic loss, respond with only statements and wait. They are undoubtedly calculating what a partnership with Beijing would actually be worth in their own hour of crisis and need.

The Iran war has not ended China¡¯s rise, but it certainly has clarified its terms. While Beijing can offer markets, infrastructure and diplomatic cover, it will not offer security. That distinction may well prove to be the defining limit of Chinese power in the century ahead.

[Daniel Wagner is CEO of Country Risk Solutions and author of five books on China.]

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post What the Iran War Reveals About the Limits of Chinese Power appeared first on 51³Ô¹Ï.

That is the core message you can read between the lines of the International Monetary Fund¡¯s (IMF) 2026 concluding statement: Japan has displayed impressive resilience, output is running above potential and inflation has been above the Bank of Japan¡¯s (BoJ) 2% target for an extended stretch ¡ª but the next phase will be defined less by ¡°escape velocity¡± than by?navigation. With the output gap positive and inflation expected to converge down to the target, the IMF argues that policy should be calibrated to sustain stability while rebuilding fiscal buffers and ensuring labor-market tightness translates into real wage gains. In other words: The liner is moving again; now it must pass through a narrow strait without scraping the rocks.

Goldman Sachs¡¯ harmonizes with that baseline but adds a market practitioner¡¯s edge: The fundamentals look steady ¡ª domestic demand, capex and a labor shortage-driven wage cycle ¡ª but the policy risks are rising, especially around the timing of BoJ normalization and the durability of expansionary fiscal choices. If the IMF writes like a harbor master, Goldman writes like a weather forecaster watching pressure systems gather. Same sea, different instruments.

A recovery with ballast

Start with what is working. Japan¡¯s growth, in the IMF¡¯s view, has been resilient: it exceeded potential in early 2025 and is projected to remain strong in 2026 even as external demand softens. Domestic demand has stayed firm despite elevated uncertainty and the of US tariffs. This matters because Japan¡¯s post-bubble history is littered with recoveries that depended on foreign tides. A cycle led by domestic demand is like ballast in rough water: it stabilizes the ship.

Goldman¡¯s narrative is similar, and more explicit: 0.8% real GDP growth in 2026, led by consumption and capex, with the economy structurally shifting toward persistent labor scarcity. In that frame, Japan is not merely enjoying a cyclical upswing; it is entering a new regime where labor shortages force wage-setting behavior to change ¡ª slowly, unevenly, but meaningfully.

Yet even here the metaphor has teeth. The engine is running, but the passengers are complaining. The IMF notes that nominal wages are rising at a historic pace, but persistent cost-of-living concerns remain because headline inflation has eroded purchasing power and real wages have continued to contract. That is the political economy of 2026: You can tell households the ship is moving again, but they will judge the voyage by how the cabin feels ¡ª warmth, food and the price of essentials.

Inflation: the fire in the hearth, not the fire in the walls

Japan¡¯s inflation story is both a triumph and a trial. After three decades of near-zero inflation, prices have been rising faster than the BoJ¡¯s target for three and a half years. For policymakers who spent years trying to light a fire under the economy, this is proof that the hearth is finally warm. But any homeowner knows: Warmth is welcome; smoke is not; and fire in the walls is a disaster.

The IMF¡¯s baseline is that inflation should moderate in 2026 and converge toward the target in 2027, helped by easing global oil and food prices, stabilization in domestic rice prices, and fiscal measures that contain prices. Core inflation, however, may remain more persistent than anticipated, partly because the fiscal stance is projected to be more accommodative.

Goldman¡¯s view is more pointed: Underlying inflation rises moderately amid continued wage growth in the low-3% range, while headline inflation decelerates mainly due to slower food prices. This is the key nuance. Japan may be shifting from a story dominated by imported inflation and commodity spikes to one where service prices ¡ª driven by wages ¡ª become the durable component. That is exactly the sort of inflation central banks treat as ¡°real,¡± because it speaks to domestic momentum rather than global weather.

The risk is not simply that inflation stays above target; it is that expectations and wage-setting begin to embed a higher inflation norm before the BoJ has fully regained conventional policy footing. In the metaphor, it¡¯s not the flames you see; it¡¯s the ember you forget, the one that catches later when the wind changes.

Monetary policy: walking the tightrope while the rope is still being strung

Both the IMF and Goldman agree that the BoJ is at a crucial stage. The IMF supports a gradual, data-dependent withdrawal of accommodation, moving toward neutral by 2027, and emphasizes uncertainty around where ¡°neutral¡± really sits after years at the effective lower bound. This is not cautious for its own sake. It is cautious because Japan¡¯s financial system, wage dynamics and inflation psychology are all being reconditioned at once. The BoJ is trying to tune an instrument while the concert is already underway.

Goldman, by contrast, argues for a faster cadence: shifting from annual hikes to semi-annual, reaching 1% with a 25 basis point hike in July 2026, and aiming for a terminal rate of around 1.5% ¡ª its estimate of neutral. It warns that the cost of delaying hikes rises as underlying inflation approaches 2%. Delay too long, and the BoJ might ultimately need to hike into restrictive territory.

These positions are less contradictory than they appear. The IMF is optimizing for stability under uncertainty; Goldman is optimizing for avoiding a ¡°behind-the-curve¡± catch-up. In metaphorical terms: The IMF says, ¡°Keep both hands on the wheel and don¡¯t oversteer in fog.¡± Goldman says, ¡°If you wait too long to turn, you may hit the pier.¡±

What matters most is credibility. The IMF explicitly welcomes Japan¡¯s flexible exchange-rate regime and stresses that BoJ independence and credibility help keep inflation expectations anchored. That independence is not a ceremonial banner; it is a structural beam. If it weakens, policy becomes more expensive: The market demands a premium, the currency becomes more volatile, and every rate move does less work.

Fiscal policy: the sugar rush versus the diet plan

If monetary policy is the tightrope, fiscal policy is the buffet table. The IMF credits Japan¡¯s post-pandemic consolidation ¡ª strong revenues and spending restraint ¡ª with a primary deficit in 2025 that is estimated to be smaller than in 2019 and among the smallest in the G7. But it also warns that near-term policy should refrain from further loosening, preserving gains in consolidation and explicitly advises against reducing the consumption tax ¡ª an untargeted measure that erodes fiscal space and adds to fiscal risks.

Goldman¡¯s analysis lands in the same neighborhood but uses a different street map. It argues that fiscal soundness has been maintained because Japan has enjoyed a ¡°bonus stage¡± in which nominal growth exceeds the government¡¯s effective interest cost. That makes the debt-to-GDP ratio easier to stabilize ¡ª even with deficits ¡ª because the denominator grows faster than the interest burden. But Goldman¡¯s warning is sharp: Permanent tax cuts and permanent spending increases can reverse the debt trajectory, and rising market rates eventually raise debt-service costs, making market confidence and debt management more important.

The shared conclusion is straightforward: temporary relief can be affordable; permanent promises are the real danger. A one-off cash transfer is like giving passengers a blanket during a cold night. A permanent tax cut without a funding plan is like removing the ship¡¯s watertight doors because they look bulky ¡ª fine until the storm hits.

The IMF¡¯s preference for targeted, temporary, budget-neutral support ¡ª and its openness to refundable tax credits ¡ª fits this logic. It is easier to steer with a compass than with applause. Fiscal policy should protect the vulnerable without locking in structural deficits that reduce room to maneuver when the next shock arrives.

Financial stability: The tide is rising, and so is the price of duration

Japan¡¯s financial system is broadly resilient, the IMF says, with strong capital and liquidity positions and improved profitability as rates rise. But the sources of risk have shifted. Higher yields can generate valuation losses, and structural vulnerabilities ¡ª mark-to-market securities positions, foreign exchange (FX) and cross-currency funding exposures, and pockets of weakness in commercial real estate ¡ª remain. Regional banks, in particular, appear more vulnerable due to weaker shock absorbers and demographic headwinds.

This is where normalization becomes real. For years, the BoJ¡¯s outsized participation in the Japanese Government Bond (JGB) market acted like a breakwater, damping volatility. As it reduces its balance sheet and market functioning improves, Japan gets price discovery back ¡ª but price discovery is not always gentle. The IMF calls for close monitoring of JGB market liquidity and investor positioning and suggests that the BoJ should be ready for exceptional, targeted interventions if volatility undermines liquidity, while communicating clearly to avoid impairing market functioning.

In plain terms: Japan is learning to sail without training wheels. That is necessary. It is also risky if communication falters or fiscal headlines spook investors.

Structural reform: turning labor shortages into real wage gains

If you want one policy ¡°north star¡± for 2026, it is real wages. The IMF highlights a stubborn reality: Despite labor shortages, real wage growth has been elusive, and the gap between productivity and wages has widened substantially since the mid-1990s. The diagnosis is institutional: Low mobility reduces competition for skills, weakens worker bargaining power and slows productivity-enhancing reallocation. The prescription is to raise mobility via job-based employment and merit-based pay, correct labor supply distortions, and expand active labor market policies and reskilling ¡ª especially to manage AI-driven displacement while capturing productivity gains temporally.

This is where Japan¡¯s macro story becomes a social contract story. An economy with a labor shortage can produce higher wages, but only if the system allows workers to move to higher-productivity areas and firms to compete for talent. Otherwise, you end up with tightness without bargaining power: a paradox that breeds frustration and invites populist fiscal fixes.

The big picture: a strong hull, but watch the steering

Japan in 2026 has sturdier fundamentals than many observers expected: steady growth powered by domestic demand, inflation no longer stuck at zero, corporate investment adapting to labor scarcity and a central bank finally able to move policy rates without fearing immediate relapse into deflation.

But the next test is not whether Japan can grow. It is whether Japan can govern the transition from extraordinary policy to sustainable normalcy. The IMF¡¯s baseline offers the roadmap: calibrate monetary tightening gradually toward neutral, keep fiscal policy from becoming permanently expansionary, rebuild buffers and undertake labor reforms so that real wages rise. Goldman¡¯s overlay adds the caution flags: if the BoJ delays too long, it may have to hike more sharply later; if fiscal expansion turns permanent, the debt trajectory and market confidence can change quickly.

Back to the ocean liner: Japan has regained forward motion. The engines are humming. The sea is not calm, but the ship is seaworthy. Now comes the narrow strait ¡ª where small steering errors matter more than raw power. If Japan keeps the wheel steady, uses fiscal policy like a compass rather than confetti and turns labor tightness into durable real wage gains, 2026 can be remembered as the year Japan didn¡¯t just sail again ¡ª it learned to steer in open water.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post Japan 2026: Steering a Reawakened Economic Giant Through the Narrow Strait appeared first on 51³Ô¹Ï.

While technology is important, it addresses only part of the problem. The largest source of environmental harm , in land clearing and peatland drainage. Forests are cut, carbon is released and ecosystems are fragmented long before palm oil reaches a mill. Financing biofuel projects without strict safeguards allows these impacts to continue, creating a gap between cleaner mills and destructive cultivation practices. This gap undermines any claims of meaningful sustainability.

Indonesia has already experienced the consequences of unchecked expansion. Between 2001 and 2023, the country millions of hectares of tree cover, much of it tied to agricultural development. In many cases, forests were intentionally cleared using fire, which not only destroyed ecosystems but also public health, displaced communities and strained regional relations. These patterns should not repeat in a country with one of the world¡¯s last large intact forest landscapes.

±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ forests massive amounts of carbon and support biodiversity found nowhere else on earth, giving them extraordinary ecological value. Large-scale plantation development threatens to fragment these ecosystems and undermine indigenous land rights. Once damaged, such environments are difficult, if not impossible, to restore.

China¡¯s financial influence gives it leverage to prevent this outcome. As a major investor and energy consumer, China can set clear conditions for cooperation. Halting funding for biofuel projects associated with deforestation would send a strong market signal: that economic partnership does not require environmental compromise.

This is not an argument against cooperation, but rather an argument for better cooperation. China can redirect investment toward projects that increase productivity on existing plantations rather than expanding into forests. Supporting replanting programs, yield improvements and methane capture technology would reduce emissions without triggering new land conversion.

Practical steps

To make this approach practical, Chinese policy banks, commercial lenders and Indonesian regulators should anchor cooperation in four measures. 

First, lenders should require verifiable zero deforestation commitments as a condition of financing, backed by satellite monitoring and public reporting. Second, Indonesian authorities must secure indigenous and local community land rights before project approval, with lenders verifying compliance. Third, both governments should mandate full supply chain disclosure, including independent verification of emissions and sourcing. Fourth, financing contracts should include automatic suspension clauses when violations occur, enforced jointly by regulators and financial institutions.

These steps are also strategic. Global markets are imports of commodities linked to deforestation, and investors are screening portfolios for environmental risk. Projects that ignore these trends risk becoming stranded assets. For Indonesia, higher standards strengthen long-term market access while protecting livelihoods. Short-term gains from deforestation are fleeting; credible, sustainable practices ensure economic stability over decades.

The Low Emission Palm Oil Mills initiative can still play a constructive role if paired with firm upstream protections. Technology should complement conservation, not distract from it. Sustainability begins with decisions about where plantations are allowed and where they are not.

China and Indonesia can become a model?

Cleaner mills alone cannot prevent forest loss, but when integrated with strong land-use standards, transparency and community protections, they can reinforce sustainable production. The real test of progress is simple: forests remain intact, communities retain their rights and emissions decline across the full supply chain. If these outcomes are met, cooperation between Indonesia and China can become a model of green growth for tropical commodities.

Ending biofuel financing tied to deforestation is not a retreat from partnership. It is a commitment to responsible development, recognizing that once primary forests disappear, no mill, no matter how advanced, can restore them. Protecting forests, enforcing standards and supporting communities is the path to a palm oil industry that is both economically valuable and environmentally credible.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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When the army is restless and distrustful,

trouble is sure to come from other feudal princes.

¡ª , 6th century BCE

The in late January of General Zhang Youxia, Vice Chairman of the Chinese Central Military Commission, spawned rumors of a coup d¡¯¨¦tat, with fringe Western online showing AI-doctored videos of tanks purportedly in Beijing suburbs, and some even reporting gunfire around General Zhang¡¯s residence. Wherever political systems are shrouded in secrecy and opacity, conspiracies flourish. China¡¯s closed political culture, in particular, nourishes conspiracy theorists both domestically and abroad.

Debunking myths: understanding power dynamics within the Chinese Communist Party

The traditional Western commentariat has been somewhat constrained, yet it is still feeding the that Chinese President Xi Jinping is under pressure from party factions, and that the arrest of General Zhang was an example of Xi¡¯s struggle to retain presidential power through tenuous control of the military. Prominent US papers alleged Zhang was , selling officer commissions and even leaking nuclear secrets to the Pentagon.

No outsider can truly know what takes place within the labyrinths of power in the Chinese Communist Party (the Party), let alone the military, but the causes of General Zhang¡¯s demise are more likely his strategic and tactical differences with President Xi, and his determination to pursue his own line, supported by a number of other senior commanders. This represented a faction or, at least, the seeds of one. That Xi moved against a figure as powerful as Zhang so swiftly and without tanks in the streets of Beijing demonstrated his power, not his vulnerability.

There is a China of common reality and a China of the foreign imagination. In the latter, the economy is always on the brink of collapse, and the government, led by recalcitrant communists, is mired in factional conflict. In reality, while social change over the decades has been radical, the day-to-day experience of both civil and public life is largely stable and predictable. The Party and government are stronger and more integrated with society than at any stage in modern Chinese history, and the People¡¯s Liberation Army () is obedient to the Party as never before, even more than under Mao Zedong.

Transforming the PLA: challenges, reforms and strategic aspirations

In 2013, a year after his ascension to power, Xi a series of military reforms. Former Chinese Leader Deng Xiaoping also drove military reforms in the , a time when units of the air force still practised formation flying with little models of Mig fighter jets in their gloved hands, moving in unison around basketball courts. China¡¯s military had come a long way from the post-revolutionary, post-Korean War army, but was still backward, running exercises that were largely performative. Rivalry between the various branches of the armed forces was rife, and corruption was endemic. Commissions were traded widely, affecting advancement for even the lowest ranks and disrupting the meritocratic principles upon which the PLA was based. In 2013, the PLA still functioned much like a giant, inefficient state-owned enterprise, with more soldiers employed supplying food, uniforms and equipment than in fighting units.

China¡¯s last significant military action was a limited incursion into Vietnam¡¯s border provinces in , in which both sides suffered heavy casualties, and after which both claimed victory. The US and Indian armed forces, on the other hand, have fought in a number of engagements, creating an experienced officer corps and competence in deploying modern weaponry. The of the PLA has been informed by China¡¯s close observation of recent conflicts, particularly the Russia¨CUkraine War, yet the modern PLA remains untested in combat.

Despite this, observers would be mistaken to assume that Chinese soldiers lack the logistical skills needed for combat, for the PLA is for disaster relief and has consistently met practical and leadership challenges, while winning the widespread respect of the people.

President Xi¡¯s proposed changes to the PLA seem rational: the formation of small, flexible brigades that can respond to crises quickly and deploy mobile missile capabilities. He has the Marine Corps to more than 50,000 soldiers to support China¡¯s increased, largely defensive naval capacity and has invested heavily in drone and unmanned-submarine development. As the Ukraine¨CRussian conflict is , drones are now a critical factor in battle, and China already has the capacity for the deployment of unmatched massed drone swarms.

It is significant that General Zhang was the last serving senior military commander with actual battlefield experience, which he gained in the 1979 war. His removal seems to undermine Western that Xi plans to invade Taiwan next year. After a succession of , the Central Military Commission, chaired by Xi, has only two of the mandated seven members left. As much as he will need to establish a political succession plan should he take a fourth term, Xi now needs to appoint the next generation of military leaders to fill the vacancies his purges have created.

Rethinking Western strategies: a diplomatic approach to China¡¯s military evolution

The West¡¯s sense of exceptionalism and attendant lack of humility means that its policymakers and commentators alike often fail to appreciate the experimental nature of China¡¯s political and industrial evolution and the scale of development across all parts of Chinese society. The Chinese military is no exception. The US and its allies will need to do better than invest in the poor science fiction that is , or rely on the chimera that is to counterbalance China. They would benefit from reconsidering their conventional approach of holding annual war games in Chinese sovereign waters, which amount to sound and fury, signifying little and increasingly damaging diplomatic trust and trade relations.

There is little any power can do to stop China from continuing to develop a military commensurate with its demographic, geographic and economic scale. But the US and its allies¡¯ actions can and will impact China¡¯s perceptions of strategic and military threat. Unlike the US, China can point to its track record of avoiding military deployment outside its borders (with the exception of peace-keeping missions) for nearly 50 years, and it is unlikely to discard this record casually.

[ first published this piece as a business report.]

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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Over the last decade, the American and European architects of the rules-based global order disabled it step by step, believing they would lose their centuries-old political dominance in competition with China.

More recently formed entities and forums, such as BRICS and the Shanghai Cooperation Organisation (SCO), are the pre-eminence in Asia of such institutions as the US-dominated World Trade Organization (WTO), the International Monetary Fund (IMF) and the World Bank. The economic influence of the US Government itself is receding. China does not need to confront the US in order to establish its authority in the region; it just needs to stand back and allow the US to continue disempowering itself.

Initially a diplomatic coalition of relatively non-aligned nations, the 10 BRICS nations are forging deeper commercial links each year, with applying to join in 2025. BRICS operates a renminbi-backed Cross-Border Interbank Payment System (CIPS), allowing to bypass the dollar-dominated trading system. Trump¡¯s and weaponization of the US currency leave America¡¯s friends and foes alike little choice but to seek alternatives to the dollar, or risk being ensnared in random sanctions and trade embargos. Washington and war by non-military means against 30 countries today.

The includes China, Russia, much of Central Asia, India and Pakistan, with Iran, Afghanistan and Mongolia as observers. Despite the fact that some members are unnatural allies and even adversaries, the SCO is becoming a regional platform for establishing Asian and Central Asian economic and trade norms.

It is as innate for humans to collaborate as it is for them to compete; governments in the pursuit of economic self-interest can manage these opposing motives. There is no better demonstration of this than the Chinese-seeded Asian Infrastructure Investment Bank (AIIB), which meets needs in Asia unfulfilled by the Asian Development Bank and the IMF. India, China¡¯s frequent adversary, is the AIIB¡¯s largest debtor.

When I joined the AIIB, not being a China specialist, I was unsure whether I could deal with its culture. The office culture can be a challenge sometimes; it is very Chinese and so different to what I have known. But the investment strategy is more objective than similar organisations I have worked for in the West. In fact, as we grow and bring in more members, Chinese influence reduces. It was designed this way. ¡ª AIIB manager

By purchasing power parity, Asia accounts for roughly of global GDP and 40% of consumption. Approximately of the world¡¯s population lives in Asia, while roughly 23% of Asians still live in relative poverty. As China has demonstrated, governments that can promulgate effective development policies while allowing entrepreneurs to flourish can unlock a potent economic resource, one which is driven by the collective aspirations of their underdeveloped citizens.

Cooperation or conflict

From the early 1990s, policymakers and economists in Washington and most Western countries were sure their systems would prevail over China¡¯s, and that as China accepted the principles of free-market economics, full regime change in Beijing would follow. Most Western attempts at regime change in the last 50 years have nevertheless failed, and continual US attempts since 1945 have been a primary cause of the weakening of the American empire.

US President Donald Trump¡¯s New Year¡¯s of Venezuelan President Nicol¨¢s Maduro and his wife was a direct assault on international law and upon the interests of not just China, but any nation depending on international law to guarantee its security. For more than ten years, China has been vital to Venezuela¡¯s economic survival. In 2024, Venezuela sold of its oil to China, amounting to 480,000 barrels a day, paid for in renminbi. China invested $50 billion in Venezuelan infrastructure over the last decade, and Caracas holds $60 billion in Chinese loans, collateralized by oil.

Nations with respect for international law now need to speak out and distance themselves from Washington, or accept that their silence is complicity. Many Western nations have already stood by while Trump Canadian, Mexican and Danish sovereignty; in Gaza; Iran, Yemen, Somalia and Nigeria without declarations of war; and Venezuelan seafarers in the Caribbean because they might have been drug traffickers.

Washington¡¯s actions over the past year will likely force a reassessment of assumptions within those countries that trade with China and yet have taken care not to undermine their loyalty to what they saw as the more law-abiding US. As the world becomes more multipolar and competitive, countries have more to benefit from trading freely with all, and more to risk and potentially lose from partisanship.

Block Quote:

Some of the infrastructure China built here was poor, and I think Beijing needs to govern private contractors on Belt and Road projects better. But overall, we prefer Chinese aid and investment because it comes with skilled engineers, know-how and good technology. They don¡¯t lecture us on how we should manage our islands, which cannot be said for Australia and New Zealand. The US talked about doing more in the Pacific. But they threaten they will do less if we deal with China. ¡ª Pacific island official

Further conflict is inevitable unless the West realizes it must work with Beijing and acknowledge the changing global order, in which regional nodes of power interact within agreed frameworks. European and US leaders seem unable to see that the right partnerships with Beijing could help stem their nations¡¯ economic declines, while increased attempts to isolate and contain China will most certainly accelerate them.

For its part, China must think more deeply about how to work with its major trading partners beyond sparring through tit-for-tat tariffs or flooding their markets with goods. China has already demonstrated it can strengthen the economies of geographical neighbors through trade and investment. This was and remains one of the motives behind the project. China¡¯s over the last 20 years have largely benefited both Beijing and African states. Although different historically and in terms of level of development, Washington and Brussels could work with Beijing to agree on principles of trade and entente if they so wished.

Boundaries

In the 1980s and 1990s, when China was still weak, it imposed conditions on foreign investors, limiting ownership in businesses and excluding selected industries. Rather than erecting tariff barriers to staunch the flow of electric vehicles and renewable energy technology into their markets, Western governments would create greater trust and achieve more balanced trade if they required Chinese firms to form joint ventures to manufacture and share their technology.

When managing regional conflicts, China has less to gain than ever from trying to exact retribution for historical injuries. When Japanese Prime Minister Sanae Takaichi recently made alluding to a military alliance with Taiwan, Beijing would have projected more strength with a short, dismissive admonition rather than vociferous outrage.

The history of Japan¡¯s invasion of China is taught in schools and most families have a relation who suffered at the hands of the Japanese. I know the West thinks we should just ¡®get over it¡¯. But it¡¯s not that simple, and one who has not suffered doesn¡¯t have the right to tell someone who has what to feel. You wouldn¡¯t dare say ¡®just get over it¡¯ to a Jewish person whose family suffered in the Holocaust. ¡ª Chinese doctor 

The US and its allies use Taiwan to provoke China in the hope that it will destabilize and weaken it. Few Western politicians understand the history and contemporary dynamics of Taiwan; even fewer care for the people of the island, and none are likely to risk the lives of their soldiers to support its independence. The best situation for all is to accept the discomfort and quasi-stability of the status quo and encourage Taibei to renew dialogue with Beijing. Unfortunately, Washington fears China too much to let go of what it imagines, falsely, as its key instrument restraining its rise.

China¡¯s advantage in this conflict is patience. Absent an unlikely direct US military escalation, Beijing will wait for American regional influence to wane, so it may negotiate with Taiwan when tensions are lower. In the meantime, Taiwan is well shielded from coercion by any power, not because of its military might but because of its microchip production, which constitutes of the global supply and therefore the Mainland Chinese supply. Neither Beijing nor Washington can risk disruption to the supply, let alone its destruction from an invasion.

China¡¯s leaders¡¯ objectives are to secure domestic economic balance while reducing dependence upon those conspiring to contain it. It would be folly for the West to provide China with any cause to take a more radical, militant path in pursuit of its security.

Given the likelihood that China achieved 5% GDP growth in 2025 and laid the groundwork for similar growth in 2026, its economy is, with some caveats, recovering well. Beijing has shown resolve in engaging, without overreacting, to US trade coercion, restoring a substantial degree of public confidence in the process. But Beijing still needs to do more if it is to stabilize and strengthen its domestic economy, retain public trust over the long term and deal with an unpredictable geopolitical environment.

The country continues to experience persistently high , and unemployment among urban professionals is increasing. This is due in part to industrial automation and AI replacing white-collar processing, data management, accounting and service sector jobs, but companies are also continuing to retrench in the generally sluggish economic environment amid trade uncertainties. Yet, overall unemployment is still in single digits, with millions of manufacturing job vacancies. Some experts are noting an absence of clear signals from Beijing on regulatory policy as a key factor in subduing business confidence.

We know it is only a matter of time before business picks up. I don¡¯t know what will trigger that. I travel to Japan and Europe, and see business confidence is low. This is not a Chinese phenomenon, but I do know China is well placed for a stronger recovery than Europe, and I expect the US, too. We¡¯re still developing, and people are hungry for success. In Europe, there is a sense in the air of complacency, even defeatism, despite the fact that it has many good companies. ¡ª Technology marketing manager in Shenzhen

Balance at home

To reduce irrational domestic competition and overproduction, Beijing could reduce its local officials¡¯ GDP targets further. For over a decade, Beijing has combined officials¡¯ key performance indicators (KPIs) with sustainability objectives and anticorruption aims, but the imperative to deliver raw economic growth still dominates. Western policymakers are often too focused on GDP growth, but many of their counterparts in China are enthralled by it as the ultimate indicator of national success. However, GDP indicators reflect an economy¡¯s temperature, but seldom its underlying health and long-term productive sustainability. Resetting local officials¡¯ goals would help to stem deflation and expand consumption; it would also reflect better the values and aspirations for greater life-work balance and physical, even spiritual, development of the younger generation.

Having exceeded most industrial nations in the quality of its supply chains, logistics, smart manufacturing and robotics, it is logical that 30% of global manufacturing should be undertaken in China, a nation that is home to of the world¡¯s population. The Chinese middle class also offer considerable consumer growth potential for imported raw materials, ingredients and brands, despite the current lull in domestic consumption.

While Western industrial companies are cautious about entering the Chinese market, global portfolio managers are less so. Interest in listed Chinese tech companies is rising in London, Europe and the Middle East, with the Hong Kong stock exchange, an early beneficiary, growing in 2025. Australia¡¯s treasury estimated that China accounted for 19% of global GDP in 2024 and the United States for 16%, and by 2035, China will likely account for 24% while the US will be 14%.

There is no reason why the West cannot compete while still collaborating with China on the leading edges of manufacturing technology. China¡¯s rise cannot be stopped, but it is not a rise driven by the rudderless juggernaut of the Chinese Government, bent on the destruction of its competitors¡¯ markets, as Western media casts it. It is the essential dynamo of an emerging global economic order in which there will be many nodes of power and prosperity, and interwoven networks, which could bring greater common wealth and stability to China, the Global South and also, despite diminished primacy, sustained prosperity in the West.

The handshake that may change history

Indian President Narendra Modi attended the SCO meeting in Tianjin last year. He and Chinese President Xi Jinping discussed border disputes, expanding trade and future Chinese investment in Indian infrastructure.

Triggered by Trump¡¯s imposition of a on most Indian exports to the US and his condemnation of the Indian economy as ¡°dead¡±, China seized the opportunity for rapprochement. China has many reasons to form deeper economic relations with India. With a population of 1.43 billion, it is the only country with the potential to compete directly with China. It has a young, well-educated population, controls the Indian Ocean ¡ª through which of China¡¯s oil imports pass ¡ª and is a founding member of the Quad, Washington¡¯s performative attempt to create a military coalition to contain China in Asia.

India increased its high-tech exports by 400% over the last five years, reaching $23 billion, and accounted for of US smartphone imports last year. The Indian economy grew by more than 7% in 2025, anything but dead. The meeting between Modi and Xi may turn out to be as significant as Former US President Richard Nixon¡¯s to China in 1972.

Together, Xi and Modi¡¯s initiative may change a relationship marred by strategic and commercial conflict into an economic alliance no other nation or trading bloc can rival.

[ first published this piece as a business report.]

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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What is striking is that amid all this chaos, the Presidential Regulation governing the program was only on November 17th, almost an entire year after MBG had already been implemented. Yet despite these glaring issues, the government has repeatedly framed MBG as a ¡°¡± to tackle malnutrition, strengthen food security and boost the local economy. But there is one crucial element at risk of being overlooked, one that could determine whether this ¡°magic bullet¡± truly hits its target: the role of young women in ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ agrifood system. The voices of women farmers need to be amplified, especially in light of the momentum created by the launch of the International Day of Women Farmers , highlighted in the report of the World Food Forum.

Overlooked and underserved, women in agriculture

The role of women in the agri-food system is inextricably linked to the issues of nutrition and food security. Women contribute between of total food production in developing countries, not only through planting and cultivation but also through ensuring that families and communities have access to sufficient food. According to the UN Food and Agriculture Organization (FAO), in , women comprised approximately half of the agricultural labor force in Southeast Asia. Yet despite this contribution, their roles are often marginalized, trapped in irregular, informal, part-time, low-skilled and labor-intensive work.?

For young people, the picture is even more pressing. Eighty-five percent of the world¡¯s youth in low- and lower-middle-income countries where agrifood systems are central to livelihoods. The inclusion of youth, especially young women, has the potential to generate a trillion-dollar impact on the global economy. According to ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ Central Statistics Agency (BPS), in , agriculture employed 28.5% of the national workforce, more than any other sector, including trade and manufacturing. Yet much of this workforce remains informal, with of agricultural workers classified as informal labor in 2024. However, the true figure may be much larger when informal, unpaid or unrecorded contributions are considered.

The presence of women in the agrifood system (AFS) naturally raises expectations that they will benefit from the MBG program, especially given the program¡¯s stated commitment to involving local farmers, small shops, and actors within the local economic ecosystem. These partnerships are effectively controlled by large vendors, sidelining smallholders, especially women farmers. Indonesia has women farmers, most of whom work as casual laborers or unpaid family workers in rice cultivation, livestock, and vegetable farming. It is therefore unsurprising that this group sees little to no gain from the MBG program.

Why does Indonesia need gender-sensitive policies?

Women in the AFS across generations face distinct and persistent challenges that require tailored approaches and policies. Young women face structural and cultural barriers in entering and sustaining livelihoods in agriculture. Access to land and credit remains heavily skewed in favor of men, while inheritance practices often disadvantage daughters. Social norms expect women to prioritize unpaid domestic and care responsibilities, reducing the time and energy available for agricultural entrepreneurship. When they do enter the agri-food system, they often find themselves in the , such as subsistence farming, food processing or informal market sales.

If the status quo continues without meaningful change, the consequences will intensify. Despite agriculture¡¯s significant contribution to the national workforce, few young people are entering the sector. In 2023, the number of farmers from 31.7 million in 2013 to 29.34 million. Startlingly, only 3% of agricultural graduates choose to become farmers. Yet there is no reliable national data that specifically captures young women in the agri-food system, rendering them invisible in both statistics and policy debates.?

