Posts Tagged ‘U.S.’

US-China trade war accelerating South Korean companies’ plans to exit China

December 14, 2018

From economic to diplomatic to military fronts, private sector and government both taking steps to avoid being caught in a clash of major powers

South China Morning Post

t’s an uneasy time for Asian nations as the rivalry between China and the United States intensifies and uncertainty hangs on whether they can resolve their trade war beyond the 90-day truce. In this special series the South China Morning Post explores how the China-US rivalry is affecting four countries in Asia. In part two, Lee Jeong-ho looks at South Korea.

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As the confrontation between China and the United States spills over from trade to a wider range of issues challenging their relations, South Korea is taking steps on the economic, diplomatic and military fronts to avoid being caught between the two giants.

By Lee Jeong-ho

South Korea, which relies on the US for its security and on China for its economy, is among the nations that stand to suffer serious collateral damage from the trade war. The clashes of the two heavyweights vying for greater geopolitical interests over the Korean peninsula have sandwiched the “middle power”, with South Korea unable to fully accommodate both the US and China’s demands.

This is not South Korea’s first experience being caught between major powers in a period of transition. Indeed, the peninsula’s location has historically drawn great powers to engage it. Koreans have seen their lands used by major powers as a proxy to achieve geopolitical interests in the first Sino-Japanese war, the Russo-Japanese war and, of course, the Korean war, all of which resulted in millions of casualties and total destruction.

Vowing to learn from history, though, South Korea – both the government and the private sector – is implementing a new strategy to actively hedge the risks.

Samsung Electronics closed its China network equipment manufacturing unit in Shenzhen last year, and moved a production base to Vietnam. Photo: EPA

Economic shelter from the trade storm

The US-China trade collision is accelerating South Korean companies’ plans to exit China and would further lessen their presence in the world’s second-largest economy.

South Korean firms have long considered relocating their production facilities, due to rising wages and political uncertainties in China. Well before the current circumstances, the pace of South Korean manufacturers’ investment in China had already slowed for the past few years due to China’s unfair market practices and increased labour costs, according to a white paper by the Korea Chamber of Commerce in China.

Samsung Electronics, the world’s largest mobile phone maker, closed its China network equipment manufacturing unit in Shenzhen last year, and moved a production base to Vietnam. Samsung is also considering shutting its Tianjin mobile phone production plant by the end of this year, according to South Korean media outlet Electronic Times.

Samsung did not respond to a request for comment.

Still, experts say the US-China trade war has firmed the resolve of South Korean companies to exit China and seek other destinations for their investments.

One beneficiary is Vietnam: South Korean investment there came to US$1.97 billion in the first half of this year, exceeding South Korean investment in China – US$1.60 billion over the same period – for the first time, according to data compiled by the Export-Import Bank of Korea.

A Lotte Mart that closed down in Jiaxing, Zhejiang province, in 2017. Photo: Reuters

The South Korean retail giant, Lotte, is diversifying into Vietnam, planning to build the Lotte Mall Hanoi, a US$600 million multi-purpose shopping centre, by 2020. Construction will include a hotel, flats, offices and a trade-centre complex.

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Kim Ill-san, chief representative of the Korea International Trade Association in Vietnam, said the US-China trade war had spurred many South Korean firms to move factories from China and into Vietnam to avoid tariffs slapped by Washington on products made in China.

“The change in the price of raw materials – due to the US-China trade war – is working as a burden for South Korean firms in China, making them shift their production base to Southeast Asia, including Vietnam,” Kim said.

“China’s increased labour costs would also be another reason for the decision. The [monthly] labour cost of manufacturing workers in China, on average, is approaching US$800 per person, while in Southeast Asia it marks about US$250-400.”

Kim Yun-hee, a senior trade commissioner at the Korea Trade-Investment Promotion Agency office in Beijing, said South Korean corporations in China were particularly concerned about the effects of a protracted US-China trade war.

“Increased cost and changes in exchange rates are some of the direct impacts of the US-China [trade] war on the corporations. Meanwhile, the increased uncertainties in the global trading environment are acting as an indirect impact to burden the businesses,” Kim Yun-hee said.

With a revised US-South Korea trade agreement, or KORUS, recently concluded with the Trump administration, South Korean companies might also consider bringing businesses back to their home, observers said.

“Southeast Asia, so far, has largely been spared from Trump’s tariff wrath … [but] Korean companies might also take another look at their own home market now that a revised KORUS agreement is in place. Higher costs aside, producing at home can at least give Korean companies US market access certainty,” Sean King, vice-president of political strategy firm Park Strategies, said.

Diversifying production facilities would also ease some of the huge fallout South Korean firms have faced from the THAAD dispute.

South Korean firms came under great pressure from China after Seoul deployed the US military’s Terminal High Altitude Area Defence system in Seongju county. South Korea says the anti-missile system is necessary to ward off threats from the North while China sees it as a challenge to its defences.

“The real turning point for South Korean companies in mainland China was … [being] mercilessly targeted by authorities after South Korea deployed THAAD … I think there’s a ‘before and after THAAD’ syndrome for South Korean companies in mainland China,” King said.

North Korean leader Kim Jong-un (left) and South Korean President Moon Jae-in after signing a joint statement at the border village of Panmunjom on April 27. Photo: AP

Minimising the US-China diplomatic factor

In addition to moving production out of China, South Korea is also trying to ensure its influence over the Korean peninsula.

Aside from the US-China trade war, of course, 2018 has been marked by the rapid thawing of relations with North Korea, with President Moon Jae-in seizing the chance to work with the North Korean leader Kim Jong-un. Seoul has focused on rebuilding its relations with Pyongyang, taking part in three inter-Korean summit meetings since April.

