Is the U.S. ready to meaningfully engage with the Asia-Pacific region? Their latest offering comes in the form of the IPEF, and the differences between the U.S.-led trade pact and competing ones led by Asian powers will show whether American leadership has brought enough to the table.

The IPEF - a U.S.-initiated trade and development partnership - is poised to bring in enthusiastic participation from several nations in the Asia-Pacific region. Notably, Southeast Asian states are well represented among members, giving the U.S. considerable influence right in China’s backyard.

Europe has taken a strategic stance when it comes to its relationship with the U.S. and with China. While the U.S. has strengthened ties with its European allies to contain China, Europe also supports China’s monetary ambitions regarding the RMB.

Globalization is at a crossroads. Compounded by U.S. geopolitics and the cost of economic development, de-globalization has huge economic and human damages.

In the short run, all increases in government expenditures have the same macroeconomic effects on both GDP and employment. However, in the long run, increases in real fixed-assets investments augment the real capital stock and increase the real GDP, whereas increases in consumption due to increases in disposable income through, for example, tax cuts and transfer payments, generate no direct lasting benefits. Infrastructural investment, which is often needed for the provision of public goods, can generate benefits that can be widely shared in the economy even though they cannot be fully captured or internalised by the projects themselves.

In economics, a public good is usually defined as a product or service that is openly available to be enjoyed by all members of a society. The Encyclopaedia Britannica defines a public good to be a product or service that is non-excludable and non-depletable (or “non-rivalrous”). Examples of such public goods include law enforcement, national defence, a stable local currency, and clean air and water. The elimination of a public bad, such as air pollution, is also a public good. The definition of a “public good” used in this article is slightly generalised to include potentially rivalrous goods, such as a seat on a train, so long as it is non-excludable ex ante. Basic education is a public good that is generally non-rivalrous; whereas mass transit is a public good that can at times be rivalrous.

On May 5, Professor Laurence J. Lau, Ralph and Claire Landau Professor of Economics of the Chinese University of Hong Kong delivered a lecture with the same title during an online session hosted by the China Center of the Jesus College of Cambridge University. Professor Lau has kindly provided China-US Focus with an edited text of the lecture in which he addresses the role of public goods - education, public health, elderly care, basic research, infrastructure, social safety net, and alleviation of poverty - in China’s social and economic development over the past seven decades. Professor Lau argues that increasing provision of public goods is consistent with China’s strategy of “dual circulation development as well as its “common prosperity” policy, and could be a significant source of growth in demand in both consumption and investment that is essential to China’s continued prosperity. The following is part one of the lecture.

U.S. announcements and actions show some new approaches. In short, trade plays second fiddle to the White House’s strategic objectives — meaning that commercial interests will be sacrificed whenever Washington has need. Trade with China is viewed through a geopolitical lens.

Russia vs. the world seems to be the story of 2022, and so far the retaliation of the West against Russia has been economic and financial. China has observed how the global finance infrastructure has been weaponized, and now must consider how to secure itself from the potential wrath of Western powers it is at odds with.

The Russia-Ukraine conflict has provided new impetus to the centennial change in global order. Combined with the impact of global pandemic, this conflict has accelerated the transformation of international economic order from a US-dominated globalization process to the globalization driven by coexistence of multiple parallel systems.