Strengthening feedback loops and designing effective interventions

To ensure that the MBG program becomes both effective and fiscally responsible, its targeting must be refined. Rather than applying a universal model, MBG should prioritize school-aged children in 3T areas (parts of Indonesia that lag behind other regions in terms of geographical, social, economic and cultural development, including underdeveloped, frontier and outermost regions), with persistently high stunting rates and communities experiencing extreme poverty. With more precise targeting, the overall budget could be significantly reduced, allowing resources to be reallocated toward strengthening agricultural systems, particularly those involving women.

In Indonesia, funding for agriculture remains inadequate and gender-blind, as evidenced by studies showing that women, especially young women farmers, have far less to land (only about 17% hold secure land rights), capital, training and state support than men, reflecting a neglect of their needs despite their growing participation in the sector.

The 300 billion Indonesian Rupiah incentive scheme for young farmers cultivating large plots to address the structural barriers faced by young women, many of whom lack access to land, credit and formal ownership required to qualify. Without gender-responsive design, such initiatives risk deepening existing inequalities rather than alleviating them.?

Moreover, agricultural programs remain narrowly focused on production, overlooking the diverse roles women play across the entire agri-food system, from processing and trade to nutrition and household food security. When viewed alongside the MBG budget, the imbalance becomes even more pronounced. In 2025, the government allocated Indonesian Rupiah for MBG, more than 3.5 times the Ministry of Agriculture¡¯s effective budget.

By 2026, the disparity widens dramatically, with Indonesian Rupiah designated for MBG, around 15 times the 22.36 trillion Indonesian Rupiah allocated for agriculture. This disproportionate emphasis on consumption-oriented programs over structural agricultural investment risks undermining long-term food-system resilience and continues to marginalize women¡¯s contributions within it.

The Indonesian government needs a set of strategies to strengthen the inclusion of young women in agri-food systems so they can own and invest in productive assets. Expanding youth-responsive social protection (especially for young women), particularly in addressing challenges such as unpaid care responsibilities, health risks and income insecurity. Finally, implementing targeted nutrition policies can strengthen the link between young women¡¯s agricultural contributions and the overall well-being of their communities.

[Tara Yarwais edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The Missing Backbone: How Young Women Sustain ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ Agri-Food System appeared first on 51³Ô¹Ï.

Alongside early-harvest and launch tracks with the , and the Eurasian Economic Union (), plus a revived Early Progress Trade Agreement () with Canada, a clear picture of India¡¯s new trade architecture is emerging. New Delhi is building high-quality, rules-based bilateral arrangements, phased where necessary, with partners that complement, rather than compete with, India¡¯s strengths and priorities.

A pragmatic partnership with New Zealand

On one level, the India-New Zealand FTA is a straightforward extension of this ¡ª a pragmatic deal between two economies whose bilateral trade, while steadily growing, currently stands at a minuscule , thus leaving plenty of potential to unlock. On the other hand, it tells us something broader about where India is headed and how it intends to build prosperity, with people, not just products, at the center.

For decades, commentators have reduced India¡¯s trade strategy to a binary: open the gates and risk import surges or stay cautious and forgo the scale and opportunity that the global economic order offers. That false choice collapsed when India refused to join the Regional Comprehensive Economic Partnership (), and instead rewired its negotiating posture around complementarity.

This shift in strategy has been made possible by a wave of internal reforms that reached a new peak in 2025. Major changes, most notably the rollout of Goods and Services Tax this year, alongside other key reforms under Prime Minister Narendra Modi¡¯s tenure, including the simplification of foreign direct investment () norms, expanded production-linked incentive () schemes, digital governance and the implementation of the Labor Codes, have all contributed to investor confidence.

It is this transformed, future-ready India that now approaches trade negotiations from a position of strength. New?Zealand fits that map. It is a high-income, rules-based economy that doesn¡¯t compete head-to-head with India in mass manufacturing; instead, it welcomes Indian services, talent and consumer goods under transparent and fair terms.

Tariff liberalization, sectoral protections and prioritizing people?

Those terms are striking. New?Zealand has granted access to all Indian exports. Not ¡°most,¡± not ¡°nearly all¡± ¡ª all. For India¡¯s labor-intensive sectors ¡ª textiles and apparel, leather and footwear, gems and jewelry, marine products, toys, handicrafts ¡ª this is a once-in-a-generation opening; the kind you build upon to broaden value chains. Small exporters who dreaded duties and nickel-and-diming at the border can now quote with confidence, contract with certainty, ship with speed and expand their operations thanks to cash flows freed from tariffs.

India, for its part, has offered tariff liberalization on about of tariff lines, covering of bilateral trade value. This has been done through a calibrated blend of immediate cuts (sheep meat, wool, coal, most forestry and wood), phased reductions (oils, select machinery, wine) and carefully managed tariff-rate quotas for a handful of sensitive horticulture lines (honey, apples, kiwifruit).

But these concessions have been meticulously crafted to ensure that India¡¯s most sensitive sectors remain protected. Dairy is the most prominent ; it is entirely ring-fenced. The shield extends further: animal products (other than sheep meat), key vegetables, sugar, some oils and strategic nonagricultural sectors such as gems and jewelry, copper and aluminum are all from tariff concessions.

This is an unmistakable signal that India will write modern, liberal trade rules, but it will do so while securing farmer incomes, Micro, Small and Medium Enterprises (MSME) resilience, and food security. This is not protectionism; it is democratic prioritization for a country where agriculture is a livelihood for and not just another sector to be casually bartered away.

The agreement¡¯s spine, however, is not goods but rather services and mobility. New?Zealand¡¯s services commitments are its most ambitious to date, Indian firms broad access across IT and IT-enabled services, professional and business services, education, finance, tourism and construction.

Crucially, the agreement includes a Most-Favored-Nation () clause: if New Zealand offers better terms to another partner in the future, India automatically receives the same benefits. For India¡¯s already globally competitive services sector, this means new opportunities to establish a presence in Oceania, recruit local talent and scale operations in a stable, rules-based environment.

But the real innovation is the Temporary Employment Entry Visa, a for up to 5,000 Indian professionals at any given time to live and work in New Zealand for up to three years, targeted at skill shortages (IT, engineering, healthcare, education, construction) and specialty roles (yoga instructors, Indian chefs, music teachers). Paired with the fact that the removes numerical caps on Indian students, guarantees 20 hours/week of work during study, and extends post-study work to 3 years for science, technology, engineering and mathematics graduates and 4 years for doctorates, as well as a 1,000-place Working Holiday scheme, and you¡¯ve stitched the ¡°living bridge¡± of a 300,000-strong Indian diaspora into the economic fabric.

Critics ¡ª some inside New Zealand¡¯s politics ¡ª have that these mobility channels ¡°give too much away.¡± That is an entirely incorrect framing, though. Global trade today is not a container-ship contest; it is a talent distribution contest. When shortages hobble , and sites, partnering with a country that supplies trained professionals under transparent, targeted and time-bound rules is not a concession for New Zealand; it is capacity building.

For India, talent mobility is not brain drain but instead brain circulation. Earnings, networks and know-how will eventually come home, while remittances in the interim can help stabilize families. Far from ¡°giving away¡± jobs, this agreement allows New Zealand to fill gaps that its own workforce cannot meet. At the same time, the pathways it opens enable Indian professionals to gain global experience and return with skills that strengthen India¡¯s economy ¡ª further enhancing India¡¯s international reputation as a source of reliable, high-quality talent.

Implementation and future prospects

The FTA also does the dull yet decisive things right. Customs modernization commits India to release windows at the border. That single clause can save exporters more money than many tariff cuts, because time itself can act as a shadow tariff. The pact hardwires cooperation on and rules and creates Agri-Technology for kiwifruit, apples and honey. These plans mean both countries will collaborate on sharing best practices ¡ª needless to say, India will be the beneficiary.

Additionally, the agreement requires New Zealand to update its Geographical Indications () framework, thereby granting India the same rights as the EU to register wines, spirits and other goods, ensuring full parity in GI protection. Regulatory access for pharmaceuticals, medical devices and organic products has also been streamlined, reducing duplication and accelerating approvals.

There is also long-term capital behind this agreement: New?Zealand has $?20?billion in investment in India over the next 15 years. The scale of this commitment signals confidence in India¡¯s economic trajectory and its potential as a global growth engine. The agreement also includes a rebalancing that allows India to take remedial measures if the delivery of investments falls short of its commitments. India has learned that FTAs without real capital and capability often disappoint; this one addresses both, the kind of long-term backbone that many earlier agreements lacked.

Of course, no agreement is without its challenges. The FTA will require careful implementation and timely ratification, efficient visa processing, and real delivery on its various Agri-tech and customs commitments.

But from an Indian perspective, the fundamentals are solid: the deal is structured to maximize opportunity while safeguarding core interests. It is precisely the template India should look to replicate ¡ª combining asymmetric access to goods that favors MSMEs with ambitious services and talent mobility. It is bilateralism that looks beyond tariffs, focusing instead on people, productivity and a true sense of partnership.

India¡¯s new trade architecture is not merely about opening doors but about building bridges among economies, nations and, above all, people. In that vein, the India-New Zealand FTA is a blueprint for how the next decade of Indian trade can and should be built.

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A handful of racist gestures posted by Miss Finland and members of the Finns Party ¡ª East Asian facial features through a slanted-eyes trope ¡ª triggered an international backlash of remarkable speed and scale. Within days, Finnish embassies in China, Japan and South Korea formal apologies. Finnish Prime Minister Petteri Orpo publicly the state from the conduct of its own parliamentarians, stating unequivocally that racism had no place in Finnish society. The response was swift, but the damage was already measurable.

Finnish airline Finnair of consumer backlash in Asian markets. Finland¡¯s Minister for Economic Affairs acknowledged reputational harm to tourism and trade. Chinese and Japanese media the episode not as a fringe scandal but as a test of Finland¡¯s values. In Brussels, Finnish Members of the European Parliament (MEPs) cautioned that diplomatic capital built on trust can evaporate far faster than it accumulates. Soft power, once dented, does not rebound easily.

This was not merely a domestic political embarrassment. It was a foreign policy event.

When domestic failures become diplomatic liabilities

In an era of instant amplification, internal social failures migrate rapidly into the international arena. For countries such as Finland ¡ª newly inducted into NATO, deeply reliant on rules-based multilateralism and economically intertwined with Asia ¡ª moral credibility is not ornamental. It is strategic. When a state¡¯s brand is on inclusion, any contradiction resonates louder abroad than at home.

The deeper discomfort lies in the fact that this did not emerge in isolation. Amnesty International has repeatedly that Finland struggles with structural racism, describing it as among the most racist countries in Europe in terms of lived experience. Surveys cited by Yle show that nearly of Finns now recognize racism as a serious societal problem, a sharp increase over five years. Black residents report some of the levels of harassment on the continent. These realities sit uneasily beside Finland¡¯s global reputation for fairness.

The contradiction exposes a familiar illusion in advanced democracies: that high development immunizes societies against prejudice. It does not. Racism adapts. It becomes quieter, coded, sometimes joking, sometimes dismissed as childish. Yet when projected through the megaphone of social media, even casual prejudice acquires geopolitical weight.

Racial innocence and the limits of Nordic exceptionalism

History matters here. Finland, like much of Europe, has often imagined itself outside colonial entanglements. Yet historians increasingly note Finland¡¯s participation in movements and its absorption of racial hierarchies in European modernity. The idea of racial innocence has functioned less as truth than as comfort. The scandal cracked that veneer.

Comparisons across the Nordic region reinforce the point. Sweden¡¯s with far-right normalization, Denmark¡¯s cases and Norway¡¯s debates over Indigenous all reveal similar tensions beneath progressive surfaces. Globally, France and the UK continue to grapple with colonial legacies that complicate their human-rights advocacy. Finland¡¯s experience fits into this wider pattern: development without deep reckoning leaves unfinished business.

What distinguishes this episode is its international reverberation. Asian reactions were not symbolic. Commentators in Beijing and Seoul the scandal as indicative of a broader European blind spot toward anti-Asian racism. For Asian publics, gestures that echo a century of humiliation resonate deeply. Trade figures and diplomatic alignments do not insulate against cultural insult. On the contrary, economic interdependence amplifies sensitivity.

This is where the foreign policy lesson sharpens. Values are not merely proclaimed; they are performed. For small and middle powers, particularly those that rely on coalition-building and normative leadership, domestic conduct becomes external messaging. Every parliamentarian, every public official, becomes an informal diplomat.

From apology to accountability

Finland¡¯s response has been earnest. Ministers have undergone anti-racism training. Parliamentary leaders issued strong condemnations. The Finns Party signaled internal disciplinary measures. Finland remains by the UN Convention on the Elimination of Racial Discrimination and the EU¡¯s anti-racism action plans. These frameworks matter, but credibility depends on implementation, not signatures.

Study increasingly links social inclusion with sustainable development. Studies published in argue that racism economic resilience, institutions and corrodes trust ¡ª the very foundations of sustainability. The UN Educational, Scientific and Cultural Organization¡¯s (UNESCO) Global Alliance Against Racism discrimination as a systemic risk, not a moral footnote. In that sense, addressing racism is not ancillary to development; it is central to it.

There is an opportunity here, albeit born of embarrassment. Finland possesses the institutional capacity, educational depth and international goodwill to turn this episode into a demonstration of democratic self-correction. Genuine curriculum reform, empowered equality watchdogs and enforceable political codes of conduct would signal seriousness. More importantly, sustained engagement with Asian partners ¡ª through cultural exchange, academic collaboration and honest dialogue ¡ª could transform apology into partnership.

Across the Asia¨CPacific, the lesson lands with particular force. This is a region stitched together by migration, memory and mobility, where history travels alongside trade and identity moves faster than policy. Societies from Northeast Asia to the Pacific Islands have learned, often painfully, that cultural slights are never contained within borders. They echo through shipping lanes, student exchanges, defense dialogues and boardrooms. 

Diplomacy in Asia-Pacific is sustained not only by strategy papers but also by acknowledgement, dignity and a quiet assurance of mutual respect. As a result, it is vital to establish an effective accountability unit to investigate officials¡¯ misconduct, as well as to implement mandatory anti-bias training throughout the government. In addition, consider a focused cultural diplomacy and investment package based on a recovery in partner trust, trade and tourism.

Dignity as strategy in a post-insulated world

When racism surfaces ¡ª whether in Europe, North America or within the region itself ¡ª it unsettles far more than domestic politics. It shakes confidence in partnerships painstakingly built over decades. In a region where trust is cumulative and memory is long, moments of disrespect are not quickly forgotten. Strategic alignment may open doors, but cultural empathy keeps them open. Without it, even the strongest alliances begin to feel brittle, exposed to the slow erosion of credibility and goodwill that no amount of economic interdependence can fully repair.

The age of domestic insulation has ended. A gesture in Helsinki can unsettle boardrooms in Shanghai and ministries in Tokyo. Foreign policy now begins at home, in the mundane ethics of everyday conduct. States that fail to grasp this reality will find their influence shrinking in ways that statistics cannot immediately capture.

Finland¡¯s moment of reckoning is therefore not uniquely Finnish. It is a mirror held up to all societies that pride themselves on progress while underestimating the persistence of prejudice. The question is no longer whether racism damages international standing. The evidence is conclusive. The question is whether moments of exposure become catalysts for renewal ¡ª or merely footnotes in a longer pattern of denial.

In a world bound tightly by perception as much as power, dignity has become a strategic asset. Once lost, it demands more than an apology to recover. It demands transformation.

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A party enforcer at the helm

Apart from other high-profile roles serving the CCP in multilateral institutions, Zou as Deputy Secretary-General of the Chinese People¡¯s Political Consultative Conference (), one of the CCP¡¯s core instruments for enforcing ideological discipline and manufacturing consent. Despite its benign-sounding name, the CPPCC is not a debating society or a pluralistic forum. It exists to align elites, interest groups and public opinion with party doctrine, ensuring that major policy decisions are not merely implemented but legitimized. Its role is coordination and control, not consultation in any Western sense. In short, she is an enforcer, just like her predecessor for a decade, Jin Liqun.

That pedigree matters because leadership in a multilateral development bank is not just about capital allocation or project appraisal; it is about institutional direction, norms and credibility. A president steeped in party discipline is not likely to treat the AIIB as an independent lender guided by developmental additionality, transparency and borrower need. She will undoubtedly use it as a strategic instrument ¡ª just as her predecessor did ¡ª one more lever in Beijing¡¯s expanding toolkit of economic and political statecraft.

Deepening alignment with China¡¯s Belt and Road Initiative

Under Zou, the AIIB can be expected to continue, and likely deepen, its alignment, since its inception, with China¡¯s Belt and Road Initiative (). The creation of both was hatched by the CCP at exactly the same time in 2013. Despite repeated assurances from management that the AIIB is distinct from BRI, the practical overlap has long been evident: shared corridors, synergistic priorities and cofinanced projects that advance China¡¯s geopolitical reach while diffusing financial and reputational risk. The AIIB offers Beijing something the BRI alone cannot: a multilateral veneer that softens political resistance and draws in the capital and legitimacy of advanced democracies. That is why countries like the US and Japan chose not to join.

In this sense, Zou is the perfect candidate. Like Jin, she combines international polish with unwavering loyalty to the party line. The continuity is not accidental. The CCP does not leave strategically important institutions to chance, especially those that intersect with global finance, infrastructure and influence. Leadership succession at the AIIB has followed the logic of absolute loyalty to the Party.

The complicity of non-Chinese shareholders

What is equally troubling is the acquiescence of AIIB¡¯s non-Chinese shareholders. Countries such as Australia, the UK and India , their taxpayers underwriting projects that often advance China¡¯s strategic objectives more than their own national interests. This persistence reflects a combination of foreign influence, elite capture and bureaucratic inertia: once inside the tent, exit becomes politically awkward, diplomatically uncomfortable and institutionally resisted. 

Canada is even considering rejoining the AIIB after concerns were first raised by the Bank¡¯s former head of Communications, Bob Pickard (a Canadian), in 2023 about a subterranean management cabal run by the CCP within the Bank, resulting in a ¡°toxic culture.¡± Canada took the allegations very seriously and with the Bank then, but this week, Prime Minister Mark Carney was essentially kissing the ring while visiting Beijing.

The justification offered is familiar. Staying in allows these countries to ¡°shape from within,¡± to promote high standards and to prevent the Bank from becoming a purely Chinese instrument. Yet years of experience suggest that this influence is marginal at best. Governance remains heavily weighted toward Beijing. Strategic direction tracks Chinese priorities. And leadership selection ¡ª arguably the clearest signal of institutional ¡°independence¡± ¡ª has remained firmly under Chinese control.

Meanwhile, participation carries real costs. Membership lends credibility to projects that may undermine debt sustainability, distort regional power balances or crowd out genuinely independent development finance. It normalizes a model in which multilateral institutions are repurposed to serve the geopolitical goals of their dominant shareholder, eroding the very norms that postwar development banks were designed to uphold. The AIIB is not the only guilty party among the multilaterals, of course, many of which are similarly highly politicized and experience oversized influence from their leadership overlords. What distinguishes them is that the CCP is not a benevolent force in the world ¡ª it is malignant.

Zou¡¯s appointment should therefore be read not as a routine personnel decision, but as a strategic inflection point. It confirms that the AIIB is entering a phase of tighter political alignment with Beijing at a time when China¡¯s external posture is becoming more assertive, not less. For democracies that continue to participate, the question is no longer whether the Bank might drift toward serving Chinese interests. That drift occurred from its inception. The question is whether their continued involvement makes them complicit ¡ª and it does.

Multilateral legitimacy captured

Multilateralism only works when institutions are more than instruments of the powerful. When leadership is drawn directly from a ruling party¡¯s ideological enforcement apparatus, claims of neutrality ring hollow. The AIIB under Zou Jiayi is unlikely to surprise anyone who has been paying attention. It will be efficient, disciplined and outwardly cooperative ¡ª while quietly reinforcing the expansionary objectives of the state that controls it.

At some point, member countries will have to decide whether symbolic influence is worth substantive compromise. If the answer remains yes, Beijing will have learned an important lesson: multilateral legitimacy, once captured, is remarkably easy to keep.

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A Chinese diplomat in Japan, as everyone by now knows, memorably and vulgarly to ¡°cut off that dirty neck¡± ¡ª presumably Takaichi¡¯s and Japan¡¯s. The Chinese foreign ministry excoriated the Japanese ambassador, that Takaichi was ¡°playing with fire.¡± Then, on December 29, Beijing Taiwan with actual fire from missiles and aircraft, disrupting the flights of upwards of two hundred thousand air passengers. These were China¡¯s largest military exercises since 2022, when another obstreperous n¨¤ ge n¨·r¨¦n (ÄǸöÅ®ÈË), the then US Speaker of the House, Nancy Pelosi, Taiwan.?

The Chinese are, indeed, reacting in anger to Takaichi¡¯s restatement of Japanese vital interests. Any comment a Japanese leader makes about Taiwan is charged with risk. I suspect, however, that the prime minister¡¯s advisors share my assessment that Beijing¡¯s frenzied response to Takaichi¡¯s off-the-cuff and rather benign comment is also addressing strategic objectives in Washington, Taipei and Beijing itself. 

Is Takaichi right?

Seen from abroad, Prime Minister Takaichi has had a successful first few months in office. The Japanese public views her , and she had a summit with the mercurial and always imperious US President Trump. She is Japan¡¯s defense budget, and she has continued Japan¡¯s progressive return as a major and activist force shaping Asian strategic affairs. I am indebted to Thomas Reilly, in his , Understanding China¡¯s Overreaction to Takaichi¡¯s Taiwan Comments, for this synopsis of China¡¯s multiple strategic concerns.?

These steps are all direct responses to the increasingly imperious diktats emanating from the new Middle Kingdom superpower about Taiwan¡¯s ¡°¡± absorption back into China, and to increasingly aggressive acts to assert Chinese sovereignty everywhere in the South and East China Seas. Like any imperious and unilateral power, though, the Chinese view Takaichi¡¯s policies and successful first months as threats to Chinese hegemony, not as responses to Chinese threats. Beijing needs to show the insolent Takaichi, therefore, the costs of her impudence.?

Swift was China¡¯s irritation at Takaichi¡¯s remarks; China also opportunistically aimed its military exercises around Taiwan at Washington. President Trump and General Secretary Xi, in recent months, have been attempting to ease US-China tensions in preparation for their upcoming in April, about which the Chinese have ¡°speculated¡± about the chances for a ¡°grand bargain¡± for ¡°a concert of power¡± between the world¡¯s two superpowers. For weeks, the US remained nearly mute about Takaichi¡¯s comments, seeming to prioritize Beijing¡¯s sensitivities to supporting the US alliance with Japan.?

But on December 18, Trump seemed to contradict himself and directly countered China¡¯s threats to Taiwanese sovereignty by announcing the sale of $11 billion in arms to Taiwan, the largest single arms deal between Taiwan and the US in history. The aid package is in keeping with America¡¯s longstanding commitment to defend Taiwanese sovereignty, but also clashes with Trump¡¯s oft-stated isolationism and distaste for any military commitment beyond ¡°America first.¡± China expressed its wrath eleven days later by its performative and menacing military exercises around Taiwan and by completely cutting off Japan¡¯s air and sea links to Taiwan for three days. China¡¯s maneuvers served as the latest stick to the dangled carrot of a China-US ¡°grand bargain,¡± while dressing down Japan and attempting to neutralize any independent strategic role Japan might play.?

China was also responding to what it characterizes as any challenge to its sovereignty over Taiwan by continuing its policy of slowly increasing its incursions into Taiwan¡¯s or Japan¡¯s territorial space, and asserting its sovereignty over recognized international waters. China takes any challenge to its positions about Taiwan and regional sovereignty, therefore, as an occasion to shift the ¡°norms¡± of behavior towards its ultimate aims. ¡°×ñÖ¼¡± (z¨±n zh¨«), ¡°I obey the imperial command¡± ¡ª China¡¯s traditional way to signal deference to the imperial center ¡ª is the only correct response anywhere within what China decides is its writ. 

China¡¯s response may be overzealous theater

Internal strife and even institutional rot also seem to be at play in Beijing¡¯s overheated denunciations of Prime Minister Takaichi and in its pressure campaign against Taiwan and Washington. Some of China¡¯s aggressiveness may be performative in order to mask that China¡¯s military remains incapable of seizing Taiwan, and is struggling with corruption, inefficiencies and growing pains. Xi has or removed dozens of senior officers for corruption or unspecified malfeasance. The removals, combined with the overheated response to Japan challenging China¡¯s conception of regional order, paradoxically indicate a degree of Chinese insecurity about its capabilities or of not being able to impose its will internationally, even as Xi completely dominates China¡¯s national security establishment and policies, and as China grows in military power.?

The Chinese Communist Party, in one of the perverse ironies of history, regularly has fanned the flames of nationalism whenever internal strife or corruption has threatened the stability of the legitimacy of the state. Nationalism, manifest as anti-Japanese sentiment and ¡°anti-colonial¡± xenophobia; the absorption of Taiwan; and making money have become the specious pillars of Chinese Communist legitimacy. As Chinese Communism has decayed into a totalitarian Cult of Xi that espouses the suppression of individual rights to state supremacy and the exaltation of a national-security state, officials easily seized on Prime Minister Takaichi¡¯s remarks as ways to divert attention and blame the historically reviled ÙÁ¿Ü (·É¨­°ì¨°³Ü) ¡°dwarf pirates¡± of Japan. These reflexive postures justify Takaichi¡¯s comment and Japan¡¯s policies but form a volatile and dangerous combination of domestic and international cross pressures. 

How to avoid conflict with China

Analyzing what China or any nation is doing and why is the devilishly difficult work that intelligence officers and diplomats do. Yet that is the easy part of the job. As President Eisenhower told President Kennedy shortly after the Bay of Pigs in 1961, when a ¡°covert¡± US operation to overthrow Castro had collapsed in an ignominious public catastrophe, only hard problems reach a leader¡¯s desk.?

China¡¯s reaction to Takaichi¡¯s comments is a symptom of Japan¡¯s strategic dilemma and the ¡°hard problem¡± Japanese leaders must confront: How to defend Japanese sovereignty in a region where China¡¯s power is rising, the US commitment is uncertain, the risk of miscalculation is high and Japan may find itself progressively isolated in a world defined by might alone? Successive Japanese governments, and so far Takaichi, too, have pursued the most coherent strategy and policies possible, although sometimes too slowly and timidly.

Japan¡¯s overarching strategy to avoid a clash with China must be, first, to prepare to live in a sphere-of-interest world dominated by China in Asia, the US in the Americas and Russia and the European Union in the western reaches of Eurasia. Second, Japan must deter China from taking steps harmful to Japan¡¯s national interests by raising the prospective costs of such actions. Third, Japan must seek to offer enticing alternatives to other states in the nascent Chinese domain (and, of course, beyond), so that they will contribute to counter-balancing China¡¯s growing influence. 

Japan has pursued increased diplomatic engagement with a range of states in the Western Pacific, Asia and South Asia. When Trump killed the Trans-Pacific Partnership agreement, which would have been the single strongest diplomatic step to counter China¡¯s rise in Asia, Japan initiated the Free and Open Indo-Pacific in its stead. Japan has been instrumental in the ¡ª what Russian propagandists have denounced, and I have praised, as a potential aspirational NATO in Asia. Japan has sought closer bilateral defensive ties with other states in the region, notably and . Japan has aggressively expanded its engagement with Pacific island nations through the summits (Pacific Islanders Leaders Meetings), precisely where China has been most actively seeking to supplant US and Australian diplomatic primacy.?

Japan has also significantly enhanced its efforts to foster multilateral trade agreements and has engaged in expanded economic aid programs. Takaichi¡¯s mentor, Abe Shinzo, the Comprehensive and Progressive Agreement for Trans?Pacific Partnership as a replacement for the destroyed TPP. Japan has vastly increased its economic development aid in Africa to counterbalance China¡¯s ambitious Belt and Road .?

It is the military sphere, of course, that Japan has drawn the most attention and drawn China¡¯s particular ire. Takaichi has aggressively, and so far, adeptly, continued her predecessors¡¯ efforts to increase Japan¡¯s military capabilities, and, at last, to free Japan from its post-World War II hobbling as a sovereign nation in military affairs. Takaichi has announced a increase in Japan¡¯s defense budget, continuing Japan¡¯s five-year plan to double defense spending, and to obtain potentially offensive weapons for the first time in eighty years, such as the near billion-dollar purchase of Tomahawk missiles Japan is from the United States. Japan is developing de facto aircraft carriers. And, most important of all, Takaichi has continued Japan¡¯s doctrinal shift by reiterating that an attack on Taiwan is possibly an existential issue for Japan ¡ª the very position that has caused China¡¯s recent apoplexy.

Japanese autonomy is integral to counter regional aggression

The objectives of all these policies are to, one, raise the prospective cost of any hostile actions to Japanese interests by China (or any state) and, critically, two, to offer other Asian and Pacific states attractive counterbalancing alternatives to Chinese diplomatic, trade and military initiatives, all in the context of a post-Pax Americana world. 

Each of these steps, as China invariably and angrily points out, increases the stakes and risks in the event of a conflict. But they complicate China¡¯s equation for any aggressive action, which is their objective. They may not succeed. A clash ¡ª war ¡ª could come even if no party wants it, and no policy Japan or any state can pursue can compensate entirely for the withdrawal of the United States from a full strategic, diplomatic, economic and military commitment to a free and open Asia. 

Japanese leaders have, in general, been too slow in adopting these policy changes, although the responsibility lies as much with a reticent public that places hopes above hard decisions concerning how to avoid war by preparing for it. Japan¡¯s leaders have struggled most in deepening relations with South Korea, a vital ally; but Seoul is probably more responsible for these delays than Tokyo. Some degree of accommodation with China is almost inevitable, whatever Japan does, as China and Japan fill the void of America¡¯s relative withdrawal from or decline in the region. Nonetheless, Japan has acted strategically and coherently to strengthen Japanese autonomy and sovereignty in response to China¡¯s rise in power and aggressiveness. 

Not too long ago, a senior Japanese official asked me how I thought Japan should respond to the changing geopolitical environment in Asia. Hold America as close as possible, I replied, but Japan should count only on itself. So far, Prime Minister Takaichi has taken strategic and coherent steps, too.

[ first published this piece.]

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The basin¡¯s survival depends on dismantling unilateral ¡°hydro-hegemony.¡± We must move beyond regional finger-pointing. Instead, a new trilateral framework must be established. This framework should recognize the residents of Ghor and Herat as the primary custodians and sovereign stakeholders of the river.

Climate shifts and hydrological collapse

Climate change has fundamentally decoupled the Harirud from its historical snow-melt cycles. Average temperatures in the basin have?increased by 1.7¡ãC?(3.06¡ãF) since 1980. Rainfall has declined by roughly 150 millimeters. The Baba Mountain glaciers serve as the basin¡¯s ¡°water tower.¡± They have experienced a?nearly in surface area over four decades.

The basin is currently enduring its sixth consecutive year of drought. Surface water resources have decreased by 29%. This represents a loss of approximately 1 billion cubic meters of available water. Even during the spring thaw, the riverbed remains dangerously low. It fails to meet the minimum ecological flow requirements for regional biodiversity.

Geopolitical misconceptions and the ¡°single-source¡± myth

A primary hurdle in regional diplomacy is a false narrative. Many believe the water of the Harirud is solely the responsibility of Afghanistan. In reality, the catchment area is . Afghanistan accounts for 39.5%, Iran for 43.7% and Turkmenistan for 20.9%. Although the headwaters are in Afghanistan, critical tributaries, such as the Kashafrud River in Iran, join the system.

This ¡°single-source¡± myth allows downstream states to evade responsibility. Downstream nations demand ¡°customary rights¡± from the headwaters in Afghanistan while often obstructing secondary branches within their own borders. This selective focus distorts the diplomatic narrative.

This situation highlights a critical water management disparity. Afghanistan utilizes only about 40% of its potential surface water resources due to conflict-damaged infrastructure. Meanwhile, neighbors Iran and Turkmenistan heavily exploit their resources, even exceeding sustainable limits. This causes aquifer stress and water scarcity, impacting agriculture, drinking water and regional stability.

The infrastructure imbalance: diversion to Mashhad

A technical comparison of reservoir capacities debunks claims that development in Afghanistan is the sole cause of downstream scarcity:

• The Doosti (Friendship) Dam: Built jointly by Iran and Turkmenistan in 2004 without consultation with Afghanistan. It has a massive capacity of  cubic meters (m?). Critically, this dam functions as a mechanism for interbasin water transfer. It diverts water out of the Harirud system to supply Mashhad, Iran¡¯s second-largest city.
• The Pashdan Dam: Inaugurated in , this project in Afghanistan has a capacity of 54 million m?. It irrigates 13,000 hectares of Herati land. This represents only 4.3% of the total volume of the Doosti Dam.
• The Salma Dam (Afghanistan-India Friendship Dam): This project has a capacity of 633 million m?.

The Salma Dam is situated nearly 480 kilometers upstream of the Doosti Dam. This vast distance means the Harirud passes through hundreds of kilometers of arid terrain and irrigation zones before reaching the border. The storage deficit at the Doosti Dam is clearly driven by systemic losses and the 180-kilometer pipeline diversion to Mashhad, which sits outside the natural flow of the Harirud River.