“An inter-Korean joint military committee will be activated shortly to avoid accidental military collision … the two Koreas have agreed to enhance exchanges and cooperation,” the September Pyongyang Declaration stated.

One reason behind Seoul’s peace initiatives was to remove the Korean peninsula as a bargaining chip in the US-China competition.

Park Byeong-seug, a South Korean lawmaker with Moon’s Democratic Party of Korea, said Seoul was trying its best to be an independent actor by improving its standing with North Korea during a transitional period of power relationships.

“It is in Seoul’s best interests to minimise its damage caused by the two countries’ hegemonic rivalry … and the only way to achieve that is by enhancing the relations with Pyongyang to create a new diplomatic space. If we go back to the cold war, there is nothing much Seoul can do as an actor,” Park said.

“US-China relations may further deteriorate beyond trade. A currency war and petroleum war between the two countries may ignite in the worst-case scenario.”

The deterioration of inter-Korean relations will only squeeze Seoul’s diplomatic space amid the intensifying US-China rivalry.

“The Korean peninsula becomes a subordinate factor of US-China relations if inter-Korean relations do not improve. This is why the Moon administration is focusing so much on improving inter-Korean relations … It will give Seoul the power to overcome the structural problem between the US and China to maximise Korean interests,” said Boo Seung-chan, a research fellow at the Yonsei Institute for North Korean Studies in Seoul.

South Korean naval destroyers with other vessels during an International Fleet Review held off Jeju Island in October. Photo: AP

Wading into deeper military waters

South Korea is also building up its own defences amid the uncertainty of the US military commitment on the region.

Seoul announced in October plans to expand its maritime forces into a blue-water navy – capable of operating globally, across oceans – to safeguard its strategic interests against China’s maritime expansion over the South China Sea.

A blue-water navy fleet “will contribute to expand the navy’s operational area into far seas, to secure maritime traffic routes, and ensure the free maritime activities and the safety of our citizens”, the South Korean navy reported to parliament in October, adding that it would also build an air command to support military aircraft and airborne weapon systems.

South Korea’s navy has traditionally been almost exclusively concerned with coastal operations, to maximise its military readiness against North Korea. But as Beijing – which has overlapping exclusive economic zones (EEZ) with Seoul in the Yellow Sea – speeds up its military modernisation, Seoul’s concerns have grown.

The South Korean defence ministry said in September that it would closely monitor China’s installation of buoys in the two countries’ EEZs.

That concern grew sharply last year as US President Donald Trump repeatedly complained that South Korea was relying on the US too much for its security, raising the possibility that the US might weaken its commitments to the region.

Moon Jang-nyeol, a professor at Korea National Defence University, said South Korea would continue to strengthen its naval force.

“South Korea has long pursued having a blue-water navy to build a deterrent capability against the powerful peripheral states … Its decision to improve its naval force capacity is less likely to change, and its spending may continue to increase,” Moon said.

“But the chance of South Korea engaging in international disputes such as the South China Sea is quite low. Its main goal is to balance the power over the region, more than actually engaging in those conflicts.”


Saudi Arabia to Target U.S. With Sharp Oil Export Cut, Sources Say

December 13, 2018

After flooding the U.S. market in recent months, Saudi Arabia plans to slash exports to the world’s largest oil market in the coming weeks in an effort to dampen visible build-ups in crude inventories.

American-based oil refiners have been told to expect much lower shipments from the kingdom in January than in recent months following the OPEC agreement to reduce production, according to people briefed on the plans of state oil company Saudi Aramco.

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Saudi crude shipments to the U.S. next month could even test the 30-year low set in late 2017 of 582,000 barrels a day, down about 40 percent from the most recent three-month average, the same people said, asking not to be named as the information isn’t public. The final figure could still change, they added.

By shifting the focus of Saudi export reductions toward the U.S., Riyadh hopes to show to the market it’s making good on its promise to cut supplies. Fluctuations in U.S. crude imports and stockpiles have an outsize impact on the market because data are available on a weekly basis. In other regions, oil traders only get official figures on a monthly basis, or not at all in the case of stockpiles in big consumers such as China and India.

The Saudi energy ministry didn’t respond to a request for comment.

While the plan to slash Saudi exports to America may ultimately convince a skeptical oil market about the kingdom’s resolution to bring supply and demand in line, it may anger U.S. President Donald Trump, who has used social media to ask the Saudis and OPEC to keep the taps open.

Donald J. Trump


Hopefully OPEC will be keeping oil flows as is, not restricted. The World does not want to see, or need, higher oil prices!

31.9K people are talking about this

Saudi total exports are set to drop to around 7 million barrels a day in January, down from about 8 million barrels a day in November-December, one of the people said. Khalid Al-Falih, the kingdom’s energy minister, told reporters last week that Saudi production will drop in January to 10.2 million barrels a day, down from 11.1 million barrels a day in November.

The oil market has so far largely ignored the production cuts that OPEC and its allies announced in early December, a larger-than-expected 1.2 million barrels a day — or just over 1 percent of global demand. Despite the OPEC+ curbs, benchmark Brent crude has hovered near $60 a barrel. Futures in London jumped 2.2 percent Thursday on the prospect of lower Saudi shipments to the U.S., closing at $61.45. Prices are still down 7.7 percent for the year.

The export curbs, if fully implemented, will affect big U.S. refiners such as Valero Energy Corp., Phillips 66, Chevron Corp., Exxon Mobil Corp., and Marathon Petroleum Corp. forcing them to buy similar crude elsewhere, such as Mexico, Canada or Venezuela. They could also hit Motiva Enterprises LLC, the Saudi-owned company that operates the largest refinery in the U.S.

