Chủ Nhật, 7 tháng 6, 2020

THE ECONOMY IMPACTS (Reuters) U.S. probing tire imports from South Korea, Thailand, Taiwan, Vietnam. (The Telegraph) HSBC at centre of political storm over Hong Kong crackdown. (Bloomberg) China Trade Surplus Surges to Record as Medical Exports Jump

THE ECONOMY IMPACTS UPON THE EAST SEA NEIGHBORS

NHỮNG TÁC ÐỘNG KINH TẾ LÊN KHU VỰC BIỂN ÐÔNG

----

-----
U.S.

U.S. probing tire imports from South Korea, Thailand, Taiwan, Vietnam

David Shepardson and Eric Beech

https://www.yahoo.com/news/u-probing-tire-imports-south-033605140.html

By David Shepardson and Eric Beech

WASHINGTON (Reuters) - The U.S. Commerce Department said on Tuesday it had opened investigations into vehicle tire imports from South Korea, Taiwan, Thailand and Vietnam to determine whether the tires are being sold at less than fair value.

The department said it was also investigating whether tire producers in Vietnam were receiving unfair subsidies for passenger vehicle and light truck (PVLT) tires.

The investigations were in response to petitions filed in May by the United Steelworkers (USW) representing workers at U.S. tire plants.

"Even though demand for PVLT tires increased, domestic producers were still forced to grapple with reduced market share, falling profits and lost jobs," USW International President Tom Conway said earlier.

The union won orders on imported vehicle tires from China in 2015, and Chinese imports have since shrunk dramatically, allowing the domestic industry to invest in new capacity, the union said.

The United States imported almost $4 billion in tires from the four nations, including nearly $2 billion from Thailand and $1.2 billion from Korea, in 2019. The USW said tire imports from the four countries have risen nearly 20% since 2017, reaching 85.3 million tires.

The Commerce Department said the alleged dumping margins range from 43% to 195% for Korea, 21% to 116% for Taiwan, 106% to 217.5% for Thailand and 5% to 22% for Vietnam.

The USW represents workers at Michelin , Goodyear , Cooper , Sumitomo and Yokohama tire plants in Ohio, Arkansas, North Carolina, Kansas, Indiana, Virginia New York and Alabama.

This month, Hankook Tires urged the Commerce Department not to investigate, saying the U.S. domestic tire industry "is in robust health and growing." In a filing it said, domestic vehicle tire producers "as a whole have not been materially injured and are not threatened with material injury by reason of subject imports."

Vietnam's Ministry of Industry and Trade told Commerce its economy is "heavily dependent on light vehicles and passenger cars for transportation, logistics and travel and the PVLT tire industry is crucial for our continued economic advancement."

(Reporting by Eric Beech and David Shepardson; Editing by Mohammad Zargham and Tom Brown)

-----

World

HSBC at centre of political storm over Hong Kong crackdown

The diplomatic crisis engulfing HSBC escalated on Wednesday amid mounting tensions between China and the West over an authoritarian crackdown in Hong Kong.

Senior figures in Beijing and Washington clashed publicly over the bank's decision to support a new Hong Kong security law which has drawn condemnation from human rights campaigners and pro-democracy activists around the world.

China's Communist leadership hit back after US Secretary of State Mike Pompeo accused the regime of bullying HSBC into backing the law banning criticism of the Government in the former British colony.

Mr Pompeo said America stood with its allies against Beijing’s "coercive bullying tactics", and added that the "browbeating of HSBC, in particular, should serve as a cautionary tale".

He warned that going public with its support "seems to have earned HSBC little respect in Beijing, which continues to use the bank’s business in China as political leverage against London".

In response, China's foreign ministry spokesperson Hua Chunying said it was "narrow minded" to assume people who support the country "must have been coerced by China".  

She said: "The world is diverse and everyone should have the right to make independent decisions and choices."

Matthew Henderson, Asia studies director at the Henry Jackson Society, said: "This highlights Hong Kong’s threatened status as a bridge between the rules-based world and the Chinese Communist party-state, where HSBC now makes most of its money, and hence feels obliged to do as Beijing demands." 

America's intervention is likely to concern senior executives at HSBC. The bank was fined $1.9bn (£1.5bn) in 2012 over money laundering for Mexican drug cartels and came perilously close to losing its vital US licence.

