Totally Glocally The Asian 21st century Parag Khanna

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Well, ladies and gentlemen, a very warm welcome  on behalf of the ifa Germany's oldest intermediary   organization for international cultural relations.  For our online talk today, Asian 21st century,   this online talk is taking  place within a series of   totally glocal Stuttgart talks, Stuttgarter Weltgespräche.   In this series, we discuss urging questions  on the relationship between global and local. Focus is on successful examples of cooperation,  distinct scope of action and social inovation.   In times where more and more people feel, I would  say helpless with the effect of globalization,   transnational collaborations seems more  important than ever. Today, we are talking   about the Asian century. After this so-called  European 19th century and the American 20th,  

it's the 21st Asian? We will discuss which role  Asia plays within the future world order. Where   is Europe within global developments? Can  growth in Asia lead to more global justice?   Which contribution can country policy have to  strengthen our relations at cultural understanding   towards Asia? So, as you see, we have an exciting  seventy-five minutes ahead in our talk, a lot of   questions to be answered, ladies and gentlemen,  once again welcome, and great to have you here   with us today. For those who don't know me yet,  my name is Corinna Egerer. I'm a professional   presenter and moderator in business and politics  topics. And I have the great pleasure to guide you   through our short program today. Before we start,  I do have just a few organizational details for  

you at the event, as I said, it will last about  seventy-five minutes, and we are recording this   event. You can ask questions any time, and that's  possible via the chat. And I do want to encourage   you to do so, because we certainly want to make  sure we answer the questions that you have. So use   the chat button on the bottom of your monitor,  and just type in whatever you want to feel, or   you feel like want to know, and I'll try to  pick up as many as I can during the talk.   Well, let's get started. First of all, I'd like to  give the word to Dr. Odila Triebel, she is head  

of dialogue and research at the ifa. Dr. Triebel Thank you Corinna. Dear Parag Khanna,   ladies and gentlemen, I warmly  welcome you on behalf of ifa,   the Institut für Auslandsbeziehungen to today's  discussion of the topic, the Asian 21st century?  Today, Asian countries occupied  leading positions in the global economy,   and are becoming ever more politically relevant.  Global historians might add, they do it again.   However, while geopolitical narratives between  East and West shape our perspectives, the world   is facing a variety of common challenges, such  as global warming and the tackling of technology   challenges in our daily lives. Especially in the  financial and economic sector, our structures are  

intertwined already, enabling close ties,  but also vulnerabilities at the same time.   Therefore multilateral cooperation at eye level  in different sectors, such as economy, science,   cultural heritage, arts should be achieved. And  the first step for cooperation is, as we believe,   dialogue, that is what we try to enforce. As an  intermediary organization for cultural policy,   ifa makes a contribution by representing a  cultural concept that understands culture not as   a haven of withdraw, but as a space of openness.  Organizations, federations of States, such as the   EU, national governments, as well as regions and  cities are integral for shaping this coexistence.   It is particularly important to include  civil society in this process of political   participation. And this is our intention to  provide such an occasion in such a space here  

today. With today's event, we cordially invite  you to participate in the discussion about Asia's   past, present, future, and its role in the world,  with us together. We are delighted to welcome   today Parag Khanna as our expert to this talk.  In this, as mentioned, in the series called Total Lokal in German, translated totally  glocally, die Stuttgarter Weltgespräche.   I would also like to thank our team at ifa  for organizing and coordinating today's event.  

I wish us all a stimulating,  exciting, and informative   event, and give the floor now back  to Ms. Egerer and I'm looking forward   to your questions. Thank you very much. Thank you very much Odila Triebel. And yeah,   I'm looking forward to an exciting talk and  talking today to Parag Khanna. He's a leading   global strategy advisor, political scientist and  bestselling author, ladies and gentlemen. He's   founder and managing partner of Future Map, a data  and scenario-based strategy consulting firm, and   he worked for the World Economic Forum in Geneva,  and was advisor to the program Global Trends 2030   of the national intelligence council in the United  States. I would say he is a true global citizen.   He was born in India, grew up in the United Arab  Emirates, Germany and the United States, studied   in the UK and in the US, and during the past year  has lived both in the US, and now in Singapore.  

In addition, he has extensively traveled 150  countries, and I would say he loves the top.   Not only that he has climbed numerous  20,000 plus peaks, foot plus peaks,   he has also reached the top career wise. He was named one of  Esquires 75 most influential people of the 21st century   and frequently appears in the media world wide.  You received the OECD future leaders prize,   and was awarded young global leader of the World  Economic Forum, and as fellow of the Robert Bosch Academy.

His book, "The Future is Asian: Commerce, conflict and  culture in the 21st century", was just published   in 2019. Welcome Parag and a pleasure, and an  honor to have you here with us today. Welcome. Thank you. Thanks so much  Corinna, pleasure to be with you. So, as for a procedure, before we start our talk,  we will just do a small poll now, just to know   who's with us. Ladies and gentlemen, you are asked now, you see on the window on your screen,   a little poll. And after that, we will start  our discussion, Parag and I. And as I said,   I'll pick up the questions via the chat any  time. So, you should see our poll right now.   Yes, it is on the screen. And the question is,  from which part of the world are you watching our  

event right now? We're interested where you're  based. Oh, that looks very European. Now,   we're getting more to Asia, that's very  interesting. And the second question is,   which sector do you work in? So we're eager to see  from which parts, not only of the world, but   from which sectors you join us today, and look  for the results that we will probably get. And// Well, let me... can I ask you a quiz  question while they're answering the poll? Yes, sure.

Corinna, who coined the word glocal? Where does  the word glocal come from? Who invented it? I frankly, I don't really know, it's  being used everywhere. What's the answer?   You can use it in German, we say Glokal,  you say it in English, don't you? It's global and local, so// Does anyone else know from your team, anyone? No. We certainly know that we didn't  invent it, but we came up with this   for the series, because we do a lot, and  we thought a lot about, and wrote about   the intersection of both, and the interdependency  of the 21st century living condition.  