Saudi Arabia has shipped 860,000 barrels a day of crude to the U.S. on average so far this year, according to Bloomberg calculations based on weekly customs data. Saudi exports into America had run even higher in the second half of the year, with July-to-December shipments rising to an average of 975,000 barrels a day, according to Bloomberg calculations.

Inventories Scrutinized

Oil trader Andy Hall, who earned the nickname “God” for his prescient calls on pricing before closing his hedge fund after suffering losses last year, says the oil market is heavily influenced by data like the weekly U.S. stockpile figures.

“People look at these things, scrutinize them,” he said of the data on Bloomberg Television Thursday. “The fact is, they only cover the U.S., which is 25 percent of the world oil market. The data available for inventories elsewhere in the world is poor at best.”

Hall now serves on the advisory board of Orbital Insight, a Palo Alto-based provider of analytic platforms to translate satellite and aerial images into useful data, including global oil supplies.

Senate Passes Resolution to Withdraw U.S. Support for War in Yemen

December 13, 2018

Resolution faces limited prospects for passage in House this year

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Sen. Bernie Sanders, the Vermont independent, was co-sponsor of a resolution to withdraw U.S. support for the war in Yemen.

WASHINGTON—The U.S. Senate ignored appeals by the Trump administration and passed a resolution on Thursday to withdraw U.S. support for the Saudi-led coalition at war in Yemen, delivering a bipartisan setback for the president’s Middle East policy.

The measure, which passed in a 56-41 vote, pits a Senate upset by the October killing of journalist Jamal Khashoggi by Saudi agents against the Trump administration, which views Saudi Arabia as a vital strategic ally. Seven Republicans joined with all 49 members of the Democratic caucus to support the resolution. Three Republican senators were absent.

The resolution, sponsored by Sens. Bernie Sanders (I., Vt.) and Mike Lee (R., Utah), would withdraw U.S. military support for the Saudi-led coalition fighting Iran-allied Houthi militants in a conflict that has left tens of thousands dead and pushed millions to the brink of starvation. Among other elements, it would bar U.S. refueling of Saudi planes and scale back the U.S. presence in the region.

While setting up a clash between the Senate and Trump administration, the resolution is unlikely to affect U.S. military policy in the region. House Republican leaders on Wednesday stopped an effort that would have forced a vote on a similar Yemen resolution on the floor.

The CIA’s Evidence Linking Saudi Crown Prince to Khashoggi Killing

The CIA’s Evidence Linking Saudi Crown Prince to Khashoggi Killing
How did the CIA conclude that journalist Jamal Khashoggi was killed on the orders of Saudi Crown Prince Mohammed bin Salman? WSJ’s Warren P. Strobel has an exclusive look at the secretive evidence behind the assessment. Photo: Reuters

“It’s important to send a message,” Mr. Sanders told reporters before the vote, adding that it could come up next year. “My very strong expectation is that in January, with Democratic control over the House, it will succeed.”

After the Senate approved the resolution, it also unanimously passed a resolution with broad bipartisan sponsorship that condemned the killing of Mr. Khashoggi and directly connected Saudi Crown Prince Mohammed bin Salman to the journalist’s death.

“It’s a strong statement of our condemnation of what has happened. To me, that’s important even if it doesn’t affect policy,” said Sen. Bob Corker (R., Tenn.).

The Saudi government has repeatedly said the crown prince had no knowledge of the operation.

The Wall Street Journal reported earlier this month that the Central Intelligence Agency determined in a highly classified assessment that Prince Mohammed sent at least 11 messages to his closest adviser, who oversaw the team that killed Mr. Khashoggi, in the hours before and after the journalist’s death.

Senior administration officials urged senators to vote against the Sanders-Lee resolution, arguing that withdrawing U.S. support would only harm the international effort to secure an end to the conflict and hinder efforts to contain Iran.

A Yemeni man sits in front of a destroyed building allegedly targeted by a Saudi-led airstrike, in San'a, Yemen, earlier this month.
A Yemeni man sits in front of a destroyed building allegedly targeted by a Saudi-led airstrike, in San’a, Yemen, earlier this month. PHOTO: YAHYA ARHAB/SHUTTERSTOCK

The congressional action came hours after the warring parties meeting at United Nations-led peace talks in Sweden agreed to a breakthrough deal meant to avert a dangerous military fight over Yemen’s most important port city.

Martin Griffiths, the U.N. special envoy on Yemen, secured agreement on Thursday from both sides for a peaceful handover of control of the Hodeidah port from Houthi fighters to U.N. forces, a deal designed to avert a risky military fight for the country’s main gateway for humanitarian aid.

The agreement marked a rare moment of diplomatic success in the four-year-old conflict.

Mr. Griffiths is hoping to use the peace talks in Sweden as a launching pad for more substantive talks to resolve the war in Yemen, which the U.N. says is home to the worst humanitarian crisis in the world.

“The progress on the peace negotiations is not coincidental to this vote,” said Sen. Chris Murphy (D., Conn.). “The United States has said through the Senate that our support for the Saudi-led coalition is no longer open-ended. We expect our partners to be partners in peace.”

In addition to the Sanders-Lee resolution, the Senate is also reviewing a separate bill introduced last week by Sen. Bob Menendez (D., N.J.) and Sen. Todd Young (R., Ind.) that would suspend weapons sales to Saudi Arabia, sanction people who block humanitarian access in Yemen or aid Houthi rebels there, as well as sanction those responsible for Mr. Khashoggi’s death.

Write to Natalie Andrews at and Dion Nissenbaum at

Senate votes to condemn Saudi Crown Prince Mohammed bin Salman as responsible for Khashoggi killing

December 13, 2018

The Senate cast two historic votes Thursday to end U.S. participation in the Saudi-led war effort in Yemen and condemn the Saudi crown prince as responsible for the killing of journalist Jamal Khashoggi, delivering clear political rebukes of President Trump’s continued embrace of the kingdom.