The row came after Aviva Investors said it was deeply concerned that HSBC and Standard Chartered had thrown their weight behind China's Communist regime. Aviva is a major shareholder in both banks and is the first City institution to publicly condemn their actions.

The two lenders spoke up in favour of the security law last week, days after Hong Kong’s pro-Beijing former leader Leung Chun-ying demanded that HSBC state its position

London-listed HSBC relies on Hong Kong and mainland China for about 80pc of its profits, but a majority of its investors are based in the US and UK. 

Shares fell 1.2pc to 400.5p. The stock was almost 600p at the start of the year.

----
World

China Trade Surplus Surges to Record as Medical Exports Jump

Bloomberg News
Bloomberg
China Trade Surplus Surges to Record as Medical Exports Jump
China Trade Surplus Surges to Record as Medical Exports Jump

(Bloomberg) -- China’s trade surplus surged to a record in May as exports fell less than expected, helped by an increase in medical-related sales, and imports slumped along with commodity prices.

Exports decreased 3.3% in dollar terms from a year earlier, beating economists’ estimates, while imports plunged 16.7%. That resulted in a trade surplus of $62.93 billion.

The record surplus comes as the price of commodities China buys such as crude oil, natural gas and soy beans declined. Exports, meantime, have come off their lows, helped in part by sales of masks and other medical supplies as countries around the world battle to stem the spread of the coronavirus.

“The recent acceleration in export growth of anti-epidemic materials contributed considerably to China’s exports,” CICC analyst Liu Liu wrote in a note. “China’s full-year export growth in 2020 may be better than our previous expectations.”

Net exports of goods and services in the second quarter will increase substantially from a year earlier, swinging to a “large positive contribution” to GDP growth after dragging in the first quarter, Liu wrote. Exports of medical devices increased 88.5%, according to CICC.

Cheaper Imports

While China increased commodities imports, the average price has fallen, according to a statement from the customs bureau. The average purchase price of crude oil slumped 21.2% in yuan terms in the first five months of the year, although the volume of purchases rose 5.2%, it said.

The price for coal, natural gas, soy bean and other commodities also dropped. The value of auto imports shrunk by 31.3%.

“The slump in imports is mainly due to a high base from last year and the fall in commodities prices,” said Xing Zhaopeng, an economist at Australia and New Zealand Banking Group Ltd. in Shanghai. “The volume of most major import items rose, showing China’s economy is gradually recovering.”

The export of textile products including masks jumped 25.5% in yuan terms in the first five months, the second-largest export item after mechanical products, according to the customs.

Slow Recovery

China’s economy continued its slow recovery from the coronavirus slump in May, the earliest indicators showed, with domestic demand gaining momentum while globally it remained sluggish. But the rising risk of an escalation in U.S.-China tensions threatens the outlook for China’s foreign trade.

U.S. President Donald Trump promised to revoke Hong Kong’s special trade status in response to Beijing’s security law, while Beijing has told major state-run agricultural companies to pause purchases of some American farm goods as it evaluates the potential U.S. response over Hong Kong, according to people familiar with the situation.

“China has always opposed the politicization of economic and trade issues,” Gao Feng, spokesman of China’s commerce ministry, said at a briefing Thursday. “In the light of the present situation, there are still many uncertain and unstable factors” weighing on China’s trade outlook, he said.

Exports to the U.S. slipped 1.2% from a year earlier, while those to India slumped 51% and Brazil’s were down 26% amid those countries’ battle to stem the spread of Covid-19. Imports slumped 13.5% from the U.S., 43.5% from Hong Kong and 29% from the European Union.

Exports remained resilient as industrial output continued to recover to normal levels and manufacturers benefit from the shift in supply chains as industrial hubs in the E.U. and U.S. were shut down during the time, according to Rajiv Biswas, APAC Chief Economist at IHS Markit in Singapore.

“With lockdowns ending across the E.U. and U.S., new orders for Chinese exports should gradually recover during the third and fourth quarters as Christmas season supports a rebound in new orders,” he said.

(Adds economist comment in fourth paragraph.)

For more articles like this, please visit us at bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

©2020 Bloomberg L.P.

