Asia & the Pacific

Joseph Nye considers lessons from his own work on preventing the spread of nuclear technology in the 1970s.

During foreign policy disputes involving China and some of its most important commercial partners, why do local leaders punish or protect foreign commercial actors? The decision comes down to the political incentives facing each local leader. Understanding this variation is important because how local leaders treat foreign businesses can influence the overall effectiveness of the Chinese government’s economic coercion against foreign states. 

Power transitions affect a state’s ability to exercise economic statecraft. As a dominating and a rising power approach parity, they face structural incentives to decouple their economies. This decoupling affects business-state relations: high-value businesses within the dominant power tend to oppose their state’s economic statecraft because of its costs to them, whereas low-value businesses within the rising power tend to cooperate because they gain from it. 

Chinese strategists increasingly believe that U.S. nonnuclear strategic capabilities threaten China’s nuclear forces. Although there is limited evidence of a shift in its nuclear strategy, China is changing its strategic posture to ensure its second-strike capability, including by relying on advanced conventional weapons (e.g., counterspace capabilities, cyber weapons, and electronic warfare) that can target U.S. missile defense. The dynamics of a nuclear-conventional entangled security dilemma may weaken arms race stability.

Economic interdependence has long been considered important to international peace. Questions about harmful effects of the free flow of capital, however, are arising. China and Organization for Economic Co-operation and Development countries are increasingly involving their business firms in security and intelligence work, causing a security dilemma dynamic that increases economic competition.

The costly Ground-based Midcourse Defense system remains unproven and unreliable in deterring North Korea’s threat to use intercontinental ballistic missiles. An airborne boost-phase intercept system may offer an alternative defense against North Korea without threatening Russian or Chinese deterrents.

It is a critical first step that the financial policymakers of the United States have acknowledged the need for a CBDC, but that realization is not enough. 

The administration of President Donald J. Trump has consistently used fear of China to undermine nearly five decades of bipartisan consensus on US–Russian nuclear arms control. The negative consequences of these actions may last far beyond the Trump presidency. If generations of agreement between Democrats and Republicans on bilateral nuclear treaties with Russia erode, it will pose a significant setback to US national security and global stability. Future leaders may ultimately need to consider new approaches to nuclear risk reduction that preserve the benefits of the arms control regime.

Polls in the United States and nine allied countries in Europe and Asia show that public support for a nuclear test is very low. If the Trump administration conducts a test, then it shouldn't expect backing from Americans or its closest U.S. partners.

Juergen Braunstein and Sachin Silva argue that sovereign wealth funds may be central to governments' efforts to balance public responsibility with private interests in post-pandemic economies.