The unanimous vote to hold Crown Prince Mohammed bin Salman responsible for Khashoggi’s murder reflects the extent to which senators of both parties have grown tired of Trump’s continued defense of Mohammed’s denials. It also puts significant pressure on leaders in the House — where the president’s Saudi policy is a much more partisan issue — to allow members to cast a similar vote condemning the crown prince before the end of the year.

Regardless, the two Senate votes Thursday set the stage for broader strategic debates about Saudi policy when Congress regroups next year.

Sen. Bob Corker (R-Tenn.) speaks to the media as the Senate prepares to vote on whether to end U.S. military support for the Saudi-led war in Yemen. (Jim Lo Scalzo/EPA-EFE/REX/Shutterstock)

Just before the Senate voted to condemn Mohammed over Khashoggi’s murder, senators voted 56-to-41 vote to end U.S. participation in the Saudi-led campaign in Yemen by invoking the War Powers Resolution — the first time a chamber of Congress has ever done so.

More importantly, the 56-vote majority — a figure that includes seven Republicans — suggests that Saudi critics will still have a majority next year to challenge Trump on Saudi policy. Both Republicans and Democrats have said they plan to pursue sanctions against Saudi officials involved in Khashoggi’s murder, to stop the transfer of nondefensive weapons until Saudi forces withdraw from Yemen, and other measures to restrain a crown prince whom many lawmakers see as out of control.

“Today we tell the despotic regime in Saudi Arabia that we will not be part of their military adventurism,” said Sen. Bernie Sanders (I-Vt.), who co-sponsored the Yemen resolution with Sen. Mike Lee (R-Utah). “Today, for the first time, we are going to go forward . . . and tell the president of the United States, and any president … that the constitutional responsibility of making war rests in the United States Congress, not the White House.”

The votes came just hours after Secretary of State Mike Pompeo and Defense Secretary Jim Mattis briefed House lawmakers behind closed doors — a meeting from which Republicans and Democrats emerged urging very different responses to Saudi Arabia and its crown prince.

A recent CIA assessment found Mohammed was probably responsible for the killing of Khashoggi, a Washington Post contributing columnist, in a Saudi consulate in Istanbul on Oct. 2.

“They have to be held responsible,” Rep. Eliot L. Engel (D-N.Y.), the incoming chairman of the House Foreign Affairs Committee, said after the briefing, referring to Mohammed and Saudi King Salman.

But there remain Republicans in the House who defend the crown prince — and those who think that even if he should be called out for his involvement in Khashoggi’s death, the punishment should stop there.

“We recognize killing journalists is absolutely evil and despicable, but to completely realign our interests in the Middle East as a result of this, when for instance the Russians kill journalists . . . Turkey imprisons journalists?” Rep. Adam Kinzinger (R-Ill.) said. “It’s not a sinless world out there.”

That stands in sharp contrast to the Senate, where several Republicans have been encouraging a broad response to Saudi Arabia over not just Khashoggi’s killing and the Yemen war, but the Kingdom’s blockade in Qatar, its recent detainment of Lebanese Prime Minister Saad Hariri, and a slate of human rights abuses they say have compromised the U.S.-Saudi alliance.

Trump has refused to condemn Mohammed for the killing of Khashoggi, a Saudi national. Pompeo has echoed Trump’s stance in public interviews, and behind closed doors as well, lawmakers said.

“All we heard today was more disgraceful ducking and dodging by the secretary,” said Rep. Lloyd Doggett (D-Tex.), who supports bringing up a War Powers resolution in the House to cut off U.S. support for the Saudis’ Yemen war effort. On Wednesday, the House narrowly voted to block rank-and-file members from demanding a floor vote on any such Yemen resolution, after leaders slipped in a rule change to do so into an unrelated agricultural bill.

House leaders also met with CIA director Gina Haspel on Wednesday to hear the details of Khashoggi’s slaying. But they emerged offering few details about the briefing — or about what step House Democrats would take, once they assume the majority in January, to pursue more punitive measures against Saudi Arabia, beyond holding hearings.

In the Senate, meanwhile, both Republican and Democratic lawmakers are making plans to capi­tal­ize on the Yemen resolution vote with further measures next year — including sanctions on Mohammed and the other Saudis implicated in Khashoggi’s killing, and an order to halt all nondefensive weapons transfers to Saudi Arabia until hostilities in Yemen cease.

“The current relationship with Saudi Arabia is not working for America,” Sen. Lindsey O. Graham (R-S.C.) said Wednesday, in comments to reporters about what next steps senators planned to take to address Saudi policy. “I’m never going to let this go until things change in Saudi Arabia.”

Pakistan willing to use ‘little influence’ it has with Afghan Taliban to help peace talks

December 13, 2018

Pakistan is willing to use its “little influence” with the Afghan Taliban to resurrect faltering peace talks between the Kabul government and the insurgency, foreign office officials said, just days before Foreign Minister Shah Mehmood Qureshi is scheduled to visit Kabul to meet with top civilian and military leaders.

US officials have long pushed Pakistan to use its influence with Taliban leaders, who Washington says are based inside Pakistan, to bring them to the negotiating table and end a 17-year war. Islamabad vehemently denies it is covertly sheltering Taliban leaders.

“We can facilitate the peace process by using our little influence over the Afghan Taliban,” a foreign office official with knowledge of the talks told Arab News on condition of anonymity as he was not authorized to speak to the media about the issue.