And so that's why I love this combination. It's a great word. It was one of  two people, and I'm not sure which,   but they were both political scientists, both  recently passed away. One is Benjamin Barber,   a political theorist who was very famous for  his work on democratic theory, cosmopolitanism,   or James Rosenau, who was an international  relations theorist. They both used the word   going back to the early 1990s, even the late 1980.   And I was a huge admirer of both of them. I  think it was more of Benjamin Barber, but//

I think so too/ for this text. All right. Well, interesting question. And  now we have the results of our poll here.   86 percent come from Europe, and 14 percent come  from Asia, none from the other continents. And   we have 36 percent from NGOs and 29 percent  from universities, then followed by government   and think tank organizations. Well, thank you  very much, ladies and gentlemen for that, very   interesting. And once again, good to have you here  with us. Parag, let's get into our discussion.   As I said, the title of your book book is "The  Future is Asian: Commerce, conflict and culture   in the 21st century". So, this is a question  back now, how you get to that topic actually?

Well, it's in a way very intuitive, I've been  living in Asia for the last seven years or so.   And this is probably the third book that was  written entirely while living in Singapore.   So I think that, you know, it's not the first  time that I've been writing about Asia as a   geopolitical entity or region, as the center of  gravity in the world. In many ways that's what,   you know, students or people roughly my age  or younger, we've grown up already with Asia   being a big part of the curriculum, in  economics and in geopolitics. So what   the reason though, why I wanted to write a book  specifically on this topic, is because I felt,   and this is of course the case with anyone who  writes a book about something, you see the gaps,   you see the weaknesses in the literature. So  some obvious ones are that most books about Asia   are basically about China. So that was a huge  gap. People talk about Asia as if it's just China,  

or China plus. And I thought to myself, well,  there are about four and a half, or five billion   people in Asia, only one point four billion  of them are Chinese. What about the rest?   Obviously having been born in India,  that's more than just a passing interest. Yeah/ sorry. No, go ahead.

And the second big gap is that people have not  treated Asia as a system. We talk about and write   about Asia as if it's always being shaped by the  United States, or in the colonial era by Europe,   or in the framework of US led alliances by  Japan and Australia. But we've never really   tried to construct an inside out appreciation and  understanding of the dynamics of the Asian system.  

In international relations we use this word  system, not just, in a very formal way, it   has a very formal definition. And there's, quite  frankly, never been a book about the Asian system,   literally never. And a system again is  where the units, the countries, the States,   the empires have more intense relations with each  other than with the rest of the world. Now, those,  

it can be a violent system or a peaceful system,  it doesn't matter. The definition of a system is   not normative. It can/ you could have war  constantly. Europe, the vast majority of   European history is the history of a conflictual  system. Europe has been a conflictual system   for millennia. It's only been a peaceful system  for the last couple of few decades. But it's been   a system for centuries. Asia has not been a system  because of colonialism, because of the cold war.   It's been geographically continuous, but India  had more to do with Britain, and Japan more to   do with America, and Australia more with Europe.  It didn't really have a gravity pulling itself  

into each other, and that is now the case.  For the first time in 500 years Asia is truly   a system. So I wanted to also make that very,  very concrete. So those are my two motivations. Very interesting. When you say a system,  is that what you mean when you talk about   a European and American or an Asian century?  Or is that, is there more to a system? Well, I wanted to be clear that, even if  Asia never influenced the rest of the world,   there is still an Asian system. So it's worth  discussing the Asian system, because Asia is   the majority of the human population, and about  half of the global economy. So Asia does not have   to influence the rest of the world directly to  be worthy of study, Asia is much of the world.  

And I/ obviously from a Euro centric or Western  centric standpoint, that's a bit of a shocking   statement, right? Because I'm obviously saying  that the Atlantic world, the Western Alliance,   and sort of Western civilization, if you will,  or the West taken as a cultural is not the center   of the world. For Asia, Europe's the periphery,  you are the periphery, America is the periphery.   America is not the center, Europe/ so it might,  might be quite stunning, for people to hear that.   But it's also irrefutable facts. I mean, these  are facts, right? It's not a debatable point that   five billion people live in this  greater Asian region, it's just a fact.   Not a debatable point that half the world's GDP  is here, that's a fact. So I wanted to, again,   write that inside out. And the funny thing is that  Asian Asians, people who are born and raised here,  

in this region, don't write things like that,  because they don't actually care to think about   that rest of/ the fact that they have not written  that is evidence that it's true, because they   don't actually care about the rest. They don't  actually spend much time caring what Europeans   think about them, or what Americans think about  them. So I think I came here as an American   to write about the inside out Asian view,  because Asians are too busy being Asians,   and living in their Asian universe, which is  the world really, as far as they are concerned.  

And there's a historical point that  I think is worth mentioning here,   that's very much about Europe. If you remember the  early centuries of global colonialism, or globe,   the expansion of global trade in the 16th century,  with the Portuguese and the Spanish empires,   remember that geographically speaking, European  kingdoms and monarchies are very, very small states. They were just, very remote provinces from  a global standpoint, right. What made European   micro States and kingdoms into global empires  was, of course, to have a presence in Asia,   and to make their trade hubs in Asia, and to  establish colonies in Asia. So the reason that   particularly Portugal and the Netherlands,  and then Britain became global empires,   is because they became Asian empires. Of  course, North America comes in as well, but you  

cannot be global unless you are Asian, right? You  cannot pretend that you are globally influential,   or globally significant as a company, or as a  country, unless you have a real influence in Asia.   So it's always been part, by always I mean,  five, 600 years, if you're not relevant in Asia,   you're not actually global. So I think  that's an interesting glocal point.   you are just local, unless you are a presence  in Asia. But again, the reverse is not true.   Asians don't have to dominate South America to be  global, because to be very blunt, South America,   or Africa, are not as important as Asia, right?  Asia again is where the center of the world   population and the economy is. So I'm not trying  to disparage any region. I'm trying to quantify   what we mean when we say global or influential.  So it's a very interesting turning of the tables,  

