Indo-Pacific Geopolitics Newsletter 07/03/2023 – Foreign Brief

Geopolitics Newsletter June 26 – July 3 2023

CHINA ADOPTS NEW FOREIGN RELATIONS LAW – July 1

China passed a new foreign relations law on July 1 allowing Beijing to use countermeasures against perceived hostile actions by foreign governments that threaten Chinese security and sovereignty. It also strengthens President Xi Jinping’s control over the government by putting CCP leadership [EXTERNAL], rather than the government, directly in charge of Chinese foreign policy. While vague, the new law is broadly viewed as a response to US legislation blocking American companies from exporting critical technology, such as microchips, to China.

Beijing has struggled to respond effectively to Washington’s actions. China has recently sought to increase its own sanctions resiliency and implemented sanctions against Western, and particularly American, companies to punish them for new Western export controls on advanced tech. This law is meant to aid those policies by facilitating future action.

Given the law’s generally aggressive take on foreign policy, it is likely China will impose its own counter-sanctions on Western chip manufacturers or bar access to critical raw materials. Such actions are expected to continue in the medium term, as China responds to further Western sanctions aimed at slowing their economic and military development. Read more here.

Indo-Pacific

Australian defense minister concludes trip to the Solomon Islands — Jun. 29

Australian Defense Minister Richard Marles traveled to the Solomon Islands to meet with government and community leaders, as well as Australian troops. After the island nation signed a security pact with China in April 2022, Canberra sought to strengthen ties by boosting infrastructure and security investment. Read more

The third China-Africa Economic and Trade Expo begins in Hunan — Jun. 29

At the expo, Chinese and African dignitaries, diplomats, and representatives of international financial institutions discussed trade and investment in green infrastructure under the theme “Common Development for a Shared Future”. Following the expo, e-commerce, and online shopping activities are expected to increase. Read more

Pacific Vanguard 2023 exercises begin in Guam — July 1

South Korea will join the Pacific Vanguard, a joint military exercise between the US, Japan, and Australia. The US and its Asia-Pacific allies have ramped up military cooperation and exercises in the region, as they seek to counter China’s expanding military capabilities. Read more

Politics and Society

Sri Lanka Central Bank begins its holiday season — Jun. 29

The Central Bank of Sri Lanka began its five-day holiday session allowing the Parliament to restructure domestic debt. The period will help the economic officials to convene with the government and cabinet to present a debt restructuring arrangement to Parliament. Read more

French verdict reached on a defendant accused of Rwanda genocide — Jun. 30 

A French Court reached a verdict on defendant Philippe Hategekimana, former Rwandan gendarme, accused of participating in the 1994 Rwanda Genocide. He is the fifth defendant to be tried in France for crimes committed during the genocide. Since 1994, Rwanda has accused France of harboring and shielding suspected perpetrators of the genocide. Read more

National Security

US extended National Emergency Declaration on North Korea — Jun. 26

The Biden administration will extend the national emergency, which gives the executive branch more flexibility in responding diplomatically, economically, and militarily against North Korea, for another year. The declaration likely hinders the prospect of diplomatic relations between the two countries and encourages further conflict. Read more

UNSC voted to end its mission in Mali — Jun. 29

The United Nations Security Council (UNSC) voted against extending its peacekeeping mission in Mali. The UN and Mali have been at odds over the presence of the UN’s 12,000-strong peacekeeper force as well as its effectiveness at counterinsurgency. Read more

Finance, Economics, and Technology

China hosted the Summer Davos Forum — Jun. 27

Chinese Premier Li Qiang delivered the keynote speech at the World Economic Forum’s 14th annual meeting. As China attempts to revitalize its economy after a slump caused by the COVID-19 pandemic, Beijing is expected to pursue bilateral economic partnerships with countries like Saudi Arabia. Cooperation with the private sector, however, will likely be limited as some private companies divest from China. Read more

EU published Digital Euro legislation — Jun. 28

The European Commission published legislation on the introduction of a digital euro. Later in the year, the European Central Bank will decide whether to proceed with the legislation. Read more

Sri Lanka Central Bank began its holiday session — Jun. 29

The Central Bank of Sri Lanka began a five-day holiday session to allow Parliament to restructure domestic debt following a historic economic collapse in 2022. Immediate action on debt repayments may stimulate the economy, and interest rates may be reduced to encourage domestic spending.

THE WEEK AHEAD:

Japan: IAEA’s Director General begins visit to Japan — July 4

International Atomic Energy Agency (IAEA) Director General Rafael Grossi begins his visit to Japan today. He aims to assess the country’s plan to release treated radioactive water from the damaged Fukushima Daiichi nuclear power plant into the Pacific Ocean. Read more

United States: Swedish PM Ulf Kristersson visits the US — July 5

US President Joe Biden will host Swedish Prime Minister Ulf Kristersson to discuss transatlantic security cooperation and Sweden’s bid to join the NATO bloc.

Contributions by: Wescott Yeaw, Kyle Rose, Simran Sharma, Tudor Boanda, and Andrew Alipui