Furthermore, Salma is not a ¡°new¡± infrastructure. The project was initially conceived in , and construction began in 1976. For four decades, its completion was a known factor in regional hydrology. The current collapse of the Doosti reservoir is a result of the 1.7¡ãC temperature rise, not upstream impoundment.

Ghor and Herat: the epicenter of custodianship

The residents of Ghor and Herat are the frontline victims. Ghor is the ¡°water tower¡± where the river begins. Herat was the most productive agricultural hub of the basin, but multi-year droughts have displaced thousands of  in western Afghanistan.

Survival depends on local stewardship. The ancient irrigation ¡°blocks¡± of Herat follow the 16th-century by Qasim Haravi. This manuscript remains a legal reference for water conflicts today. Modernizing this traditional system with lined canals could reduce water losses from seepage by . This would directly benefit the families who have protected this river for generations.

The path toward a basin-wide plan: a strategic framework

Addressing ¡°water bankruptcy¡± requires a multidimensional approach that balances high-level diplomacy with grassroots custodianship:

1. Establishing trilateral data transparency and a joint monitoring body: The first step toward stability is the creation of a permanent, trilateral technical committee involving Afghanistan, Iran and Turkmenistan. This committee must facilitate the transparent exchange of real-time data on all tributaries. This includes the Kashafrud River and other secondary branches originating in Iran. By establishing a common hydrological baseline, the three nations can move away from political rhetoric and toward evidence-based allocation and joint drought forecasting.

2. Modernizing local custodianship through integrated management: We must bridge the gap between ancient wisdom and modern technology. We must modernize community-led irrigation by integrating pressurized systems and satellite-monitored soil sensors. These upgrades should be managed directly by the local Mir Abs (Water Masters). Empowering local stakeholders ensures ¡°buy-in¡± and compliance that top-down treaties often lack.

3. Addressing interbasin transfer inequities through benefit-sharing: Negotiations must confront the unsustainable practice of interbasin transfers. The Doosti Dam¡¯s primary function ¡ª supplying Mashhad at the expense of the Harirud¡¯s internal ecology ¡ª is a major driver of regional scarcity. Treaties must prioritize the basin¡¯s ecology over external urban demand. Downstream nations must invest in internal recycling and desalination rather than further depleting the Harirud. A ¡°basin-first¡± policy could be supplemented by a? in which downstream gains contribute to upstream water efficiency.

4. Legal harmonization and accountability: Regional water management must be codified within a robust legal framework of ¡°equitable and reasonable utilization.¡± This requires harmonizing national water laws with international standards. By moving toward a unified basin-wide plan, the Harirud can transform from a source of conflict into a model for regional cooperation and climate resilience.

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The scale of the analysis adds weight to the finding. The ESR covers 30 of the world¡¯s largest economies, representing about of world output. It concludes that much of the 2024 widening reflects what the IMF calls : external positions that deviate meaningfully from what country fundamentals and policy settings would warrant. Thus, the concern is not merely that surpluses or deficits exist, but that their magnitude and persistence signal underlying distortions in saving and investment behaviors.

To strengthen causal clarity, it is worth noting that these spillovers arise through interest-rate channels, exchange-rate movements and global liquidity cycles that amplify the asymmetry between surplus-driven capital exports and deficit-driven capital absorption.

Macro-financial risks reemerging

This resurgence of economic divergence reawakens familiar risks that have long characterized global macro-financial cycles. Economies with sustained current-account deficits remain vulnerable to abrupt reversals in capital flows, sudden increases in borrowing costs and the pressures of forced adjustment. Conversely, economies with persistent and sizable surpluses may inadvertently suppress global interest rates, channel excess savings abroad and weaken aggregate demand in deficit economies. These opposing dynamics reinforce each other: Liquidity constraints in deficit nations coexist with excess savings in surplus economies, magnifying volatility and mispricing of risk.

The IMF¡¯s ESR 2025 stresses this dual-risk framework, warning that ¡°delaying macro-economic adjustments to correct post-pandemic domestic macro-imbalances could result in continued current-account divergence in major economies.¡± Moreover, the report that ¡°such rapid and globally sizable increases in excess current-account balances can generate significant negative cross-border spillovers,¡± underscoring that imbalances on either side of the external ledger contribute to systemic fragility and threaten the cohesion of the international monetary system.

The IMF research, notably under the direction of IMF Chief Economist Pierre-Olivier Gourinchas, reinforces this perspective by demonstrating that external surpluses are not inherently the ¡°safe side.¡± His paper that large, persistent surpluses can depress global equilibrium interest rates, entrench savings gluts and exacerbate liquidity traps in an interdependent world economy. In this framework, creditor nations export their safe-asset status and, in doing so, inadvertently heighten global fragility. This finding directly aligns with the IMF¡¯s concern that systemic risks arise not only from deficit economies, but equally from those with sustained surpluses.

A structural break, not simply a rebound

The year 2024 marked not a cyclical rebound but a structural inflection in global current-account dynamics. What distinguishes this episode is not only the magnitude of the widening but its asymmetric composition and global reach. Major surplus economies ¡ª particularly China and parts of East Asia ¡ª expanded their surpluses, while major deficit economies, led by the United States, deepened their shortfalls.

The IMF¡¯s ESR 2025 estimates that about two-thirds of the widening in global current-account balances was ¡°excessive,¡± meaning inconsistent with countries¡¯ structural fundamentals or cyclical positions. When these excess balances are excluded, the underlying widening falls to roughly 30% underscoring how far the current trajectory diverges from equilibrium drivers such as demographic trends, fiscal stances or commodity prices.

Although the pattern resembles the mid-2000s surpluses and deficits, today¡¯s environment differs crucially ¡ª China¡¯s reserve accumulation is smaller relative to GDP, macroprudential regulation is stronger and global capital is shaped more by risk-management frameworks than by unregulated financial intermediation. These differences caution against overly direct comparisons while still supporting the argument that the widening is structurally driven.

The composition of these shifts reveals the extent of renewed structural divergence. China¡¯s external surplus expanded by about 0.24% of global GDP, the US deficit deepened by 0.20% and the euro area added roughly 0.07%; together, these factors account for the of the global imbalance. This pattern evokes the mid-2000s configuration, when Asian and commodity-exporting economies accumulated surpluses as the US ran record deficits ¡ª a prelude to the global financial crisis. Although today¡¯s context differs ¡ª our current world is marked by subdued trade elasticity, altered capital flows and evolving reserve accumulation motives ¡ª the reemergence of excess balances suggests that global saving and investment asymmetries have again become entrenched.

The policy implications are sobering. The ESR 2025 that raising tariffs or erecting trade barriers, though politically expedient in deficit economies, does little to narrow external gaps and may instead distort resource allocation, dampen productivity and intensify inflationary pressures. Durable adjustment will require deeper rebalancing: fiscal consolidation and higher household saving in deficit economies, coupled with stronger domestic demand and financial liberalization in surplus economies. The 2024 widening thus represents a structural reassertion of global asymmetry, one that challenges both the resilience of the international monetary order and the credibility of its adjustment mechanisms.

A structural break in the global balance

The year 2024 marked a turning point in the world economy, a structural rupture in the global balance of payments. The sharp widening of global current-account gaps revealed deep-seated asymmetries: Surplus economies expanded further, while deficit countries fell deeper into shortfalls. This divergence reflected enduring mismatches between national saving and investment patterns rather than temporary business-cycle fluctuations. Data from the Council on Foreign Relations (CFR) Tracker that these disparities accounted for a significant share of world GDP, with surplus and deficit economies drifting further apart in 2024 ¡ª an imbalance shaped more by structural saving-investment behavior than by short-term trade trends.

At the root of these imbalances lie persistent domestic distortions. In surplus countries, precautionary saving remains elevated, social safety nets are underdeveloped and investment is overly concentrated in export-oriented sectors ¡ª constraining the transition toward consumption- and services-led growth. In deficit economies, dependence on external financing is reinforced by weak private saving and structural fiscal laxity ¡ª not in the sense of countercyclical stabilization, where temporary deficits play a productive role during downturns, but as a persistent feature of policy shaped by political economic constraints rather than macroeconomic necessity.

As in CFR¡¯s commentary, the global pattern of imbalances increasingly reflects excess precautionary savings and limited policy adaptation in major economies. Europe continues to lag behind the US in productivity and investment dynamism, China¡¯s consumption-driven transition remains incomplete and the US has delayed credible fiscal consolidation despite mounting debt pressures.

True rebalancing, therefore, requires structural reform, not external confrontation. Stronger social insurance systems could moderate excess saving; higher domestic investment could support innovation and productivity; and credible fiscal rules could anchor sustainability. Yet political responses have often moved in the opposite direction. The recent revival of tariffs and industrial policies in advanced economies a turn toward visible but misguided remedies. Such measures function economically as negative supply shocks ¡ª raising costs, discouraging investment and compressing real incomes ¡ª without improving the external balance. Protectionism, rather than correcting global asymmetries, risks amplifying domestic inefficiencies and undermining long-term welfare.

To avoid overgeneralization, it is important to distinguish investment-oriented industrial policy (which can raise potential output) from protectionist industrial policy (which typically functions as a negative supply shock). The latter is the source of imbalance-worsening dynamics.

At the multilateral level, policymakers have begun to acknowledge that external divergences are no longer adequately explained by bilateral trade flows, but by macro-financial incoherence across a fragmented global system. As capital flows become increasingly regionalized and supply chains realign, systemic fragility grows. Without coordination, what begins as national adjustment failure could evolve into global dislocation. To avoid this will require coherent fiscal, monetary and structural policies that recognize the spillovers of domestic choices on the international system.

The international monetary system, still anchored by the US dollar, remains stable but faces . Its dominance is challenged by shifting , the proliferation of digital and concerns over US fiscal sustainability. While confidence in dollar liquidity and institutions endures, global fragmentation risks raising transaction costs and financial volatility. The widening current-account imbalances of 2024 thus stand as a warning: Without domestic reform and renewed cooperation, the world risks turning structural distortions into systemic fault lines ¡ª testing both the resilience of the global order and the political will to sustain it.

The three pillars of domestic reform

While the IMF¡¯s ESR Report diagnoses the reemergence of global current-account imbalances, the IMF¨CWorld Bank Annual Meetings helped to define the policy response. A consensus emerged around three domestic pillars: fiscal sustainability, public investment and productivity, and social insurance with demand rebalancing. Each pillar is supported by IMF analysis and cross-country policy assessments.

Deficit economies must restore fiscal space to reinforce confidence and resilience against shocks. The IMF¡¯s Fiscal Monitor (Annual Meetings 2025) that ¡°starting from too high deficits and debt, the persistence of spending above tax revenues will push debt to ever higher levels, threatening sustainability and financial stability.¡± The report stresses that fiscal consolidation and the rebuilding of buffers are essential to ¡°prepare fiscal space to use in case of severe adverse shocks.¡± In practical terms, this means strengthening fiscal rules, prioritizing high-quality expenditure and improving tax efficiency. Fiscal frameworks that demonstrate medium-term discipline, rather than ad-hoc austerity, are the for credible adjustment and reduced external vulnerability.

This distinction is important because excessive reliance on temporary or politically motivated fiscal expansions has historically weakened policy credibility, especially in high-debt advanced economies like Japan¡¯s.

Surplus economies with ample fiscal capacity are encouraged to channel excess domestic savings into productive investment at home ¡ª particularly in infrastructure, digital transformation and green transitions. The IMF ESR 2025 notes that countries such as Singapore and Japan should ¡°raise public investment and strengthen social safety nets to reduce external surpluses by lowering net saving in both public and private sectors.¡± Specifically, Japan is advised to ¡°implement policies focused on structural reforms and fiscal sustainability through a credible and specific medium-term fiscal consolidation plan,¡± and to ¡°shift the drivers of the economy to one driven by the private sector, raising potential growth through labor-market and fiscal reforms that support private demand, digitalization, and green investment.¡± Likewise, Singapore is urged to ¡°execute planned high-quality and resilient infrastructure projects and continue strengthening social safety nets to help reduce external imbalances,¡± while ¡°increasing public investment to address structural transformation brought by aging and the transition to a green and digital economy.¡±

Furthermore, the IMF Managing Director¡¯s Global Policy Agenda (Fall 2025) that ¡°countries need to restore their depleted policy buffers¡± while pursuing ¡°fiscal measures that promote medium-term growth through innovation and green investment.¡± Together, these recommendations imply that global rebalancing depends as much on the productive absorption of savings as on fiscal prudence ¡ª transforming surplus positions into engines of sustainable domestic growth.

Japan approach: responsible stimulus or fiscal risk?

Japan¡¯s fiscal trajectory under Prime Minister Sanae Takaichi has emerged as one of the most revealing case studies in the post-pandemic evolution of macroeconomic policy. In sharp contrast to the consolidation trend prevailing across advanced economies, Tokyo has embarked on a renewed phase of large-scale countercyclical intervention ¡ª a fiscal package exceeding (approximately 2.4% of Japan¡¯s GDP; $88.9 billion) aimed at alleviating cost-of-living pressures, accelerating real-wage recovery and revitalizing corporate reinvestment.

This deliberate pivot toward fiscal expansion is both pragmatic and experimental, reflecting Japan¡¯s long-standing struggle with chronic deflation, rapid population aging and structural underinvestment in productivity-enhancing sectors. Yet these same structural forces that justify fiscal activism may also constrain its long-run effectiveness, raising questions about sustainability and market confidence. A central challenge is that Japan¡¯s stimulus increasingly serves multiple objectives simultaneously ¡ª short-term support, structural transformation and political stabilization ¡ª which complicates the task of maintaining a coherent medium-term fiscal anchor.

The fiscal deficit for 2024 is estimated to be than projected in the 2024 Article IV Consultation, as robust corporate earnings have buoyed tax revenues while pandemic-related transfers to households and small and medium-sized enterprises have been largely phased out. Nonetheless, the deficit is expected to widen moderately in 2025, reflecting new expenditures for defense, family-support measures and industrial-policy initiatives.

Given constrained fiscal space and mounting political pressures on the minority government, any additional expansionary measures must be fully offset through corresponding revenue gains or expenditure rationalization elsewhere in the budget. This offsetting requirement is especially important because repeated reliance on discretionary stimulus, without equivalent medium-term consolidation, risks weakening long-run fiscal credibility even if short-term financing conditions remain benign.

Public debt, while declining marginally in the near term as nominal GDP growth exceeds the effective interest rate, remains among the globally. In fact, it is projected to resume an upward trajectory by 2030. This rise is driven by a growing interest burden and escalating social-spending commitments related to healthcare and long-term care. Ensuring debt sustainability and restoring fiscal buffers will therefore require a credible and granular medium-term consolidation strategy anchored in durable institutional frameworks and transparent fiscal rules. The absence of such a framework increases the likelihood that future fiscal adjustments will be abrupt, procyclical or politically disruptive.

A coherent fiscal framework should prioritize:

1. Expenditure rebalancing toward productivity-enhancing and socially efficient categories by eliminating poorly targeted subsidies, particularly energy subsidies, while safeguarding high-quality public investment. Enhancing the targeting and cost-efficiency of social security programs is indispensable to manage demographic pressures without eroding welfare quality.
   
2. Revenue restructuring to strengthen equity and efficiency. Policy options include expanding taxation of financial income for high-income earners, broadening the property-tax base, streamlining income-tax deductions and gradually unifying and raising the consumption-tax rate. Any new deductions, such as the proposed personal-income-tax reforms, should be budget-neutral, supported by compensatory revenues or savings.
   
3. Restricting reliance on supplementary budgets, whose repeated and partial execution dilutes fiscal discipline and transparency. Such budgets should be confined to genuine, unanticipated shocks beyond the scope of automatic stabilizers. Medium-term expenditure commitments, especially in industrial policy and the green transition, must be incorporated into the regular annual budget process.

As domestic interest rates normalize, the cost of servicing public debt is projected to roughly double by 2030, underscoring the urgency of a robust debt-management strategy. With gross financing needs expanding and the Bank of Japan (BoJ)¡¯s balance sheet contracting, sovereign issuance will increasingly depend on renewed demand from foreign investors and domestic institutional holders. This shift in the investor base heightens the importance of maintaining fiscal credibility, as foreign participation tends to be more sensitive to perceived sustainability risks.

IMF perspective and the Takaichi strategy

The IMF¡¯s evolving stance represents a subtle yet significant departure from its pre-pandemic orthodoxy. Rather than advocating procyclical austerity, the Fund now distinguishes between productive fiscal stimulus ¡ª which enhances potential output and facilitates structural rebalancing ¡ª and generalized expansion, which risks eroding policy credibility and market confidence.

In its working paper, economists Sam Ouliaris and Celine Rochon that Japan¡¯s diminished fiscal multipliers stem from the persistent elevation of the debt-to-GDP ratio. Despite historically low interest rates, the accumulation of debt has deepened structural deficits and heightened the likelihood of future fiscal adjustment through higher taxes or expenditure restraint. This dynamic underscores a critical policy constraint: the efficacy of fiscal policy declines as debt-sustainability concerns become endogenous to private-sector expectations.

Consequently, stimulus is most effective when directed toward productivity-enhancing, innovation-driven investment that raises potential output and reinforces fiscal credibility over the medium term ¡ª rather than measures that merely boost transitory demand. This interpretation helps reconcile an apparent paradox: While Japan¡¯s borrowing costs remain low, the marginal impact of new stimulus on growth is declining because private agents increasingly expect future consolidation.

In our interpretation of the same paper, we contend that the reduction in multipliers reflects not temporary cyclical weakness but structural saturation ¡ª the upward trajectory of government debt relative to GDP. Despite persistently low interest rates, it has expanded Japan¡¯s structural deficit and increased the likelihood of eventual fiscal consolidation through reduced expenditures and higher taxation.

Japan, however, remains in a uniquely permissive financial environment. Exceptionally low government-bond yields, the predominance of domestic debt ownership and deep institutional trust confer an unusual degree of fiscal latitude. Yet, as the IMF warns, such conditions are not inexhaustible; they hinge on continued market confidence in future consolidation and structural reform.

Empirical studies reinforce these structural headwinds. Researchers Jiro Honda and Hiroaki Miyamoto that population aging weakens the output effects of fiscal stimulus, as older households exhibit lower consumption multipliers and weaker labor-supply responses. Similarly, at the Baker Institute for Public Policy, economist Russell Green and I that Japan¡¯s long-term stagnation stems from entrenched rigidities ¡ª persistent deflation, sluggish productivity and delayed institutional reform ¡ª that constrain the effectiveness of conventional fiscal responses.

These findings highlight the demographic and institutional limits of demand-side stimulus in an aging economy. These demographic limitations mean that stimulus measures relying heavily on household demand are particularly constrained in their effectiveness, reinforcing the urgency of more targeted, productivity-oriented investment.

Prime Minister Takaichi¡¯s economic program, as ¡°responsible and proactive fiscal policy,¡± thus blends near-term social relief with longer-term strategic investment. Her fiscal package integrates income transfers and energy subsidies with industrial support for semiconductors, defense technologies and innovation ecosystems, combining short-term stabilization with supply-side resilience. This approach partially aligns with the IMF¡¯s three-pillar framework for sustainable fiscal policy:

1. Strengthening aggregate demand through expanded social protection,
   
2. Enhancing productivity via targeted public investment and
   
3. Maintaining a credible fiscal anchor to ensure long-term debt sustainability.

Yet the alignment remains partial and fragile. The IMF that durable fiscal credibility depends on a medium-term framework explicitly linking current stimulus to future consolidation. Takaichi¡¯s strategy, by contrast, prioritizes growth-first sequencing ¡ª the conviction that economic expansion will itself generate the fiscal space necessary for subsequent discipline.

This sequencing creates a logical vulnerability: If growth underperforms, the fiscal anchor does not automatically tighten, leaving consolidation perpetually deferred.

Between resilience and reckoning

This divergence reveals a deeper philosophical tension. The IMF envisions discipline preceding growth; Japan is testing whether growth can restore discipline. Both perspectives seek the same macroeconomic equilibrium ¡ª a self-reinforcing cycle of wage growth, investment and productivity ¡ª but diverge in temporal logic. The IMF¡¯s caution is grounded in cross-country evidence that prolonged fiscal expansion in high-debt contexts can erode market confidence. Japan¡¯s experiment, however, suggests that with credible institutions and domestically anchored financing, fiscal activism may delay the limits imposed by debt dynamics.

In this sense, the ¡°Japan Approach¡± is neither a repudiation of IMF orthodoxy nor an uncritical adherence to it. It represents a contextual reinterpretation ¡ª fiscal policy as an instrument of national resilience, calibrated to domestic realities yet framed within the Fund¡¯s broader logic of credibility through productivity. Japan¡¯s policy debate epitomizes the central dilemma confronting mature, high-debt democracies: whether fiscal sustainability can be achieved not through retrenchment, but through revitalization.

Absent credible medium-term consolidation and productivity reform, however, Takaichi¡¯s growth-first experiment risks collapsing under its own weight. Should it succeed, it may offer a blueprint for reconciling stimulus with sustainability in advanced economies. If it fails ¡ª as structural evidence increasingly suggests ¡ª it will reaffirm the IMF¡¯s enduring caution: that even Japan¡¯s exceptional fiscal insulation cannot permanently defy the gravitational pull of debt dynamics.

Beyond Japan: global imbalances and the return of structural asymmetry

The revival of global current-account imbalances has once again become a defining feature of the post-pandemic economy. Despite the cyclical recovery seen across major regions, the world economy continues to exhibit deep structural asymmetries: persistent US deficits, renewed Asian surpluses and increasingly fragmented trade and capital flows. These patterns suggest that global adjustment will not occur spontaneously as the aftershocks of the pandemic dissipate. Instead, they point to enduring distortions in the distribution of savings, investment and demand ¡ª distortions that call for deliberate, coordinated policy action.

For economists and policymakers alike, the message is unambiguous: external-sector dynamics must be reintegrated into domestic macroeconomic frameworks. Fiscal sustainability, productivity enhancement, social insurance and financial stability are not discrete policy domains, but mutually reinforcing components of a single adjustment architecture. Neglecting imbalances risks not only abrupt crises, but also prolonged secular stagnation or, in the worst case, a fragmentation of the international monetary system that has underpinned globalization for half a century.

Correcting these imbalances demands more than short-term macroeconomic management ¡ª it requires patient, coordinated structural reform rooted in fundamentals rather than expedience. The 2024 BIS Bulletin that trade protectionism and industrial policy realignment act as negative supply shocks, raising prices and depressing investment without materially improving external balances.

Thus, the task of global rebalancing is inherently collective. Surplus economies must expand productive investment and social spending to absorb savings domestically, while deficit economies must rebuild fiscal buffers and national savings without undermining growth. Exchange-rate flexibility can cushion shocks, but only structural reforms in innovation, human capital and infrastructure can sustain adjustment.

Global imbalances have returned, but their structural weight is heavier and their political management more fragile than in the past. The challenge now is to forge a credible and cooperative roadmap that addresses the roots of these distortions, strengthens international institutions and preserves the integrity of the global monetary order anchored by the US dollar. The time for complacency has passed; the window for collective action is narrow but not yet closed.

Japan¡¯s path to resilience

The best prescription for Takaichi is to transform her current stimulus package from a short-lived, demand-support measure into a structured transition strategy designed to rebuild Japan¡¯s fiscal and macro-financial resilience. This requires three mutually reinforcing pillars.

First, fiscal expansion must shift decisively toward targeted, productivity-enhancing investment ¡ª in semiconductors, digital infrastructure, human capital and industrial innovation ¡ª so that public spending raises potential growth rather than merely cushioning cyclical weakness. Researchers Koji Nakamura, Sohei Kaihatsu and Tomoyuki Yagi that Japan¡¯s productivity slowdown stems from two structural frictions: the inefficient utilization of accumulated technologies, capital and labor within firms, and weak reallocation of these resources across firms.

Fiscal policy should therefore prioritize investments that not only strengthen frontier technologies but also enable firms to reorganize production processes, adopt digital tools, upgrade research & development capacity and redeploy labor and capital more flexibly in response to technological and demographic shifts. By anchoring stimulus in areas that enhance both technological capability and resource mobility, Japan increases the likelihood that debt-financed spending today generates durable productivity gains and greater fiscal space tomorrow. This approach aligns with empirical evidence showing that productivity-oriented investment delivers larger long-run multipliers than generalized transfers or subsidies, particularly in aging, high-debt economies.

Second, Takaichi must introduce a simple, credible and binding medium-term fiscal rule that gradually moves the primary balance toward sustainable territory. Establishing such a framework is essential because Japan¡¯s chronic deficits and rising debt burden have weakened long-run fiscal resilience, even as government bond yields have remained artificially low. Researchers Takeo Hoshi and Takatoshi Ito that Japan¡¯s low Japanese government bond yields are sustained by structural factors ¡ª high domestic savings, home bias among institutional investors and stable long-term expectations. Yet they warn that these conditions will erode as the population ages and the investor base contracts.

As demographic aging reduces national savings and risk tolerance, markets may reassess Japan¡¯s fiscal trajectory, making policy credibility and transparency increasingly vital to preventing sudden increases in borrowing costs. A well-designed fiscal rule helps anchor expectations, mitigate concerns about future taxation and inflation and signal a commitment to gradual consolidation without imposing immediate austerity.

This approach is consistent with evidence that Japan¡¯s fiscal policy has historically been insufficiently responsive to rising debt, as well as with international that credible fiscal rules can support orderly, growth-friendly consolidation without triggering abrupt austerity. By adopting a transparent and enforceable medium-term anchor, Takaichi can reinforce confidence in Japan¡¯s fiscal management and limit the probability of a sudden rise in borrowing costs as structural conditions evolve.

Third, and most critically, any normalization of monetary policy must be paired with an explicit, institutionally coordinated strategy to resolve zombie firms ¡ª the structural legacy of decades of ultra-low interest rates. Researchers Ricardo Caballero, Hoshi and Anil Kashyap that zombie firms depress investment, productivity and the healthy reallocation of credit by tying up financial, managerial and human resources in inefficient firms that survive due to banks¡¯ evergreening practices. With the BoJ gradually shifting toward a more normal interest-rate environment, these firms represent a major transmission risk: Even modest rate hikes could expose the fragility of heavily indebted, low-productivity firms, prompting bankruptcies, credit contractions and a sharp decline in business investment.

To prevent this outcome, a coordinated policy architecture is essential. The BoJ must adopt a gradual, predictable normalization path; financial regulators should provide targeted flexibility that facilitates restructuring rather than indiscriminate tightening and policymakers must expand programs supporting corporate restructuring, mergers, divestitures and the reallocation of labor and capital to more productive firms. Such an integrated strategy ensures that monetary normalization strengthens the business sector rather than destabilizing it, while accelerating long-delayed structural adjustments necessary to raise long-term productivity and growth potential.

Strategy, not complacency

The reemergence of global current-account imbalances marks not a cyclical deviation but a structural disequilibrium rooted in fiscal fragility and institutional asymmetry. Persistent excess savings in surplus economies and entrenched deficits in others reveal a deeper malfunction in global adjustment mechanisms ¡ª where fiscal policy, monetary credibility and capital-market integration have become progressively decoupled.

As economist Ricardo Reis , modern macroeconomic equilibrium is sustained by institutions that internalize imperfections: fiscal authorities that anchor expectations, central banks that preserve credibility and financial systems that intermediate risk without distortion. When these stabilizing institutions erode, imbalances do not self-correct; they amplify through feedback loops of mistrust, inflation drift and policy inertia. In this sense, fiscal and monetary credibility have into global public goods ¡ª forms of institutional capital whose degradation in one major economy transmits volatility across borders, destabilizing liquidity conditions and constraining the global supply of safe assets.

In particular, when fiscal authorities fail to provide credible medium-term anchors, private agents increase precautionary saving and shorten investment horizons, reinforcing the very imbalances policymakers attempt to correct.

This logic reframes global adjustment as an institutional equilibrium problem, not merely a policy coordination failure. The erosion of credibility in one jurisdiction increases precautionary demand for safe assets, compressing yields and propagating financial fragility elsewhere. Conversely, credible fiscal anchors and independent central banks generate positive externalities, stabilizing expectations and lowering the cost of global liquidity.

Hence, credibility today functions as an endogenous source of international stability, no longer confined within national borders. This point is especially vital for Japan. If domestic fiscal credibility weakens, the resulting rise in precautionary demand for Japanese safe assets could paradoxically depress yields in the short term while increasing long-term sustainability risks.

Correcting these distortions demands strategy, not complacency. Tactical stimulus or ad-hoc tightening cannot restore equilibrium. What Japan needs is patient, coordinated institutional reform that aligns domestic objectives with systemic coherence ¡ª strengthening fiscal frameworks, enhancing productivity and renewing the architecture of macro-financial governance. Adjustment, as Reis argues, is a deliberate act of institutional design, rebuilding the trust architecture that allows disequilibria to unwind without crisis.

The challenge before policymakers is therefore both intellectual and operational. To sustain globalization under stress, nations must reconcile short-term flexibility with long-term credibility, viewing fiscal prudence and monetary independence not as opposing doctrines but as complementary pillars of collective resilience.

The central lesson of this new era makes itself clear: Stability will not arise from market self-correction alone but from the credibility of the institutions that govern it ¡ª the very institutions that now constitute the world¡¯s most fragile and indispensable public good.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post Once an Economic Giant, Japan Now Tests a New Fiscal Path ¡ª and the World Is Watching appeared first on 51³Ô¹Ï.

Responses from Beijing and Jakarta

Beijing¡¯s reaction was swift and unequivocal. It the US operation as a violation of international law and called for dialogue over unilateral action. Chinese officials framed the capture as an erosion of the international legal order and reiterated China¡¯s opposition to external intervention, consistent with its long-standing diplomatic positions.

Indonesia a more restrained tone. Jakarta urged all parties to pursue a peaceful resolution, emphasized respect for international law and called for de-escalation, while avoiding direct criticism of Washington. The carefully calibrated language reflected ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ preference for neutrality and its effort to preserve diplomatic space.

Together, the two responses revealed differing diplomatic styles, but also a shared emphasis on stability and legal principles.

How the episode shapes China¨CIndonesia engagement

The significance of the Maduro episode lies in how it may influence ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ reading of China¡¯s broader diplomatic posture. Beijing¡¯s emphasis on sovereignty and nonintervention aligns with themes that resonate in Indonesian foreign policy. At the same time, Jakarta places a premium on consistency and predictability in its external partnerships.

The Maduro incident directly impacts how China interacts with Indonesia on multiple fronts. First, the episode reinforces ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ preference for steady and measured engagement. While China¡¯s position underscores its normative stance, Jakarta¡¯s focus remains on maintaining balanced relations with all major powers. This places importance on continuity in China¡¯s approach to Indonesia rather than shifts driven by external crises.

Second, the incident also draws attention to how principles are applied across different contexts. Indonesia closely observes China¡¯s behavior beyond rhetoric. The contrast between Beijing¡¯s defense of sovereignty in Venezuela and its near ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ Natuna Islands continues to shape perceptions. Although Indonesia is not a claimant to the Spratly Islands, it has consistently rejected China¡¯s maritime claims where they overlap with ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ exclusive economic zone near the Natuna Islands, making Chinese activity in those waters a sensitive issue in the bilateral relationship.

Taken together, these factors suggest that China¡¯s engagement with Indonesia is shaped not only by shared positions on international law but by how those positions are reflected in regional practice.

Economics as a stabilizing pillar

remains the foundation of China¨CIndonesia relations. Trade, investment and large-scale infrastructure projects under the Belt and Road Initiative anchor the partnership and provide resilience against political uncertainty. The Maduro episode may encourage Beijing to emphasize the economic dimension of the relationship more strongly, providing tangible benefits while avoiding overtly confrontational rhetoric. Economic ties are a key lever in ensuring Indonesia remains a partner in Southeast Asia, particularly as Jakarta balances US security cooperation and regional leadership ambitions.

±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ importance magnifies this dynamic. As Southeast Asia¡¯s largest economy and a leading Association of Southeast Asian Nations (ASEAN) member, Jakarta plays a central role in China¡¯s regional strategy. Beijing¡¯s ability to accommodate ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ preference for neutrality and multilateral engagement will influence both bilateral ties and China¡¯s broader standing in Southeast Asia. Careful management of economic cooperation remains essential to sustaining trust.

A stress test for engagement

The US capture of Maduro is unlikely to trigger an immediate shift in China¨CIndonesia relations. Instead, it functions as a stress test for how external developments interact with existing dynamics in the relationship.

For Indonesia, the episode reinforces the importance of strategic autonomy and balanced diplomacy. For China, sustaining engagement with Indonesia will depend on aligning its global positions with regional expectations, while maintaining economic cooperation and sensitivity to Indonesian concerns. Maritime conduct near the Natuna Islands remains a quiet but enduring reference point.