Pakistan Foreign Minister Shah Mehmood Qureshi is scheduled to visit Kabul to meet with top civilian and military leaders. (Reuters)

“Pakistan is willing to bring the Afghan Taliban to the negotiating table but obviously is not in a position to forge a peace agreement with them. The modalities and all other relevant things are to be decided by the US as it is the major stakeholder,” he said.

However, he said that the Taliban seemed “least interested” in engaging with the Afghan government at a time when the next presidential elections were scheduled to be held in April next year. He said the US and Afghanistan had to mutually decide if they wanted to delay the presidential elections so the present dispensation could better engage with the Taliban or if they wanted a new government with a full five-year mandate to broker a peace deal.

Earlier this month, US President Donald Trump asked for Pakistan’s help with Afghan peace talks in a letter to Prime Minister Imran Khan.

“The peace process has started and the good thing is that the US has finally agreed to find a negotiated settlement to the Afghan conflict,” foreign office spokesman Dr. Mohammad Faisal told Arab News. “Pakistan is ready to play its role and our foreign minister will convey this to the Afghan leadership.”

Addressing a ceremony in Multan last week, Foreign Minister Qureshi said it was a testament to the robustness of Pakistan’s foreign policy that the US had asked for assistance in resolving the Afghan conflict, adding that he would visit Kabul on Dec. 15 to hold talks with the “Afghan leadership on political reconciliation and durable peace in Afghanistan.”

Pakistan is committed to an Afghan-led and Afghan-owned peace process, the minister added.

During last week’s visit to Pakistan of the US special representative for Afghanistan, Zalmay Khalilzad, Islamabad had expressed its willingness to host direct talks between representatives of the Afghan government and leaders of the Taliban if all stakeholders, including the US, agreed on a common agenda for the meeting.

“We have conveyed this to the US during the recent visit of Zalmay Khalilzad, but obviously nothing is final at this stage as different options for peace in Afghanistan are being explored,” the foreign office official said.

Last month, Khalilzad said that he hoped a peace deal would be reached by April 2019. But Afghan Taliban militants have repeatedly said that they have not accepted any deadline and that a three-day meeting in Qatar between their leaders and Khalilzad in October ended with no agreement.

In July 2015, Pakistan arranged the first official meeting of representatives of the Kabul government and the Taliban in Murree, a hill resort near Islamabad. Observers from the US and China also attended the talks. The process was, however, scuttled after the death of Taliban chief Mullah Omar, throwing fledgling efforts to negotiate into disarray.

Last week, the Afghan president constituted a 12-member committee to hold direct talks with the Taliban, but they have yet to get a nod from the militants.

Rahimullah Yousufzai, an expert on Taliban affairs, said that Pakistan can help to arrange meetings of the Taliban with the US and the Afghan government by using its influence but “there is still a long way to go.”

“The Taliban are seeking a schedule of withdrawal of foreign forces from Afghanistan and until the US agrees to that, there are little chances of moving ahead,” he told Arab News, adding that Pakistan could facilitate negotiations between the Afghan government and the Taliban as it had in the past but “nothing more than that.”

“Taliban’s international recognition has increased manifold in the past years and they are now least dependent on Pakistan’s help,” Yousafzai said.

A senior security official privy to talks said that no peace deal was possible without the ownership of the process by the Afghan people: “Right now, the biggest question is, do the Afghan people even accept this process?”

Arab News

US wants Africa to chip in more on anti-terror ops, John Bolton says

December 13, 2018

“Unfortunately, billions upon billions of U.S. taxpayer dollars have not achieved the desired effects. They have not stopped the scourge of terrorism, radicalism, and violence.

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The Trump administration is pushing African nations to take on a greater role fighting the terrorist groups that threaten them, White House national security adviser John Bolton said Thursday.

“What we’d like to do is empower the African countries to do more of their own security, to do it in coordination with one another,” Bolton said during an address on the Africa strategy at the Heritage Foundation. “They’re the ones who know the neighborhood rather than have the deployment of American forces who are comparatively very well paid and well equipped.”

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John Bolton

The Pentagon announced last month it will draw down the roughly 7,200 U.S. military personnel in Africa by 10 percent over the next several years, even as it continues support counterterrorism operations and airstrikes in places such as Somalia.

Al-Qaeda linked al-shabab recruits walk down a street on March 5, 2012 in the Deniile district of Somalian capital, Mogadishu, following their graduation

Al-Shabab is an al-Qaeda-linked group fighting to overthrow the UN-backed Somali government. AFP photo

The U.S. has a main base in Djibouti and conducts military operations including advice and assistance to partner forces across Africa. The operations, often conducted out of the public eye, sparked controversy last year when four U.S. troops were killed in an ambush in Niger.

A Somali security officer looks toward the scene of twin car bombs that exploded within moments of each other in the Somali capital Mogadishu on November 9, 2018. (AFP)

Bolton pointed to the G5 Sahel Joint Force as a model for the continent’s new independent counterterror operations. Mali, Burkina Faso, Mauritania, Niger, and Chad formed the joint force last year to fight terror groups and curb organized crime.

President Trump’s new Africa strategy focuses on countering growing Chinese and Russian influence and takes a hard-line approach to years of what Bolton described as failed U.S. aid and United Nations peacekeeping support.

“Unfortunately, billions upon billions of U.S. taxpayer dollars have not achieved the desired effects. They have not stopped the scourge of terrorism, radicalism, and violence,” Bolton said. “They have not prevented other powers, such as China and Russia, from taking advantage of African states to increase their own power and influence.”


“From now on, the United States will not tolerate this long-standing pattern of aid without effect, assistance without accountability, and relief without reform,” he said.


