Indications are that Joe Biden will win the US presidential election on November 3. If Biden does win, Donald Trump’s “America First” foreign policy doctrine will come to an end. The isolationist — you are either with me or against me — policies and associated bravado will be dialled down.
Biden will look to shore up the crumbling liberal international order and try to take the reins of global leadership again. In Europe he will seek to repair damaged trust with allies by reaffirming the US commitment to Nato. In the Middle East, Washington will return to the negotiation table with Iran. However, in the Indo-Pacific the trade war that has turned into a New Cold War under the Trump administration will likely continue.
In fact, under Biden the New Cold War could intensify to become a “US-led allies in Europe and Asia” against China, instead of just US vs China. Biden will continue the policy of shoring up security support to Japan, South Korea, Taiwan and Australia, and build on the momentum to reinforce security alliances with India, Vietnam and the Philippines, with the goal of providing checks and balances against the emergent China in the Indo-Pacific.
The US has announced it will offer developing countries in Africa loans to purchase 5G equipment manufactured by its Swedish, Finish and Korean allies at interest rates competitive to what Chinese banks offer for Chinese equipment. As part of the US’s decoupling strategy, where the US lobbies its allied countries to cut out Chinese 5G technology, Africa has become the latest battle ground.
It’s not all doom and gloom though — businesses in Africa need to distinguish between political rhetoric and economic realities. The China Securities Regulatory Commission has loosened regulations to give securities trading licences to 100% foreign-owned institutions. Citi, JPMorgan, Goldman Sachs and others can now hold securities and sell related custody services to China-based mutual funds. Despite the vociferous rhetoric, the Chinese government continues to see the benefit of Wall Street investments. Wall Street firms are similarly confident in the Chinese domestic market.
With political rhetoric at the surface and deeply entangled economic interests beneath as the great power alliances shift and change, it is important that the Ramaphosa administration, unions and SA businesses form a united front. If not to play one side off the other to maximise economic benefits, at least not to be trampled like grass as the two elephants fight.
Early in 2018 the Trump administration published a list of 10 countries that have tallied the highest number of votes against it in the UN in recent years. Most of the top 10 are expected: Zimbabwe, Iran, Syria, Venezuela, North Korea, Turkmenistan, Cuba, Bolivia, Burundi. And SA. As a middle power with aspirations for regional leadership, Pretoria should not be taking a radically anti-US position.
Nor does the US deserve SA’s contempt. Some official figures: in 2016 USAID’s total foreign assistance to SA amounted to $459.7m, mostly spent fighting Aids. There was bilateral trade of $14bn in 2018 and the US department of commerce estimates US exports of goods and services supported 46,000 jobs in 2015.
A new US administration will necessitate a foreign policy recalculation across the globe. The priority for the Ramaphosa administration is without doubt the new economic recovery plan. SA needs to hustle for every rand of foreign direct investment and chase every export opportunity. Pretoria needs to affirm that the Zuma administration’s anti-West ideology is in the past and adopt a pragmatic policy driven by the recovery plan. Being mindful of the nuances of the New Cold War, Pretoria needs to urgently rebuild its relationship with the US-led West.
• Dr Kuo, a former a lecturer at the Shanghai International Studies University in China, is a research associate at the University of Pretoria’s Gordon Institute of Business Science.
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