and I don't do it to be rhetorical because that's  not my job. I'm not a politician, I'm an analyst.   And I'm analyzing, why Asia is the way it is, what  it has meant historically and what it means today.   And yes, to some extent, maybe I'm reflecting  how Asians view the world. And I may even  

dangerously be giving them some ideas  about the confidence that they could have,   or should have about their role in the world.  But in a way, this is the way it already is. One thing I'm asking myself when you use  a term like the Asian century, and before   that the European or the American century,  is there something like a transition point,   or a starting and finishing points? One gets  started, the other is over, where do you see that? It's a great, great question. So,  I/ there's two answers. The first   is that there is definitely no formal, if  you will, turning point in this/ I mean,   sort of yes and no. The thing is that  everyone would set it differently.   And for me, I try to amalgamate and kind of think  about transitionary periods, rather than points.   Some would say that it's much easier to identify  the point at which America became the dominant   global power, it's the end of World War II, and  it's the Suez Crisis of 1956. So you have a two  

decade period where clearly great Britain's role  was shrunk immensely, and America's role became   completely, globally dominant. By the end of  World War II, the United States represented 50   percent of global GDP. So there you can identify  a very narrow period. When it comes to Asia,   I like to think of it definitely/ again, starting  points and momentum generating and so forth,   obviously the rise of Japan. Japan by 1975 was  already the world's second largest economy,   and as you probably remember, Americans used  to fear Japan as their great rival, not as a   military one, just as an economic one. So by the  1970s, you already had rising sun, Asia rising.  

And that was before China, right? China at that  point was still a completely feudal, agrarian,   province and politically, not only  communist, but utterly Maoist authoritarian.   And then in the late 1970s, you had a major China transition. So you had Japan, the tiger economies,   like South Korea, the China's rise, and all of  that was before the end of the Cold War. But just   because Asian States were becoming important,  it doesn't mean that it was the Asian century.   But the question you rightly ask is, what about  the actual anchoring of the global system around   Asia? And I would say that certainly the beginning  of the process would be the collapse of the Soviet   Union, because without the collapse of the Soviet  Union, Asian/ and the end of the Cold War, Asian   countries could not focus more on their internal  relations and their external relations. So the  

building of the Asian system definitely really  kind of begins with the end of the Cold War.   But in terms of becoming an obvious day-to-day  fact, you might say it was in the last ten years,   when China surpassed the United States as the  world's largest economy in PPP terms, when you had   the announcement of the Belt and Road Initiative  and the creation of the Asian infrastructure   investment bank, when the internal trade within  Asia surpassed Asia's trade with the rest of the   world, that was also 2014, 2015. All of these  things happened in between 2014 and 2016, some   of these very significant milestones. And that's  actually just when I started writing this book.  

But again, the term Asian century is, actually  dates back to the 18th century, with Napoleon   talking about China. And even in the late 19th  century, there were forecasts about what the   Asian century might look like and who would lead  it. But I will differentiate myself very clearly   from those people, because I never say that the  rise of Asia means the decline of the West, ever. Okay.

I have said that the West is not the center of  the world, I have not said that the West is not   important. As far as I'm concerned, the world  is multipolar. When you look at the structure of   power economically and its economic foundations,  which is by far the most important component of   power, the world is clearly multipolar. It's  an American, European and Asian world, roughly   equal, with Asia a little bit heavier,  but obviously with a lot more people,   but the world will remain multipolar for a long  time. So the difference between the transition   from a European world to an American world, or  an American world to an Asian world, is that   Asia is not destroying the West, it's not  superseding the West, it's not eliminating   the West, it's not conquering the West. None  of those things are happening. And I liken   it to just an additional layer of paint. The  world, the entire planet earth has a European  

layer of paint, a coating of European paint.  We have sovereignty, we have democracy,   we have modern political institutions, we have our  borders, everything about the organization of the   planet is European, in so many ways, and it has  not gone away. And we have an American layer, from   the American military, to the English language,  the structure of capitalism and international   financial networks. That's the American  layer of paint. And now you have Asian layers  

of paint. You have Chinese and Japanese and Indian  people, and trade, and supply chains and there are   other kinds of cultural and influence, all over  the world. So one doesn't replace the other. And   I think that's the beauty of looking at these  issues from a cultural standpoint, rather than   assuming that the world, that world history is  a zero sum competition amongst large blocks,   because that's not true of Asian history,  and it's not true of global history. So it is getting eventually more  diverse, if I understand you correctly. Absolutely.

Let's take a minute and look at  the commercial aspects of the   Asian, system, or century. As I would say, we do  have a couple of questions already coming in on the   RCEP, on the economic partnership that's just  been launched, but let's stick to that later.   Why has Asia really become so powerful  economically within the last years?   What is the reason there and which are the  most important sectors that you would define? Well, those are are very good questions.  With all stories of economic growth, it's  

a/ there's multiple factors and drivers.  Obviously there's demographics, the population of   multiple Asian countries has tripled or  quadrupled since 1945. So you have, again,   the largest concentration of people in the world,  and that's not only true today. It's been true   obviously for centuries. But so then the other  part of the story is infrastructure, investment,  

economic reforms, investment in human capital and  education, connectivity across these countries and   their growing trade, their connection to global  supply chains, empowerment of women. To be honest,   economic history is a long laundry list of  the things that you can do correctly. Not to   mention technological inputs, obviously. And  Asia is one by one, country by country, doing   all of those things, following that playbook.  In many ways, it's not necessarily special   as a story, but it's larger and it's faster,  because part of the process of history is   that knowledge diffuses faster, and technology  diffuses faster, and countries can learn from the   experience of others faster, and global supply  chains and technology transfer and investment   make all of this happen faster. So that's why  Asia has risen so incredibly, breathtakingly,  

quickly. Now in terms of key sectors, quite  frankly, the answer is absolutely everything.   And there's a big difference between invention and  innovation. And a lot of people like to say that   Asians don't innovate, or rather they don't  invent, they just copy. But I think anyone who  