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© AFP/File | Burkina Faso is on the front line of the jihadist revolt in the Sahel, with gunmen launching coordinated attacks in March on the French embassy, cultural centre and the Burkinabe military headquarters in Ouagadougou

Israel encircles Ramallah after West Bank attack

December 13, 2018

Israeli forces encircled Ramallah in the occupied West Bank on Thursday and sent in reinforcements after a gunman shot dead two Israelis at a bus stop in the area, the army said.

The military was sending “a few more infantry battalions” to conduct operations in the West Bank. (File/AFP)

“Entrances and exits to the city are all closed. We are conducting searches,” army spokesman Jonathan Conricus told journalists.

He said the military was sending “a few more infantry battalions” to conduct operations in the West Bank.



A poster published by Hamas claiming the December 9, 2108, Ofra terror attack and praising the 'martyr' Salih Barghouti, posted on Hamas's official Twitter account, December 12, 2108. (Twitter)

A poster published by Hamas claiming the December 9, 2108, Ofra terror attack and praising the ‘martyr’ Salih Barghouti, posted on Hamas’s official Twitter account, December 12, 2108. (Twitter)

Democrats plot to revive earmarks — Get ready for Pork!

December 13, 2018

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House Democrats are eager to revive the notorious earmark, which is any provision that allocates cash to a pet project in a particular congressional district, when they take back the majority in January.

There is no House rule banning earmarks, but the Republican majority curtailed the practice in 2011 following allegations of corruption and years of bad publicity about projects like Alaska’s “bridge to nowhere” that came with a $320 million price tag.

Now that Democrats are poised to take charge in January, there is nothing to stop them from inserting earmarks in the fiscal 2020 spending bills next year, and lawmakers said they are hoping to soon get a piece of the federal spending pie for specific needs in their districts.

“I hope they come back,” Rep. Jim Clyburn, D-S.C., who will take over as majority whip next year, told the Washington Examiner. “I was against them ever leaving.”

Clyburn and other proponents believe the earmark moratorium imposed by Republicans usurped the authority of Congress to direct spending.

Republicans and Democrats alike have argued that the earmark ban left directed spending up to the executive branch, which does not have the same ability or motivation to fund the needs of individual congressional districts. Lawmakers want the power back in order to give them more control over federal spending for their constituents.

“That’s my argument,” Clyburn told the Washington Examiner.

Democrats in particular are eager to wrest back control of the executive branch because most are so vehemently opposed to President Trump.

“Having the Trump administration decide what is going to happen in various congressional districts is not necessarily the right approach,” Rep. Zoe Lofgren, D-Calif., told the Washington Examiner.

Returning earmarks requires no congressional action, but Democratic leaders would have to give the green light when appropriations bills are drafted next year. They are poised to do so, top leaders said this week.

But Lofgren and other veteran lawmakers in both parties are wary of simply going back to the old earmarking practices that were deemed wasteful or outright corrupt.

According to Taxpayers for Common Sense, earmarks “quintupled” between 1996 and 2005 and included spending that earned public disdain.

In 2006, Rep. Randy “Duke” Cunningham was sentenced to eight years in prison for using his perch on the House Appropriations Committee to earmark money for military contractors in exchange for bribes.

Democrats in the majority at the time added accountability and transparency to the earmark process, but Speaker John Boehner, a staunch earmark opponent, imposed a moratorium when he took over in 2011.

House Republicans have since then increasingly clamored for a limited return of earmarks for waterway and other projects, but the GOP leadership had shied away from returning to a practice that was vilified just a decade ago.

Democratic leaders do not appear hesitant at all.

“I am for what the Constitution says the Congress has the authority and responsibility to do: raise and spend money,” said Rep. Steny Hoyer, D-Md., who will become majority leader in January.

But even those who want earmarks back are wary of simply permitting earmarks without making additional changes to ensure transparency and accountability.

“It would definitely need to be different than the way it was before,” Lofgren told the Washington Examiner.

Rep. Sander Levin, D-Mich., is a proponent of earmarks, which he said he was able to use to help the neediest in his district and to acquire federal dollars for low income housing and other projects.

“The problem with earmarks is they were abused,” Levin, who has served in Congress since 1983, told the Washington Examiner. “I think they need to essentially eliminate earmarks for private entities and have them only public. There needs to be a really good look at it.”

Hoyer reminded reporters this week of the earmark reform put in place by the Democrats when they took the majority in 2006. Those changes include limiting spending to public sector and nonprofit recipients and making them transparent in legislation posted online.

Democrats also required lawmakers affirm they have no financial interest in an earmark.

“To say that a member of Congress is unable to help his or her district, I think that is incorrect,” Hoyer said. “I expect to have the majority of both parties supporting this.”


Should We Give Politicians the Power to Swap Campaign Cash for Corrupt Earmarks?

Trump sets ‘terrible precedent’ by crossing red line on Huawei case

December 13, 2018

The President’s remark is “extremely disturbing” — Crossing the red line of the rule of law.

China will see the arrest as “a plot to gain leverage in the [trade] negotiations, a plot to embarrass China, a plot to go after Huawei — any number of plots, pick your plot.”


President Donald Trump’s suggestion that he might use an arrested Chinese tech executive as a bargaining chip in trade talks with Beijing drew rebukes for setting a “terrible precedent” crossing the red line that separates American politics from the rule of law.


The remark triggered pushback from law enforcement officials, criticism from lawmakers and concern from legal and business analysts who said it’s not only a weak bargaining move that might create more friction with allies, but it represents a “poisonous” precedent that could eventually undermine the safety of Americans overseas.

Image result for Donald Trump, Pictures

“The US, like Canada, we’re both rule of law countries based on a constitution, legal principles, rule of law,” said William Reinsch, the Scholl chair for international business at the Center for Strategic and International Studies. “Our history is that things like this proceed through the criminal justice system and justice is blind. Trump is basically saying he might interfere with this process, which is a terrible precedent.”


