“As this trade made them rich, Japan, Taiwan, Korea, and China all became more nationalistically sensitive and aggressive about their claims no matter how materially insignificant.” - Clyde Prestowitz
In his blog post “Will trade keep the peace in Asia?,”
Clyde Prestowitz wonders where the
various Asian marine territorial disputes are heading (here):
….. So far at least, all the supply chain cooperation and economic talks
have not seemed to deter or dampen a rising furor over the disputed islands.
The situation is particularly awkward for the United
States because it is committed by its security treaties with
Korea and Japan to defend
both countries in the event of conflict. Thus, in the case of the
Dokdo/Takeshima islands, the problem for Washington
would be to decide whether to defend Korea
or Japan.
Or perhaps it would be the U.S. Army defending Korea
and its claims and the U.S. Navy defending Japan and its claims. In the case
of the Senkakus, the United States
has not interest of its own in them and certainly no wish to go to war with China over
them. But it is in effect being driven by the
mayor of Tokyo (famously the co-author along with Sony
co-founder Akio Morita of the book, The Japan that Can Say NO) into a
position that could easily lead to a U.S.-China face off.
The rising tensions have actually introduced a higher element of risk into the supply chains and are a factor in the consideration by some companies of relocating some manufacturing back to the United States and to other non-Asian locations.
As similar developments did in 1909, these events also raise the question of whether rather than God's diplomacy, trade is the devil's workshop. Before the relatively recent Japanese, Korean, Taiwanese, and Chinese economic miracles, there was no discussion or interest in these god forsaken rocks and shoals in the western Pacific. Over the years, the United States has enabled these countries to become rich by trading with them, investing in them, and transferring technology to them. Indeed, Washington has acquiesced in an asymmetric trading relationship in which the United States played the role of buyer of last resort as these countries pursued export led growth strategies. As this trade made them rich, Japan, Taiwan, Korea, and China all became more nationalistically sensitive and aggressive about their claims no matter how materially insignificant.
Hi Rudy, I agree. The rising tensions have actually introduced a higher element of risk into the supply chains and are a factor in the consideration by some companies of relocating some manufacturing back to the United States and to other non-Asian locations.
Looking forward for more great post
Posted by: Statistical Arbitrage | September 25, 2012 at 11:37 AM