Viewed this way, the Maduro episode illustrates how developments far from Southeast Asia can influence the context in which China and Indonesia manage their relationship ¡ª not through rupture, but through careful adjustment and sustained engagement.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post How the US Capture of Nicol¨¢s Maduro Impacts China¡¯s Engagement with Indonesia appeared first on 51³Ô¹Ï.

A unfurled when an Afghan asylee was arrested for the November 26 shooting of National Guard members in Washington, DC. The Trump administration extrapolated the actions of one suspect to an entire group of people, while ignoring the easy availability of guns.

But for white men, who, relative to their population, commit mass shootings in the United States, there is neither extrapolation to their entire demographic (nor, of course, policy prescriptions to reduce the availability of guns) ¡ª only ¡°thoughts and prayers.¡±

So untouchable is gun control in the United States that some even double down, saying restricting firearms would lead to because victims wouldn¡¯t be able to defend themselves against perpetrators, never mind that in the case of the Bondi Beach massacre, an tackled the gunman with his bare hands, ensuring more lives would not be endangered. If guns truly made people safer, the US, which has than people, would have among the lowest rates of gun violence in the world.

But the is true. In 2023, the latest year for which statistics are available, more than in the US lost their lives as a result of gun violence, which is also the of death for children and teenagers. Every day, an average of are killed in the US because of the easy availability of guns, their blood and bodies swept under the rug, hidden from view.

But perhaps we need to see the bodies in order to end our love affair with guns.

The stark reality of gun violence: Australia vs the US

Gun violence is so appallingly prevalent in the US that it is akin to a nation ¡°experiencing .¡± There were mass shootings in 2025 alone, one of the most recent taking place on the campus of on December 13, where two people who escaped death survived . Gun regulations barely featured in media coverage of the Brown University shooting. Instead, focused on the perpetrator being on the loose for days before being found. Such perverted attentions are symbolic of the pro-gun adage that ¡°guns don¡¯t kill people, people do.¡±

As horrific as the Bondi Beach massacre was, in Australia, a nation with strict gun laws, it was an outlier. It took a single mass shooting in 1996 for Australia to pass strict gun controls. Known as the , a shooter killed 35 people, after which the nation¡¯s politicians united to pass wide-ranging bans on assault rifles, shotguns and other types of firearms. Authorities bought guns back en masse from the public and melted down as many as 1 million guns.

The results were stark, especially compared to the United States, where right-wing factions seem to consider guns more sacred than human life. Australia¡¯s per capita rate of was 12 times lower than that of the United States, according to 2023 figures. For more than 20 years, there were no mass shootings in Australia. That record was broken in 2018 with a horrific murder-suicide, and then in December 2025 with the Bondi Beach shooting.

Closing the loopholes

If Australia¡¯s laws were already so strict, how could the Bondi Beach massacre in Sydney have happened? It turns out they weren¡¯t strict enough. in the nation¡¯s regulations allow individuals to stockpile guns, and gun club members in particular are allowed to purchase firearms using licenses for recreational use. One of the suspected shooters was a of such a gun club and had a recreational license for the gun believed to be used in the shooting.

Moreover, the gun used in the shooting required , because semiautomatic assault rifles, which automatically reload, are in Australia. They are in the US and have been used in horrific mass shootings, such as the in Uvalde, Texas, allowing shooters to spray bullets without pausing. That means the Bondi Beach massacre could have been far deadlier if Australia had the same lax laws as the US.

Australian lawmakers and advocates of gun laws are taking the logical next step to ensure that the lives of the Bondi Beach victims were not lost in vain and are actually working to the loophole that appears to have led to their killings. Australian Prime Minister Anthony Albanese refreshingly announced ¡ª alongside protections for the Jewish community ¡ª greater .

Why the US can¡¯t quit guns

Gun laws work, and Australia isn¡¯t the only example. Within the US, those states with fewer gun restrictions have higher rates of gun-related deaths. A June 2025 in the Journal of American Medical Association (JAMA) Pediatrics found that ¡°states with the most permissive firearm laws after 2010 experienced more than 6,029 firearm deaths in children and adolescents aged 0 to 17 years between 2011 and 2023 and 1,424 excess firearm deaths in a group of states with permissive laws.¡± In contrast, ¡°four states had statistical decreases in pediatric firearm mortality during the study period, all of which were in states with strict firearm policies.¡±

A majority of Americans it is too easy to obtain guns in the US, and while most Democrats agree on basic regulations such as banning assault rifles, there is a majority bipartisan support for raising the minimum age for purchasing guns to 21.

So, why is it nearly impossible to pass stricter gun laws in the US? A large part of the problem is the stranglehold the has over the political system.

Additionally, the US is a nation tilting headfirst toward authoritarian rule, and gun owners, who are right-wing and white, are seen by the political establishment as far too important to alienate. Republicans are fanatically pro-gun, while Democrats are on gun control.

We also have a national cultural attachment to guns that borders on religious. For that, we can thank the around gun-toting pioneers who believed they were destined to colonize the nation. Our obsession with individual rights over collective well-being is not limited to a reticence against or . Individualism is at the heart of gun ownership, no matter the strong correlation between lax gun laws and gun violence.

Facing the true cost of gun violence

We are awash in stories that glorify guns, especially from the liberal purveyors of obsessively feeding us movies about ¡°good guys with guns.¡±

But the pain of gun violence survivors is rarely explored in nuanced ways on our television screens, newspapers or social media. If the Bondi Beach massacre had happened on US soil, there would be little focus on guns beyond the usual advocates calling in vain for stricter controls and gun activists shouting them into silence.

What if, instead of pixelating the images of gun victims ¡ª which quite literally renders them invisible ¡ª we were forced to face the ugliness of gun deaths?

In 1955, insisted on an open casket for Emmett Till to showcase what white supremacist lynch-mob violence did to her son and to force the nation not to look away. Perhaps the news media ought to start showing us what bullets do to a body.

In the 1970s, of the Vietnam War on nightly television news shows helped Americans see the impacts of massacres funded by their tax dollars and turned the tide of popular support against the war. Perhaps today¡¯s censors ought to stop shielding us from how a person¡¯s brains and guts spatter a campus sidewalk when an armed shooter has emptied the assault rifle.

In 2025, former President Barack Obama¡¯s speechwriter credited social media with ¡°smashing our young people¡¯s brains all day long with video of carnage in Gaza,¡± as a reason for why public opinion has moved against Israel over its genocide. Perhaps social media platforms ought to show us what victims of mass shootings really look like before they are buried or cremated.

Such imagery can carry the requisite trigger warnings to save those already traumatized by witnessing gun violence from being subjected to it again. But those who vehemently support deadly weapon ownership over the right to live free from fear ought to face the results of their dogma.

We should be haunted by the images of the dead. They should invade our dreams. Better to be traumatized by such savage visuals than to end up dead, or worse, lose a beloved to gun violence.

[This article was produced by , a project of the Independent Media Institute.]

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Leadership turnover and a faster diplomatic rhythm

Satoh opens by noting how leadership changes in Japan¨CKorea relations tend to generate ¡°anxiety or optimism,¡± and therefore unpredictability. South Korea¡¯s transition from President Yoon Suk Yeol to President Lee Jae Myung and Japan¡¯s rapid succession of prime ministers create both risk and opportunity: Bilateral ties can regress into grievance politics, or they can consolidate a forward-looking partnership.

Choo argues that Lee moves quickly despite the lack of a traditional transition period. In his telling, Lee signals seriousness by traveling early, attending key summits, and ¡ª most symbolically ¡ª making Japan his first stop en route to the United States. The two leaders also revive ¡°shuttle diplomacy,¡± emphasizing frequent contact and reciprocal visits. Choo frames Lee as someone who wants to de-escalate historical disputes and prioritize coordination with Japan and the US, describing Lee¡¯s posture succinctly: ¡°He¡¯s ready to move on.¡±

Satoh underscores the stakes of that choice. She sees earlier periods, especially when the ¡°history card¡± becomes the centerpiece, as costly for both sides. She suggests that personalities in Tokyo mattered as much as disputes in Seoul. Even so, both speakers treat the current moment as unusually conducive to rebuilding habits of cooperation.

Why the ¡°anti-Japan card¡± weakens

A major part of the conversation tests a common fear in Tokyo: that a leadership change in Seoul automatically means a turn back toward confrontation over comfort women, forced labor and related legal battles. Satoh suggests that past governments sometimes leaned too heavily on these issues, while also acknowledging that Japanese leadership choices affected the diplomatic room available.

Choo argues that recent court rulings have ¡°settled the score¡± in ways that make reopening certain disputes legally harder. Additionally, he claims the political incentive structure is shifting. Polling by Seoul National University¡¯s Peace Unification Institute shows that South Korean public sentiment toward Japan has generally been friendlier than toward China or Russia, with Japan typically ranking behind the US and North Korea. Without elite incitement, anti-Japan mobilization has diminishing returns.

That point matters because it reframes bilateral fragility. Instead of treating Japan¨CKorea ties as permanently hostage to historical memory, Satoh and Choo treat them as increasingly responsive to present-day strategic needs ¡ª especially economic security and managing China.

Trump 2.0 and the case for Japan¨CKorea leverage inside the alliance

Satoh and Choo diverge in tone on Trump. Satoh emphasizes the US president¡¯s transactional instincts and doubts that he is ¡°strategic¡± in a conventional sense. Choo, by contrast, reads Trump as capable of strategic calculation, offering an anecdote about his interest in the Bagram airbase in Afghanistan as evidence of China-focused thinking.

Despite this difference, they reach the same structural conclusion: Japan and South Korea have bargaining power because they sit at the center of any US strategy that aims to check China economically and militarily. As Choo puts it, ¡°Japan and Korea are actually quite lucky, because we are at the frontline countries.¡±

Now, if Washington is serious about rebuilding US manufacturing capacity, tightening supply chains and sustaining deterrence in East Asia, Tokyo and Seoul are indispensable partners. That dependency, Satoh and Choo argue, should be translated into concrete gains during negotiations, rather than accepted as a one-way demand for alignment.

Industrial security and rebuilding bureaucratic channels

The most detailed discussion concerns a division of labor across the US¨CJapan¨CKorea technology ecosystem: US raw technology, Japanese equipment and intermediary inputs, and South Korean manufacturing scale. Choo argues that China understands this structure and therefore pressures Seoul (and implicitly Tokyo) to negotiate constraints with Washington first ¡ª because many of the binding limits are US-imposed export controls and sanctions.

Semiconductors, which are a vital component in many consumer, healthcare and military technologies, are the test case. Choo describes US restrictions as a ¡°ceiling,¡± limiting the sale of advanced chips to China. He notes the knock-on effects for Korean-owned production in China. He recommends that Tokyo and Seoul coordinate by approaching Washington together, identify where restrictions are unnecessary or counterproductive and bargain for tailored easing that preserves core security concerns while reducing economic damage. As he says, the goal is to ¡°move the ceiling¡± through joint leverage rather than isolated pleading.

Satoh adds a governance angle: Japan and Korea need deeper, more routine policy coordination beyond foreign ministries ¡ª especially because this era is driven by industry and economic security. To conclude, Choo suggests the Asian nations revive the once-close working relationship between Japan¡¯s Ministry of Economy, Trade and Industry and Korea¡¯s industry ministry, treating industrial policy cooperation as the backbone of a more resilient Japan¨CKorea partnership in an age of US¨CChina rivalry.

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No less curiously, the country visibly on the rise, China, is distinctly not acting like a typical imperial power of history (at least the history I¡¯ve known). In a world where the US still has or so military bases around the world, China, as far as I can tell, has at most just one (in ). While its economy has become significant globally (imperially significant, you might say), unlike essentially every from the Portuguese and Spanish in the 15th and 16th centuries on, it has no colonies and only the most minimal military presence abroad, though it does continue to build up its military power (and its ) at home.

Of course, it¡¯s worth remembering that we are distinctly on a different planet than the one any of those older powers inhabited. And even if America¡¯s great man (my joke!), President Trump doesn¡¯t seem to know it, but China¡¯s leader, Xi Jinping, certainly does.

Putin¡¯s version of imperial aggression is, at present, aimed at Ukraine in a war that will in the ¡ª and yes, I can hardly avoid the word! ¡ª end undoubtedly prove a disaster, not just for Ukraine but for Russia and the rest of the planet, too. Meanwhile, Trump¡¯s version of imperial aggression, which is likely (again, in the end) to prove disastrous, is for the time being (and, with him, you always have to add a qualifier) the Caribbean Sea, the Eastern Pacific Ocean, and (which he now seems intent on turning into an ), even as he prepares to build his own ¡°,¡± including ¡°¡± (old-fashioned) battleships.

On the other hand, China¡¯s major ¡°aggression¡± (and indeed, that word does have to be put in quotation marks!) is aimed ¡ª setting aside the island of Taiwan (which it claims not as a colony but as a part of China itself) ¡ª at the conquest of the future global green economy.

Or put another way, to give credit where it¡¯s due, despite the fact that China continues to coal plants in an unnerving fashion, its great-power desires are at least aimed at something ¡ª in fact, the thing ¡ª that truly matters on this distinctly beleaguered planet of ours. It is intent on becoming the Earth¡¯s global powerhouse when it comes to the sale of green energy and the ways to produce it. Consider that its imperial target, one unlike any other in history (though perhaps a comparison could be made to the industrialization of what became imperial Great Britain in the nineteenth century). Moreover, it¡¯s already green energy production units to countries globally, while anyplace else on this planet in producing electric vehicles (EVs).

At war with the world

Last year, China installed more wind turbines and solar panels than any other country, indeed more than the rest of the planet combined. And as The New York Times (The Times) earlier in 2025, ¡°Not only does China already dominate global manufacturing of solar panels, wind turbines, batteries, EVs, and many other clean energy industries, but with each passing month it is widening its technological lead.¡±

While Trump¡¯s America is putting so much of its energy (so to speak) and into coal, oil and natural gas production, China¡¯s government has been giving hundreds of billions of dollars in subsidies to wind, solar and electric car manufacturers. And it is now hard at work spreading the products for producing wind and solar power globally. As The Times also reported:

Block Quote:

Chinese firms are building wind turbines in Brazil and electric vehicles in Indonesia. In northern Kenya, Chinese developers have erected Africa¡¯s biggest wind farm. And across the continent, in countries rich with minerals needed for clean energy technologies, such as Zambia, Chinese financing for all sorts of projects has left some governments deeply in debt to Chinese banks.

And of course, China is unequaled in the production of electric vehicles. There are now at least selling such vehicles in China, and they are exporting more than one-fifth of their products globally, while Chinese companies continue to out-innovate those elsewhere on this planet.

On the other hand, Putin, who that global warming might be good for Russians because they could then ¡°spend less on fur coats,¡± at least now acknowledges its reality. Nonetheless, he only recently a decree that would allow his country, already heating up 2.5 times faster than the global average, to increase its emissions of greenhouse gases by 20% by 2035. And of course, the US is now led by a president who, all too bluntly, ran for office the second time around on the campaign slogan ¡°¡± and is making policy based on ¡° the green new scam.¡±

Only recently, in fact, his administration ¡°paused¡± the leases on and the building of five major wind projects under construction off the east coast of the US, supposedly due to ¡°national security risks.¡± In essence, Trump and crew have been doing their best to or get rid of anything in this country that might effectively impede climate change and the future broiling of Planet Earth. That is, in fact, the definition of his America, which is also the definition of decline on a scale that once would have been unimaginable. And remember, I¡¯m talking about the same president who, last fall, delegates from nations around the world at the UN that climate change was ¡°the greatest con job ever perpetrated on the world,¡± while insisting that, ¡°If you don¡¯t get away from this green scam, your country is going to fail.¡±

In the bluntest terms, the greatest imperial power of the past century, the US, is now in the Trumpian process of sending itself into a steep imperial decline on a distinctly beleaguered planet itself undoubtedly in decline. And part of the reason for that, Trump aside for a moment, is that we humans just can¡¯t seem to stop making war on ourselves. After all, in addition to killing and wounding staggering numbers of us and doing untold damage to (even destroying) whole regions of the planet, wars also release stunning amounts of carbon dioxide into the atmosphere, as do what still pass for ¡°peacetime¡± armies. In fact, the US military, even when not at war, more greenhouse gases than whole countries like Sweden or Norway. As it happens, it may be the single largest institutional emitter of such gases on planet Earth.

And worse yet, at such an increasingly dangerous moment in history, there are at least three significant wars underway on this planet of ours. In this distinctly post-modern age, there should be a term for such wars and the way ¡ª in addition to the hell on earth they have created since time immemorial ¡ª they are now helping produce an environmental hell through the release of greenhouse gases in vast quantities into the atmosphere. There is, of course, the never-ending war in Ukraine, the one (in partial ¡ª but ¡ª remission) in the Middle East and the brutal ongoing one in Africa. I¡¯m thinking of , of course. (And don¡¯t forget the more minor but still brutal one in the Congo.)

And when it comes to one conflict for which we have some figures on greenhouse gas emissions, The Guardian that, in the first 15 months of Israel¡¯s war in Gaza, those emissions were ¡°greater than the annual planet-warming emissions of a hundred individual countries.¡± It similarly reported that ¡°the climate cost of the first two years of Russia¡¯s war on Ukraine was greater than the annual greenhouse gas emissions generated individually by 175 countries.¡±

A long-term definition of suicidal on planet Earth

So, at a time (and what a time!) when we¡¯re experiencing one record hot year after another, ever fiercer forest fires, ever more horrific floods, ever more severe droughts and so on (and on and on) ¡ª at a moment, in other words, when it increasingly seems as if humanity is ever more at war with this planet, the old form of imperial power, the one involving wars, colonies around the world and global military bases, seems increasingly pass¨¦, even if the leaders of neither the US nor Russia seem capable of recognizing that reality.

And in that context, those two imperial powers of the last century aren¡¯t simply following the pathways of other imperial powers whose time was up. Yes, they are both distinctly heading downhill, but both of them, in an eerily purposeful fashion, seem (in climate-change terms) to be intent on taking down much of the rest of the planet with them. And none more purposefully (or so it seems) than Trump¡¯s America, which is distinctly focused on ensuring that, at least in the United States, wind power projects will be , solar energy projects avoided or , and ever larger areas from to more than a of ocean waters opened to the production of yet more fossil fuels. If you need a long-term definition of ¡°suicidal¡± at both a national and a planetary level, that obviously should be it.

And it¡¯s in just such a world that China, the rising power on this planet, is neither spreading its military might globally, nor creating military bases and seizing colonies around the world. Instead, its leaders are doing their damnedest to take control of the universe of green energy and so plowing new imperial ground by potentially becoming the unparalleled green-energy power on planet Earth.

Of course, it shouldn¡¯t really be a surprise that, on a planet changing before our eyes in the most basic fashion, the meaning of the very word imperial would change or that the old war-making, colonizing version of it would be left to the history books (and to the increasingly ancient and outdated great powers whose leaders can no longer seem to imagine the actual nature of our future).

And this brings me to myself. In some ways, in my 82nd year on this planet, I just can¡¯t believe the world I¡¯m in, nor could I ever have guessed that it would be quite this way. Trump, president of the United States ¡­ really? At a moment when it should have been all too obvious that humanity was in danger of creating an all-too-literal hell on earth, a of my compatriots elected (for a second time!) a man who not only refuses to faintly grasp what¡¯s happening but has made a clear and conscious decision to worsen our situation by promoting the further use of fossil fuels in every imaginable way.

All too sadly, though it¡¯s not normally used that way, the word ¡°suicidal¡± seems a reasonable description of his policies. I mean, what needed to be done really shouldn¡¯t have been all that complicated ¡ª not on a planet where the most recent years have been the hottest in human history, the last ten the , 2024 the hottest year ever (and unsurprisingly, when the final figures are in, will undoubtedly be right up there, too); not on a planet where Arctic ice is , sea levels and the weather (from to ) is growing ever more extreme by the year.

And yet, obvious as all that may be, Trump and crew have decided to actively intensify the ongoing disaster. And if that isn¡¯t the definition of a once great imperial power going down (and attempting to take the rest of us with it), what is? To the extent that great power global politics even matter anymore, President Trump is literally turning this world, economically and ecologically, over to China, lock, stock and rain barrel.

And all of that makes me wonder: How did I ¡ª how did any of us ¡ª end up here?

Yes, we¡¯re clearly entering a new imperial age with China potentially at the helm of a planet that, in weather (and human) terms, will be going down, down, down.

It may be hard to believe, but that¡¯s our reality ¡ª and I must admit that I find it painful to leave such a planet to my children and grandchildren. They truly deserved better.

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Trishul can be considered ambitious security theater

Trishul, which involves land, air and naval forces across a thousand-kilometer front, is the most joint exercise since . According to a press release from India¡¯s Ministry of Defense, the goal of Trishul was to bolster cooperation between the Indian Navy, Army and Air Force. Trishul was conducted near Sir Creek, a territory between India¡¯s Gujarat and Pakistan¡¯s Sindh province. By conducting Trishul near this strategically sensitive area, India seems to be showcasing its military readiness.

Strategic theorists frequently claim that when a state¡¯s defense preparations are heightened by spectacle, they gain an element of performative deterrence. American economist Thomas Schelling referred to this as the ¡°art of coercion and intimidation,¡± which involves exploiting visible capabilities to alter enemies¡¯ potential reactions. India¡¯s exercise fits that pattern perfectly. Trishul¡¯s time, scope and position project not only preparation but also a posture that signals to neighboring states where military power lies.

The language around Trishul provides more nuance. Indian commanders have of a ¡°new normal¡± in which any cross-border provocation may result in a full military reaction. That is a doctrinal shift with major geographical implications. Now, the escalation threshold appears to be more fluid. South Asia¡¯s security, which was already vulnerable to , is now working in a context that blurs deterrence and domination. This will undoubtedly lead to more security misunderstandings.

Issues arise with displays of military prowess

History offers useful caution. Across 2016 and 2019, India¡¯s carefully calibrated military to perceived threats were at home but unnerving across the region. Each instance, however brief, incrementally changed the bounds of what constituted acceptable military posturing. Exercises such as Trishul, therefore, may serve less as training routines than as symbolic gestures aimed to remind rather than reassure.

There is also a maritime complication worth mentioning. The Arabian Sea, once a trade channel, is now becoming a competitive arena. India¡¯s increased naval exercises, combined with its Indo-Pacific , indicate a shift from coastal defense to a role in deciding the trajectory of the region¡¯s security. For the wider region, such patterns can readily translate into worry ¡ª not from an impending threat, but from an inferred sense of power. British political scientist Barry Buzan once , ¡°In regional security complexes, proximity magnifies perception.¡± When a major power operates near contested or shared spaces, the neighbors are obligated to interpret purpose through action.

This is where India¡¯s challenge lies. It strives to be recognized as a responsible stakeholder in global security, yet its regional messaging frequently appears unilateral. The greater the prominence of its military footprint, the less room for diplomatic reassurance. Over time, frequent exhibitions of force, no matter how appropriate, risk instilling in smaller governments what cyber scholars refer to as . When the average user is faced with more online privacy choices than they can process, they often regard online security with resignation, leading to less secure online behavior. This idea can be applied to global security: When met with military prominence, states may consider discourse as unnecessary because deterrence has already determined the conversation.

India must be aware of its own limitations

It would be misleading to assume that India¡¯s aims are entirely coercive. The integration of its military forces, technological advancements and operational readiness are all indicators of a growing power¡¯s natural progression. However, how we demonstrate evolution is important. Strategic confidence is best judged by how a state handles perceptions, rather than how it demonstrates capacity.

Trishul may eventually prove to be a double-edged sword. It strengthens India¡¯s image as a capable, collaborative power, but it also highlights a growing disparity between its self-perception and regional reception. The exercise informs neighbors of India¡¯s capabilities, but not of its limitations. And in an area as rich in history and mistrust as South Asia, that divide might mean the difference between deterrence and supremacy.

If New Delhi wants to lead, the way forward is through softer guarantees rather than bigger displays. Even caution can be a sign of strength in the deterrent theater.

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This initiative is built on two pillars: the first taxing rights over highly digitalized multinational enterprises, and the second a 15% global minimum corporate tax rate. Of the two, the latter has gained greater momentum and made faster progress toward global implementation in recent years.

Holding up the pillar

From a progress perspective in Pillar Two, the tax advantages that fueled the ¡°¡± among nations no longer exist, fostering fair competition and leveling the playing field. Within the OECD-led international tax regime, China, as a , has actively contributed to global tax reform discussions from the early days.

In broader, positive terms, China¡¯s projected inclusion and contribution in global tax governance has pushed its interest and its global south interest, simultaneously. But, in the progress for Pillar Two, China seems , and is not yet taking consolidated global minimum tax (GMT) or tax legislation at home.

Politically intriguing, global tax reform faces significant complications under the Trump administration, which demands carve-outs for US multinational firms. China¡¯s to these US tax carve-outs from the global minimum tax have not altered Washington¡¯s position but remain noteworthy.

A global calculation

Turning to the core issue, the prospect of global tax reform, specifically Pillar Two, if fully implemented, will raise the tax burden on international investment activities and dampen the incentive for cross-border capital movements.

Under these circumstances, China¡¯s outbound investment momentum will face a critical challenge. One of the different positions, unlike OECD-capital-exporting countries, is that China has experienced the transition from a capital-importing to a capital-exporting economy.

From China¡¯s domestic institutional backbone, one finding warrants a stronger recommendation: China must secure a capital-related . This is due to China¡¯s growing outward investment momentum, which has coincided with the pace of international tax governance reform; China is no longer merely a destination for capital but has become a major capital exporter.

Technically speaking, China lacks the overseas income tax deferral clauses that Western capital-exporting countries usually use to help their firms remain competitive abroad. Through the lens of tax and investment relations, traditional tax incentives, under the GMT era, will be challenged, compelling developing countries and emerging markets to focus more on enhancing their nonfiscal investment capacity to attract capital.

In other words, China must be able to sustain its structural outbound investment to align with the rise of nonfiscal incentives in Belt and Road Initiative () countries, particularly in the Association of Southeast Asian Nations (ASEAN). This signals that China should pay closer attention to its outbound investment strategy in Southeast Asia, as ASEAN is a crucial partner in its capital-exporting ambitions. So, China would be wise to shift its investment orientation from tax incentives-seeking to capacity-building.

In this context, China must sustain and recalibrate its outbound investment in ASEAN by aligning its strategy with the region’s expanding nonfiscal incentive frameworks, such as energizing more investments in opportunity zones like Special Economic Zones (SEZs).

ASEAN, SEZs and economics

According to the ASEAN , Southeast Asia hosts over 1,600 diverse economic zones. From a public policy position, SEZs¡¯ strategy must be fully integrated with national economic development, both with its regional industrial policies and its broader economic development strategies.

Consequently, it can be said that SEZs increasingly function as magnets for Global Value Chain (GVC) integration, a role underscored by a decade of political economy discourse on how multinational enterprises optimize global production. By its legal character, SEZs are designed as unilateral national economic policies that reflect core principles of international trade and investment law, functioning independently or alongside the absence of multilateral/bilateral agreements.

Unsurprisingly, through the current discourse in the international political economy of SEZ, revealed that the big recommendation for SEZ is more in creating an attractive and conducive business environment, rather than relying on fiscal incentives like tax holidays.

Within for SEZs Development and Collaboration, tax holidays or exemptions are common but abused and limited to profitable ventures, failing to attract innovative investments. Through these guidelines, ASEAN will harmonize its policies with the G20 Development Working Group¡¯s guidance from the International Monetary Fund, the OECD and the UN on foreign direct investment incentive policies.

Moreover, the International Institute for Sustainable Development (IISD) recommends reforming to better target sustainable development and clean energy goals. In that sense, countries are thus encouraged to rethink the tax incentives needed to attract renewable energy investments. In practice, green technology and strategic industries are no longer driven by a simple pursuit of low costs or tax breaks. Instead, capital is now flowing into ¡°strategic, ¡±, specifically electronic vehicles, semiconductors and green energy systems.

The rise of geoeconomics has transformed tax and investment policies into vital instruments of regional strategy, a shift accelerated by the advancement of tax multilateralism. As China remains a primary partner for Southeast Asian economies, it must recalibrate its tax-investment relation strategy to align with this new reality.

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And I found that a serpent was coming towards me. It was thirty cubits in length, and its beard was more than two cubits in length, and its body was covered with gold scales, and its eyebrows were of pure lapis lazuli¡­

And it opened its mouth to me, as I was lying flat on my stomach before it, and it said unto me, ¡°Who hath brought thee hither? Who hath brought thee hither, O miserable one?¡±

That is from the Tale of the Shipwrecked Sailor, the oldest complete story that has come down to us from antiquity. It was written in Hieratic during the Middle Kingdom of Ancient Egypt, and I read it in the original Egyptian from the comfort of my bed, four thousand years after it was written.

Reading an ancient story is an experience unlike any other. It is a glimpse into the mind of an alien ¡ª utterly foreign, yet oddly familiar. A yawning gap of time, culture and language divides me from the author, but I read his tale nevertheless, and I marveled when the sailor encountered the serpent god with eyebrows of lapis lazuli.

I¡¯ve often felt the pressure to better myself, and I occasionally crack a technical manual or a literary classic in my spare time in deference to that pressure. I¡¯ve known colleagues whose hobbies are essentially identical to their work ¡ª Nothing would depress me more, though I¡¯d probably be better at my job.

Instead, my hobbies are almost militantly useless. I write a blog in which I the hot-dog-ness of various sandwiches, and spin density waves if they were made of guinea pigs. The only foreign languages I speak are Latin and Ancient Egyptian, into which The House of the Rising Sun (so useful). The history books I love best are the furthest removed from my own time. In general, my delight in a hobby is inversely proportional to its utility.

But despite, or perhaps because of, the unavoidable pressure to be productive that pervades modern life, I feel that my useless hobbies are not only personally valuable, but essential to a life well-lived, and I think the ancient philosophers tend to agree with me.

Crawling in the mud: Zhuangzi and °Â¨²·É¨¦¾±

°Â¨²·É¨¦¾±, nonaction in accord with the natural flow of the universe, was praiseworthy to the Daoist sage Zhuangzi, born 2300 years ago in ancient China. Zhuangzi was renowned across China for his wisdom, and his counsel was greatly desired by the political elites of the time. When the duke of Qi, one of many desiring wise counsellors, invited Zhuangzi to become his chief minister, his messengers found the old sage fishing among the river reeds. Upon receiving this job offer, Zhuangzi did not look up from his rod and :

¡°I have heard that there is a sacred turtle in Chu that died three thousand years ago. The duke keeps it in a casket wrapped in cloth and has placed it in a temple. May I inquire whether the sacred turtle wanted to be dead and to have its bones venerated by man? Or was its intention to stay alive and crawl around in the mud, dragging its tail?¡±

¡°Naturally,¡± replied the messengers, ¡°it hoped to crawl around in the mud, dragging its tail.¡±

¡°Go home,¡± said Zhuangzi, ¡°I also want to crawl around in the mud, dragging my tail.¡±

The serenity of Epicurus

, too, understood the value of nonproductive pursuits. He was a Hellenistic philosopher who suffered from chronic pain all his life, and perhaps fittingly, developed a philosophy focused on pleasure and pain. To Epicurus, what is true pleasure? True pleasure is not the fleeting pleasures of wealth, rich food and debauchery, but a restrained, mental satisfaction that lingers, like heat from the embers of a hearth. True pleasure is the absence of pain and freedom from unnecessary desires.

This pleasure comes with freedom from the desire for wealth, freedom from the fear of death and of the gods, the bond of the tight-knit community and from pure intellectual exploration ¡ª this pleasure is serenity, ataraxia in Greek. The fear of death was simply one more pain to overcome in the life of Epicurus, and so his followers wrote thusly on their tombstones: Non fui, fui, non sum, non curo ¡ª I was not, then I was, I am no more, I do not mind. 

Epicurus reminds us that the pursuit of wealth does only so much to decrease the pain of life. For indeed, what shall it profit a man, to gain the world but lose his soul?

Aret? and the joy of useless excellence

But for me, there is still more to life than ·É¨²·É¨¦¾± and ataraxia, for there is pleasure too in purpose. Former US President John F. Kennedy, another great philosopher, spoke to this purpose when he of the Apollo moon mission that we choose to go to the moon not because it is easy, but because it is hard, because that goal will serve to organize and measure the best of our energies and skills, because that challenge is one we are willing to accept, one we are unwilling to postpone and one we intend to win.

Indeed, to strive for one¡¯s excellence, for one¡¯s aret?, in any field of human endeavor, for no practical benefit whatsoever ¡ª this is the highest pursuit of man, his virtue par excellence, and his greatest good. To strive for mastery in a field, regardless of practical benefit and indeed in spite of it, is a noble and fulfilling pursuit.

So why do I waste my time? To exist in non-action, to be free of the burden of utility, to find ataraxia, to strive for something difficult, yet not lose myself in pursuit of material gain, and because ultimately, it is my time to waste.