In an interview with Reuters Tuesday, Trump said he would intervene in the case against Meng Wanzhou if it proved beneficial in securing a trade deal that has splintered relations between the two countries in recent months.
The CFO of Chinese tech giant Huawei was arrested December 1 in Vancouver for violating US sanctions on Iran — the same night Trump was dining with Chinese President Xi Jinping during the G20 summit in Argentina.

‘I would certainly intervene’


“Whatever’s good for this country, I would do,” Trump told Reuters. “If I think it’s good for what will be certainly the largest trade deal ever made — which is a very important thing — what’s good for national security, I would certainly intervene if I thought it was necessary.”

The Huawei Case Just Got (More) Political

Huawei’s Meng Wanzhou on her way home after bail hearing (Screenshot)
While Trump’s assertion to Reuters violates a basic American tenet, Reinsch notes that, “on the other hand, this is exactly the kind of thing China understands … because China isn’t a rule of law country and that’s what they would do.”
There are also the unintended consequences to worry about, said Michael Zeldin, a CNN legal analyst and former global leader of the anti-money laundering/terrorist financing and economic and trade sanctions practice at Deloitte Touche Tohmatsu in Washington.
“The danger is the unintended consequence of an American citizen abroad being arrested and held hostage to the arresting state’s economic, trade desires,” Zeldin told CNN. “But now we’ve set the appropriateness of Americans abroad being held hostage to trade deals. There’s too much danger in that,” Zeldin added. “If I was counseling the President I would say those two things should not be coupled.”
Image result for Michael Zeldin photos
Michael Zeldin
If Trump were able to follow through on his impulse, it could also create more friction with Canada, Reinsch said. “It seems to me to be an odd thing to say at this point in the process,” he said. “She’s not in US jurisdiction. She’s in Canadian jurisdiction. Intervening in the process means he would talk to [Canadian Prime Minister Justin] Trudeau, who has said more than once the normal judicial process will go ahead. It just creates another point of friction with Canada.”
Canada’s Foreign Affairs Minister Chrystia Freeland told reporters Wednesday that she has spoken with Secretary of State Mike Pompeo about Meng’s case. When asked about Trump’s comments, Freeland said Canada is not responsible for the behavior of other countries. “Canada will very faithfully follow the rule of law,” she said.

‘Let them grovel’


While Reinsch is adamant that Trump’s suggestion is not “the way we should be behaving,” he said that if Trump went ahead, it would be “a tactical mistake.”
“If you’re going to do it, the way to do it is make the Chinese come to us,” Reinsch said. “Let them grovel for a bit and then respond. You don’t give them what they want up front. What do we get if he does that? Nothing.”
At a Senate Judiciary Committee hearing Wednesday, top national security, counterintelligence and cybersecurity officials testifying on Chinese espionage threats also pushed back on Trump’s comments.
“What I do, what we do at the Justice Department, is law enforcement. We don’t do trade,” Assistant Attorney General John Demers, the department’s top national security official, said at when asked about the remarks.
“We follow the facts and we vindicate violations of US law. That’s what we’re doing when we bring those cases, and I think it’s very important for other countries to understand that we are not a tool of trade when we bring the cases,” he added.
Sen. Richard Blumenthal, the Connecticut Democrat who had asked the officials for their take on the President’s comments, said he felt “the danger of the President’s statement is that it makes it look like law enforcement is a tool of either trade or political or diplomatic ends of this country.”

‘Not in this one’


“That may be true in other countries,” Blumenthal said, “but not in this one.” The President’s remark was “extremely disturbing to me,” he said.
Image result for Richard Blumenthal, photos
Richard Blumenthal
“It seems to me,” the senator added, “that the President does a disservice to the work as well as the image of our nation in terms of law enforcement.”
Demers told the committee that if Meng is extradited from Canada, as the US has requested, “our criminal case will continue,” he said. He declined to comment further on the case.
Bill Priestap, the FBI assistant director in charge of the counterintelligence division, simply said the FBI would simply follow the motto “do your job.”
“From the FBI’s end, we’re going to continue to do our job,” he said.
Meng was arrested earlier this month at an airport in Vancouver, Canada, at the request of the US government, authorities have said.
The Chinese executive is accused of helping Huawei get around US sanctions on Iran by telling financial institutions such as HSBC that a Huawei subsidiary, Skycom, was a separate and unaffiliated company.
On Tuesday, Meng stepped out of detention after 10 days behind bars when a judge in Canada approved her release on $10 million Canadian bail ($7.5 million US).
Officials in China, where the judicial system is subordinate to the Communist Party, will have a hard time believing Meng’s arrest was due to the wheels of justice turning at their own pace, Reinsch said.
“They’ll believe it has nothing do with a judge in” New York who issued the warrant for her arrest in August, he said.
Instead, said Reinsch, a former president of the National Foreign Trade Council with long experience on US-China ties, the Chinese will see the arrest as “a plot to gain leverage in the [trade] negotiations, a plot to embarrass China, a plot to go after Huawei — any number of plots, pick your plot.”
That highlights another problem with Trump’s remarks, Reinsch said. “It will be seen as validation of what they already think, that we’re not a rule of law country,” he said. “That’s what makes it so poisonous, that they’ll think we’re just like them and we’re not.”
CORRECTION: The spelling of Meng Wanzhou’s name has been corrected.