THE ARMS RACE (Reuters video) China puts final satellite for Beidou into orbit. (AP) Japan PM to bolster defense after scrapping missile system. (CBS NEWS) (Video) U.S. "not going to allow Russia and China to continue" increasing nuclear stockpiles, top negotiator says(Business Insider) The US wants to kill part of an 8,000 mile-long undersea cable linking Hong Kong with LA over China spying fears. (The National Interest) Will China Have Global Naval Dominance by 2030? (Reuters) U.S. to sidestep arms pact to sell armed drones. (The National Interest) China Finishes Its Second Large Amphibious Assault Ship. (Reuters) U.S. Senate panel authorizes $9.1 billion for 95 F-35 jets made by Lockheed. (Defense News) Senate panel OKs $6 billion military fund to confront China. (The National Interest) Two of America's Most Powerful Aircraft Carriers Have Just Joined Forces. (The National Interest) China Just Added Two New Nuclear Missile Submarines to Its Fleet. (Bloomberg) A U.S.-China Cold War Could Be Good for Investors, After All

(Cuc Chy Ðua Vũ Trang)
---
Timeline Index: Sept. 15, 2020

Timeline: 6/23/2020

---
World

China puts final satellite for Beidou into orbit

-----
World

Japan PM to bolster defense after scrapping missile system

MARI YAMAGUCHI
Japan's Prime Minister Shinzo Abe speaks during a press conference at the prime minister's official residence, Thursday, June 18, 2020, in Tokyo. Abe said Thursday that he regretted the arrest of his former justice minister and the minister's lawmaker wife over allegations they engaged in vote buying during last year's election, and that he takes the public criticism seriously. (Rodrigo Reyes Marin/Pool Photo via AP)

Japan Politics

Japan's Prime Minister Shinzo Abe speaks during a press conference at the prime minister's official residence, Thursday, June 18, 2020, in Tokyo. Abe said Thursday that he regretted the arrest of his former justice minister and the minister's lawmaker wife over allegations they engaged in vote buying during last year's election, and that he takes the public criticism seriously. (Rodrigo Reyes Marin/Pool Photo via AP)

TOKYO (AP) — Japanese Prime Minister Shinzo Abe said Thursday that his country needs to bolster its security posture amid threats from North Korea and should consider acquiring preemptive strike capability after having to scrap the planned deployment of two new land-based missile defense systems.

Abe said he wants to redefine the meaning of deterrence in the face of the threat from North Korea and its advancement in missile technology.

“We should renew our discussion of adequate deterrence we need, considering North Korea’s missile technology that has advanced since the time we introduced our missile defense systems,” he said.

Abe said that should include the capability to conduct preemptive strikes within the limitations set by the country's pacifist constitution.

"The question is if we should stay within the boundary when enemy capability is dramatically advancing,” Abe said.

Abe has long pushed to amend Article 9 of Japan's post-World War II U.S.-drafted constitution, which renounced war and the use of force as a means of settling international disputes and has been interpreted as limiting the country's armed forces to acting only in self-defense. Abe in 2015 reinterpreted Article 9 to allow self-defense to also include right to fight back for its ally, the U.S. in case of enemy attack.

Abe's comments come just days after Japan's Defense Ministry announced that it would “stop the deployment process” of two land-based Aegis Ashore missile defense systems after it was found that the safety of one of the planned host communities could not be ensured without a hardware redesign that would be too time consuming and costly.

Defense officials had said the two Aegis Ashore units could cover Japan entirely. The country’s current missile defenses consist of Aegis-equipped destroyers at sea and Patriot missiles on land.

After being on the back burner in the ruling party for decades, the possibility of gaining preemptive strike capabilities and deploying cruise missiles were proposed to Abe's government by his party’s missile defense panel in 2017.

Abe had since largely avoided the highly divisive topic after seeing his support ratings plunge amid a series of political scandals.

Abe said Thursday that it's time to discuss it again as tensions escalate on the Korean Peninsula.

___

Follow Mari Yamaguchi on Twitter at https://www.twitter.com/mariyamaguchi

----
World

(Video) U.S. "not going to allow Russia and China to continue" increasing nuclear stockpiles, top negotiator says


The U.S. is set to sit down with Russia and possibly China on Monday to discuss limiting all three countries' nuclear stockpiles. CBS News foreign affairs analyst Pamela Falk spoke to Ambassador Robert Wood, the U.S. top arms control negotiator, about his growing concerns over Russia and China's nuclear arsenals.