In the words of Seneca, omnia aliena sunt, tempus tantum nostrum est ¡ª All else is foreign to us, only time is ours. And I intend to spend mine generously, spiced with those useless hobbies that bring me joy.

[Dylan Black first published this piece on .]

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Just over three years on, Anwar¡¯s has defied the unforgiving math of Malaysian politics that felled his reformist predecessors ¡ª notably the PH administration that collapsed after only 22 months in 2020 ¡ª by holding together an unlikely government. This very survival, however, is now shaped by the unresolved politics surrounding former Prime Minister Najib Razak¡¯s corruption convictions and the challenge of managing an unstable, ideologically divided government coalition.

A constructive course correction is therefore no longer optional. If Anwar¡¯s so-called hopes to turn mere political survival into credible reform, the next two years will be decisive, as it demands tougher handling of corruption-linked politics and firmer control over a shaky governing coalition before Malaysia enters the runway toward the next general election due in 2028.

Razak¡¯s corruption convictions and the political cost of reform

As the President of the ruling People¡¯s Justice Party (PKR), Anwar rose to power on a reform-leaning, anti-graft platform, but his government¡¯s moral authority has been dented whenever rule-of-law principles appear hostage to coalition politics. Nothing captures this dilemma more clearly than the ongoing saga of Najib. He remains imprisoned for , but over the years, the party he once led, UMNO, has openly advocated .

Najib¡¯s corruption controversy began with the creation and control of the state-owned development fund 1Malaysia Development Berhad () to attract investment and drive economic growth, which later became the center of one of the world¡¯s largest financial scandals, exposing of more than $4.5 billion between 2009 and 2014. The former chairman of BN was convicted in July 2020 on multiple charges linked to SRC International, a former 1MDB subsidiary. He began serving a 12-year prison sentence in August 2022 after exhausting his appeals.

In February 2024, Najib was surprisingly granted a partial by then Malaysian King Abdullah of Pahang, with the Pardons Board halving his sentence to six years and reducing his fine from 210 million ringgit ($44.5 million) to 50 million ringgit ($10.8 million), though it stopped short of granting his release. Subsequently, Najib applied for in April 2024; the High Court rejected the request in July 2024, and the matter was appealed.

The issue came to a head in December 2025, when the High Court not only Najib¡¯s audacious bid to serve his sentence under house arrest but, days later, him in the main 1MDB trial of four counts of abuse of power and 21 counts of money laundering, sentencing him to 15 years¡¯ imprisonment and imposing fines totalling 11.4 billion ringgit ($2.8 billion).?

Although Najib has both his conviction and sentence, the rulings affirm that Malaysia¡¯s courts are prepared to hold even former prime ministers to account. Regardless, the political storm surrounding it highlighted the pressure on Anwar¡¯s unity government ¡ª and the perception of wavering commitment to reform.?

UMNO¡¯s reaction to its long-time president¡¯s courtroom defeat was , as several senior figures denounced the decision as an affront to Malay royal authority and called for the party to withdraw from Anwar¡¯s governing coalition. Such rhetoric laid bare the coalition¡¯s fault line that is rehabilitating its patronage networks, whereas Anwar¡¯s PH camp is rooted in promises of clean governance.

Now, fortunately for Anwar, pressure over Najib has not coalesced into a unified offensive from the main opposition. The National Alliance () ¡ª anchored by its core parties, Malaysian United Indigenous Party (Bersatu) and Malaysian Islamic Party (PAS), and supported by smaller partners such as Malaysian People¡¯s Movement Party (Gerakan), and Malaysian Indian People¡¯s Party (MIPP) ¡ª has mixed positions and thus failed to form a coherent position on Najib¡¯s prosecutions.

Some leaders within PN have invoked regarding the royal prerogative, while others have been about any posture that could be read as defending a figure emblematic of 1MDB-era corruption. The divide arguably exposes a deeper clash between PAS¡¯s Islamist orientation and Bersatu¡¯s Malay-primacy nationalism ¡ª a party born of UMNO defections in 2016 ¡ª by unresolved questions over PN¡¯s leadership and prime ministerial direction that leaves the coalition unable to sustain a unified line on Najib.

The sharpest political pressure on Anwar, consequently, has come not from the opposition benches but from inside his , where latent tensions between and PH¡¯s Democratic Action Party () continue to test the limits of ideological coexistence over issues of reform priorities. And this emphasizes that Najib ¡ª after a nine-year Malaysian premiership ¡ª still over Malaysian politics. Yet, he serves not as a rallying cause so much as a fault line that reveals over accountability and power.

Caught in the middle, Anwar tried to the fray ¡ª reiterating that he does not interfere in court cases and that due process must run its course. He formally kept his , but his cautious silence on UMNO¡¯s was widely interpreted as ambivalence and not neutrality.

Many reform-minded Malaysians who voted for change in 2022 expected Anwar to firmly reject any backroom deals for Najib or other kleptocrats. Instead, they witnessed prosecutors under Anwar¡¯s watch drop or defer cases involving high-profile UMNO-related figures, most notably Deputy Prime Minister and BN Chairman and , the wife of Najib Razak.

Anwar, in reclaiming the reform narrative, must reassert an unambiguous doctrine of noninterference and institutional reform. The Prime Minister should publicly affirm that coalition politics will not dictate the fate of corruption cases ¡ª no matter who is implicated. Beyond statements, his government needs to accelerate structural changes that insulate the rule of law from political bargains.

The reality, however, is less forgiving. Reformist governments are judged most harshly when their own allies, rather than their opponents, put their principles to the test. For Anwar¡¯s administration, these commitments must therefore be implemented in the years ahead, specifically in 2026, if the Madani government is to regain some of the reformist credibility that the compromises of coalition governance have clouded.

Balancing power in a diverse, fragile coalition

Holding together a diverse coalition has been Anwar¡¯s most notable achievement, but it has come at the expense of reform momentum, as 2025 showed. The year saw the prime minister navigating a series of political aftershocks, from state election setbacks to cabinet infighting, which he addressed through tactical concessions that, to critics, looked more like than transforming it.

The clearest example came from the Sabah state election in November 2025, a regional poll that delivered a sharp to Anwar¡¯s federal alliance. PH ¡ª comprising PKR, DAP and the National Trust Party ¡ª along with its national partners, won only one of the 20 seats it contested in the Sabah assembly.

Voters in Sabah gravitated toward local parties running on ¡°¡± platforms that reflect grievances about neglect and unmet promises of autonomy. And although an Anwar-aligned local coalition, GRS, retained control of the state, it did so strictly on . The October 2025 Kota Kinabalu High Court only hardened these attitudes by giving legal weight to Sabah¡¯s claims of fiscal marginalization, turning autonomy demands into a concrete constitutional grievance that sharpened voter skepticism and raised the political cost for Anwar¡¯s federal government of deferring reform.

Anwar¡¯s response, thereafter, was a long-anticipated in mid-December 2025, framed as a refresh to improve economic delivery but ultimately amounting to coalition maintenance. Several vacancies had opened up after two Anwar prot¨¦g¨¦s ¡ª Economy Minister Rafizi Ramli and Natural Resources Minister Nik Nazmi Nik Ahmad ¡ª in May 2025 following defeats in PKR¡¯s party leadership elections, while Entrepreneur and Cooperative Development Minister Ewon Benedick in November 2025 in protest over the federal government¡¯s stance on Sabah¡¯s revenue entitlement, giving the prime minister an opportunity to rebalance portfolios among coalition allies.

The reshuffle brought in a Federal Territories Minister, , from DAP ¡ª a predominantly Malaysian Chinese, urban-based party ¡ª likely to shore up the urban non-Malay base in the federal territories of Kuala Lumpur, Labuan and Putrajaya, even as it drew from Malay nationalists.?

More notably, Anwar increased by appointing Natural Resources Minister Arthur Joseph Kurup, along with Sabah and Sarawak Affairs Minister Mustapha Sakmud, as part of following PH¡¯s poor performance in the recent 17th Sabah state election. Likewise, to consolidate support ahead of the 20th Sarawak state election, expected by early 2027, GPS now holds five cabinet posts and six deputy ministerial posts, in which Anwar¡¯s configuration is designed to project federal attentiveness to . Together with parallel adjustments involving Sabah and Sarawak, these moves strengthen Anwar¡¯s message that East Malaysian partners remain critical to keeping the coalition together.

Yet despite replacing more than a third of his cabinet, Anwar, as PH Chairman, was careful to keep each coalition partner¡¯s share of power intact. His original political home, UMNO ¡ª the Malay-centric party and strongman of Malaysian politics ¡ª retained , including several key ministerial portfolios, in return for its continued loyalty.?

Far from reset, the reshuffle amounted to little more than political , with changes largely confined to swapping positions rather than direction that prioritized coalition balance and stability, as well as projected confidence in Anwar¡¯s existing team, over any decisive shift in policy. This approach speaks to Anwar¡¯s overarching strategy since consolidating power in 2023, which prioritizes coalition survival over potentially divisive reforms. It has worked, insofar as the unity government still stands and even looks relatively stable heading into 2026.

What¡¯s next for Anwar Ibrahim¡¯s unity government?

As 2025 draws to a close, Anwar has demonstrated that the Madani government can survive the rough math of coalition politics, but it remains an open question whether it can inspire the confidence of a truly reformist government.

The next major tests of coalition cohesion ¡ª and by extension, the unity government¡¯s durability ¡ª loom over the next two years. The calendar opens with in January 2026, including the Sabah state seat of Lamag and the federal seat of Kinabatangan. These contests will then give way to full state polls, with the Sarawak state election due by 2027, followed by by February 2027 and by June 2027, collectively placing sustained pressure on the governing coalition as it defends its unity across multiple political fronts.

And for Anwar, the good news is that he enters this electoral cycle from a position of relative strength, as the opposition remains mired in . PN enters 2026 in disarray, following former Prime Minister Muhyiddin Yassin¡¯s (2020-2021) resignation ¡ª effective January 2026 ¡ª as the coalition¡¯s chairman, and the departures of several senior leaders, which together created a .?

The recent Perlis and unresolved arguments over leadership succession and ideological direction have aggravated rivalry between Bersatu and PAS. And that dysfunction sharply limits its capacity to challenge Anwar¡¯s government, which would tilt the political terrain in his favor ahead of the coming state elections.

Regardless of the opposition¡¯s weakness, Anwar¡¯s more immediate risk lies within his own coalition. Its internal contradictions have repeatedly slowed or blunted the reform agenda Malaysians were promised. Anwar¡¯s to reach the premiership has equipped him with political resilience, but staying power alone will not carry him through the next electoral cycle.?

If reforms continue to stall and state-level losses mount, partner confidence could erode, raising the political costs of inaction. With the 16th General Election due by February 2028 and political positioning accelerating by 2027, his legitimacy will hinge less on survival than on visible delivery.

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However, in the broader context of national cohesion, its rise also highlights the intricate interaction between Pakistan¡¯s official institutions and its peripheries. While it is true that the PTM expresses valid sociopolitical and humanitarian concerns, a sustainable response to its growth would require a nuanced, reform-oriented and inclusive state strategy. A strategy that would strengthen the integrity of Pakistan’s federation and address the structural inequities that started the movement. 

Colonial legacies to contemporary marginalization of PTM

The Pashtuns¡¯ discontent dates back to the colonial administrative system of the British Raj, which ruled the tribal belt under the Frontier Crimes Regulation (),? an extremely repressive legal system that denied the Pashtuns due process and political rights. Pakistan inherited this system after British rule ended. Following this, the tribal areas remained semi-autonomous, which were ruled by proxy. The political and economic marginalization of the region that makes up the current Newly Merged Districts (NMDs) of Khyber Pakhtunkhwa (KP) was solidified by this legacy.

During the (1979-1989), the western borders of Pakistan became strategic rear bases for the anti-Soviet jihad funded by the USA and Saudi Arabia. The resulting militarization and refugee flow were inflicted particularly on the Pashtun population. After the 9/11 attacks, Pakistan¡¯s role in the US¡¯s war on terror turned the NMDs into war zones once again.

Military campaigns like , , and were undertaken to combat the terrorists. Though the operations were successful on a larger scale, they also resulted in Internally Displaced Persons (IDPs), to civilians and destruction of the socioeconomic infrastructure. As localities sought accountability and rehabilitation, this collective?trauma ultimately resulted in?the birth of PTM.

Pakistan¡¯s response to PTM¡¯s security imperatives and democratic accommodation

Pakistan¡¯s engagement with the PTM has oscillated between safeguarding national security along the northwestern borders and maintaining space for democratic expression and dissent, as many of the PTM¡¯s demands undermine Pakistan¡¯s national security apparatus. Bearing in mind Pakistan¡¯s history of political turmoil and regional turbulence, it is challenging to discern the state¡¯s cautious stance towards the PTM from substantive national security apprehensions.

Initially, the military high command accepted the complaints of the movement¡¯s members, taking them as ¡°our own children,¡± and described their plight as a consequence of decades of militancy and in the old tribal regions. This accommodating stance underscored Pakistan’s readiness to address the populace’s problems by carrying out a procedure of progressive sociopolitical consolidation.?

After the , Pakistan embarked on a far-reaching process of integrating Federally Administered Tribal Areas (FATA) in KP and granted complete constitutional, political and legal rights to the tribal citizens. The repeal of the FCR, judicial review and inclusion into the KP Assembly were historical achievements of empowerment.

As part of the 10-year Development Plan, the infrastructure, education and healthcare sectors were made a priority, alongside for young people through Ehsaas, Ba-Ikhtiyar Naujawan and Kamyab Jawan, which opened up employment opportunities in the merging districts. Together, these activities are evidence of a wider vision of Pakistan, to substitute decades of marginalization of the tribal population with inclusion, justice and sustainable development.?

Security, sovereignty and the shifting narrative of PTM

As the movement grew from the peripheries of KP, a northwestern province of Pakistan, and spread to urban centers like Karachi, Lahore and Quetta. Its rhetoric developed into not just confrontational but also into a propagation of an anti-state stance, as heard by their infamous slogan: ¡°Lar ao bar yao Afghan¡± (¡°Here and there Afghan are one¡±). Certain PTM leaders started making sweeping indictments of state institutions, especially the armed forces, and in so doing, destroyed the space for dialogue and fueled perceptions of foreign manipulation.

The incident of 2019, which led to clashes between the supporters of the PTM and security personnel, known as Khar Qamar, was a tragic expression of mistrust and polarization. The of PTM members of parliament Ali Wazir and Mohsin Dawar in 2024, on anti-terrorism grounds, exacerbated the rift between the state and the movement.

After recurrent intelligence warning signs that hostile actors were attempting to penetrate and utilize the expanding network of PTM, the federal government prohibited the movement pursuant to Section 11B of the in 1997. Although human rights organizations, such as and the Human Rights Commission of Pakistan (), had condemned the move as heavy-handed, the reasoning behind the decision by the state was based on a larger security risk assessment.?

The evolving situation of Balochistan, a southwestern province in Pakistan, shows that legitimate socioeconomic unrest had been exploited by separatist and foreign sponsor networks, which became an important pre-set for the Pakistani state. Similarly, the rhetoric of PTM and its exaggeration by foreign media and antagonistic rhetoric ¡ª by undermining the importance of the Durand line and waving Afghan flags in their events ¡ª have caused concern that it might be employed as a soft front to damage the functioning of the national institutions, delegitimize anti-terrorism efforts and generate ethnic polarization. This poses a challenge to? Islamabad in distinguishing between an acceptable civil disobedience and organized subversion, which is especially crucial in a region with external influence and asymmetric warfare.

Reconciling national cohesion and regional inclusion

The PTM phenomenon has been a timely wake-up call about the importance of inclusive governance and equitable development in Pakistan¡¯s peripheries. The 25th Constitutional Amendment, which consolidated the former FATA with KP, was one of the milestones in the of Pakistan. This union officially terminated the century-long rule of colonial-era law and granted millions of Pashtuns full constitutional rights.?

The key challenge after the merger is the effective implementation of the 25th Amendment, ensuring that the constitutional promises are translated into visible improvements in the tribal areas. However, this process has been made tricky due to multiple acts of terrorism, which cut across Afghanistan¡¯s borders into the tribal region of Pakistan and the ethnic politics of PTM. This has been taken advantage of with developmental delays to propagate ethnic division, such as with chants and doubts about the goodwill of the state to work towards inclusive governance and stability in the country.

Rebuilding trust through reform and reconciliation

The state¡¯s strategic mandate is to unify these reforms by making specific investments in government capacity, education, medical services and livelihood recovery within the NMDs. Through long-term structural imbalances, the federation and Pakistan¡¯s border regions can reinforce the social contract. This developmental solution aligns with the overall goals of national security, as inclusive governance is an inherent to radicalization and alienation.

At the same time, reform of the security sector is also a necessity to promote public trust. The normalization of state-citizen relations can be achieved through the gradual demilitarization of the civilian areas and empowerment of the local police and courts. Moreover, the establishment of a ¡°Truth and Reconciliation Commission,¡± as sometimes suggested by the PTM and backed by certain quarters of civil society, would be a plausible model for settling grievances without necessarily compromising the institution¡¯s integrity.

This type of commission, based on transparency and inclusiveness, would not only promote reconciliation but also demonstrate Pakistan¡¯s commitment to democratic resilience in post-conflict environments.

Pakistan¡¯s response to the PTM will help shape the future course of its federal democracy, counter-extremism policy and civil-military balance. The way forward, as seen by Pakistan, is an open dialogue and not a confrontation. The PTM has, by all means, brought to the fore some problems that must be addressed, including displacement and post-conflict rehabilitation. The long-term credibility and moral capital of the movement, however, rely on the observance of nonviolence, constitutionalism and national unity. 

To become a positive force, the PTM needs to direct its activism through democratic institutions of Pakistan and mobilize parliamentarians, as well as cooperate with provincial governments in policy formulation. The continued rhetoric augmentation of the military and other state institutions, creating division and hatred against other ethnicities or a repetition of messages that appeal to the enemies of Pakistan, is perilous in diminishing the legitimacy of the very people it supposedly represents.

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µþ²¹²Ô²µ±ô²¹»å±ð²õ³ó¡¯²õ , which ended with the toppling of Sheikh Hasina¡¯s 15-year increasingly authoritarian premiership, was the first of this Gen Z Protests wave. What started as dissent against quota-based recruitment to government jobs quickly grew into a massive pro-democracy and anti-corruption movement, in which were killed, and the incumbent fled across the border to India and has since been sentenced to death.

In the last 18 months, similar Gen Z protests have emerged in more than 20 countries worldwide, from Mozambique to Mongolia, Paraguay to the Philippines. There are ongoing protests in 11 countries.

From local sparks to a global Gen Z uprising

The triggers for resistance are often incidental and varied in different contexts. In Serbia, the of a rooftop in the Novi Sad railway station, where 16 people were killed, led to a spontaneous eruption of protests among the student community against government corruption and negligence. In Madagascar, a peaceful September protest against the persistent failures of state-owned companies¡¯ provision of power and water in the capital into widespread unrest spearheaded by a Gen Z online movement, and a military coup has since replaced the President.??

But there are between these disparate protest movements: the erosion of democratic rights, rising authoritarianism, corruption and economic stagnation. Each protest has learned the lesson of the last, taking from online culture and other protests to create independent movements, each with a recognizable Gen Z signature.

Gone are the ¡°There is no Planet B¡± placards of 2020¡¯s Fridays for the Future , which blossomed globally but were most prominent in the capital cities of Europe, Australia and North America. Now, protestors are taking inspiration from online meme culture. ¡°Ok boomer, time¡¯s up¡± became a rallying cry for the successful protests in Nepal this past September. A skull-and-crossbones flag from the Manga One Piece has become a of protest across countries, and Pikachu is no longer a beloved Pok¨¦mon but a firebrand provocateur.?

The protests themselves are an expression of a generation that has grown up in a global social media age, who pride themselves on absurd humor and nihilism, and ironically, are willing to die for it. 

And while their methods and motivations might be unconventional, with Nepal¡¯s election via the app Discord providing the best case in point, Gen Z protestors have been remarkably successful. Governments have been overthrown in Sri Lanka, Bangladesh, Nepal and Madagascar. Major policy changes have been achieved in Timor-Leste and Kenya.?

Not since the of 2011 and 2012, when pro-democracy protests deposed rulers in Tunisia, Libya, Egypt and Yemen, has a protest movement caused so much political upheaval in such a short time.

Climate change and global protests

There were many contributing factors to the political instability that rocked the Arab Region over a decade ago. But the of climate change, especially when combined with bread and butter issues like affordability, corruption and authoritarian overreach, are an explosive cocktail. Indeed, widespread droughts wiped out around of livestock across eastern Syria in 2011, while severe weather-induced in 2010 saw price spikes on key foods cascade across the region.??

With protests ongoing around the world, it would be difficult to attribute all current Gen Z protests to a single climate event. In fact, climate change has been noticeably absent as a rallying call for the movements altogether.

At a cursory glance, that might be surprising. It was only six years ago that more than protesters took to the streets around the world for the Global Climate Strike. The phrase ¡°Gen Z Protest¡± has its origins in a by the French Market Research firm Ipsos, which looked at climate action and intergenerational conflict. Since then, climate activism hasn¡¯t gone away, but it has undergone a reckoning. The last major global climate strike took place in ahead of the 26th UN Climate Conference (COP26) in Glasgow.

For a while, the COP process provided a lightning rod for protest. But the hosting of three subsequent COPs in Egypt, the United Arab Emirates (UAE) and Azerbaijan significantly curtailed the space for such campaigns. 

One noticeable outcome of COP30 being hosted in democratic Brazil has been a welcome return of newsworthy peaceful protests. This was best exemplified when 90 protestors from indigenous communities the negotiators¡¯ entrance to object to resource extractivism in the Amazon.

Why climate change is missing ¡ª and why that matters

A decade on from the landmark Paris Agreement, there has been little progress in annual greenhouse gas emissions. However, there have also been wins along the way. China continues to hurtle forward in its staggering rollout of . Recently, the European Union announced that it was on track for its 2030 emissions .

However, anthropogenic greenhouse gas are still higher than they have ever been. Even the Secretary-General of the United Nations has warned that exceeding the warming target, even temporarily, is inevitable.

During that period, activism and protest movements have had to adapt to a more turbulent and impoverished world, rocked by the economic and social shocks of the COVID-19 pandemic, geopolitical tensions, major military conflicts and the advent of artificial intelligence. The World Bank estimates that global growth in this decade will be the slowest since the .

Key figures in the climate movement, while not abandoning their roots, have since chosen to devote their energy to pressing humanitarian disasters. In September, Greta Thunberg and 170 other pro-Palestinian protestors were by Israeli forces as they sailed an aid flotilla to Gaza.

The flare-ups of protest led by Gen Z are a response to a fragmented and dangerous world order. It is not surprising, then, that the center of gravity of this new wave of protests lies in developing economies and fragile democracies, and that its chief protagonists are local activists focused on bread-and-butter issues.

Climate change will exacerbate the conditions for political instability. The World Economic Forum estimates that for every degree of warming, of global GDP is lost. The world is currently on course for 2.7 ¡ãC warming by .

The nature of that instability could derail climate action and see a slide towards authoritarianism. This is already happening in the United States, where a in climate migrants crossing the US-Mexican border has been used to justify the Trump administration¡¯s homeland security policies. The Gen Z protests might demonstrate an antidote to this in the long run, ironically, precisely because they do not tackle climate change head-on.?

Accountability and the rule of law are prerequisites for international climate action. Corruption and inequality are blockers to addressing both rapid mitigation and adaptation, the latter being a significant challenge in the developing world. 

In this day and age, some of the most effective climate change activism might not be about environmental collapse, but rather about reinvigorating the democratic contract between governments and their people.

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Still, for Indonesia, the partnership could matter a great deal if it is implemented with intention.

The MOU is a framework, not a project list. It specifies no funding volume, no country allocation and no thematic quotas. Instead, it allows QFFD to cofinance ADB-led projects using ADB¡¯s existing pipelines, safeguards and relationships with recipient governments. Projects are expected to begin in 2026, following individual approvals by both institutions and host countries.

This structure gives the partnership flexibility. It also leaves outcomes largely contingent on choices yet to be made, particularly in large, energy-hungry countries like Indonesia.

Transition goes beyond financing

±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ energy transition remains uneven. Coal continues to the power sector, renewable deployment stated targets and fiscal constraints limit the government¡¯s ability to finance large-scale change. In this context, new development partnerships are often presented as potential solutions. But financing alone does not guarantee transition.

The ADB¨CQFFD partnership emphasizes concessional financing, typically in the form of loans with lower interest rates and longer maturities. These instruments can help close financing gaps, but they also add to public debt. For Indonesia ¡ª where energy transition investments often produce public rather than commercial returns ¡ª debt-heavy financing risks slowing progress rather than accelerating it.

If the partnership is to benefit ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ energy future, QFFD would need to go beyond concessional lending. Grants, equity participation and risk-sharing instruments would be better suited for renewable energy deployment, grid upgrades and early coal retirement. Without such flexibility, Indonesia may gain infrastructure, but not transition.

Challenges and opportunities

Coal remains the central constraint. ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ decision to the early retirement of the Cirebon-1 coal-fired power plant illustrated how fragile its transition commitments remain. Without retiring coal assets, emissions reductions will be marginal, regardless of new renewable investments.

While the MOU does not address coal explicitly, the partnership could support ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ transition if it aligns future financing with coal phase-down efforts. Financing new infrastructure alongside operating coal plants risks undermining climate and economic resilience objectives.

Governance will also determine whether Indonesia benefits. Under the , ADB remains the lead implementing agency. QFFD can choose to be a passive financier or an active partner in project design and oversight. If it opts for the former, it will inherit ADB¡¯s long-standing challenges, particularly around social safeguards and community engagement in large infrastructure projects.

A more active role for QFFD, as a project coordinator rather than merely a source of capital, could help improve project quality and accountability, especially in energy projects that affect land use and local livelihoods.

Project selection is another open question. ADB¡¯s in Indonesia have historically favored capital-intensive projects such as geothermal power. Geothermal energy is considered an abundant renewable resource, but it often creates conflict with local communities in many areas. Meanwhile, distributed renewable solutions such as rooftop solar, community-scale solar and micro-hydropower remain underfinanced despite their suitability for ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ archipelagic geography.

The partnership could become an opportunity for Indonesia if project selection shifts toward these locally appropriate solutions. This would require a bottom-up approach, informed by community needs rather than institutional preferences.

Finally, who participates in decision-making matters. ADB typically works through central ministries, leaving subnational governments with limited influence. In a decentralized country like Indonesia, this approach often disconnects projects from local energy needs.

QFFD could encourage trilateral coordination among ADB, the central government and subnational authorities. Greater local involvement would increase the likelihood that projects support ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ actual energy transition rather than abstract development targets.

The ADB¨CQFFD partnership does not promise Indonesia an energy transition. But it creates a window. If financing moves beyond loans, if coal retirement is not sidelined, and if communities and local governments are meaningfully involved, the partnership could help Indonesia reshape its energy future. If not, it risks becoming another well-funded initiative that leaves the fundamentals unchanged.

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Legal deforestation as national policy

Satellite and field indicate that the clearing is not a fringe crime but a mapped, sanctioned process tied to strategic projects and concessions, and that the damage is concentrated where biodiversity and carbon stores are richest.

According to , Indonesia lost 260,000 hectares of forest in 2024, an estimated 190 million tonnes of carbon dioxide into the atmosphere, a figure echoed by civil society monitors and contested by official tallies.

The scale of forest loss leaves little room for abstract debate. Independent monitoring found that ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ tree cover losses in 2024 were in the hundreds of thousands of hectares ¡ª roughly the equivalent of several Jakarta¡¯s ¡ª and that nearly all the most recent losses occurred within legally authorized concessions. That transformation of upland watersheds into monoculture plantations has a hydraulic consequence: forests act like sponges, and when those sponges are replaced by single-species oil palm stands, runoff spikes and flash floods become more likely.

Global Canopy¡¯s (a nonprofit that targets the market forces destroying nature) work in Aceh, for policymakers and communities, shows plantation-dominated catchments flood three to five times more often than intact forested systems ¡ª not an abstract correlation but a local lived reality.

From land-use change to climate diplomacy

This is not only an internal policy dilemma. Indonesia sits at the center of global commodity chains and climate diplomacy. Land-use change ¡ª much of it driven by plantation expansion ¡ª has for nearly half of the country¡¯s greenhouse gas emissions over recent decades, complicating pledges made at international conferences and undermining credibility with partners seeking durable climate action.

The diplomatic irony is sharp: victories at trade panels or at the World Trade Organization (WTO) over market access for palm derivatives ring hollow if the homeland keeps being sold short of the resilience needed to face a warmer, stormier century.

Comparative experience matters. The late-2025 floods in Sumatra are part of an unsettling pattern observed elsewhere in tropical forest states. In , accelerating Amazon clearance has produced urban flooding and heat stress in Amazonian cities. In Bel¨¦m, the loss of tree cover led to a summer of chronic flooding and record temperatures that became impossible to ignore during a recent international . These are parallel expressions of a single governance problem: an extractive approach to natural capital that externalises risk onto marginalised communities and into the future.

The Philippines¡¯ extraordinary late-2024 typhoon season, which over a million people, and Myanmar¡¯s loss of 290,000 hectares of forest in the same year, underscore that Sumatra¡¯s floods are part of a wider Southeast Asian crisis of climate vulnerability and ecological degradation.

Sumatra¡¯s floods pose a moral question: how much forest and how many rivers must be sacrificed before a development model is judged dangerous to its own people? The answer is visible in submerged roofs, muddy queues for clean water and communities whose losses were predictable. When an unusually intense November cyclone met landscapes reshaped for profit, a humanitarian catastrophe became inevitable.

The human toll

Human costs are staggering and still rising. Official tallies and reporting in the immediate aftermath of the Sumatra flood 1,000 dead, 200 missing, tens of thousands evacuated and critical infrastructure severed ¡ª bridges, power lines and communications ¡ª leaving pockets of the island almost inaccessible to rescuers.

Recent climate-driven storms and landslides in western Indonesia have hundreds of lives and left many still unaccounted for, a humanitarian tragedy that has exposed gaps in preparedness and raised difficult questions about national urgency and accountability. This is not an abstract policy debate but a clear moral responsibility: every hectare of forest lost erodes food security, water regulation and the resilience on which our communities will depend in the decades ahead.

Suppose we are serious about safeguarding the next generation. In that case, we need transparent moratoria on destructive concessions, swift support for affected families, and a credible plan to restore and protect the forests that anchor the nation¡¯s safety and stability.

Trust, leadership and the policy response

The images from flooded towns and isolated villages carry another figure: trust, eroded. Where systems for land stewardship and disaster response should have been robust, communities report thin budgets and slow escalation of national assistance, exposing gaps between legal authority and practical rescue capacity.

In this context, President Prabowo Subianto¡¯s for expanded oil palm planting in Papua to support biofuel production and reduce reliance on imported fossil fuels raises concern. Indonesia needs leadership that reads the lessons of today¡¯s climate disasters carefully and responds with policies that strengthen resilience rather than deepen ecological risk.

Policy responses must therefore be twofold: immediate and structural. First, emergency governance needs simplification so that severe events trigger rapid national mechanisms for logistics, finance and military support ¡ª mechanisms that are not dependent on protracted interbureaucratic certainties. The procedural hesitation of past weeks translated into delayed helicopters, late convoys and preventable suffering. 

Second, the longer arc of reform must reframe land use as a security imperative. Legal moratoria that remain porous and concessions that permit conversion of high-risk watersheds should be tightened into enforceable obligations, accompanied by credible, independently audited standards for plantation certification.

Reforestation of critical catchments and support for agroforestry ¡ª policy instruments that align livelihood diversification with ecological restoration ¡ª offer practical ways to reduce flood risk while income. Evidence-based policy, backed by rigorous monitoring and sanctions for non-compliance, will be central to restoring both ecosystems and confidence.?

International partners also have a role beyond moralizing. Technical cooperation to strengthen remote sensing and concession transparency, finance for watershed restoration and trade agreements that incentivise low-impact production would turn global demand into leverage for better governance rather than a driver of degradation.

The Council on Strategic Risks and other think tanks have that climate adaptation belongs inside national security planning; protecting ports, energy grids and rural lifelines against climate shocks is not a discretionary budget item but a foundational defense of national capability.

The moral and strategic reckoning

The moral ledger here is clear and severe. When landscapes are fundamentally reshaped for export and the legal system prioritizes short-term gains over long-term resilience, the cost is disastrous: lives are lost, towns are displaced and diplomacy suffers. The choice isn¡¯t between conservation and development but between a fragile, extractive approach that repeatedly harms its citizens and a resilient path that safeguards livelihoods by repairing the hydrological and social systems that support them.

Sumatra¡¯s rivers will remember what was cut from their slopes. Rebuilding will require more than sandbags and temporary shelters; it demands an honest recalibration of national priorities, one that reconciles sovereign economic interests with the sober realities of climate risk and ecological limits. That is a foreign-policy truth as well as a necessity: partners will judge commitments by deeds, not speeches; communities will judge leaders by whether tomorrow¡¯s rains are met by forests and systems that hold. The most immediate tributary of security is the watershed ¡ª and the next crisis will not wait for better intentions.