knows Asia knows that's not true. If you look at a  scientific advancement, in a wide range of areas,   whether it's medical sciences, cancer treatments  and, or obviously artificial intelligence in China   and so forth, there is a great many areas where  Asians both invent and innovate. There is no   question that this is the most innovative region  in the world by far. It's not even a contest. And  

again, innovation does not mean you invented  something, innovation means you apply it. You   apply it in a novel way to your own context, to  your market, to your society, to your economy.   So for all of the things that we take for  granted, or wish we could in day to day life,   the phone that you use, who has the fastest phones  or the best cameras, right? It's Asians. Who has   the super apps where you can do cashless payments  for anything, QR codes to scan anything, all of   your/ anything that you need for data, to show,  everything. Bandwidth speeds, internet speed,   everything is better in Asia, right? And it's much  better in China than it is in America, or in the   United States. I mean, leaps and bounds better,  because they wrote their regulations from scratch.  

They were consumer friendly, and industry  friendly. They are not data privacy friendly,   obviously. They're very uneuropean in that sense,  but in terms of innovation that empowers consumers   and citizens, there's no question that Asia is  five to ten years ahead of the rest of the earth,   even in areas that were innovated or invented  in America. E-commerce, sure Amazon's great,   but Ali-Baba is way faster. And in terms  of payment platform and so forth, it's just  

leaps and bounds better. So again, the innovation  there/ this is, again, not something that we can   debate. With the facts on the table, the scale  has massively tilted towards Asia, that's just   an objective fact. And the room for improvement  though is significant in terms of just scale,   right? Let's remember that if Asia were a country,  or even Southeast Asia, this region where I live   of 700 million people, if it were a country, it  would be by far the most unequal country in the   world. There's billions of people who are still  poor in Asia, billions, especially in India,   and in parts of Southeast Asia. But that's part  of why you know that Asia will still grow a lot,   because these governments are investing the  most in infrastructure and connectivity,   and internet access, and mobile finance, and  rural electrification and all of these things.  

Asian countries, even the poorest  countries are trying very hard   to do these things in public policy, and public  finance, and social policy. So I'm optimistic   that even though they have such high inequality,  they're making big efforts to reduce poverty. What's a typical Asian strength  that you would define there?   When you say everything's so much  faster, how come? In economics you would call it the advantage of  late development. Again, these things were not   invented in Asia. The internet was not invented  in Asia. The mobile phone was not invented in   Asia. The automobile was not invented in Asia.  Electric cars were not invented in Asia. But  

all of these things are here now, in larger  number, bigger markets, more state support,   obviously that's one big factor. Again, writing  the more effective regulations, less legacy,   it's all of those/ we call it political  economy. All of these political economy factors   have come together to allow countries to do  these things in a strategic way. So strategic  

national modernization is not an accidents,  that's the whole point. It's strategic,   it's premeditated, it's done according to a master  plan, a design. Japan knows ten years in advance   where they're going to build the next  high speed rail lines, so does China,   and they get it done. Now again, we're  not, we haven't yet talked about obviously   the political issues, democracy rights and  freedom, all of these things come at a cost.  

But just remember that Asians have made their own  decisions, they're not having the debate that you   or I may have now, or that Europeans have.  I've spent a lot of time in Germany, and I'm   debating with Germans and German politicians  regularly, and they still carry this bias,   that unless Asia does things the way we do  things or have done things, it must fail,   because it's not morally correct according to  our view. But you need to understand, again,   I say this as someone/ I can put on a German hat,  I can put on an American hat, I can understand   your point of view, but you, not you personally,  but this crowd of people in Europe or in America,   in Berlin or Washington, don't seem to be able to  understand that point of view, which is that we   have way more people than you. We have ten times  more people than you. Innovation and modernization   development will not happen by accident with five  billion people. Silicon valley will not happen by  

accident. Food will not get on people's tables by  accident. This is a crowded and layered, and very   heavily divided, and fragmented and poor, or has  been, part of the world. So you really do have   to understand the way these people are thinking  about it. They all understand how you understand   the world, because a lot of them were educated in  Europe. They were shaped by European colonialism,  

by American dominance, every Asian understands  how Westerners think, but the reverse is not true.   There's a distinction, I'm not contradicting  myself earlier. Earlier I said, Asians don't   care what you think, but I never said  they don't understand what you think.   They perfectly well understand. Asia is  a large set of post-colonial countries.   They were dominated by Europe for centuries.  Asians understand perfectly well what the European  

worldview is, what the American world view is. It  is completely inevitable in any part of the planet   to know what Europe has done and what America  has done, but the reverse is not true.   And I've come here to understand the  reverse, and to reflect that reverse view. Yeah, global citizen, as I said. Yeah.  Well, very interesting. Let's look at Asia,   or the parts of Asia a little bit. As you said in  the beginning, it's not only China, it's not only   India. So what about the, when we refer to Asia,  we often mean just simply China, or a little bit  

more. So what are the big regions that you would  talk about one hand, and then what we also, and   I'm just adding this, have an interesting question  from someone from our audience saying, that the   middle powers in Asia, would they have to choose  sides? Is it not a century of alliance that's   ahead of us, that they was choose sides, either the  US way or the Chinese way? Like a bipolar thing. Right. So again, that's a very, it's a very common  view that Asia middle powers, or swing States,   especially here in Southeast Asia, have to choose  sides, and make an alliance, or be part of an   alliance. Again, that's not at all true. In Asian  history there are almost, almost no alliances.  