----
Business

The US wants to kill part of an 8,000 mile-long undersea cable linking Hong Kong with LA over China spying fears

insider@insider.com (Isobel Asher Hamilton)
Undersea cables provide internet all over the world.
Undersea cables provide internet all over the world.

Getty/ullstein bild/Contributor

  • In 2016 Google and Facebook announced a new high-speed undersea cable connecting Hong Kong and Los Angeles.

  • The cable is now laid, but a DOJ committee has advised the FCC deny approval for the Hong Kong section of the cable.

  • The committee is worried the cable could be tapped by the Chinese government.

  • Visit Business Insider's homepage for more stories.

The US government seems poised to stunt a multimillion undersea cable project by Google and Facebook.

The cable is part of the Pacific Light Cable Network and was announced in 2016. Google said at the time the cable would be 8,000 miles long and span the Pacific Ocean, linking Los Angeles with Hong Kong, Taiwan, and the Philippines. It is designed to manage 120 terabytes of data per second, or 80 million HD videoconference calls between LA and Hong Kong, according to Google's statements in 2016.

A Depart of Justice committee called Team Telecom has now recommended to the FCC that the part of the cable connecting Hong Kong be rejected on security grounds.

The committee said it fears a cable to Hong Kong could be vulnerable to being tapped by the Chinese government, and is particularly concerned by the fact a large investor in the cable was a Hong Kong-based company called Dr. Peng Ltd which it says is the "fourth largest provider of telecommunications services in the PRC [People's Republic of China]."

More broadly it says the cable could help China make Hong Kong a pan-Asian Pacific telecommunications hub, meaning US data would be more likely to pass through Chinese infrastructure even if China wasn't its final destination.

The US government's fears were heightened is due to "the PRC government's recent actions to remove Hong Kong's autonomy and allow for the possibility that PRC intelligence and security services will operate openly in Hong Kong."

In May China introduced sweeping new legislation for Hong Kong, cracking down on dissent and taking away many of the region's semi-autonomous powers, sparking widespread protests.

Team Telecom said the portions connecting the US with Taiwan and the Philippines should be allowed to function.

Read the original article on Business Insider

-----
The National Interest

Will China Have Global Naval Dominance by 2030?

Peter Suciu
The National Interest

Click here to read the full article.

According to some dire predictions, China’s People’s Liberation Army Navy (PLAN) could have naval dominance by 2030 and naval superiority by 2049. Such a foreboding prophecy comes from Captain James E. Fanell (Retired), former director of Intelligence and Information Operations for the U.S. Pacific Fleet, in a widely published account this past weekend.

In an op-ed, Captain Fanell wrote, “After 20 years of transformation, the PLA Navy operates around the world from the Baltic to the South Pacific and from the Arctic to the Antarctic… The PRC’s naval expansion is already well advanced. Since 2008, the PLA Navy has dispatched 35 naval escort task forces through the Indian Ocean and into the Gulf of Aden, and PLA Navy ships have visited over 60 nations.”

Fanell added that the PLAN no longer worries about warship shortages, and that great attention is now being paid to its aircraft carrier platform, while Beijing is also focusing on its Type 075 landing helicopter (LHA) amphibious assault vessels. The latter would be comparable to the U.S. Navy’s America-class LHA—and that platform would prove crucial should Beijing ever actually mount an invasion to reclaim Taiwan.

Perhaps most worrisome in Fanell’s forecast is that he assesses that the PLAN could consist of a surface force of more than 450 ships, along with a submarine force approaching 1109 submarines by just 2030. That is a 10 percent increase from his 2015 estimate, one he warned could even be on the low side. The goal for China is a global naval presence, first to the Indian Ocean and then beyond.

Some of that global reach has already become a reality, as the PLAN is engaged in enlarging its first overseas military base in Djibouti on the Red Sea. That base, which is located near the U.S. Naval Expeditionary Base, was built at a cost of $590 million in 2017. While Djibouti is one of Africa’s smaller nations it has become an important “strategic partner” to Beijing.

Fanell is not the only one to express concerns at the rate of the PLAN’s expansion.

Last month a Congressional Research Service Report, China Naval Modernization: Implications for U.S. Navy Capabilities Background and Issues for Congress, highlighted Beijing’s naval modernization efforts, which encompassed a wide array of platforms and weapon acquisition programs. According to the report, these include anti-ship ballistic missiles (ASBMs), anti-ship cruise missiles (ASCMs), submarines, surface ships, aircraft, unmanned vehicles (UVs), and supporting C4ISR (command and control, communications, computers, intelligence, surveillance, and reconnaissance) systems.