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Across Myanmar¡¯s hills and plains, life is now measured by absence. Since the 2021 coup, more than people have been killed and over 3.5 million displaced. Nearly half the population has fallen into poverty. According to the United Nations, nearly 22 million people require humanitarian assistance. Hunger and disease are no longer byproducts of war; they are its instruments.

As if human cruelty were insufficient, nature delivered its own verdict.?In March 2025, a powerful struck central Myanmar, killing thousands and leaving tens of thousands without shelter. The disaster exposed what politics had already destroyed: a hollow state incapable of protecting its people.

In the aftermath of such devastation, the ongoing violence only deepens the tragedy the nation faces. Another hospital burns. Another report is filed, marking the attack on a healthcare facility. Thirty-three dead. Twenty wounded. The numbers arrive already fatigued, stripped of urgency by repetition. The head of the World Health Organization says he is appalled. He must say this. The world nods, as it must. Indignation has become ritual ¡ª performed, recorded, forgotten. In a country long isolated, atrocity has become routine, and routine has become silence.

The illusion of order

This paralysis did not emerge by accident. It was engineered.

Civilian supremacy has been deferred since 2008, when the constitution guaranteed the military of parliamentary seats ¡ª enough to veto any reform. Elections are not a step forward; they are a mechanism to preserve that design?and block any genuine federal future.

When the generals seized power, they did not merely overturn the 2020 election; they replaced legitimacy with procedure. They appointed an election commission of former generals and prepared a vote meant not to reflect the people, but to exhaust them.

To recover the appearance of order, the generals an election on December 28. An election that the United Nations calls ¡°.¡± The big question is whether the world will pretend otherwise. It will take place under state-controlled media and laws so severe that dissent no longer risks prison alone, but erasure. Even then, thousands remain incarcerated for resistance. President Win Myint is still behind bars. Former State Counsellor of Myanmar Aung San Suu Kyi remains imprisoned, her party dissolved, her voice extinguished. Power, when it fears the people, does not persuade. It confines.

The cost of moral symbols

There is a private irony in this repression. Two leaders I once met ¡ª Imran Khan and Suu Kyi ¡ª now share the same fate: confinement imposed by regimes that claim stability. I remember my 30-minute interview with Suu Kyi in 2012. She was razor-focused, her eyes fixed on mine, listening with a meditation-like intensity. She was intelligent, already familiar with my country¡¯s history, noting that her Oxford classmate was the sister of Sri Lanka¡¯s former president Chandrika Bandaranaike, and shared reflections on Sri Lankan politics.

She asked pointed questions about our three-decade civil war. Then she asked, ¡°How old were you when your father was killed?¡± I replied, ¡°16.¡± She said, ¡°I was only 2. See, we have something in common. Both our parents were killed.¡± She paused and then asked, ¡°So, have you forgiven the killers? Isn¡¯t that reconciliation?¡± She spoke quietly of patience and moral clarity, yet warned that reconciliation in Myanmar is uniquely difficult, especially among its fractured ethnic groups.

History answered otherwise, and her later silence during the Rohingya atrocities revealed a harsher truth: even moral symbols fracture when trapped inside the machinery of the state.

A crisis without borders

Myanmar¡¯s democratic failure does not stop at its borders. It spills outward ¡ª into Thailand through narcotics and scam networks, into Bangladesh through the displacement of more than a Rohingya and across the region through an instability no wall can contain.

Above this suffering, the great powers calculate. Roads, pipelines and corridors thread through the Kachin and Shan States as part of the China¨CMyanmar Economic Corridor (). Geography, for Beijing, is destiny: access to the Indian Ocean and control over essential to modern technology. Much of these deposits lie in areas controlled by resistance groups such as the Kachin Independence Organization.?I trace this strategic geography in my forthcoming book, .?For China, they are a necessity. For Washington, they are supply chains. , too, explores quiet ties with the Kachin Independence Army.?Even principles bend when rare-earth minerals promise power and profit.

What peace would actually require

Yet calculation alone cannot end a civil war of this depth. A sustainable peace in Myanmar demands more than condemnation or convenience; it requires a disciplined, four-pronged effort. First, inclusive political dialogue is essential: any settlement must bring together the military, representative civilian leadership such as the National Unity Government, ethnic armed organizations and civil society. Dialogue must move beyond the Association of Southeast Asian Nations¡¯ (ASEAN) limited consensus toward a genuine federal arrangement, anchored in constitutional guarantees and a credible framework for transitional justice.

Second, international pressure and accountability must shift the junta¡¯s calculus. Targeted sanctions on military revenue, arms embargoes, protection for political prisoners and sustained humanitarian corridors are instruments of restraint. Accountability for war crimes is not a moral luxury; it is a condition for peace.

Third, regional mediation must be strengthened. ASEAN, supported by India, China and Japan, can facilitate ceasefires, transitional talks and confidence-building measures ¡ª if sovereignty is no longer used as a shield against human suffering.

Fourth, grassroots reconciliation and economic stabilization must anchor peace where it matters most: addressing ethnic grievances, restoring basic services, enabling the return of displaced families and rebuilding livelihoods. Federalism, tailored to local realities, remains the only architecture capable of holding this fractured country together.

The United States speaks of human rights. It sanctions, freezes funds and finances aid. Yet words without leverage resemble lamps in a storm ¡ª visible, but cold. A regime that controls only fragments of its territory and depends increasingly on Beijing is not a partner; it is a liability. Pragmatism, whether under a Trump administration or any other, may offer clarity ¡ª but only if paired with engagement.

Gregory B. Poling of the Center for Strategic and International Studies (CSIS) argues that Myanmar¡¯s best future lies in a truly capable of toppling the military regime or forcing it to the negotiating table.?To reach that future, the United States must engage rather than isolate, countering the junta¡¯s drift toward Russia and China.

The people of Myanmar are not variables in a strategic equation. They are bodies broken by bombs, families uprooted by fear, survivors of earthquakes and artillery alike. Any policy that discounts their suffering is not realism; it is cruelty disguised as strategy.

In the ruined towns and shattered valleys of Myanmar, one question persists ¡ª quiet and unforgiving: will the world act as guardian or spectator? Peace cannot be declared in isolation. It must be built through restraint, solidarity and the refusal to exchange human suffering for advantage. If the great powers fail this test, Myanmar will stand as a monument ¡ª not to ambition, but to the world¡¯s choice to look away.

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The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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Beyond the ¡°middle power¡± label

Howe begins by rethinking how power is categorized in today¡¯s international system. Traditional middle powers such as Canada or Australia historically pursued what he calls ¡°niche diplomacy,¡± acting as normative brokers at the United Nations and advancing global humanitarian agendas. By contrast, Howe introduces the idea of ¡°second-tier powers:¡± states with greater-than-middling resources that deploy them pragmatically in pursuit of national interest rather than moral leadership.

South Korea, Howe argues, fits this category better than almost any other country. Long described as a ¡°shrimp among whales,¡± the South Korean capital of Seoul has never aspired to great-power status. After all, it is surrounded by far larger neighbors such as China, Russia, Japan and the United States. Yet its economic growth, political consolidation and expanding global reach have pushed it well beyond the middle-power bracket. Rather than seeking global dominance, South Korea concentrates its influence where it can be most effective ¡ª economically, technologically and strategically.

Military strength without full autonomy

One of the clearest markers of South Korea¡¯s rise is its military capability. Howe notes that, by most measurements, South Korea ranks between the sixth and eighth most powerful militaries in the world and is now the eighth-largest arms exporter globally. Its development of NATO-compliant systems, including the KF-21 stealth fighter jet, has made South Korean defense exports attractive to countries ranging from Poland to Australia.

At the same time, Seoul¡¯s alliance with Washington remains central. South Korea still relies on the US for key technologies such as aircraft engines and for extended nuclear deterrence. Howe questions, however, how decisive that nuclear umbrella really is. As he puts it, ¡°the real threat to South Korea from North Korea does not come from the nuclear weapons,¡± but from conventional soviet-era artillery positioned near the demilitarized zone that could devastate Seoul in the opening moments of a conflict.

This leads to one of Howe¡¯s more provocative conclusions: South Korea¡¯s reliance on the US is now ¡°much more psychological than physical.¡± While US support remains important symbolically and politically, Howe suggests that South Korea has developed sufficient conventional strength and institutional resilience to survive even a dramatic reduction in American backing.

North Korea and a ¡°crisis democracy¡±

Turning to North Korea, Howe observes a striking gap between outside perceptions and domestic attitudes. International commentators often speculate about an imminent Korean War 2.0, but most South Koreans are far less alarmed. They are more concerned with cyberattacks, environmental risks and nuisance provocations such as waste-carrying balloons than with a full-scale invasion.

Howe is sharply critical of former South Korean President Yoon Suk Yeol¡¯s use of the North Korean threat for domestic political purposes, calling it scaremongering. He argues that exaggerated security claims contributed to Yoon¡¯s downfall and reinforced public resistance to politicizing national defense.

Domestically, South Korea¡¯s frequent prosecutions of former leaders are often portrayed abroad as signs of instability. Howe rejects this framing, describing the country instead as a ¡°crisis democracy¡± ¡ª a system that repeatedly confronts and resolves political turmoil. The willingness to hold presidents accountable signals democratic consolidation rather than decay, even if it complicates South Korea¡¯s image as a model to emulate.

Economic, cultural and demographic futures

South Korea¡¯s economic ascent rests on what Howe calls the ¡°triple miracle on the Han River:¡± rapid industrialization, democratic consolidation and sustained development under conditions of unresolved conflict. Centralized planning, defiance of US advice to remain agrarian and relentless investment in education and research turned this war-ravaged country into a manufacturing and technological powerhouse.

That same intensity, however, has produced social costs. Howe links South Korea¡¯s high suicide rate to the extreme pressures of its education system, where competition begins early and never truly ends. Soft power, too, reflects this double edge. Hallyu ¡ª the global popularity surge of K-pop music, Korean films and television ¡ª emerged from deliberate government support and has generated enormous global influence. Yet Seoul often conflates public diplomacy with soft power, risking backlash by trying to manage cultural attraction too aggressively.

Looking ahead, the gravest challenge is demographic. With one of the world¡¯s lowest fertility rates, South Korea faces an aging population and a shrinking workforce. Howe suggests that automation, artificial intelligence and advanced military technology may offset some losses, but sustaining the welfare state will likely require a politically difficult shift toward greater immigration.

In the broader global context, Howe predicts a move away from large-scale multilateralism toward smaller, issue-focused coalitions. He argues that initiatives led by second-tier powers may prove more inclusive and less polarizing than those dominated by great powers. That offers South Korea a path to influence without forcing others to choose between Washington and Beijing.

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[Note: This FO Talks/FO Live is part of the Osaka School of International Public Policy¡¯s ¡°Peace and Human Security in Asia: Toward a Meaningful Japan-Korea Partnership¡± project supported by the Korea Foundation.]

The views expressed in this article/video are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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After several generations, we are now encountering bottlenecks ¡ª both technical and financial. The scale involved has become so great that we are entering uncharted territory. How we deal with these scale bottlenecks has significant implications. Implications for our financial system in particular, and society in general. The underlying changes are so dramatic that new approaches are likely to be needed to deal with them.

Following the 2017 publication of the key Attention is All You Need, people began experimenting with what became known as LLMs. By late 2022, a relatively small number of companies developing leading-edge GenAI systems began to observe the emergence of new, valuable behaviors as the size of LLM models (¡°brains¡± of GenAI systems) increased (generally measured by the number of parameters). Going from millions of parameters to tens of millions, hundreds of millions, billions, tens of billions and hundreds of billions. Numbers in the trillions of parameters started to present difficulties, although the pressures to continue to 10X didn¡¯t abate.

The 10X problem

Recently, we started to hit limits. Someplace in the Trillions of parameters, people realized that with existing chip and data center infrastructure technology, there was not enough fab (semiconductor manufacturing) capacity on the planet to produce enough chips to make the next 10X generation. Two different approaches emerged to deal with this bottleneck: China¡¯s and the US¡¯s.

Shut out from the most powerful AI chips, China¡¯s government started GenAI software development. Today, there are approximately 20 state-funded Chinese companies releasing Models (open-weights is similar but more extensive than open-source). China is seeking to overcome the limitations of fewer, less powerful chips by learning as much as possible from US proprietary models, supporting software innovation and sharing (through Open Weights).

The US frontier model companies are focusing on new, more powerful chips and more of them. While they are waiting for more capable hardware, they are using the time to refine their proprietary models (secret source code and secret weights). They are also following the Chinese open-weights models closely.

NVIDIA, an American technology company, has that it will have a new generation of more powerful chips. Other sources are doing the same. My best guess is that they will be available in mid to late 2027. But even with more powerful chips, larger numbers will be needed.

NVIDIA has also a new rack architecture (the organization of chips into support systems that are stacked to maximize chip density within limited space). The current rack architecture is operating at its power-handling and cooling limits. The new architecture proposed by Nvidia requires twice the power and twice the cooling of current racks. Nvidia is calling this new architecture AI Factory. Nvidia is announcing this now as part of a request to the ecosystem to develop solutions for these new racks.?

To increase the level of challenge, it is unclear whether these new racks will fit within existing data centers. It may be necessary to build new buildings to hold the new racks. In any case, whether new or existing buildings, they will need greatly increased power sources and communication feeds.

The costs involved have risen well into the of dollars. We are entering the financial range where previously only the largest nation-states could operate financially. So, it has grown beyond the capacity of a single company to finance. US companies have dealt with this by forming partnerships. This has the effect of creating something similar to a (a Japanese business conglomerate before World War II) or a (a Japanese conglomerate after World War II). It appears that the players think that not all the parties will survive, at least in the AI frontier segment. Accordingly, they are making partnerships with multiple players. The result is not yet a clear set of competing entities.

Diverging strategies in the US¨CChina AI race

Thus, if you look at this as a horse race between the US and China, both are betting on different horses. The Chinese, at least in part because of restricted access to hardware, are betting on limited hardware and open-weights software. The US is betting on dramatically increasing hardware capability and proprietary weights software. Behind both horses are a set of .

To many who look at US companies, these complex partnerships involving previously unheard of amounts of money are troubling. The fact that some of the people in these companies are entrepreneurs who have never previously worked under such intense public scrutiny has also troubled some. Some of those who are troubled have looked back at the . Is concern about systemic financial system risk warranted?

What are the systemic risks?

Expectations about the future drive financial markets. If enough people expect a bubble-burst market, a bubble-burst market will occur. So, setting expectations on a sound foundation is important. What follows is an attempt at such a foundation.

First, it is good to put this in context. For many, the changes that AI is creating are hard to recognize. These people are well-versed in financial analysis techniques that worked before AI¡¯s emergence. For them, it is somewhat similar to the experience of people well-versed in agricultural economies being confronted with the beginning of the . In that transition, the amounts of money involved and the ways of assessing risk changed dramatically.

As we make the transition to the AI economy, there will be winners and losers. But it is unlikely that the whole AI ecosystem will collapse in a fashion similar to the Web Bubble Burst. There are two kinds of frontier model companies: 1) large existing businesses whose leaders think that they need a strong position in AI to stay relevant, and 2) pure, but very large start-ups.

The large frontier LLM companies are unlikely to fall into crippling financial situations overnight. They may have difficulty raising the enormous amounts of cash needed for the next 10X. Or they may run into technical/marketing problems. If either, they may shrink the way did when it lost its position as the dominant computer company.

Pure start-ups may face financial difficulties. This can be the result of challenges raising enough cash, technical/marketing problems or mistakes in correctly estimating the exact timing of future revenues. In such a case, the most likely outcome is a forced merger with one of the winning companies. A significant reduction in valuation may cause some investors in the losing company to incur losses. The losses could be large. Most of the investors in such a company will have hedged their bets. But even if insufficient hedging is done, the reduction in valuation is not likely to have a drastic systemic effect.

The large semiconductor companies have a lot of experience in weathering changing market/competitive dynamics. They are public companies that have seen AI dramatically increase their share prices. Competitive rearrangement can lower one company¡¯s stock price while increasing others¡¯. Financial troubles among the semi companies¡¯ customers and frontier model companies could impact quarterly revenue. A delay in sales resulting from one of the frontier companies falling into financial difficulty may affect stock prices.

In the past, there has been such substantial demand for AI chips that orders have been placed well in advance. If any order is canceled, there is a purchaser ready to step up and take it over. Based on the current outlook, it seems that there is a risk of one or more semi companies having a stock price reduction. But systemic risk seems unlikely.

In the rest of the infrastructure ecosystem, losers may not make dramatic departures. One possible outcome is that the industry becomes more vertically integrated. Weak companies in the infrastructure ecosystem are purchased by the very big players. For the smaller start-ups in the infrastructure ecosystem, the normal start-up failure rate may also characterize the space.

For companies in the application, customization, domain-focused and other spaces, the typical start-up failure rate may also apply.

Technical innovation may change some of the underlying forces driving the 10X phenomenon. Such changes move relatively slowly. In semiconductors, it takes approximately three years or more. In software, maybe faster, but still slow enough for the players to adjust enough to avoid a systemic financial shock.

There are two sources of systemic risk resulting from: 1) a market disruption and 2) a jobs-led economic downturn. 

First, the 10X increase in financing needs is straining the financial markets¡¯ ability to provide the required amounts. Thus, there is a temptation to remove the guardrails put in place following the and the . One such effort is to open the private market to retail investors (low net worth individuals as opposed to professional investors such as insurance companies). Recently, the US administration issued an that points in this direction.?

The systemic risk is that a large number of individuals, without the ability to effectively assess risks and an inability to hedge, will be drawn into very high-risk portions of the private equity market and incur crippling losses.  Losses in savings, retirement accounts, etc., will leave the individuals struggling with mortgages, credit card debt, auto loans and more. If the high-risk funds themselves run into trouble, it could be even worse. Our experience with the Great Recession is an indicator of how serious such a systemic situation could be.

Second, job loss through AI automation could cause an economic downturn. GenAI is still in its early stages of development. It will continue to grow in capability as the 10X generations proceed. On top of that, we are in the very early stages of learning how to apply AI. Over time, we will get much better at it. Given these facts, it is difficult to exactly predict the full effect and timing of AI¡¯s impact on employment.

Some have that 20% of jobs will be eliminated, while new jobs will be created. Others have estimated that 80% or more will be automated, and very few new jobs will be created. The US consumer supports the US economy. The US economy supports the global economy. If enough consumers lose their jobs, or fear losing their jobs and stop buying, the result could be a very serious systemic economic disruption.

Concentration of power

What may be more significant is the concentration of power. Many believe that control of AI will mean control of the world. That is what motivates the race between the US and China. If, as appears likely, the US horse wins, there will be a great amount of power in the hands of a small number of interlinked companies. 

That power could be concentrated in a single company or keiretsu. If it doesn¡¯t happen with this 10X step, the next 10X step is likely to force it. That is, the size of the financial resources needed will become so large that only one such organization will be able to exist. 

The leaders of the frontier model companies don¡¯t talk about this potential concentration. Whether they feel it but can¡¯t articulate it, or just don¡¯t think it is politic to mention it, they are motivated by it. Some approach it by being cautious. Playing the long game. Others are tempted to take all-or-nothing approaches. Thus, raising the risk level.

Maximizing upside while minimizing downside

The 10X process leads to questions of nationally focused antitrust, natural monopolies and public utility regulation. There is also work from an international perspective. An international approach, if viable, might make sense because the impacts of these very large models will be global.

The UN has started the area. China has released an international . Some of these international efforts point to what has been done around nuclear power. It is important to be knowledgeable about what has worked and not worked in the past. However, because these 10X-size endeavors are unprecedented, new approaches are likely to be necessary.

Thought is needed about both the power from the financial size and the power from the AI itself, what this means for society in general, financial markets in particular and for the growing wealth gap. With a good understanding of these factors, attention can then turn to maximizing benefits while minimizing adverse effects. In doing so, new approaches may emerge. Just as financial markets had to make dramatic changes as the world moved from an agrarian economy to the Industrial Revolution, the AI economy may require a similar set of dramatic changes. An open AI is exploring these questions of AI and society.

Conclusion

For the last few years, AI has been in a process of growing model sizes 10X per generation. Recently, that 10X step has begun to run into bottlenecks ¡ª first chip availability, then financing. These bottlenecks and the industry¡¯s response to them have some very important implications for financial markets and society. New approaches will be needed to deal with these implications.

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The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post The 10X AI Bottleneck and the Future of Financial Markets appeared first on 51³Ô¹Ï.

The proposal would require chip manufacturers to prioritize American customers over export markets, with the stated objective of protecting national security. Critics, however, that the law is unnecessary and could ultimately weaken US technological leadership by introducing additional barriers in a sector already subject to a strict export control regime.

The strategic role of high-performance chips in AI development

The importance of artificial intelligence to the modern world is undeniable, and with it comes the central role of high-performance chips, which form its true foundation. These semiconductors underpin everything from data centers and advanced language models to scientific and military applications, making them a strategic resource for innovation, defense and economic competitiveness.

The problem is that the US government already exercises over exports of sensitive technology. Sales of advanced chips are subject to rigorous licensing regimes that allow federal authorities to block transactions deemed contrary to national security.

The concern underlying the GAIN AI Act is that US manufacturers could, during periods of strong global demand, prioritize foreign customers over the domestic market. However, there is no evidence that this is occurring, nor are there signs of chip shortages in the domestic market.

Risks of market intervention and global competitiveness

While national security concerns are legitimate, state intervention in markets rarely improves their functioning, especially when there is no concrete market failure to justify such intervention. Analysts at the Brookings Institution and major financial institutions have that imposing legal sales priorities can introduce regulatory uncertainty and weaken the global competitiveness of US chips.

In attempting to protect its domestic market, the US government risks catalyzing China¡¯s technological rise. Whenever access to American chips becomes limited or uncertain, Beijing responds by accelerating the development of domestic alternatives and reorganizing its supply chain.

Financial institutions and independent analysts have also these effects. Analysts at JPMorgan, for example, have noted that China¡¯s largest technology companies are well-positioned to lead artificial intelligence growth in 2026 despite limitations on access to US technology. This assessment suggests that export restrictions are not slowing China¡¯s technological progress ¡ª they¡¯re driving the reorganization of its domestic ecosystem.

This pattern is already beginning to materialize in concrete ways. In 2025, Huawei began of its Ascend 910C artificial intelligence chip, explicitly designed to replace the US company NVIDIA¡¯s solutions across a wide range of workloads in the Chinese market. While the chip does not yet match the most advanced US offerings at the cutting edge, it is sufficiently capable for large-scale inference, cloud services and many enterprise applications. Its rapid deployment reflects not only technological progress but also the existence of a guaranteed domestic market created by US export restrictions.

Shortly thereafter, Chinese web services company Baidu new processors in its Kunlunxin line, reinforcing a broader shift toward domestically produced AI hardware. Kunlun chips are already being integrated into cloud infrastructure, telecommunications projects and financial services, supported by software stacks optimized for local silicon. Together, these developments point to the emergence of a self-reinforcing national AI hardware ecosystem in China, one that benefits from scale, captive demand and accelerated learning cycles. Rather than slowing China¡¯s progress, reduced access to US chips is helping to consolidate domestic champions and accelerate technological self-sufficiency.

Looking ahead: policy alternatives to strengthen US competitiveness

Although the GAIN AI Act was proposed as part of the NDAA for 2026, the amendment was not included in the final version of the bill reconciled by both chambers. The fact that the debate remains open makes it especially important to prevent similar proposals from resurfacing in other forms.

Instead, lawmakers should pursue alternatives that strengthen US competitiveness, such as using existing export control mechanisms, investing in productive capacity, energy and talent, and coordinating with allies. In a global race in which national security ultimately depends on the ability to innovate and compete worldwide, the US cannot afford to cede its advantage to China.

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The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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A country at war with itself

Khattar Singh opens by situating the election in Myanmar¡¯s post-coup existence. In February 2021, the military seized power after the National League for Democracy won a landslide victory, triggering nationwide resistance and armed conflict. Large parts of the country are no longer under central control. Airstrikes, arrests and censorship continue across junta-held areas.

Sullivan finds it ¡°very hard to imagine¡± these conditions producing anything resembling a free or fair vote. The military continues active combat against ethnic resistance groups, suppresses political organizing and controls information flows. The absence of accountability for past atrocities, especially the genocide against Myanmar¡¯s Rohingya people, further undermines any claim to legitimacy. More than a million Rohingya remain stranded in refugee camps in Bangladesh, unable to return to homes that are still unsafe.

Elections as a tool of control

Khattar Singh presses on whether the vote is meant to restore legitimacy or simply consolidate power. Sullivan answers bluntly: ¡°It¡¯s absolutely [an] attempt to grab ¡­ legitimacy.¡± The process responds partly to external pressure, particularly from countries such as China that want a more predictable governing structure to protect their interests.

The rules of the election, however, are designed to guarantee military dominance. The most popular parties from the pre-coup period are barred, the National League for Democracy party is dissolved and its leader, Aung San Suu Kyi, remains under detention. Protesters and potential opposition candidates face arrest. Even before ballots are cast, the constitution reserves 25% of parliamentary seats for the military, while most registered candidates are tied directly to the junta.

This is a familiar playbook: Elections staged to project an image of civilian governance without surrendering real power. Even a single polling station ¡ª potentially on a military base ¡ª could be used to claim territorial legitimacy. Without independent observers or real competition, the vote becomes an administrative exercise rather than a democratic one.

A deepening humanitarian emergency

Beyond politics, Sullivan emphasizes the scale of human suffering. More than 3.5 million people are internally displaced, and roughly one-third of Myanmar¡¯s population now requires humanitarian assistance. Aid delivery remains extremely difficult due to ongoing fighting and restrictions imposed by the military.

Drawing on his fieldwork, Sullivan says communities most affected by violence see the election as a sham. For Rohingya refugees, the same military responsible for their expulsion is now asking for recognition as a legitimate government. In conflict-affected states such as Kachin and Rakhine, many ethnic groups believe continued resistance is the only way to protect their populations. Even in junta-controlled areas, political participation is constrained by fear and repression, leaving little public confidence in the process.

Regional miscalculations and global neglect

Khattar Singh turns to the regional picture, asking whether the Association of Southeast Asian Nations (ASEAN) can use the election to stabilize the country. Sullivan is skeptical. ASEAN¡¯s five-point consensus, announced soon after the coup, has gone unmet as fighting and airstrikes continue. He argues that granting legitimacy to the vote would only reward intransigence and encourage further abuses.

China and India both have strong economic stakes in Myanmar, from infrastructure corridors to ports. Sullivan acknowledges their interest in stability but warns that Beijing¡¯s belief that elections will calm the situation is misplaced. In his view, recognition would likely increase instability and fuel further refugee flows into neighboring states, including India and Bangladesh.

Internationally, Myanmar has slipped from headlines as wars in Ukraine and Gaza dominate attention. Sullivan points to worrying signals in the United States, where South Dakota Governor Kristi Noem cited the election when announcing an end to Temporary Protected Status for people from Burma. He calls this a ¡°false narrative¡± that misrepresents conditions on the ground. At the same time, he notes bipartisan condemnation in Congress, ongoing sanctions in Europe and continued documentation of abuses through a United Nations investigative mechanism.

What should happen next

Sullivan closes by outlining what he believes the international response must be. Governments should refuse to recognize the election, maintain diplomatic pressure backed by sanctions and prioritize accountability through international legal mechanisms. He also notes that uncertainty extends even within the military itself, where questions remain about whether junta leader Min Aung Hlaing can consolidate power or whether internal fractures may emerge.

The stakes are clear: treating this vote as legitimate would not move Myanmar toward peace. It would entrench military rule, prolong conflict and deepen one of the region¡¯s worst humanitarian crises.

[ edited this piece.]

The views expressed in this article/video are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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Alongside external relations building, the Taliban are also contesting with attacks and militant activity from nonstate actors (NSAs) like ISIS-Khorasan (IS-K) and Tehriki-Taliban Pakistan (TTP), which number in the thousands and continue to recruit via online campaigns. Their efforts have to Afghanistan¡¯s 78% increase in NSA attacks from 2024 to 2025. When American troops withdrew in August 2021, the US didn¡¯t just leave Afghanistan ¡ª it left behind a vacuum now being filled by powers with starkly different values and ambitions.

Why the US must re-engage

The US must re-engage with Afghanistan for three key reasons. First, complete disengagement has allowed China and Russia to rapidly expand their influence in a strategically important country that connects Central and South Asia to the Middle East. Second, turning a blind eye to NSA activity in Afghanistan is allowing groups like IS-K, who have a history of attacks against the US and the West, to grow their power and online influence unchecked. Finally, the US has a moral obligation to support the Afghan military contractors and other allies left dangerously behind, whom it had previously promised safe passage.

Russia, which formally recognized the Taliban in July 2025, said that while its recognition will not involve a military presence, it will economic and development results ¡°soon.¡± As the sole country to recognize the government, Russia may receive preferential treatment when applying for energy and development projects, including for roads, mining and hydro dam construction. This relationship may provide Moscow with potential new energy markets, from which it is suffering due to international sanctions in response to its military actions in Ukraine.

While less overt, China has also warmed its relations with Afghanistan¡¯s Taliban. China has now received the new Afghan Ambassador to China, allowing it to support to existing projects like China Metallurgical Industry¡¯s (MCC¡¯s) Mes Aynak Mine and engage in humanitarian diplomacy, such as its support for those affected by the floods in and the earthquake in .

China¡¯s reasoning for continuing its relationship in Afghanistan is twofold. First, it wants to maintain border security regarding extremist Uyghurs from the Xinjiang province who found sympathy with IS-K¡¯s cause. Subsequently, such extremists have used the Wakhan border as a means to reach Afghanistan from China to train with the groups. Upon joining, some militants have spread Uyghur-language that threatens China with attacks, prompting Beijing to maintain its relationships with willing partners and build military bases along the border, such as the one in .

Secondly, China has existing and new investments within the country that need to continue churning profits, including the and the oil extraction agreement. If China disengaged with the Taliban, other investors would surely scoop up the remnants and claim the profits as their own, robbing China of future opportunities. 

Though both Russia and China have the Taliban¡¯s efforts to combat and stifle extremist terrorism activity from within the country, data tells a different story. In January 2025, the UN Security Council IS-K, operating mainly in Afghanistan, as the most dangerous affiliate of the Islamic State.

While IS-K¡¯s increasingly deadly attacks have been decreasing in number amidst a ¡°funding crisis,¡± groups such as TTP are alive and well, with rising attack numbers and support from the Afghan Taliban. According to the National Terrorism Index, TTP was as the fastest-growing group in 2024 with a 90% increase in attributed deaths, doubling its numbers from the previous year.

Furthermore, Central Asia jihadist groups, such as Jamaat Ansarrullah (JA), aka Tajiki Taliban, are camps to train and recruit in Afghanistan alongside TTP, using the same terrain whose skies were once dominated by US drones. Ironically, the new camps opened by TTP and JA are tacitly supported by the Afghan Taliban, with the government ¡°logistical and operational space and financial support¡± according to the UN. Despite evidence that the Afghan Taliban is supporting TTP and JA, both Russia and China continue to support its counterterrorism narrative. 

Finally, the US has a profound moral responsibility to support the Afghan people, especially those who fought alongside our military. Afghans eligible for special immigrant visas (SIVs) ¡ª 50,000 of whom are still approval ¡ª risked their and their families¡¯ lives to advance the US¡¯ mission in Afghanistan for over two decades, only to be abandoned and left in danger in their own country or in legal limbo in neighboring nations.

The US over $2 trillion in Afghanistan ¡ª not only in military operations but also in building institutions, schools and infrastructure meant to foster stability and democracy. This immense investment was not merely financial ¡ª it represented a promise to the Afghan people that America would stand by them in their pursuit of peace and self-determination. To withdraw entirely after such a long and costly engagement is to neglect that promise and undermine the moral foundations of US foreign policy. Moreover, the alliances and partnerships forged during 20 years of collaboration cannot simply be discarded; they are the result of shared sacrifice and mutual trust.

Re-engaging with Afghanistan is not just a matter of strategic interest but of ethical duty. America¡¯s credibility as a global leader depends on its willingness to uphold its commitments and to act with compassion and integrity toward those who stood beside it in times of war.

How can the US engage with Afghanistan without recognizing the Taliban?

The most common and legitimate critique of re-engagement with Afghanistan is the issue of recognizing the Taliban as the legitimate government of Afghanistan. While that is off the table for most policymakers, there are various ways in which the US, via the US Mission to the UN, the Department of State and the Department of War, can and must engage with international organizations, other nations and Afghan citizens.

Firstly, the US Mission to the UN can and should support the UN Human Rights Council¡¯s resolution, introduced by the European Union, to establish an investigative body monitoring human rights abuses in Afghanistan and gather information on possible perpetrators to bring justice to the victims. The body is set to mirror the UN¡¯s International, Impartial and Independent Mechanism () on crimes committed in Syria by the Arab Republic post-2011.