Asians don't think of themselves as having to form  rigid alliances and do balance of power against   each other. Yes, such dynamics exist, but not  in the framework of institutionalized alliances,   like NATO and so forth. Because that's not how  Asians view their relationships with each other.   They are always practicing what we call hedging.  They're saying, I don't know, who's going to win   in this dispute between China and Japan, or China  and Korea, or Japan and Korea, or China and India,   but I'll just be friends with all of them, and  whoever wins, I'll stay friends with them. That's   the way Asians operate. If they have to team up to  defeat a hegemonic, like of course, in the case of  

World War II, where Asian powers had to resist  Japanese imperialism, and that required China,   and the support of the United States, and Korea  and Southeast Asian governments to reject Japanese   imperialism, that wasn't a case of alliances. That  was anti Imperial resistance. So, Asian countries   today do not use the language of, "We have to  choose sides, which side shall we choose?".   That is the way that people in the West, and  scholars, and analysts, and diplomats in the West   talk about the way they think the dynamics will  be, because they think that there is a US-China   global Cold War, the world is becoming bipolar  again, and therefore like the last Cold War,   each country must choose a side between the  two. But we are not in a new global cold war,   there is not a new bipolarity between the US and  China. The world is not being carved up into two  

rival camps, and therefore Asians do not  believe that each of them must choose a side.   They correctly view the world as, again, much  more layered and interdependent. They get   investment from Japan and they trade with China,  and they have military relations with America,   and they're constantly shifting these patterns  and teams and doing business in all directions.   They are actually creating a situation where  China and America and India and Japan and Europe   are all bidding to have more influence in their  countries, like in Thailand, or the Philippines,   or Indonesia. So they are not choosing sides, they  will not choose sides. No one is asking and no   one is pretending that they must. I mean,  sometimes some American officials may come here  

and say, "We want you to be on our side". And  the next day some Chinese officials may arrive   and say, "We would like you to be on our  side". But pretty much every Asian country   that has some sovereignty, like Thailand, or  Indonesia, or Philippines, certainly Vietnam,   India, none of these countries actually pick a  side. So the fundamental lesson, just to draw   it to a punchline so everyone can remember, Asia  will never choose sides. So, I hope that everyone   can simply remember this one sentence, Asia will  never choose sides. Asians do not choose sides.  

You cannot tell Asians that the rules of the game  are that they must choose sides, because actually   they are the ones making the rules of the game,  which is that they will not choose sides. You   really have to understand the way it works from  the inside, because what I'm saying represents   the perspective of three plus billion people,  right? And that's the way India operates, that's   the way Indonesia operates, that's the way the  big countries are operating. And they have found   ways to resist China and to resist America. So the  truth is that the, the point of view that says we   will not choose sides is winning, therefore it's  worth your time to understand why that is true. Before we move on to the RCEP, I just  want to understand one more thing or   ask you one thing that is, when you said,  actually Europe invented a lot of things,   and then the Asians came and innovated on  top of that. Cars came from here and then//

Don't forget the American chapter in between. Yeah. But my question goes to Europe.  Where do you see Europe's future   role economy-wise, in that respect? Well, so Europe as an economic region unto  itself, I am more positive about it than   most people, certainly way more than Americans,  than most Americans, because Americans are   very dismissive of Europe as a geopolitical  actor, and they view it as sort of rife with   staces, and having bloated States and  heavily indebted welfare systems and so on.   My view is that Europe is governed by principles  of parliamentary democracy and social solidarity,   and I view those as very virtuous things. And  I think that, even with the pandemic being as  

bad as it is, the public support has been far  stronger than in most other parts of the world,   and certainly of course way more than the United  States. So I'm certainly a believer in Europe,   and I believe that Europe learns from crisis, and  the patterns of modern history show that, in terms   of taking this opportunity to evolve from the  monetary union towards a fiscal union, the sorts   of the large bailouts, socializing European  debt, launching more sovereign Euro bonds,   making a stronger push for the Euro to be a  reserve currency, this two trillion dollar budget   over the next five, seven years. I think these  are all examples of Europe acting in a cohesive,   future oriented and humane way. And I think/  so I'm a believer in Europe, and I'm also a   believer that Europe will have a growing role in  Asia, and a far more important one than the US.   Because after all Europe and Asia actually  share this mega continent of Eurasia, Europeans   have a long history here. There's obviously a  very large number of Europeans who live here.   European trade with Asia is much larger than  European trade with America. And that's one of  

the central infographics and charts in the book  shows how, Europeans may not even realize this,   but European trade with America and Canada  together is about one trillion dollars a year,   which is a decent amount. But European trade  with Asia is about one point six trillion   dollars a year. So your economic future is far  more pinned to Asia, than it is to North America.   And certainly because you're exporting more, and  European economies, especially Germany are export   oriented/ of course you have a large population  and so forth, but you have a high savings rate   and relatively low consumption. So trade with  Asia matters a lot to Germany and to Europe.   And so that's why European governments, since  again, this period of time that I mark as one of   the key milestones of the Asian sort of century,  in the mid 2000 tens, European governments   started to join the Belt and Road Initiative,  and the Asian infrastructure investment bank,   and pushed very hard for more trade deals.  Europe has a free trade agreement with Japan now,   with Korea, with Vietnam, would like to have  one with ASEAN, the Southeast Asian countries.   And the Americans have obviously taken a very  different approach. They've pulled out of the  

major trade agreements, like the Transpacific  partnership and so on. So Europe really does   have the right strategy towards Asia. And so I'm  quite bullish about that in the long long-term. Partnerships. That brings me through the  regional comprehensive economic partnership,   that's just been signed by 14 Asia  Pacific States. So it seemed, that,   well it is a very important that agreement of  course, but someone wants to know, is it not   overrated, according to some reason comments  comparing the EU Asian trade deals with Asia? Well, so the regional  comprehensive economic partnership,   even though it's not a hundred percent free  trade, it's not like the European Union or   rather the Eurozone, but it's relatively close.  The key innovation is used/ since tariffs were  

already getting lower between Asian countries,  the key is around some of these technical issues,   like rules of origin, where now you make one thing  in multiple places within Asia, you don't have to   have disputes about labeling and so forth. So  some of these things have been now, will now be   harmonized. And these logistical and regulatory  barriers overcoming, them itself unlocks a lot   of value. So the regional comprehensive economic  partnership is a big deal, but Asians practice   what is called open regionalism. So yes,  they are deepening regionalism through RCEP,   but they also want to be part of, and are part  of, most of them, the Transpacific partnership.  

