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Economy

How Mexico Can Exploit The U.S.-China Showdown

If Mexico could forge a clear vision of its business interests, the showdown between the United States and China would present it with some major trading and strategic opportunities.

Photo of U.S. ​Vice President Kamala Harris and Mexican President AMLO walking in the couryyard of the National Palace during in Mexico City on June 8

U.S. Vice President Kamala Harris and Mexican President AMLO on June 8

Carlos Ramos Mamahua/Presidencia/Planet Pix/ZUMA
Luis Rubio

-Analysis-

MEXICO CITY — New Zealand rugby players famously perform a Maori dance called the Haka before each match. Its gesticulations, grimaces and threatening noises are meant to intimidate adversaries, though most see it as nothing more and nothing less than a celebration of heritage. I wonder if after the Donald Trump presidency and the Afghan débacle, the world will see the United States, the erstwhile leader of the free world, with the same rational distance.

Trump's election surprised the world, and his refusal to moderate his discourse once in the White House stretched the surprise out for four years. His successor, Joe Biden, though seeking to remove everything relating to Trump, still shares a common objective: to change the basic premises that have marked the U.S. since 1945.

Trump was elected in part for the effects of globalization and technological changes, which made ordinary folk feel increasingly vulnerable. Biden was elected as a reaction to Trump, but has similar goals and the same inward-looking vision that is bound to reduce America's global presence.

Recreating the British Empire

These changes have curiously coincided with China's ascent as a global power. Its economy is now almost as big as the United State's, and its leaders have exhibited an exceptional sense of strategy. In the U.S. in contrast with their predecessors of the late 20th century, the last two presidents have shown they do not even believe strategic thinking is necessary. Their way is to react to circumstances, even spontaneously it seems, as shown in the shambolic departure from Afghanistan. The objective was probably the right one, but its implementation was pathetic.

Mexico could move into the enviable position of being a natural alternative in both those nations.

In contrast, the international affairs specialist Parag Khanna describes China's systematic rise as the recreation of the British Empire, not through colonies, but infrastructures. China's expansive Belt and Road project is certain to threaten the weight and power of the U.S., whose leadership seems unable, or unwilling, to see and react to what is happening.

Photo of a worker at an Audi car factory in Chiapa, Mexico.

A car factory in Chiapa, Mexico

Carlos aranda

Supplanting Chinese imports

For many here in Mexico, this is seen as an opportunity to reduce the depth of our ties with the U.S. and start diversifying our commercial relations. As the Mexican analyst Luis de la Calle observes, the commercial and political confrontation between the two superpowers opens up opportunities for Mexico to "reaffirm its position as a credible competitor in the two leading economies."

Mexico can supplant Chinese imports in the U.S. market, and attract new sources of foreign investment. It is an enormous opportunity, but requires a concerted strategy to move into the enviable position of being a natural alternative in both those nations. It won't last forever.

Nothing is written in stone.

The wider framework for Mexico's future in a changing international setting means observing the implications in coming years of China's ascent and of possible political changes in the U.S. The interaction of the two powers will determine the panorama in which we'll be moving. China has exceptional strategic leadership and an extraordinary ability to adapt, while its political nature means it can forge ties democratic states would not even contemplate.

Yet one cannot underestimate the economic and political challenges it will also face in coming decades. The Americans, for their part, find themselves lacking clear-sighted leadership and are sharply polarized. That may entail swings in domestic politics before they regain their traditional, strategic clarity as they so often have in the past. It is easy to underestimate the U.S. at this moment, but their open political system allows them to rebound swiftly. Nothing is written in stone.

Mexico has exceptional opportunities if it can deftly exploit the divisions between the U.S. and China. But that would require vision and leadership, which hasn't been one of our most notable traits. Separately, the fading liberal vision, at least in economics, may prove a formidable obstacle to grabbing this opportunity.

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Economy

Lex Tusk? How Poland’s Controversial "Russian Influence" Law Will Subvert Democracy

The new “lex Tusk” includes language about companies and their management. But is this likely to be a fair investigation into breaking sanctions on Russia, or a political witch-hunt in the business sphere?

Photo of President of the Republic of Poland Andrzej Duda

Polish President Andrzej Duda

Piotr Miaczynski, Leszek Kostrzewski

-Analysis-

WARSAW — Poland’s new Commission for investigating Russian influence, which President Andrzej Duda signed into law on Monday, will be able to summon representatives of any company for inquiry. It has sparked a major controversy in Polish politics, as political opponents of the government warn that the Commission has been given near absolute power to investigate and punish any citizen, business or organization.

And opposition politicians are expected to be high on the list of would-be suspects, starting with Donald Tusk, who is challenging the ruling PiS government to return to the presidency next fall. For that reason, it has been sardonically dubbed: Lex Tusk.

University of Warsaw law professor Michal Romanowski notes that the interests of any firm can be considered favorable to Russia. “These are instruments which the likes of Putin and Orban would not be ashamed of," Romanowski said.

The law on the Commission for examining Russian influences has "atomic" prerogatives sewn into it. Nine members of the Commission with the rank of secretary of state will be able to summon virtually anyone, with the powers of severe punishment.

Under the new law, these Commissioners will become arbiters of nearly absolute power, and will be able to use the resources of nearly any organ of the state, including the secret services, in order to demand access to every available document. They will be able to prosecute people for acts which were not prohibited at the time they were committed.

Their prerogatives are broader than that of the President or the Prime Minister, wider than those of any court. And there is virtually no oversight over their actions.

Nobody can feel safe. This includes companies, their management, lawyers, journalists, and trade unionists.

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