The US can support the new unit by efficiently responding to requests for evidence in its possession and assisting with providing relevant information to investigations. Because the US had such an extensive presence and intelligence awareness in Afghanistan, its military can likely assist with investigations.

Additionally, if legal frameworks do not yet exist to support such collaboration, the US should work to adopt relevant frameworks with assistance from the new UN investigative unit. The US¡¯ engagement with the unit will reinstate trust in its commitment to international law, human rights and multilateral cooperation, all of which are currently in question.

Furthermore, while the US cannot directly engage in counterterrorism efforts with the Taliban against IS-K and similar groups, it can coordinate with local partners, such as Tajikistan and Pakistan. Tajikistan, which a 843-mile border with Afghanistan, has largely resisted cooperation with the Taliban and increased its investment in border security after the instability from August 2021.

The US Department of War, whether independently or through NATO, should engage with Tajikistan and Pakistan to support their counterterrorism efforts and engage in capacity building and intelligence sharing to deplete the capabilities of groups like IS-K, TTP and others. If the US allows Afghanistan to once again become a breeding ground for terror, how long before the threats come knocking ¡ª again ¡ª at America¡¯s door?

Finally, while the US may not be able to directly invest in Afghanistan, nor engage diplomatically with Taliban officials to compete with China and Russia, nor conduct on-the-ground counterterrorism operations, it can support the Afghan people within the US and in the diaspora.

The Department of State should continue to rapidly process SIVs by re-opening the Coordinator for Afghan Relocation Efforts (CARE) center to support the immigration of former Afghan military contractors who are stuck in hiding. Unfortunately, the Trump Administration CARE in July 2025, despite 300,000 pending cases, further depleting hope and allies¡¯ trust in our security promises.

In addition to reopening the CARE center, Congress should pass the long-stalled bipartisan Afghan Adjustment Act (), which would address the immigration issues many Afghans in the US are currently . Promises made should be promises kept, and returning to our original promise to provide these non-citizen patriots with safe passage to the U.S. would offer a moral lifeline to the administration.

By stepping back from Afghanistan, the US surrendered both the moral high ground and strategic leverage it once held to its geopolitical rivals. Today, terrorist groups exploit the power vacuum, while competitors like China and Russia shape the future of a region that America spent decades and trillions of dollars trying to stabilize. The time has come to ask not whether the US should re-engage ¡ª but how soon it must engage.

[The views expressed in this article are solely those of the author and not of any other entity.]

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That these demands had to be shouted through a protest is the real scandal. And responsibility for it rests less with Beijing than with Jakarta.

A decade of ambition meets regulatory challenges

Over the past decade, Indonesia has eagerly courted Chinese investment, particularly in nickel processing and downstream industries critical to the global energy transition. The Indonesia Morowali Industrial Park, or , has become a symbol of that ambition: a sprawling industrial complex producing stainless steel and battery materials for the world. It has delivered jobs, export revenue and geopolitical leverage. But it has also revealed a troubling pattern: when foreign capital arrives faster than state capacity to regulate it, workers pay the price.

The Morowali protest exposes systemic failures that go well beyond one company. Workers complained of missing payslips, inadequate safety gear, excessive physical workloads for women, the elimination of rest days without additional staffing, opaque bonus systems and punitive policies that cancel overtime pay when workers take sick leave. These are not obscure technical disputes. They are violations of basic labor protections already enshrined in Indonesian law.

Gaps in enforcement, not labor regulations

Indonesia does not lack . What it lacks is enforcement ¡ª especially when the employer is a powerful foreign investor embedded in a strategic national project. Local officials are often reluctant to confront companies that promise jobs and infrastructure. National authorities, meanwhile, are torn between protecting workers and maintaining ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ reputation as an ¡°investor-friendly¡± destination. Too often, the balance tilts decisively against labor.

Chinese companies operating abroad frequently bring management practices shaped by China¡¯s own : long hours, top-down discipline and weak independent unions. That context helps explain some of the tensions in Morowali, but it does not excuse them. When companies operate in Indonesia, they must follow Indonesian law. Ensuring that they do so is not China¡¯s responsibility. It is ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ sovereign duty.

Indeed, failing to impose strict and consistent rules ultimately undermines ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ own long-term interests. Labor unrest disrupts production, damages investor confidence and fuels public resentment toward foreign involvement. Worse, it risks turning strategic industrialization into a race to the bottom, where competitiveness is built on suppressed wages and compromised safety rather than productivity and innovation.

Toward a proactive and transparent regulatory framework

The government¡¯s current approach ¡ª intervening sporadically after protests erupt ¡ª is inadequate. What is needed is a proactive regulatory framework specifically tailored to large foreign-dominated industrial zones like IMIP. This should include regular, unannounced labor inspections; mandatory public reporting on wages, safety incidents and employment practices; and meaningful penalties for violations, including suspension of operating licenses for repeat offenders.

Transparency is crucial. Workers at PT. CTLI demanded something as basic as payslips issued on time. That request alone speaks volumes about how opaque employment relations have become. Requiring standardized payroll documentation, clear overtime calculations and accessible grievance mechanisms would go a long way toward preventing disputes before they escalate.

Equally important is empowering workers themselves. Independent unions must be allowed to operate freely inside industrial parks, without intimidation or co-optation. Outsourced and contract workers ¡ª often the most vulnerable ¡ª should enjoy the same protections against arbitrary dismissal as permanent staff. Policies that punish workers for taking sick leave, as alleged at PT. CTLI should trigger immediate sanctions.

None of this means turning away foreign investment. On the contrary, clear and enforced rules benefit responsible investors by creating a level playing field. Companies willing to respect labor standards should not have to compete with those that cut costs by ignoring them. ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ goal should not be cheap industrialization, but sustainable industrialization.

The Morowali protest should be a warning. Indonesia is at a pivotal moment, seeking to transform its natural resource wealth into industrial power. That transformation will succeed only if it carries workers along with it. If the government continues to look the other way when labor rights are trampled, it risks building its industrial future on fragile foundations.

Stricter rules for Chinese companies ¡ª and for all foreign investors ¡ª are not an act of hostility. They are an assertion of sovereignty. And they are long overdue.

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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However, it seemed that a glimmer of hope finally appeared in this bleak conflict when Thai Prime Minister Anutin Charnvirakul and Cambodian Prime Minister Hun Manet signed a on October 26, 2025. This agreement was signed at the Association of Southeast Asian Nations (ASEAN) summit in Kuala Lumpur, with US President Donald Trump and Malaysian Prime Minister Anwar Ibrahim in attendance. The joint declaration aimed to pave the way for a lasting, peaceful resolution to the conflict.

Things went off track

Just over two weeks later, on November 11, the Thai authorities the suspension of the peace treaty, after a series of border incidents, including the deaths of several Thai soldiers who had stepped on , which Bangkok claims were recently laid by Cambodian forces.

For its part, Cambodia denied placing any new mines, insisting they were left over from previous clashes. Phnom Penh has expressed serious concern about Thailand¡¯s actions while also confirming its commitment to upholding the terms of the treaty.

At the same time, armed conflicts along the border have increased significantly, changing from small-scale clashes to involving aircraft, rocket systems and strike drones. In the space of just a few days, both sides have suffered heavy casualties, and tens of thousands of civilians have been forced to flee their homes.

The bloody toll: humanitarian crisis unfolding

According to Thailand¡¯s Second Army operational center, the Cambodian side has lost at least since the conflict entered its active phase in December 2025. Thai forces have also reported the destruction of six Cambodian T-55 tanks, a BM-21 multiple rocket launcher and an anti-drone system. The Thai command stresses that these figures are drawn from combat reports and intelligence assessments.

Thai officials have also acknowledged their own losses: the Ministry of Defence has that nine Thai soldiers and four civilians were killed, and that more than 120 people were wounded.

Thai defense representatives say that intensified attacks along the entire border, including in Sa Kaeo province, are being carried out by Cambodian troops, prompting Thailand to take .

The conflict is accompanied by a huge in Thailand¡¯s border areas. The number of evacuees currently housed in temporary shelters has now reached 222,000, with the provinces of Si Sa Ket, Surin and Ubon Ratchathani being the hardest hit. These provinces have seen tens of thousands of displaced people.

Meanwhile, Cambodian authorities have detained more than 7,000 Thai citizens at the Poipet border checkpoint. Cambodia closed the crossing on Friday and Saturday while the armed conflict was ongoing, and officials have refused to open it temporarily for people to return home. 

The head of this idea, former Cambodian Prime Minister Hun Sen, on social media that the closure of land crossings and ports is intended to protect the safety of Thai and Cambodian citizens.

Colonial ghosts: towards a new war?

The current escalation appears to be even more dangerous than the five-day border conflict in , which resulted in over 30 deaths and 150 injuries on both sides. A map from , when Cambodia was under French colonial rule, is the root of the various land claims. Thailand says the map is wrong. This inaccuracy has led to the long-standing territorial dispute that has already displaced hundreds of innocent people from both countries.

The world is waiting to see whether Trump can use his favored economic tactics to prevent the conflict from escalating and encourage Bangkok and Phnom Penh to resume talks. Or will the October peace deal signed under his leadership fail, causing a full-scale war in the heart of Southeast Asia? Either way, the answer will not depend on just one treaty, but rather on ongoing, direct negotiations between Thailand and Cambodia.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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The assessment shows ¡­ the Pentagon¡¯s overreliance on expensive, vulnerable weapons as adversaries field cheap, technologically advanced ones ¡­ Despite ample warnings, military and political leaders trained in one set of assumptions, tactics and weapons fail to adapt to change. Whether it was the French army in 1940, stuck behind its defensive Maginot Line, or Russian armored formations in Ukraine in 2022, decimated by Javelin missiles, the result is devastating for the side that will not discard old concepts, adopt new weapons or rethink its way of war ¡­ To see where American defense dollars go, considered the USS. Gerald Ford, America¡¯s latest aircraft carrier, which deployed for the first time in 2022 after more than a decade of construction and delays ¡­The price tag: an estimated $13 billion. That figure does not include the billions of dollars on military aircraft carried by the Ford ¡­ Yet the Ford is fatally vulnerable to new forms of attack. China in recent years has amassed an arsenal of around 600 hypersonic weapons, which can travel at five times the speed of sound and are difficult to intercept ¡­ Ultimately, a stronger US national security depend less on enormous new budgets than on wiser investment. Spending heavily on traditional symbols of might risk shortchanging the true sources of American strength: relentless innovation, rapid adaptability and willingness to discard old assumptions.

China, an asymmetric superpower

Providing some context for this interesting piece may be useful. Since the beginning of the millennium, China has sought to outsmart the United States¡¯ military strength through a very particular strategy. A strategy that aimed at overcoming America¡¯s technological advantages and much superior military budget by investing a huge amount of its resources in asymmetrical capabilities. As early as 2008, British political scientist and author Mark Leonard how China was attempting to become an ¡°asymmetric superpower¡± beyond the realm of conventional military power.

Conscious that the Soviet Union had spent itself into bankruptcy by accepting a ruinous competition for military primacy with the US, China looked for cheaper ways to compete. As a result, it invested billions in an attempt to achieve a generational leap in military capabilities, capable of neutralizing and trumping America¡¯s superior conventional forces. In other words, instead of rivaling the United States on its own game, it engaged it in a different game altogether.

This was the equivalent of what companies like Netflix, Uber, Airbnb or Spotify did in relation to the conventional economic sectors with which they competed. A best-selling 2016 by P.W. Singer and August Cole depicted how, through surprise and a wide array of asymmetric weapons, China defeated the superior forces of the United States.

In essence, these weapons have a dual focus. On the one hand, they emphasize long- and intermediate-range precision missiles and advanced targeting systems capable of penetrating battle network defenses. On the other hand, they aim at systems destruction warfare, able to cripple the US¡¯ command, control, communication and intelligence battle network systems. The objective in both cases is to target the US¡¯ soft spots with weapons priced at a fraction of the armaments or systems that they strive to destroy or render useless.

The whole notion of asymmetric weapons, indeed, is based on exploiting America¡¯s military vulnerabilities (like its huge dependence on information highways or space satellites), while neutralizing its strengths (like its fleet of aircraft carriers). American strategist and expert on China, Michael Pillsbury, this situation in graphic terms, stating that for two decades the Chinese had been developing arrows designed to find a singular target ¡ª the Achilles¡¯s heel of the United States.

The US and its legacy weapons

To counter China¡¯s emerging military threat, the Obama administration put in motion what it called the . This was also known as the Third Offset Strategy, as it recalled two previous occasions in the 1950s and the 1970s when, thanks to its technological leaps, the US was able to overcome the challenges posed by the Soviet military.

Recognizing that the technological superiority that had been the foundation of US military dominance for years was not only eroding but also being challenged by China, the Pentagon a series of areas to prioritize. Among them were the following: Autonomous learning systems, human-machine collaborative decision-making, network-enabled autonomous weapons or high-speed projectiles.

However, as it happened with many other initiatives representing the Obama legacy, this one began fading into oblivion after President Donald Trump¡¯s arrival to power in 2017. As a result, the vision of significantly modernizing America¡¯s military forces as well. This implied a return to the previous state of affairs, which still lingers today. In the of managing partner of Shield Capital, Raj M. Shah, and former director at the National Security Council, Christopher M. Kirchhoff:

We stand at the precipice of an even more consequential revolution in military affairs today. A new way of war is bearing down on us. Artificial-intelligence-powered autonomous weapons are going global. And the US military is not ready for them ¡­ Yet, as this is happening, the Pentagon still overwhelmingly spends its dollars on legacy weapons systems. It continues to rely on an outmoded and costly technical production system to buy tanks, ships and aircraft carriers, that a new generation of weapons ¨C autonomous and hypersonic ¨C can demonstrably kill.

Indeed, as American journalist and political commentator Fareed Zakaria put it a few years ago, the United States¡¯ not only remained wasteful and yet eternally expanding, but the real threats of the future, which required different strategies and spending, kept being skipped. Meanwhile, he said, Washington continued spending billions on aircraft carriers and tanks.

Two reasons may explain why Washington keeps investing in outmoded and costly legacy weapons. First, Congress¡¯s pork barrel decisions: Legacy systems ¡ª such as aircraft carriers, fighter jets and tanks ¡ª are in key congressional districts around the country so that the argument over whether a weapons system is needed gets subsumed by the question of whether it produces jobs.

Second, the Pentagon¡¯s : The status quo command structure protects the labyrinthine inner workings of the Pentagon. Companies that want to sell to it must navigate more than 2,000 pages of the Federal Acquisition Regulation. Additionally, the military¡¯s testing and approval systems can take up to a decade for new weapons systems. As a result, there is a tendency to adapt old weapons platforms rather than develop new ones.

Fighting the previous war

After Napoleon I, a military innovative genius, France always fought the previous war. That is, it entered the fight with the previous war in mind. The , mentioned by The NYT, is the best example of it. Because World War I was a trench war, the French prepared for the next conflict with Germany by building a vast trench system that covered most of the country. As a result, they were easily outmaneuvered and defeated by Germany¡¯s blitzkrieg, a lightning mechanized offensive in which tanks and attack planes acted in coordination.

While the Germans were imaginative and creative in relation to warfare, France¡¯s military (with the clear exception of General Charles de Gaulle) remained tied to the past. That is precisely the risk faced by the United States. The country, indeed, still relies on the instruments of conventional warfare that led it to win World War II: Aircraft carriers, tanks and planes.   

China¡¯s anti-aircraft carriers¡¯ missiles and its hypersonic missiles, costing just a few million dollars, can destroy the Gerald R. Ford-class aircraft carrier, with a price tag of more than $13 billion (and the more than 65 F-35C air fighters that it carries within it, each at a cost of $107 million). Actually, it has been that China could build over 1,200 DF-21D anti-aircraft missiles (capable of sinking an aircraft carrier at a range of over 1,500 miles) for the cost of the Gerald F. Ford.

Something similar could be said about continuing to build M1A2 Abrams tanks, costing? $8 million each, when, as proven in Ukraine, 300 Javelin stinger shots 280 Russian tanks. China¡¯s equivalent to the Javelin, although with greater destructive capability, is the , also known as the Red Arrow-12. Oblivious to its obsolescence, the Pentagon keeps building these legacy weapons.

Two additional factors

Two additional factors compound the situation described above. First, in all probability, a war with China would be fought in China¡¯s neighborhood. In other words, where the bulk of the People¡¯s Liberation Army Navy (PLAN) ¡ª the largest in the world ¡ª is located, where  27 heavily armed Chinese artificial islands in the Paracel and Spratly archipelagos present themselves as an almost insurmountable barrier, and within range of China¡¯s mighty rocket power. Second, a country like the US, whose armament industry has been receding for decades (facing limited and not easily replenishable stocks in several key areas), would be facing an industrial juggernaut like China.

According to The :

By itself, the United States cannot keep up with China¡¯s soaring industrial capacity, which translates directly into military might ¡­ By one count, it is acquiring advanced weapons systems and equipment five to six times faster than America is. One Chinese shipyard can build more than all American builders combined.

In order to prevail against such inauspicious odds, the United States¡¯ military establishment would need relentless innovation, rapid adaptability and willingness to discard old assumptions. Seemingly, bygone qualities within it. As in the case of France in the 1930s, the United States appears to be approaching a potential war with China with the past world war as a frame of reference. If so, it would have already lost the incoming war.

[ edited this piece.]

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What Takaichi said

Kiba begins by clarifying that the dispute centers on how Japan interprets its Armed Attack Situation Response Act, the legal framework governing deployment of the Self-Defense Forces. The law distinguishes between a direct armed attack on Japan and a more ambiguous category known as a ¡°survival-threatening situation,¡± defined as an attack on a foreign country in a close relationship with Japan that endangers Japan¡¯s survival and its people¡¯s fundamental rights.

That vagueness is deliberate. Japan¡¯s government has long kept the concept strategically ambiguous. What is not ambiguous, however, is which country qualifies as being in a ¡°close relationship¡± with Japan: the United States, due to the bilateral security alliance.

Taiwan does not fall into this category. Japan formally recognizes the People¡¯s Republic of China (PRC) as the sole legal government of China and respects Beijing¡¯s One China principle. As a result, Japan would never deploy forces to defend Taiwan directly. The legal opening exists only if the US were attacked in or around the Taiwan Strait, in which case Japan might consider collective defense in support of its ally.

The controversy erupted during a November 7 parliamentary hearing, when opposition lawmaker Katsuya Okada pressed Takaichi to clarify what would constitute a survival-threatening situation. Instead of sticking to abstraction, she offered a highly concrete example involving Taiwan, US warships and the possibility of Japanese support.

Kiba notes that while Takaichi¡¯s explanation did not formally violate existing policy, it went further than previous prime ministers had dared. ¡°Her statement was just too much,¡± Kiba says, emphasizing that Takaichi¡¯s specificity appeared to brush aside the careful legal and political balancing underpinning Japan¡¯s strategic ambiguity. Still, there has been no change in policy. Any declaration of a survival-threatening situation would require cabinet deliberation and approval by the Diet.

Will Japan defend Taiwan?

Kiba stresses that Japan will not defend Taiwan as Taiwan. That legal reality is well understood among Taiwanese policymakers and intellectuals, who recognize that Japan¡¯s position remains anchored in respect for the One China principle. From that perspective, Takaichi¡¯s comments were not shocking.

Public opinion in Taiwan tells a different story. A 2022 survey by the Taiwanese Public Opinion Foundation showed that 43% of respondents believed Japan would send troops to defend Taiwan in the event of a Chinese attack ¡ª a higher share than those who expected US intervention. Kiba is blunt about this gap between expectation and reality, calling it ¡°very wrong.¡± The episode underscores the need for clearer public diplomacy, not only toward Taiwan but toward the international community more broadly.

China¡¯s anger

Beijing¡¯s reaction was immediate and unusually sharp. Chinese Foreign Minister Wang Yi accused Japan of crossing a red line, language that reflects how Taiwan sits at the center of China¡¯s primary interest. From Beijing¡¯s standpoint, silence was never an option.

Kiba situates the reaction within the framework of the 1972 Japan¨CChina Joint Communiqu¨¦, which normalized relations. In that document, Japan recognizes the PRC as the sole legal government of China ¡ª a deliberately strong formulation ¡ª and states that it ¡°fully understands and respects¡± China¡¯s position that Taiwan is an inalienable part of its territory. That language has not changed since 1972. Whatever confusion Takaichi¡¯s remarks created, they did not alter the legal foundation of Japan¨CChina relations.

China¡¯s sensitivity is heightened by how it perceives Takaichi personally. Even before becoming prime minister, she was viewed in Beijing as an assertive, conservative figure: a self-declared successor to former Prime Minister Shinzo Abe, outspokenly critical of China and committed to expanding Japan¡¯s defense capabilities. Although she ultimately decided not to visit the Yasukuni Shrine ¡ª which to many represents Japanese nationalism and honors perpetrators of humanitarian crimes in World War II ¡ª after taking office, China continues to watch her closely.

What next for Japan¨CChina relations?

Looking ahead, Kiba identifies the safety of nationals as a persistent and underappreciated flashpoint. Japan remains deeply concerned about the security of its citizens in China, recalling past incidents involving workers detained since 2014 and the 2024 killing of a Japanese schoolboy by Chinese resident Zhong Changchun. Simultaneously, Kiba acknowledges that Chinese citizens in Japan worry about hate crimes and discrimination during periods of political tension.

Kiba ends on a cautious but humane note, expressing hope that public sentiment on both sides remains calm and that geopolitical disputes do not spill into violence against civilians. Strategic ambiguity may define Japan¡¯s security posture, but diplomatic and social restraint will shape whether future frictions escalate or fade.

[ edited this piece.]

The views expressed in this article/video are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post FO¡ã Talks: Understanding Japan¡¯s Taiwan Stance ¡ª Why PM Takaichi¡¯s Comments Triggered China appeared first on 51³Ô¹Ï.

Wang Yi¡¯s views were frank and also quite stern; his core intention was to explain to the international community why China had to retaliate against Japanese Prime Minister Sanae Takaichi¡¯s erroneous remarks.

China¡¯s government has taken a hard line

There are at least three points in Wang Yi¡¯s speech that deserve special attention:

First, 2025 is a very special year, marking the 80th anniversary of China¡¯s victory in the Against Japan. Besides, Japan bears a historical ¡°original sin¡± regarding the Taiwan issue. In Wang Yi¡¯s words, returning Taiwan, which Japan ¡°¡± from China, is an international obligation that Japan, as a defeated nation, ¡°must continue to abide by.¡± Therefore, especially this year, Japan should deeply reflect on its actions and adhere to the rules and commitments on the Taiwan and historical issues, acting with caution and restraint, rather than provoking trouble, he says.

Second, Wang Yi pointed out, ¡°But what is shocking is that the current Japanese leader has publicly sent the wrong signal of attempting to intervene militarily in the Taiwan issue, said things he shouldn¡¯t have said, and crossed a red line that shouldn¡¯t have been touched.¡±

Why is this considered a wrong signal? Because Sanae Takaichi broke with the practices of almost all previous prime ministers of Japan, explicitly stating her to intervene militarily in the Taiwan Strait dispute. This clearly constitutes ¡°saying things she shouldn¡¯t have said and crossing a red line she shouldn¡¯t have touched.¡±?

Third, faced with Japan¡¯s blatant infringement upon China¡¯s sovereignty and territorial integrity, and its violation of international justice and human conscience, China seems to have no choice but to retaliate. Therefore, Wang Yi also stated, ¡°The Chinese people love peace and are friendly to their neighbors, but on major issues concerning national sovereignty and territorial integrity, there will be no compromise or retreat.¡±

This indicates that China is unlikely to have any room for compromise on this issue. If the Chinese government chooses to compromise, the surging nationalistic sentiment among 1.4 billion Chinese people could very well shake the foundations of the Chinese Communist Party¡¯s (CCP) rule.

Japan has ¡°no bargaining chips¡± over China on the legal basis

If China were to attack Japan in a future conflict across the Taiwan Strait, it would have a legal basis, namely the 53 and 107 of the UN Charter which stipulate that if a former enemy state launches another invasion, the five permanent members of the UN Security Council ¡ª China, France, the Soviet Union (now Russia), the United Kingdom and the United States ¡ª have the right to directly conduct military action without authorization from the Security Council. Although the Japanese Ministry of Foreign Affairs by emphasizing that these clauses are outdated because UN General Assembly Resolution 50/52 of 1995 declared them obsolete, they remain valid.

This is because the UN Charter has a higher legal standing than any UN General Assembly resolution. In other words, a General Assembly resolution cannot overturn the UN Charter. Even if a country votes in favor of a General Assembly resolution, it can still invoke the UN Charter because it has the highest legal standing. It¡¯s like, if a bill passes a referendum in the United States but violates the Constitution, actions can still be taken according to the Constitution, not the bill itself, unless the Constitution is amended.

The UN Charter, the core of the ¡°enemy state clause,¡± states that when the UN Security Council considers a situation threatening international peace, it may authorize regional organizations or states to take action. However, actions against ¡°enemy states¡± (such as the Axis powers in World War II, such as Germany and Japan) are not subject to this restriction and do not require Security Council authorization. Legally, this clause allowed the Allied powers to take direct military action against aggression by ¡°enemy states¡±, thereby serving as a deterrent to the post-World War II international order.

Article 107 of the UN Charter is also one of the core contents of the ¡°enemy state clause¡±, stipulating that: ¡°This Charter does not abolish or prohibit any action taken or authorized by a responsible government against an enemy state of any signatory State of this Charter in connection with the Second World War.¡± Its core meaning can be understood as: this clause explicitly preserves the right of victorious powers in World War II (such as China and the United States) to conduct military action against the Axis powers (Japan, Germany, etc.), and even after the UN Charter came into effect, these actions remain unrestricted by Security Council authorization. Essentially, this is an ¡°exceptional authorization¡± under international law for the military expansion of defeated powers, aimed at preventing a repeat of the history of aggression.

During World War II, Japan and China were enemies, and Taiwan was also affected during the war (occupied by Japan). Therefore, if Japan were to intervene in Taiwan affairs militarily, it would perfectly comply with the provisions of the clause as mentioned above, allowing China to launch an attack on Japan directly without authorization from the UN Security Council.

Would China dare to declare war on Japan?

However, the key question is, even with these legal guarantees from the UN, would China really dare to declare war on Japan?

Economically, signs of Japan¡¯s downturn have indeed been emerging for some time. In the third quarter of this year, Japan¡¯s GDP for the first time in nearly two years; inflation has continued to rise for consecutive months, already exceeding the Bank of Japan¡¯s warning line; consumer goods prices are soaring while wages are still stagnant; the yen¡¯s exchange rate has been for a long time; plus, the most troublesome problem ¡ª extremely high debt-to-GDP ratio. With all these internal problems unresolved, a diplomatic conflict with China is particularly detrimental at the moment, as China has already begun imposing a slew of economic measures that appear aimed at Japan.

First, the Chinese Ministry of Foreign Affairs immediately Chinese citizens to avoid traveling to Japan. Subsequently, major Chinese airlines announced that tickets for flights to Japan could be refunded free of charge, while several other airlines directly the cancellation or reductions of flights to Japan. Meanwhile, the Hong Kong and Macau Tourism Bureaus also updated their travel safety advisories, reminding those planning to travel to Japan to be vigilant. According to media reports, tens of thousands of tickets from China to Japan were cancelled in just two days after November 15.

Suddenly, Japan¡¯s tourism industry lost its largest source of customers and its overseas consumer group ¡ª Chinese tourists. As a result, the Nikkei index on the Tokyo Stock Exchange began to fall on the morning of November 17, with significant declines seen in sectors related to the Chinese market, particularly those pertaining to Chinese tourist spending, such as Mitsukoshi Isetan (a wholly-owned subsidiary of Mitsukoshi Isetan Holdings, a Japanese department store holding company that primarily operates the Mitsukoshi and Isetan brands in the Kanto region). If the number of Chinese tourists visiting Japan were to decrease by 25%, as in 2012, it would roughly lead to a reduction in spending of trillions of yen, equivalent to nearly 0.5% of Japan¡¯s real GDP. Simultaneously, China also reimposed bans on imports of Japanese and beef.

Still, China has more cards to play, such as launching trade remedy investigations, restricting investments and taking antidumping measures. However, all these moves seem like ¡°sharp pinpricks¡± rather than ¡°a knockout blow¡±. This is to say, in the long run, these economic measures from China¡¯s side are unlikely to shake the foundations of Japan¡¯s macroeconomy. This is because, fundamentally, Japan is a high-end manufacturing powerhouse, not a country primarily reliant on agriculture or services. What will remain most critical to Japan¡¯s economy will still be its ability to sell cars to the United States, not the ability to sell seafood to China.

Politically, on November 24, the leaders of China and the United States also by phone again. Unlike their previous meeting in South Korea, this time the two sides explicitly discussed the Taiwan issue (according to China¡¯s side). Immediately afterwards, US President Donald Trump spoke with Takaichi. Although Takaichi did not mention whether the Taiwan issue was discussed in the press conference, she did not deny it either. Media outlets widely speculated that Trump exerted pressure on Japan at China¡¯s request.

This shows that regardless of how the outside world evaluates some of Trump¡¯s policies, he remains clear-headed, at least on historical and Taiwan issues. However, this has once again negatively impacted China¡¯s diplomatic strategy and international image. As the world¡¯s second-largest economy, which frequently clashes with the United States on various international stages, China still needs the US to mediate its conflicts with other countries at crucial moments, even if it¡¯s for China¡¯s own domestic problems. Rationally, this makes us wonder how China¡¯s ¡°brotherly¡± countries, like North Korea, Iran and even Russia, will view China after this recent Sino-Japanese conflict.

From a military perspective, Japan and Taiwan have completely different international statuses. Taiwan is a disputed territory, and if China were to launch a military attack on Taiwan, the United States would lack the legal basis to assist it, as the UN General Assembly resolution formally recognizes the ¡°¡± principle. Therefore, any conflict between mainland China and Taiwan would be considered as China¡¯s internal affair. Japan, on the other hand, is entirely different. Japan is a fully sovereign state and has a formal military alliance treaty with the United States.

If China and Japan were to go to war, the US military could fully intervene in it without any legal or realistic restrictions. As for Russia, the Russia-Ukraine crisis has already overwhelmed the ¡°polar bear¡± significantly; lots of experts doubt that Russia will truly have the capability and willingness to fully assist China when the war comes. As for China¡¯s other ¡°friendly¡± countries, such as North Korea, Iran and Myanmar, as well as others, they will likely only issue some diplomatic statements at most.

Ultimately, China still needs to face two military superpowers simultaneously ¡ª Japan and the United States ¡ª in which case, China would have virtually no chance of victory. Note that on Thursday, November 20, US State Department spokesman Tommy Pigott reaffirmed the US¡¯s commitment to Japan¡¯s national security on , without mentioning the ¡°One China¡± policy.?

The situation may continue to deteriorate

It is foreseeable that the situation will continue to deteriorate in the short term, and it will be hard to get back to the status quo ante. This is because the Chinese government has no way out of the issue of Sino-Japanese relations. The Taiwan issue not only concerns China¡¯s core interests ¡ª a red line within a red line ¡ª but also represents the most important foundation of public opinion for the CCP¡¯s rule in China.

However, this right-wing wave in Japan did not actually begin with Sanae Takaichi. Instead, it has already been sweeping across Japan for quite a long time. For instance, in , the Japanese Self-Defense Forces had already formulated plans to operate around the Taiwan Strait. In recent years, the Taiwanese, US and Japanese militaries have conducted numerous joint . What does this mean? It means that the US, Japan and Taiwan have already essentially begun preparing for military intervention in a potential Taiwan Strait crisis.

Does China know about these facts? Of course, it does. But for many years, the Chinese government has remained silent. Furthermore, Japanese warships the Taiwan Strait three times ¡ª in September 2024, February 2025 and June 2025 ¡ª neither the Chinese government nor the military has responded appropriately to such incidents, nor has it taken Japan¡¯s military actions seriously or analyzed them from a strategic perspective.?

Therefore, the rapid rise of right-wing forces in Japan in recent years has resulted from the goodwill shown to them by the former victorious powers in the surrounding region (China, South Korea, North Korea and Russia). Japan¡¯s passage through the Taiwan Strait under the guise of freedom of navigation is, in reality, an act of militarism that will inevitably be exposed.

Sanae Takaichi¡¯s firm decision to lift the lid on this matter may have been deliberate, intended to put a ¡°pressure test¡± on China. China¡¯s retaliation, to some extent, is also a ¡°pressure test¡± for Japan. China wants to test the economic reaction to decoupling from Japan. Of course, political factors are also at play. China has taken a series of actions, including conducting military exercises and so-called ¡°comprehensive military preparations,¡± all aimed at putting pressure on Japan.