They also want to have free trade agreements  with the EU. So they're practicing a global   open regionalism, because in general, the more  such agreements you are part of, the better off   you are in terms of access to markets and  having harmonized investment regulation,   and so forth. So Asians are playing this very  wisely, and they remain quite pro globalization,   which is obviously more than one can say  from, about Western societies right now. What about India? India wanted to be part, but  it's not now. So what is the effect of that? Well, I mean, if India wanted to be  part of RCEP, it would be part of RCEP,   but India clearly does not want to be part of  RCEP, even though it should be part of RCEP. Well, at first it seemed they  wanted, and now they are not, not in.

No. So, I mean, again, if you want something/   if India were a person, and India wants to sign  something, then India would sign something. Okay. But in the form of its present leadership  says it wants to trade more with East Asia,   and yes, it is trading more with East Asia, and it  wants to reduce its trade deficits with East Asia,   because India has very large deficits with China,  with Japan, and other countries. In other words,   it imports a lot of their commodities and  food or other goods, manufactured goods,   and doesn't export enough. Now their view was  that, the RCEP would disadvantage them even   further because they're not very competitive.  They would wind up importing even more from  

other countries who make things faster, better and  cheaper. So India would like to ideally eventually   join RCEP, but once it is more competitive.  The other caveat, which is fair from India's   point of view, is that RCEP is not a high standard  trade agreement in terms of intellectual property   protections, in areas like software. And India's  largest export is software, it's well over 100   billion dollars a year of software exports. So  if the agreement does not cover Indian software,   why join it? So that was the debate happening in  India, but you can't have it both ways. You can't   join, but have it protect software. You can't  join, but forestall the flood of goods until you  

are more competitive. Either you join or you don't  join. So India will eventually join, and the RCEP   members were extremely clear in their declaration  that they strongly welcome and want India to join,   and that the door is always open. So I think it  was a very amicable understanding that India is   just not yet in that in the position. And by the  way, India did the same thing two years ago with   global trade negotiations on agriculture. There  were strong efforts to bring down restrictions to   food imports, and genetically modified seeds,  and these kinds of things. And India stood up and  

said, "Absolutely no way. We are an agricultural  country. We can not have our farmers be flooded,   our markets be flooded with foreign goods  that are competing with our local production,   and we need to have some safeguards to protect  our farmers", and India stood up for its position,   based on its economic and social composition.  And that's what governments are supposed to do. Well, your book is called "Commerce,  conflict and culture, so let's move on   a little bit to the conflict side. You've  mentioned already a couple of conflicts,   and with India, we are certainly hearing one.  What are the potential fields, or the big   fields of conflict, culturally, politically? Well,  economically, we've already talked a little bit.

Well there's many. And I don't suppress this  aspect of the story. Like you said, the subtitle   of the book has the word conflict in it. Asia is home to all of the major World War III   scenarios that exist in the world. If World War  III is going to happen, it's going to happen in  

Asia. There are conflicts in Asia, there are  tensions in Asia, there are rivalries in Asia,   all the time. You name it. Taiwan, South China  sea, North Korea, Senkaku islands, Kashmir, the,   India-China border, many very serious flashpoints.  But there's a couple of things that one has   to keep in mind. The Cold War ended 30 years  ago. And for 30 years people have been saying,   World War III is going to happen in Asia, it's  going to be a disaster. And for 30 years they've   been wrong. They didn't say it would happen  the next day, and it still could happen.  

But the point is, it's more interesting to look at  why certain conflicts do not happen, than simply   assuming that they will happen, because you will  learn a lot more studying the 364 days a year   where the conflicts and tensions are managed,  and the one day a year where there is a flare up,   and escalation. And Asians have done a good job  of integrating geo-economically. Look at RCEP,   look at the trade relations between China, Japan,  and Korea. They are rivals, but they trade four   point five trillion dollars a year in intermediate  goods. The most dense trade relationship   by volume on the planet is China, Japan and Korea.  That's four and a half trillion dollars. That's   Germany's GDP roughly, something like that.  So/ because of their integrated supply chains.  

So, they've managed the geo-economic integration,  but suppressed their geo-political rivalries. That   could change tomorrow. Taiwan/ China could invade  Taiwan tomorrow. There could be war between China   and Japan over the Senkaku islands tomorrow. North  Korea could launch a nuclear weapon tomorrow.   China and the Philippines could/ and Vietnam could  be fighting it out over islands in the South China   sea tomorrow. And none of that, absolutely  none of that invalidates my argument. Because,  

for two reasons. One, when you have a war, that  is again a proof that you have a system. Again,   Europe has been a system for thousands of years,  it has been a violent, conflictual system for   thousands of years, but it has been a system. And  the proof that you are a system, is that you have   so much friction and tension and interdependence  with each other, that you represent a system,   but a violent system. But Asia has actually  been a peaceful system for 30 years,   and hopefully it will stay that way. But the point  is that, my argument is not that Asia will be   peaceful. My argument is that Asia is the system,  and it operates according to its own logic. The   second reason why, if you have one of these  conflicts, it doesn't invalidate the argument,   is because unlike Europe in 1914 or the 1940s,  where one conflict took down the whole region,   set back the whole region, destroyed an entire  region of the world, just remember how much   bigger Asia is. All of Europe fits inside one  corner of Asia. And instead of one civilization,  

one common heritage, and one geography where  one power, let's say, Germany, for example,   or France in the 18th and early 19th centuries can  pretend that they could dominate the whole region,   and march with their armies in all directions,  that cannot happen in Asia. Asia is too big.   And it's not one civilization, right? You  can convince yourself that all Europeans can   be forced to speak French or German, but you will  never have all Asian speaking Chinese or Hindi, it   will never happen. So again, the rules of the Asia  are different. The analogy does not even work. So   even if you had one war in Asia, let's say Taiwan,  let's say South China, sea, let's say North Korea.   Let's say you have three wars in Asia. Even if  you have three wars in Asia at the same time,   Asia is so big that it's not going to derail  the whole Asian story. You're still going to   have economic growth. You're still gonna have  populations urbanizing. You're still going to  