Huawei arrest perceived as a “political kidnapping” in China

December 13, 2018


South China Morning Post

  • Foreign business executives face greater risks as US decides to target individuals in corporate misconduct cases
  • Donald Trump says he may intervene in the case, feeding into a popular belief in China that Meng’s arrest was a ‘political kidnapping’ for trade war leverage
  • US Deputy Attorney General Rod Rosenstein said in a speech on November 29 that under the revised Foreign Corrupt Practices Act, “pursuing individuals responsible for wrongdoing will be a top priority in every corporate investigation”
Image result for Huawei, logo, pictures
PUBLISHED : Thursday, 13 December, 2018, 5:01am
UPDATED : Thursday, 13 December, 2018, 1:15pm

The Huawei Case Just Got (More) Political

The Huawei Case Just Got (More) Political
The arrest of a former Canadian diplomat in China and unexpected comments from President Trump raise a fresh question about the case of Huawei’s Meng Wanzhou, who has now been released on bail: How political is it? Photo: Associated Press

The arrest of Huawei Chief Financial Officer Sabrina Meng Wanzhou is an early indication of the risks now facing foreign business executives, as American law enforcers start targeting individuals at companies that breach sanctions.

The controversy is increasingly being perceived as a “political kidnapping” in China, after US President Donald Trump suggested that he would intervene in the case as a means of gaining leverage in the trade war. For foreign corporate executives that facilitate trade with blacklisted countries, it may be a sign of things to come.

Against a backdrop of growing rivalry between Beijing and Washington, the case has infuriated the Chinese government and frayed China’s ties with Canada. It came as a result of a shift in focus by the US Department of Justice, which is centring corporate investigations on individual executives working at companies that break US laws.

Meng was arrested on fraud charges in Canada on December 1 upon the request of a district New York court, in relation to Huawei’s alleged violation of US sanctions on Iran. She has been granted US$7.5 million bail.

US Deputy Attorney General Rod Rosenstein said in a speech on November 29 that under the revised Foreign Corrupt Practices Act, “pursuing individuals responsible for wrongdoing will be a top priority in every corporate investigation”.

“The most effective deterrent to corporate criminal misconduct is identifying and punishing the people who committed the crimes. So we revised our policy to make clear that … a corporate resolution should not protect individuals from criminal liability,” read the transcript of Rosenstein’s speech.

Rosenstein said that the US Department of Justice has charged more than 30 individuals and convicted 19 in the past year, after a review of policy concerning individual accountability in corporate cases.

Previously, the US targeted the companies that breached sanctions, doling out mammoth fines to a series of international banks. However, the US targeting foreign nationals in its “long arm” law enforcement could bring fresh risks, analysts said.

Jeffrey Sachs, a professor at Columbia University and the author of A New Foreign Policy: Beyond American Exceptionalism, wrote in an opinion piece for Project Syndicate on Tuesday that, while executives should be held accountable for corporate misconduct, “to start this practice with a leading Chinese business-person, rather than the dozens of culpable US CEOs and CFOs, is a stunning provocation to the Chinese government, business community, and public”.

Sachs wrote that many banks, including US banks such as JP Morgan Chase, have violated US sanctions on Iran, but none of the CEOs or CFOs were put behind bars.

“One can say, without exaggeration, that this [arrest of Meng] is part of an economic war on China, and a reckless one at that”, he wrote.

Trump said in an exclusive interview with Reuters on Tuesday that he is open to using the case to help close a trade deal with Beijing, or for leverage in other American national security interests.

“If I think it’s good for the country, if I think it’s good for what will be certainly the largest trade deal ever made – which is a very important thing – what’s good for national security – I would certainly intervene if I thought it was necessary,” Trump told Reuters in the Oval Office.

Trump added that Chinese President Xi Jinping had not called him about the case, but said the White House had been in touch with both the Justice Department and Chinese officials over the arrest of Meng, a daughter of Huawei founder Ren Zhengfei.

This courtroom sketch shows Meng (right) in court in Vancouver. Image: Jane Wolsak via AFP

Mei Xinyu, a researcher at the Chinese Academy of International Trade and Economic Cooperation, a state-owned think tank affiliated with the Ministry of Commerce, said that Trump’s comments could be read as an “indirect confession” of kidnapping Meng.

“Isn’t this a self confession that he [Trump] had directed the kidnapping and now is blackmailing a ransom [from China]?” Mei wrote in a brief note.

Meng’s arrest in Canada has infuriated Beijing. She was apprehended while changing planes en route to Mexico from Hong Kong, after an arrest warrant was issued by the US for the alleged sanctions violations.

The Chinese foreign ministry has summoned the Canadian and US ambassadors to lodge a “strong protest” against the arrest and has demanded that Canada release Meng or face “grave consequences”.

China’s state media and researchers have widely depicted the case as a conspiracy by Washington to undermine the development of Huawei’s 5G technology, and to broadly thwart China’s rise.

“Washington should not attempt to use its domestic laws as strategic support for its commercial and diplomatic competition around the world. There is no doubt that the US actions are political, as the thin veneer of justice cannot conceal the political motives,” Chinese state-backed tabloid Global Times argued in an editorial on Tuesday.

US Attorney for the Eastern District of New York Richard P. Donoghue (centre) is trying to get Meng extradited from Canada to America. Photo: Getty Images via AFP

When Meng was released on bail on Tuesday, she was ordered to wear a GPS ankle bracelet, submit to the 24-hour supervision of a private security firm, and surrender her Hong Kong and Chinese passports.

She will live in a Vancouver home she owns with her husband. Meng has been told to return to court on February 6 to set a date for her extradition hearing.

The US is seeking her extradition on fraud charges related to alleged breaches of US and EU sanctions on Iran. Huawei has denied the charges.

“Huawei complies with all applicable laws and regulations in the countries and regions where we operate, including export control and sanction laws of the UN, US, and EU,” the company said in a statement after Meng was released.

See also:

Canadian Michael Spavor Questioned in China Following Detention of Ex-Diplomat