Over the past decade, Sino-Japanese relations have experienced ups and downs, but have generally improved in the same direction towards a warming relationship. However, Takaichi¡¯s actions have completely undermined this long-held momentum and further fueled new animosity between the two countries. In other words, the achievements accumulated over many years in Sino-Japanese relations have been almost entirely destroyed this time.

For the moment, tensions thus far show no sign of abating. In the near future, we should not be surprised if small-scale conflicts even occur between China and Japan.

German philosopher Friedrich Nietzsche said, ¡°When you gaze into an abyss, the abyss also gazes into you.¡± And those words still resonate powerfully today. They serve as a constant reminder to every nation in the world, including China and Japan: most cycles of history begin with the forgetting of history!

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The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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Japan¡¯s warning and the weight of history

Atul opens by going through the facts. Japanese Prime Minister Sanae Takaichi declared in Parliament that an attack on Taiwan by China¡¯s People¡¯s Liberation Army (PLA) would create ¡°a situation threatening Japan¡¯s survival¡±. This public statement confirmed what Japanese diplomats, intelligence officials and military officers had previously discussed only in private: Japan could intervene militarily if China were to invade Taiwan, exercising ¡°collective self-defense.¡±

Why is this important? Atul dives into the deeper history fueling this contemporary crisis: Japan ruled Taiwan from 1895 to 1945, an often-overlooked fact. China views Japan¡¯s 1895 takeover of Taiwan as the first step in Japanese imperial expansion, an act Beijing has neither forgiven nor forgotten. In the 19th century, Japan decided that it needed to industrialize, modernize and imperialize. The ¡°sudden expansion doctrine¡± aimed to transform Taiwan into a ¡°showpiece model colony¡±.

Although the Japanese administration implemented some improvements in the economy, public works and industry, it also imposed a cultural ¡°Japaneseization¡± on the island, which is what the Chinese, being so proud, deeply resent. Furthermore, Chinese citizens retain painful memories of the long Japanese occupation of the mainland, including events like the Rape of Nanjing.

In light of this history, Beijing has demanded that Japan ¡°fully repent for its war crimes¡± and ¡°stop playing with fire on the Taiwan question¡±. This has resulted in a full-blown diplomatic crisis. China suspects that Japan is going to remilitarize. The latest example of this is Japan¡¯s plans to deploy missiles on an island near Taiwan ¡ª a plan that China has criticized.

Rising Chinese nationalism, economic repercussions and military tensions

Emotions on Chinese social media are running high. Furthermore, there has been a massive rise in Chinese nationalism over the past few years. These feelings now go beyond rhetoric and have turned into action. China has suspended visa processing for Japanese travelers and issued warnings to its own citizens against visiting Japan. Note that Chinese tourism is a major source of revenue for Japanese airlines, hotels and retail stores. Japan will ¡°obviously suffer¡± as a result of China¡¯s actions.

The economic impact of this crisis is significant. According to the Japanese Ministry of Finance, the country¡¯s net foreign direct investment into mainland China plummeted by 30.6% in the first three quarters of 2025, reaching the lowest level recorded since the data series began. Furthermore, only a fraction (10%) of 8,300 Japanese firms surveyed by the Japanese Chamber of Commerce in China indicated plans to increase investments.

Japan has also warned its citizens in China about their safety as the crisis deepens. Additionally, Japan has scrambled aircraft after detecting a suspected Chinese drone near its southern island of Yonaguni, which is close to Taiwan.

Why do we have a crisis and what is Japan doing?

At the heart of this dispute are two contrasting geopolitical philosophies. The Chinese Communist Party (CCP) considers the ¡°one China policy¡± its ¡°holy grail.¡± Beijing views any Taiwanese declaration of independence or outside support for that independence as a direct threat to China¡¯s sovereignty. Atul points out that this could all also be a ¡°cynical play for popularity¡± because, at the end of the day, the CCP is ¡°no longer communist¡± in the traditional way. The CCP has now become a repository of Chinese nationalism and wants to return the Middle Kingdom to its former glory. As a result, the rhetoric, both from the regime and within Chinese social media, directed at Takaichi has been ¡°extremely aggressive.¡±

Conversely, Japan views Taiwan as a de facto independent state. Tokyo is increasingly nervous about China as an ¡°aggressive revisionist power.¡± Japan views a Chinese threat to Taiwan as a risk to its own national security. Should China gain control of Taiwan, many islands claimed and owned by Japan would fall within threatening proximity of the PLA and its Navy.

In 2020, a Chinese and Russian fleet circumnavigated Honshu Island, which Atul and Glenn viewed at the time as a ¡°wakeup call for Japan¡±. Atul makes the case that this circumnavigation was the ¡°equivalent of someone waving a gun and walking outside your front door.¡±

To counter the threat of an assertive China and an aggressive Russia, the Japanese have increased their defense spending and have abandoned self-imposed restraint. However, this increase has occurred during a period when the yen has depreciated substantially against the dollar, meaning that a higher budget does not translate into more US arms. Demography is also a constraint. Despite these barriers to military development, a new determination to invest in defense and prepare against external threats is evident. Tokyo also recognizes that it can no longer rely on the US, so it must ¡°beef up.¡±

The Japanese are also tired of living with post-World War II guilt. They believe that 80 years of saying ¡°sorry¡± is enough. The Chinese would claim otherwise. Many Japanese still visit Yasukuni, a very controversial shrine that honors some war criminals. The Japanese do not think this is a big deal. They believe that they have recognized and atoned for their war guilt. Today, the Chinese have emerged as the provocateurs and aggressors. Many Japanese believe that if they do not act against China now, then Japan¡¯s security and sovereignty will be at risk.

Nationalism, a political instrument for the CCP, and a new regional order

Glenn argues that Chinese nationalism should be viewed as a ¡°spigot¡± that is controlled by the CCP, or really, Xi Jinping. The CCP consciously utilizes nationalism to turn up the pressure when it seeks to exert international influence ¡ª particularly on Japan in this instance ¡ª or to rally domestic support for the position of the Beijing government. However, this tool carries the inherent risk of becoming uncontrollable. The ¡°tub¡± into which this nationalist ¡°liquid¡± pours has no emergency ¡°drain pipe,¡± and it can overflow.

Atul points out that, despite this official rhetoric, many educated Chinese individuals, and even officials, privately express admiration for the Japanese, citing their organization, culture and courtesy. The Japanese will also similarly say nice things about the Chinese. The economic relationship between the two countries is symbiotic.

Glenn explains that Takaichi is a disciple of the late Japanese prime minister Shinzo Abe, and that her comments regarding China are no different from what Abe said, or what she herself has said for many years. The Chinese have chosen to make this a bigger issue because they fear increasing Japanese defense capabilities. Tokyo realizes that Japan can no longer rely on the US. Therefore, Japan is increasing its defense capabilities and views Chinese actions as ¡°dramatically significant to the sovereignty, wealth and independence of Japan.¡± 

The CCP¡¯s interpretation of its sovereignty extends 1,500 kilometers and more from its coast into the shores of the Philippines and other states in the South China and East China Seas. Notably, Chinese nationalists (who moved to Taiwan after losing the civil war in 1949) had an 11-dash line (a visual representation of China¡¯s claims), which the CCP reduced to a nine-dash line, but has recently increased to a ten-dash line. Expansionist Chinese claims are not just a CCP problem; they stem from Chinese nationalism. 

While China denounces Japan¡¯s increasing defense budget and rising militarism, it is fair to say that Tokyo is largely reacting to Beijing¡¯s aggressive nationalism and challenges to the status quo. The Xi-led CCP is actively moving to resolve the ambiguity surrounding Taiwan, with the clear intent to absorb the island. This includes dramatically increasing military activity, such as launching missiles, conducting exercises with the world¡¯s largest navy and escalating the number of overflights around Taiwan, and also actions on the Pacific side of Japan.

Japanese nationalism is also on the rise. Takaichi wants a stronger Japan and is more up for a fight with China than her predecessors. She is a ¡°different kettle of fish¡± than her previous leaders. She is, after all, the first female prime minister of Japan and a self-proclaimed Thatcherite nationalist. Regardless of whether Takaichi is really different from her predecessors, we are certainly seeing a ¡°more assertive Japan in a more dangerous environment.¡± China-Japan tensions are on the rise, and conflict is a real possibility.

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The views expressed in this article/video are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post FO¡ã Exclusive: Tensions Over Taiwan Push China and Japan Closer to Conflict appeared first on 51³Ô¹Ï.

±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ outreach to Qatar is a vivid demonstration: a maritime, pluralist democracy with the world¡¯s largest Muslim population stepped into Doha¡¯s bruised salon of mediation not to grandstand, but to shore up the fragile scaffolding that keeps alive. That matters for lives on the ground, for the of small-state mediation, and for the health of a rules-based diplomacy the world needs to salvage.

Indonesian President Prabowo Subianto¡¯s September visit to Lusail Palace with Qatari Emir Tamim bin Hamad Al Thani was not merely ceremonial. Jakarta and Doha to launch a formal Strategic Dialogue and signed Memorandums of Understanding (MoUs) that signal new economic ties.?

These economic ties included a $2 billion commitment to Indonesian infrastructure ¡ª but the political subtext was clear: Indonesia is buying influence through patience and partnership, not weaponry. It is an investment in convening capacity and in the fragile habit of maintaining neutral space, where enemies can be encouraged to talk.

That posture is ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ : it can simultaneously leverage Muslim-majority legitimacy and Association of Southeast Asian Nations (ASEAN)-style discretion.?

Diminished back-channels for diplomacy?

Why does this matter now? Because mediation is a ¡ª easily squandered, painfully hard to rebuild. Qatar has for years been one of the few states able to talk to Hamas, to Israel¡¯s interlocutors and to Western and regional capitals simultaneously. The Israeli on Qatari soil in early September shattered that immunity. It prompted Doha to pause parts of its mediation work ¡ª a dramatic, costly response that shows how quickly sanctuary can evaporate.

The result is : fewer back-channels, more diplomatic paralysis, and that conflicts calcify into perpetual violence. In that void, great-power rivalry deepens and civilians pay the price.?

±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ ¡°free and active¡± (bebas-aktif) diplomacy and ASEAN¡¯s quiet, consensus-driven approach are not flash-in-the-pan doctrines. They are ¡ª patient, low-profile, sometimes maddeningly slow, but often effective at keeping dialogue alive where loud condemnation drives parties further apart.

The ASEAN Way¡¯s on noninterference and private consultation buys endurance, not immediate headlines; Jakarta¡¯s strength is converting that endurance into something operational in the Middle East: convening second-track dialogues, cosponsoring humanitarian corridors or hosting technical talks on prisoner releases and ceasefire mechanics. Those are the small, essential things that make a ceasefire stick.?

But perks and principles alone are not enough. If Indonesia to meaningfully augment Doha¡¯s tapering role, it must be strategic and inventive. First: protect negotiation sanctuaries. International law still treats sanctuaries for diplomacy as sacrosanct; practice often does not. Jakarta should champion an ASEAN-Gulf compact ¡ª a multilateral statement, practical and enforceable ¡ª that establishes clear protocols for protecting host-state venues, mediators and humanitarian couriers.

This compact could be ¡ª rapid fact-finding mechanisms, agreed ¡°no-strike¡± notification channels for high-risk meetings, and joint diplomatic demarches that raise the political cost of violations. A pledge does not stop bullets; it makes the political fallout for attackers immediate and collective.?

The Indonesia-Qatar partnership

Second: institutionalize two-track with teeth. Indonesia and Qatar make a : Doha brings access to armed nonstate actors; Jakarta brings multilateral legitimacy and Southeast Asian convening power. Together, they could underwrite an ¡°Inclusive Track¡± secretariat ¡ª small, agile and designed to keep negotiators talking even when capitals shout.

Funded by Gulf and ASEAN donors and housed in a neutral location, it would stabilize the very back-channels that prevent escalation. Australia, the EU and middle powers should seed this organ as a practical alternative to the zero-sum politics that now paralyze the UN Security Council. 

Third: convert moral solidarity into humanitarian architecture. Indonesia has used its UN platform to ceasefire language and demands for aid access; now it should push for protected humanitarian corridors under multilateral supervision, with donor-backed rapid response financing.

When mediators lose leverage, civilians die ¡ª and that must not be the bill for failed diplomacy. A simple rule: where a mediator can secure a humanitarian route, a pooled fund activates within 72 hours to keep aid flowing. That is operational charity, not rhetorical condolence. 

±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ role as a middle power in global diplomacy

This will be politically uncomfortable. ASEAN¡¯s for quiet diplomacy will chafe against louder calls for immediate accountability. Some Gulf partners will resist anything that feels like external interference.

Yet the cost of inaction is higher: shrinking mediation space invites unilateral military solutions, drives proxy escalations and shifts the regional balance toward securitized blocs. ±õ²Ô»å´Ç²Ô±ð²õ¾±²¹¡¯²õ skill ¡ª modest but durable ¡ª is precisely the kind of middle-power resource the world needs if wartime bargaining is to have any chance at peacetime outcomes. 

Indonesia cannot rebuild Doha¡¯s unique access on its own. But it can be the coal that keeps the embers alive: offering platforms, underwriting small, technical talks and convening coalitions that translate solidarity into safeguards for diplomacy. That is a practical power: not the dramatic thrust of aircraft carriers, but the patient craft of keeping channels open until politics catches up with humanity. In a time when great powers posture, middle powers must deliver the quieter instruments of survival. 

Indonesia and Qatar, together, can ¡ª if the international community supports them ¡ª transform the devastation of a struck capital into the foundation of lasting negotiation. The alternative is to watch the last hospitable spaces close, one by one and for diplomacy that prevents war from dying in the silence that follows the guns.

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The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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Seeing humanity in everyday Hiroshima

When you walk the streets of Hiroshima, you¡¯ll never be able to guess if the grandmother with a poor gait passing you was the sole survivor of her family in the bombings, or if the gray-haired man was in utero during the bombings. The middle schooler in uniform may come from a family that experienced discrimination due to their exposure to A-bombs, and her mother may harbor resentment toward the Japanese government for never acknowledging the pain inflicted on Koreans who were to serve a nation that denies their dignity.

Experiencing the ordinary in an extremely unordinary city shifts your perspective on the history of human atrocity. What we so often gloss over in history books and mass media, occurring 80 short years ago, appears in the rhythm of daily living with an overwhelming mundanity and a horrifying profundity.

When I see the habits and mannerisms of my own grandparents in these brave, merciful (survivors of the atomic bomb), the unconscious rationalizations that help me justify the bombings as an American citizen are overridden by the power of human connection and compassion. Citizens are treated like pawns in any militaristic society, sacrificed in atrocious ways, often not for their country¡¯s common good, but the corrupted aims of their leaders and generals.

Leaning into the humanitarian within me

What Hiroshima taught me is to lean into the humanitarian within me and implore my friends, family and community to do the same. As an aspiring public servant and diplomat from the United States, I wish to remember the human component in all of my professional endeavors. This task is easier said than done.

Campaigning, political compromises, utilitarian decision-making and diplomatic negotiations can often trivialize the multitude of human stories that even the most minute policy outcomes will impact. In this cynical world we live in, I often ask myself how I can advance each human being as an end in themselves, rather than as a means to an end that benefits me professionally and politically. I refuse to accept that entering the political sphere requires a degradation in moral character.

¡°The real problem of humanity is the following: We have Paleolithic emotions, medieval institutions and godlike technology. And it is terrifically dangerous, and it is now approaching a point of crisis overall.¡± ¡ª

People in my life ask, ¡°Why diplomacy?¡±. Our human family has advanced rapidly in the last few centuries; yet, we collectively never seem to realize the limitations (and power) placed upon us by our emotional wiring. Technological innovations will bridge critical gaps in industries such as engineering, nuclear medicine and cloud computing. It will never solve the subjective difficulties of embodied human dialogue, which have consequences in interpersonal, inter-community and international relations.

I consider myself blessed to have not one, but three separate opportunities to engage in meaningful dialogue with students, activists and Hibakusha in the inspiring city of Hiroshima, Japan.

Holding onto hope in global conflict

Many people, including myself, feel despair when reading the news about the conflicts in , , and other places. Individual action is seemingly minuscule compared to political summits, diplomatic negotiations and military exchanges. However, conversations between groups, irrespective of nationality, foster understanding and build unimaginable connections between thoughtful individuals around the world.

We cannot lose hope in these times, for a lack of hope now will render us powerless in the most hopeless of times. A reminder to my fellow Americans who may be reading this: our country has the privilege to govern itself directly and indirectly, and we still have a multitude of . Now imagine people in countries and territories who cannot afford to dissent, and pay with their lives for speaking truth to power.

It is overused, but people are not their governments. If Hiroshima has taught me anything, it is this simple lesson. I conclude this reflection with the profound words of Nelson Mandela: ¡°The best weapon is to sit down and talk.¡±

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The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

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My visit was meant to be a simple exploration of a modern Asian society, but what I found was much deeper: a country that has not only survived in the shadow of a giant but has thrived with grace, innovation and quiet determination.

This article is both a personal reflection on my travels across Taipei, northern Taiwan, where we visited the Yehliu Geopark, Jiufen and Shifen, Tainan and Kaohsiung, and a strategic discussion of Taiwan¡¯s place in Asia. To me, Taiwan is not just a beautiful, modern society with rich history and hospitality, but also one of the most strategically complex territories in the world today.

Taiwan ¡ª a strategic island nation

Taiwan is an island nation in East Asia, situated between the East China Sea and the Philippine Sea, about 180 kilometers off the southeastern coast of Mainland China, and surrounded by several smaller islands such as the Penghu, Kinmen and Matsu archipelagos. 

The terrain is strikingly diverse: the eastern two-thirds of the main island are dominated by rugged, forested mountain ranges, some peaks, like Yu Shan (Jade Mountain), rise above 3,900 meters, while the western third features flat to gently rolling plains that are home to most of the population. 

Taiwan¡¯s land area is approximately 36,200 square kilometers, featuring a subtropical climate in the north and tropical in the south, with frequent typhoons and many earthquakes due to active tectonic boundaries. The coasts present cliffs, sandy beaches and wetlands, while the mountainous interior holds extensive forests, making the island both densely populated and ecologically diverse.

Landing at Taoyuan International Airport, I was immediately struck by the efficiency of Taiwan¡¯s infrastructure. Immigration was swift, connectivity seamless and the first airport metro ride into Taipei gave me a glimpse of an island that wears its modernity with quiet confidence.

The subways and highways were smooth, lined with greenery and punctuated by neat housing clusters and factories ¡ª an immediate indication of Taiwan¡¯s role as a global industrial hub, especially in semiconductors and electronics.

The capital city of Taipei itself is a fascinating fusion of the modern and the traditional. The Taipei 101 skyscraper stands as a towering reminder of the city¡¯s ambition, once the tallest building in the world, now an icon of engineering and resilience against earthquakes and typhoons.

Around it, however, the city breathes with night markets, street food vendors and temples. In the Shilin Night Market, I tasted oyster omelets and bubble tea, and in the alleys of Ximending, I saw Taiwan¡¯s youth culture alive and confident.

What impressed me most in Taipei was the metro and bus system. Clean, punctual and affordable, it was a revelation compared to many Asian capitals. For a traveler, it meant effortless navigation. For a defense analyst, it underscored how Taiwan¡¯s infrastructure is not only modern but also deeply integrated into daily life, ensuring resilience in case of disruptions.

North Taiwan: tradition meets geography

Moving north from Taipei, I explored the coastal areas and mountain ridges. The contrast between urban Taipei and the rugged northern coastlines was dramatic. The Yehliu Geopark, with its unique rock formations carved by the sea, reminded me that Taiwan is a land of natural fortresses. Steep cliffs plunge into the Pacific, and the mountains rise sharply from narrow coastal plains.

For a strategist, this geography is not just scenery; it is defense. Taiwan¡¯s Central Mountain Range runs like a spine across the island, rising over 3,000 meters at its peaks. This range divides east from west and acts as a natural barrier. If any hostile power, namely China, were to consider an amphibious invasion, they would face not only the beaches and coastal defenses but also these looming mountains that dominate the interior and the beaches.

In the small towns of North Taiwan, I saw a quiet life that contrasted with Taipei¡¯s bustle. Temples with incense smoke stood against mist-covered hills, and fishing harbors buzzed with activity. Yet even here, in conversations with locals, there was an awareness of China¡¯s shadow. People spoke pragmatically about the tensions, but they were not paralyzed by fear. Life went on, and the island exuded a sense of normalcy that was almost defiant in itself.

Southward by High-Speed Rail: the spine of connectivity

One of the highlights of my trip was traveling by Taiwan¡¯s High-Speed Rail (HSR). With the HSR pass in hand, I boarded the sleek train from Taipei to Tainan, and later Kaohsiung. The speed, comfort and efficiency of this rail system were world-class. Within a couple of hours, I was transported from the northern capital to the cultural heart of Tainan.

The HSR, for me, was more than just transportation. It represented Taiwan¡¯s ability to invest in infrastructure despite the constant external threat. Building such a system requires vision, capital and confidence in the future. Taiwan clearly believes in its tomorrow.

Tainan: the cultural heart

Tainan, the ancient capital of Taiwan, felt like stepping back into history. Its temples, shrines and preserved alleys revealed the island¡¯s cultural richness. I visited the Chihkan Tower, where history unfolded through layers of Dutch, Chinese and Japanese influence. The city¡¯s food scene was remarkable, with beef soup, danzai noodles and mango shaved ice creating memories as vivid as the monuments.

Walking through Tainan, I realized how Taiwanese identity has been shaped by centuries of layered influences, indigenous roots, waves of Chinese migration, colonial encounters with the Dutch and Japanese, and finally, the resilience against external pressures in the modern era. Unlike the hyper-modern Taipei, Tainan felt more introspective, grounded in tradition.

Kaohsiung: the southern powerhouse

Further south, Kaohsiung stood out as Taiwan¡¯s industrial and maritime hub. Its harbor is one of the largest in the world, a vital artery for Taiwan¡¯s trade. The Pier-2 Art Centre reflected the city¡¯s creative spirit, transforming warehouses into art spaces. The Love River, lined with cafes and promenades, gave the city a softer edge.

Yet, Kaohsiung¡¯s strategic significance is undeniable. Its port would be a primary target in any conflict scenario. As I walked along the harbor, I imagined how vital control of this city would be in a blockade or invasion attempt. For a defense analyst, it was impossible not to connect the dots between geography, infrastructure and strategy.

The Chinese military threat: a strategic assessment

Traveling across Taiwan reinforced a conviction I have held as an Indian defense analyst: Taiwan is not an easy conquest/target for China.

The geography is formidable. The Taiwan Strait is about 130 km at its narrowest point ¡ª a deceptively short distance ¡ª but, in military terms, a daunting expanse for amphibious operations. Crossing it with hundreds of thousands of troops, heavy equipment and supplies, all while under constant surveillance, would be a nightmare. Amphibious landings are among the most complex military maneuvers, and Taiwan¡¯s beaches are few, narrow and overlooked by mountains.

The Central Mountain Range is another massive obstacle. Even if Chinese forces were to establish a beachhead, pushing inland against defenders who know the terrain would be extremely costly. The urban density of western Taiwan ¡ª cities like Taipei, Taichung, Tainan and Kaohsiung ¡ª would turn any invasion into prolonged urban warfare.

Achieving air dominance would also be challenging. Taiwan¡¯s air bases are hardened, and its air defense systems are distributed. China has numerical superiority, but Taiwan has invested in survivability and asymmetric strategies, mobile missile launchers, sea mines, fast attack craft and cyber resilience.

Ultimately, the political reality is that any conflict in Taiwan would not be a local affair. The United States, Japan and potentially other regional actors would be drawn in. For China, the risks of escalation are immense.

Thus, when I traveled across Taiwan, through its bustling cities, mountain ridges and harbors, I saw not just beauty but layers of defense. Geography is Taiwan¡¯s silent ally.

A modern nation under pressure

What struck me throughout my visit was how little the ordinary Taiwanese people seemed burdened by the constant Chinese threat. Life in Taipei¡¯s night markets, Tainan¡¯s temples and Kaohsiung¡¯s art districts was vibrant, unhurried and deeply rooted in everyday joys. This resilience is Taiwan¡¯s greatest strength.

Despite the ominous shadow across the strait, Taiwan has chosen not to live in fear. Instead, it has built world-class infrastructure, nurtured a thriving democracy and cultivated a distinctive cultural identity. That, perhaps, is the most powerful form of resistance: to live well despite the looming storm.

Reflections: Taiwan as a lesson

As I concluded my journey and prepared to return to Singapore, I reflected on what Taiwan meant to me both as a traveler and as a defense analyst.

For the traveler in me, Taiwan was a delight, a land of excellent infrastructure, kind people, delicious food and breathtaking landscapes. From the neon lights of Taipei to the quiet harbors of the north, the historic temples of Tainan and the dynamic port of Kaohsiung, Taiwan offered experiences that were rich and varied.

For the strategist in me, Taiwan was a case study in resilience. Its geography, infrastructure and society together create a formidable challenge for any adversary. The looming threat of China is real, but Taiwan¡¯s strength lies not just in weapons or alliances but in its will to endure and its confidence in the future.

More than a journey

My visit to Taiwan was more than a journey; it was an education. I traveled as a tourist, but I returned with a deeper appreciation of a society that has built modernity under constant pressure. Taiwan, to me, symbolizes courage: the courage to live fully despite threats, the courage to build despite uncertainty and the courage to stand tall in a turbulent region.

As an Indian defense analyst, I cannot help but draw parallels. Geography, resilience and the will of the people often determine the outcomes of history more than sheer numbers or military might. Taiwan embodies that truth.

In the end, I left Taiwan with admiration and hope for its people, for its democracy and for its place in Asia. And perhaps that is the greatest lesson Taiwan teaches: that survival is not enough; one must also thrive.

[Shokin Chauhan first published this piece on .]

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post Taiwan: A Journey Through Its Landscapes and Strategic Realities appeared first on 51³Ô¹Ï.

Materiality

The of this institution, in its modern sense, dates back to 17th-century Holland. Its main characteristics were a permanent share capital, publicly tradable shares, separation of ownership and management, limited liability for shareholders and a State charter granting it monopoly rights. It wouldn¡¯t take long, though, before England emerged as a rival. The Glorious Revolution, which put the Dutch Stadtholder on the throne of England under the name of William III, was responsible for bringing these new notions to London.

, however, remained reluctant to the concept of publicly tradable shares. There, the company¡¯s capital tended to be state-owned. This resulted from the resounding failure of its first major private company, which John Law at the beginning of the 18th century.

However, notwithstanding their publicly tradable shares, Dutch and English companies their aims at the service of the grand purposes of the State or the Crown. In this regard, they were not all that different from the French ones. They all became, indeed, implementing tools of the State¡¯s mercantilist and imperialist policies.

In the case of Dutch and English companies, the conquest and colonization of overseas territories was entrusted to them through State charters that granted them commercial monopolies. To this end, these companies had their own armies and fleets, administered territories autonomously and waged war against rival countries and companies. All of this, while the State not only retained a significant share of the profits but also had its flag flying over the conquered territories.

The Dutch East India Company (), responsible for the spice trade with the Far East, was the first major global corporation. It boasted 150 ships, 40 large warships, 50,000 employees and a highly equipped private army of 10,000 soldiers. The English and the French East India companies would the VOC¡¯s size some years later, and the three would vie for control over countries, raw materials and trade routes.

England would eventually reach the top of this competition, bringing this corporate vision of trade and international relations to its highest expression. By , Robert Clive, at the head of the army of the British East India Company (EIC), had conquered a large share of India.

Contrary to the Virginia Company and the Plymouth Company, dating back a century earlier ¡ª both English joint-stock companies chartered by the Crown to establish permanent English colonies in North America ¡ª the function of government in India remained in the hands of the EIC. Indeed, whereas in the former two cases the Crown retained government, it would take until for it to assume direct governmental responsibilities over India.

In the final years of the 19th century and the beginning of the 20th century, the British South Africa Company, a public joint-stock company headed by Cecil Rhodes, also had its own . With it, it conquered the territory of what was to be called Rhodesia (present-day Zambia and Zimbabwe). By Royal Charter, this company was entitled to raise its own police, exert control over taxation, make administrative regulations, grant land rights and establish courts. For all practical purposes, it like a private government very much in the same manner in which the East India Company had done before.?

If something characterized institutions such as the VOC, the EIC or the British South Africa Company, it was their sheer materiality. This means: armies, war fleets, territories and their capacity to wage wars. To an important extent, they represented the most visible manifestation of the power of their states.

Immateriality

Fast forward to the end of the 20th century and the beginning of the 21st (100 years after Rhodes¡¯s exertions in Southern Africa), the nature of the company as an institution changed completely. From its raw materiality, it had evolved into an increasing immateriality. Indeed, globalization led big corporations to divest from everything that wasn¡¯t core to their business, making them more and more bodyless.

The assembly line, which since the time of Henry Ford had become the essence of the manufacturing process, reached such a point of specialization during the height of globalization that it got fragmented. The different components of a single final product came to be manufactured in numerous factories scattered across multiple countries.

Within this model, the large corporation focused on finding the lowest-cost worker for each constituent part of the manufacturing process. Wherever he could be found. But, at the same time, it went on the hunt for the most economical engineer, designer, accountant, financial analyst or customer service representative, also, anywhere in the world. This, of course, required targeting those countries where a higher level of qualifications and lower costs converged for each specific function.

As Thomas L. Friedman , with the global economy transformed into a level playing field of sorts, there was little impediment to having not only production, but also design, research or services, broken up and scattered around the world. All of the above, needless to say, implied a massive outsourcing of blue-collar and white-collar jobs.

This process not only involved outsourcing manufacturing and service operations to other countries but, even more significantly, outsourcing them to other companies. Increasingly, manufacturing and services were not performed directly by the multinational corporations themselves, but were outsourced to local companies in the countries involved. That is, smaller companies were scattered across the most diverse latitudes. As a result, big corporations were able to rid themselves of labor obligations that had traditionally burdened their finances.

Following this trend, the large corporation of the early 21st century tended to strip itself of everything that was not core to its business. Ultimately, the corporation jealously guarded brands and patents, its two fundamental assets, while outsourcing as many functions as possible. Hence, corporation¡¯s notorious contrast with the Dutch or the British East Indian companies, whose materiality runs counter to the disembodiment hereby pursued. 

Materiality or immateriality?

Recent but fundamental changes, though, have brought back materiality into the life of big corporations. The resurgence of geopolitics, the disruption of global supply chains brought about by COVID, the reduction of production costs in developed countries driven by technology, and, most recently, US industrial policies and increasing tariffs, have profoundly undermined globalization.

Under these circumstances, divesting itself from noncore functions lost its meaning. Nowadays, companies are integrating vertically once again, strengthening themselves by adding functions and, above all, .

Is this newfound materiality, thus, the prevailing trend within the corporate world of our day? Not necessarily. Jointly with it, immateriality is the main characteristic of the most consequential technology shaping the future: Artificial Intelligence. A technology based on data, algorithms and computing. Meaning, soft assets that can be shared or duplicated without depletion. AI companies, indeed, do not depend on the accumulation of people or of huge assets, beyond those necessary to make their ethereal nature functional: energy, computer hardware, and networking and data storage infrastructures.

Let¡¯s just consider the event that took place on , 2023, inside OpenAI, the pioneer of ChatGPT. Reacting against the dismissal of its President and founder, Sam Altman, by the board of directors, 70% of the company¡¯s staff rebelled, threatening to resign. Indeed, 738 of the company¡¯s 770 employees forcefully demanded the reinstatement of Altman and the departure of the board members. In other words, a company that was revolutionizing the modern economy had a workforce of fewer than 800 employees.

Since then, OpenAI has somewhat grown. As of 2025, it has employees. Meanwhile, Anthropic, one of its main competitors, valued at $61.5 billion, has just employees. Mistral AI, with a reported value of $12 billion, has employees, while Thinking Machines Lab, also with a valuation of $12 billion, has even fewer personnel: just employees.

The main characteristic of companies like these is that they have very leveraged teams. Meaning, a small group of people that produces an unusually large amount of output, economic impact or value. Within them, each employee can generate high amounts in revenue, as, by its own nature, AI is scalable. That is, able to grow significantly without needing a proportional increase in costs or efforts.

However, the scalability of Artificial Intelligence is not limited to the companies that produce it. As countless corporations in other fields are in the process of engaging with AI for their own business purposes, jobs will undoubtedly be lost to it. The implications of this are clear: Increasing immateriality could be the sign of the corporate world of the future ¡ª a very costly immateriality, indeed, when measured in human terms.

The gigantic level of power that can be attained through immaterial algorithms (including machine learning or pattern-recognition ones) is something that Robert Clive, despite his soldiers, war fleets, weaponry and huge territories under his control, could never have imagined possible.

[ edited this piece.]

The views expressed in this article are the author¡¯s own and do not necessarily reflect 51³Ô¹Ï¡¯s editorial policy.

The post Corporate Power: From Armies and Cannons to AI appeared first on 51³Ô¹Ï.