have technology investment. All of those things  are still going to happen in Asia because a   war over here doesn't mean a war over here. In  European history a war over here does mean a war   over here. Chain reactions, alliance affects  right? Again, in Asia, you don't have alliances.   You don't have these chain reactions. Instead,  when you have a conflict, it remains isolated to  

that location between those countries. And the  third thing I'll add is, if you have that war,   that war will also end. And when that war ends,  you move on, you settle the border, you have a new   agreement or a treaty, and the countries  learn that they have to accept that reality.   And that is what Asians and Europeans, or any  people have in common. Is that once it's over,  

it's over. So you could have a 1945 moment in  Asia. I don't think it would be a cataclysmic   world war, it would be a local ward. It would  be a tragic war, it would be a violent war,   it would be an unnecessary war, it would be a  bad thing. But you would also have a settlement,   a solution, a treaty and history would  move on. And that's what could happen. Very interesting. And when you talk about the  Asian system, I want to add something else that   is important to the system certainly,  which is education. What would you say  

is the typical Asian education like? What  are the pillars there? First, you said some,   many are educated of course in America or  in Europe. So what is the future of that? Well, there isn't really one Asian educational  system. I talked about this in the early part   of the book, where I/ sort of Asians are not  so cosmopolitan, that they do not have heavily   nationalized educational systems, that gloriously  reflect their own histories to the detriment of   others. Of course they do that, as fanatically  as anywhere in the world, if not more so.   And I I'm very clear about that. And that's one  of the reasons that I also wrote the book, was   to write an Asian history. Not a Chinese history,  not an Indian history, not an Indonesian history,   not a Persian history or a Turkic history, but  an Asian history. And that was the hardest part  

of the book to write by far, because I couldn't  find a common Asian history that all Asians would   agree to. I can find common facts, even facts  about history of course are heavily disputed,   that's why Koreans and Japanese still can't get  along. So it took me about one year to write 40   pages of this book, because it was such a painful  and thankless task to try to tell one version   of the truth, one version of Asian history,  that a Filipino, or a Pakistani, or a Kazak or   a Vietnamese person could agree to. And actually  what has been gratifying is that that worked. It   seems to have worked, a lot of people tell me  that they learned Asian history, rather than   just learning their own country's history. So that  all of that is to say, that there isn't obviously   one educational system. People like to generalize  about Asia outside Asia and say, "Oh, they just  

sit in the classroom and they memorize things,  and they stick their heads down and they go blind,   memorizing facts". That is true in some places,  but obviously not true at university. In the   PISA exams now, they have these creative problem  solving components, and the kids from Shanghai   and the kids from Singapore are doing better than  the kids from Germany and the kids from England.   But the kids from the Czech Republic and Finland  are doing as well as some of the Asian kids. So,  

you cannot say Asians are not creative, you cannot  say Asians aren't innovative. Just look at the pop   music charts, it's all Korean music these days.  So how can one possibly generalize about Asian   education? So things are changing very fast here  in Singapore, and Singapore is, of course, always   an outlier, it's a tiny country, it's a very  wealthy country. It's a very Anglicised country   because of colonialism. But they are getting  rid of some of the toughest standardized tests.  

They don't want school children to spend all  day in the classroom. They're forcing them to   go out in the sunshine. Memorization is going out  through the window. In the early year, first year   of university, they do not have to get grades on  their exams anymore. You just study, just learn,  

just explore, dabble. These are not things that  you would expect Asian education systems to do,   but that's exactly what they're doing, and  I think that's obviously a very good thing. Interesting. Economical collaboration on  the one hand, and then often political,   I would say competition, something like  that, especially when it comes to China,   that has become an economic friend  to us, but often we feel like it's   a/ I don't really want to use the term enemy,  but a political opposite. Actually a former   German foreign minister Gabriel, he was on  TV last week here in one of the big stations,   and he said China was something like a "frienemy".  How can we overcome those political conflicts? Well, I mean, I did start using that word  "frienemy" a long time ago actually, in my first   book. And I said that Europe, America and China,  are sort of three "frienemies". Now obviously  

the scales are tilted somewhat. But the whole  point is, goes back to what I was saying about   how Asian powers view the world. They don't  choose to align with one side or the other,   they practice multi alignment. And that's  the complexity of the world today, of   everyone having multi-directional relations with  everyone else. And that/ those complex threads   are part of how you mitigate conflict in the first  place. And that is the kind of age old dichotomy,   or tension between the idea of globalization,  meaning interdependence and integration,   versus geopolitics which signals division, and  rivalry, and tension and conflict. And the truth  

is that they're both, they're two sides of the  same coin, right? They're all happening at the   same time. So I don't know if there is any way to  eliminate these tensions. I mean, I do think that   there is a scenario, a very happy scenario where  we have spheres of influence, if you will, natural   spheres of influence, but you have a race to  the top in terms of the quality of governance or   services provided, in order to justify that sphere  of influence, rather than having it by conquest.   And you have resource sharing, and knowledge  sharing across these regions that may be   competing with each other for market share, but  not for territory. And I do think that we sort of   live in that world now, even though we also live  in a world of rivalry geopolitically. Again, both   of these things are happening at the same time,  because geopolitics and globalization co-exist   at the same time, because they are two sides of  the same coin. That that's exactly the point.

