Sputnik: In recent years we have been seeing the rise of protectionist measures in China and the United States, and they have been involved in a tariffs war. It seems that there has been an indication that they are prepared to put an end to this war.
Maybe this summit will mark the end of the war. In your opinion, will we see that kind of change? Will there be an agreement between Beijing and Washington on resolving trade conflicts or is it just an illusion?
John Kirton: No, I think at the end of the Osaka Summit, at the end of the great bilateral meeting between presidents Trump and Xi, we will see at least a trade truce. They won’t raise any more tariffs against each other. I think we will see, secondly, they will agree to resume negotiations for a deal. And thirdly, they might even agree to start on the basis of the second last draft they had where they had agreed until in Washington’s view the Chinese reneged.
Now, whenever you get to putting down on paper the fine print, the lawyers get involved and you can always find things you hadn’t anticipated. But there was a basis for a deal and it can be brought back. Now that said, there are bigger, broader issues that remain. What do you do about subsidies to state-owned enterprises that are big enough to really destroy free and fair open markets globally, affecting in the case of China important Russian industries and exports [of] steel and aluminium as well. So, everyone has a stake and ultimately solving those will take some time.
Sputnik: In the background of the meeting, we have seen Trump criticising America’s allies, namely Japan and Germany, on defence-related issues. The German leadership probably got used to his remarks about GDP, about the defence spending, which he voiced in Hamburg and during NATO summits in Brussels.
But Japan probably is not used to Trump verbally attacking it, saying that it won’t protect America in case there of a war. Do you think the Japanese leadership will be offended by this?
John Kirton: Not really. You are right. Japan is not used to it. But Mr Trump did it when he was running for president publicly saying almost the same words: “The United States has to defend militarily Japan, Japan doesn’t. So people attack the USA, the Japanese can just watch it on their Sony TVs” – his exact words. Well, if you just read the fine print of the US-Japanese defence agreement, the Security Treaty.
Yes, but when you look at the real world of strategy, Japan defends the United States just by being an ally of the United States. Anybody in Pearl Harbour would instantly say “why now?” as well as thinking back to 1941. But Japan by being an ally of the United States and one with a strong military, very strategically geographically located, protects Guam, part of the United States, so well so. But Mr Trump has a chance to have a second thought. I think it is not something that he will put in that small category of tweets that he seriously intends to act upon.
Sputnik: [Donald] Trump and Russia’s Vladimir Putin are meeting in Osaka, with Putin being openly critical of the West when it comes to missile defence agreements, with him being sceptical about Russo-US relations. Do you think there will be some kind of progress after their talks here?
John Kirton: I hope there is [...] possibility which there hasn’t been late of late time. They can both come to an agreement that at the last thing neither of us needs is another arms race, quite apart from the strategic dangers. If they are building more nuclear weapons and it is easier for Iran to say: “We should have them too” and that North Korea’s intercontinental ballistic missiles and everybody will be worse off. But also economically, the Russian economy is struggling.
The last thing they need to do is to put their money and their best minds into the new high tech of warfare missiles, space, drones, artificial intelligence. It should be going to create new Silicon Valleys throughout the Russian Federation. So it can be competitive in the new digital economy globally rather than relying on oil and gas, which is a wasting asset if you look ahead for the next 20, 30, 40 years.
So everybody has a vested stake and Mr Trump with the ballooning US fiscal deficit to run down [...], doesn’t have money to spend should we get a serious downturn again. So he has a real need to cut back after already having an enormous build-up of the American defence budget. [...] Mr Putin had begun to curtail his.
Sputnik: One question about Canada. Justin Trudeau will be meeting with G20 leaders when there is a certain conflict between China and Canada on the diplomatic front. And recently with the incident involving Chinese military jets and Canadian ships, will we see new developments? Will he be able to get support from other Western leaders? And will China change its stance maybe in this conflict?
John Kirton: Well, yes and no. He will get support from many other western leaders. No one really thinks it is a good idea to actually kidnap citizens of another country and imprison them with only minimal contact with their own diplomats, their own consul generals, keep them awake all day and all night. Meanwhile, the Chinese executive of Huawei is living in a mansion in Vancouver, who is free to go out shopping.
So the rest of the world sees this as to the question is “dear Mr Xi, does this make China look good?” When all Canada was doing was simply acting upon the rule of law under an extradition treaty with the United States. And we are waiting to see how that judicial process plays out. Even Mr Putin recently, when it was drawn to his attention that there was a bogus arrest in Russian Federation of a journalist, he said: “No, we have to respect the rule of law.
This was wrong”, right? So whatever the new closeness of the relationship between Mr Xi and Mr Putin, as we saw at the St. Petersburg [International] Economic Forum, I think maybe even Mr Putin will tell his Chinese friends maybe privately that this is not a good idea to keep bashing Canada in a way that makes you, the Chinese government look so bad.
Sputnik: Russian President Putin and Chinese leader Xi Jinping will be meeting here also in the Russia-India-China format. This won’t the first time that they will meet on the sidelines of the G20. Do you think there is big potential in this format?
John Kirton: Oh, I do… the slightly broader BRICS, whose summit we have just seen in both trilateral one, in the bigger BRICS you have got these big powers. But one of them is a big democratic power committed to openness, and that is India. And India is now growing faster than China both in its economy and in its population. So India is the new big kid on the bloc.
And to the extent that cooperation amongst those three neighbouring countries can intensify on many things to build quality infrastructure, is a place to start. So people are going actually trade not just on paper but in practice, that is all to the goods. We know that in their neighbourhood Tajikistan, Kyrgyzstan– they are countries that have not yet had the full benefit of being connected to the global economy. And to the extent that summits of this sort – we have seen this in recent past – can prevent China, India, and Russia moving towards military conflict between any of the bilateral pair. That too is a good thing.
The views and opinions expressed by the speaker do not necessarily reflect those of Sputnik.
