ch 4, Alternative centres of power Flashcards
European Union
1) Under the Marshall Plan, the Organisation for European Economic Cooperation (OEEC) was established in 1948 to channel aid to the west European states. It became a forum where the western European states began to cooperate on trade and economic issues.
2) The collapse of the Soviet bloc resulted in the establishment of the European Union in 1992. The foundation was thus laid for a common foreign and security policy, cooperation on justice and home affairs, and the creation of a single currency.
3) The European Union has evolved over time from an economic union to an increasingly political one.
The EU has economic, political and diplomatic, and military influence.
1) The EU is the world’s biggest economy with a GDP slightly larger than that of the United States.
2) Its currency, the Euro, can pose a threat to the dominance of the US dollar.
3) Its share of world trade is three times larger than that of the United States allowing it to be more assertive in trade disputes with the US and China.
4) Its economic power gives it influence over its closest neighbours as well as in Asia and Africa. It also functions as an important bloc in international economic organisations such as the World TradeOrganisation(WTO).
The EU also has political and diplomatic influence
1) Two members of the EU, Britain and France, hold permanent seats on the UN Security Council.
2) The EU includes several non-permanent members of the UNSC.
3)Britain’s former prime minister, Margaret Thatcher,
kept the UK out of the European Market. Denmark and Sweden have resisted the Maastricht Treaty and the adoption of the euro, the common European currency
ASSOCIATION OF SOUTH EAST ASIAN NATIONS (ASEAN)
1) At the end of the Second World War, this region of Asia confronted problems of nation-building, the ravages of poverty and economic backwardness and the pressure to align with one great power or another during the Cold War.
2) Hence, the Southeast Asian nations sought an alternative by establishing the Association for South East Asian Nations (ASEAN).
3) ASEAN was established in 1967 by five countries of this region — Indonesia, Malaysia, the Philippines, Singapore and Thailand — by signing the Bangkok Declaration.
The objectives of ASEAN
1) The objectives of ASEAN were primarily to accelerate economic growth and through that ‘social progress and cultural development’.
2) A secondary objective was to promote regional peace and stability based on the rule of law and the principles of the United Nations Charter.
3) Over the years, Brunei Darussalam, Vietnam, Lao PDR, Myanmar (Burma) and Cambodia joined ASEAN taking its strength to ten.
The objectives of the ASEAN Economic Community are
ASEAN was and still remains principally an economic association. The objectives of the ASEAN Economic Community as
1) to create a common market and production base within ASEAN states
2) to aid social and economic development in the region.
THE RISE OF THE CHINESE ECONOMY
1) The third major alternative centre of power is our immediate neighbour, China.
2) China’s economic success since 1978 has been linked to its rise as a great power.
3) China has been the fastest growing economy since the reforms first began there.
4) It is projected to overtake the US as the world’s largest economy by 2040. The strength of its economy, together with other factors such as population, landmass, resources, regional location and political influence, adds to its power in significant ways.
How did the Chinese do it?
1)After the inception of the People’s Republic of China in 1949, following the communist revolution
under the leadership of Mao, its economy was based on the Soviet model.
2) The model was to create a state-owned heavy industries sector from the capital accumulated from agriculture.
3) Employment and social welfare was assured to all citizens, and China moved ahead of most developing countries in educating its citizens and ensuring better health for them.
4) China ended its political and economic isolation with the establishment of relations with the United States in 1972.
Reasons for the rise of economy in modern China.
1) Premier Zhou Enlai proposed the ‘four modernisations’(agriculture, industry, science and technology and military) in 1973.
2) By 1978, the then leader Deng Xiaoping announced the ‘open door’ policy and economic reforms in China.
3) The privatisation of agriculture in 1982 was followed by the privatisation of industry in 1998. Privatisation of agriculture led to a remarkable rise in agricultural production and rural incomes. High personal savings in the rural economy lead to growth in rural industry.
4) The new trading laws and the creation of Special Economic Zones (SEZs) led to a phenomenal rise in foreign trade.
5) China has become the most important destination for foreign direct investment (FDI) anywhere in the world. It has large foreign exchange reserves that now allow it to make big investment in other countries.
INDIA – CHINA RELATIONS
1) After India’s independence from Britain, for a brief while, the slogan of ‘Hindi-Chini bhai-bhai’ was popular. However, military conflict over a border dispute between the two countries marred that relationship.
2) Soon after independence, both states were involved in differences arising from the Chinese takeover of Tibet in 1950 and the final settlement of the Sino-Indian border.
3) China and India were involved in a border conflict in 1962 over territorial claims in Arunachal Pradesh and in the Aksai Chin region of Ladakh.
4) Rajiv Gandhi’s visit to China in December 1988 provided the impetus for an improvement in India–China relations. Since then both governments have taken measures to contain conflict and maintain ‘peace and tranquility’ on the border.
5) They have also signed agreements on cultural exchanges and cooperation in science and technology, and opened four border posts for trade.
6) At the global level, India and China have adopted similar policies in international economic institutions like the World Trade Organisation.
7) Indian and Chinese leaders and officials visit Beijing and New Delhi with greater frequency, and both sides are now becoming more familiar with each other. Increasing transportation and communication links, common economic interests and global concerns.
8) Border disputes between India and China continue till date.