I like the term happy scenario. Someone else wants  to know, speaking/ which is an important question,   I think. Speaking about global warming, what  scenarios of cooperation do you see here,   considering that there might be  a challenge to dealing with this,   together with questions of  prosperity and equality? Well, that's definitely an area where you could  sort of, again, have a happy scenario. There's  

plenty of things that we could and should work on  together, and the obvious one is climate change.   But quite frankly, before climate change  became the hot button issue that is today,   we could have been talking, and still need to  be talking about poverty, about failed States,   post-conflict reconstruction. There has been  a broad, viable, sensible global agenda for a   long time. Now we can add climate change very  urgently, and should of course, to that list.   And the question is, what is a fair approach? On  whose shoulders does certain responsibility, do   certain responsibilities lie? Are we doing these  things fast enough? Who is providing public goods?   Which institutions or powers? How can we do more  technology transfer to the places that need it,   to reduce their emissions and to reduce their  consumption of water and energy? This kind   of thing. So, I think that this is an area  where there should not only be cooperation,   but in a way healthy competition to  profit from making the world better,   if that's what it takes to get powers to think  in that way. That's the way China thinks about   solar panels, right? China used industrial policy  to copy and internalize solar panel technology,   and now it leads the world in it. And now  the whole world is buying solar panels from  

China. So China is making money off of something  that is good for the world. Now, so is that a bad   thing or a good thing? Well, I mean, the way in  which they went about dominating the industry,   put a lot of other people out of business, but  China is able to do things faster and cheaper, and   at scale, better than other countries can. So we  would have to go back in time and say, you know,   "Would Americans have sold solar panels  all across Africa and the middle East, and   all of these places as quickly as China is doing  it?", probably not necessarily, we don't know. But   nevermind what happened in the past, should  everyone be making efforts to reduce fossil fuel   consumption, and reduce emissions, and do water  conservation projects and all of these things   in the industrializing world?  The answer is of course, yes. When we talk about China's, or actually Asia's   rising or expanding influence, you said, you  talk about Africa. I just wanna wanna tackle   that for just a moment. How can that be seen  in the African context? The Asian influence.

So Africa/ again, a lot of people look at it  primarily from the outside in, they say that   this is a Europe, former European colonies, and  Europe's back yard. And now China is coming in,   and colonizing Africa and so forth. And  I don't like to view Africa in those   terms. Because the truth is, it's a very, it's a  shifting geopolitical landscape. Africa is first   and foremost in African hands. Again, this is a  post-colonial region, there's 50 plus countries.  

They have political sovereignty. They also  are becoming somewhat more of a system, not an   intensely integrated one, but more interdependent  than before. They're trying to have an African   free trade area. African visa free mobility, for  all Africans around the continent. They're working  

on these things, and African development bank is  financing sustainable agriculture projects. China   is building infrastructure that benefits Africans  across borders. They don't just do projects in   one country and this country and that country,  they're also doing projects that allow these   countries to connect better to each other. In a  way, if Europe created the scramble for Africa,  

and carved up Africa, a lot of what China is doing  is helping Africans to unscramble themselves. And   that's something that I've been writing  about, and reporting about for a long   time. There are benefits, there's a reason  why many African countries appreciate these   Chinese infrastructure projects. But that  doesn't mean that it's all about China.   There are more Indians in Africa, than there are  Chinese people in Africa, obviously because of   the British empire. So the Indian influence in  Africa is rising, Europe is working on a new  

set of strategies for Africa, United States has  contributed a lot of assistance to Africa. So   it's a/ as with any other part of the world, it's  very, it's less connected than Asia is to the   world. But it's getting, it has been getting more  connected and that is generally been good for Africa. What about the Middle East countries? Well, I don't use the term Middle East. I don't  like that term. And I sort of, I go to great   lengths to denounce the term. I think I have for  the last 15 years, I think in all of my books,  

because I'm trained in geography, and there's no  such thing as the Middle East in geography. In   geography, we actually use geographical points of  reference, not destinational sort of references.   And then the term Middle East, as you know, is  really just about how long it takes to refuel a   ship, when you're traveling from London to India,  which is not really important in the 21st century.  

But geography is far more timeless.  So we can talk about North Africa,   Arab North Africa. We can talk about the Gulf  countries, you can call it the Persian Gulf or the   Arabian Gulf as you like. We can talk about the  West Asian countries, which is the term I prefer.  

And West Asia is in fact, the Gulf countries,  it is the Levantine countries, it's the Mashriq countries,   so Iraq, Syria, Lebanon, Israel, Turkey.  These are all Asian countries by geography.   And this is something that those people in the  geographic West Asia increasingly understand.   And I spend a whole chapter of the book  on this, because again, we tend to think,   we meaning you and me, and people with our  background, tend to think of this region   as the Middle East, and being historically,  and still today linked to, or dependent on   our policies and trade. And that's literally  just not true. That's just factually wrong.   Since the 1990s, the Gulf countries have  traded much more with China, Korea, Japan,   and India than they do with the West. Especially  you in Europe, don't really buy Arab oil anymore,   and don't need it, because you have been  innovating your way out of that dependence. You  

get natural gas from Russia, and North Africa and  the Arctic. But the point is that, these places   are now doing infrastructure deals with China.  Much of the population,   of course, of the Arabian Gulf countries is  Indian. Ethnic Indian, Indian nationals who are   permanently or semi permanently living in those  countries. So there's almost nothing "Middle East"  left about many of these places. They are West  Asia. And so they have a very different fate,   the fate of North Africa versus the fate of Iraq  and Syria, or the fate of Saudi Arabia or Turkey.  

These are four completely different answers to  the same question. So that's why I've never,   ever used the term Middle East, but I'm happy to  talk about Iraq, if you want to talk about Iraq,   or Saudi Arabia, or Egypt if you want to talk  about Egypt. But these places, they are not that   much of a system, let's put it that way, right?  The Middle East, again, they're geographically   very close to each other, but they're a terrible  system, a very weak system, and certainly   a very conflictual system, and most of these  countries barely trade with each other at all.

Well, I'd love to talk to you for much,  much longer, but our time is already,   almost running out. So let me finish  with two more, or broader questions.   One is, would you agree that growth in  Asia would lead to more global justice? Well, I mean, if you define  justice as access opportunity,   obviously the ability to have a basic, humane 

2021-01-05

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