The report also highlighted that there are several issues that Congress must take action on, including whether the U.S. Navy is responding appropriately to China’s naval modernization efforts and even if the planned size of the Navy will be appropriate to counter China.

While such concerns of Chinese naval acquisitions must be addressed by lawmakers in Washington, there are some factors to consider. First, such a building problem by Beijing still faces the very serious issue of corruption. As The National Interest previously reported, China’s naval modernization is far more complex than simple growth as the corruption among the shipbuilders will have lasting consequences for the PLAN. The more money that China invests in shipbuilding the more opportunities for corruption will emerge, so the question then becomes whether Beijing can offer the necessary transparency to fight that corruption.

Then there are the lessons from history.

The British Royal Navy adopted its so-called “two-power standard,” which required that it increase its naval strength. The standard called for the Royal Navy to maintain a number of battleships at least equal to the combined strength of the next two largest navies in the world, which then were France and Russia. This became a real problem when the Royal Navy built the HMS Dreadnought, which made all other battleships essentially obsolete. Overnight the British lost their advantage and that started a new round of warship building.

For China to gain naval dominance would require that it could launch and maintain more than the 11 aircraft carriers the United States Navy now operates, but would also need to keep pace with the carriers in service with the Royal Navy, France and Australia. As long as NATO exists it isn’t just the 11 U.S. carriers and potentially nine LHAs in the U.S. fleet, but all of those other carriers.

Fanell noted that an alliance with other partners is the United States’ best course of action. He wrote, “The best option to avert future conflict is for the U.S. and India to adopt a combined effort to significantly enhance our whole of government approach to strengthen and integrate our military capabilities to confront the PRC’s bad behavior, especially at sea.”

Perhaps, first letting China spend wildly on developing a navy should also be an option as well. Maintaining it—dealing with the corruption—and trying to create its own “multi-power standard” might just be more than Beijing bargained for.

Peter Suciu is a Michigan-based writer who has contributed to more than four dozen magazines, newspapers and websites. He is the author of several books on military headgear including A Gallery of Military Headdress, which is available on Amazon.com.

Image: Reuters

Click here to read the full article.

----
U.S.

U.S. to sidestep arms pact to sell armed drones

Reuters Videos
https://www.yahoo.com/news/u-sidestep-arms-pact-sell-152518184.html

The Trump administration will re-interpret a Cold War-era arms-control agreement in order to help American defense contractors sell military drones to more nations.

Three defense industry executives and a U.S. official told Reuters about the policy change, which has not previously been reported.

The change concerns the 33-year-old Missile Technology Control Regime - or MTCR - a pact created to curb arms proliferation, which counts 34 member nations.

Washington has long seen the MTCR's restrictions on cruise missile sales as applicable to large, weaponized drones.

And until now, only England, France and Australia have been allowed to buy armed drones from U.S. manufacturers, according to data collected by The Center for the Study of the Drone at Bard College in New York state.

But an arms industry executive told Reuters that Jordan, Romania, Saudi Arabia and UAE have shown interest in purchasing U.S. systems and will be among the first customers in line when the U.S. policy changes.

Reinterpreting the MTCR is part of a broader Trump administration effort to sell more weapons overseas.

A U.S. official and industry executives told Reuters the State Department is expected to approve the first drone sales under the new interpretation as soon as this summer,

The U.S. National Security Council is expected to support the policy change at a meeting next week and discuss a possible White House announcement.

----
World

U.S.'s Pompeo to meet China's top diplomat in Hawaii seeking to ease tensions: media

Reuters
FILE PHOTO: U.S. Secretary of State Mike Pompeo attends lunch with counterparts China, Britain, Russia and France, the permanent five veto-wielding members of the U.N. Security Council.
FILE PHOTO: U.S. Secretary of State Mike Pompeo attends lunch with counterparts China, Britain, Russia and France, the permanent five veto-wielding members of the U.N. Security Council.

WASHINGTON (Reuters) - U.S. Secretary of State Mike Pompeo will meet China's top diplomat Yang Jiechi in Hawaii, trying to ease tensions between the world's two largest economies over various issues, according to media reports.

Pompeo was planning the trip "quietly" and the arrangements were not yet finalized, Politico said.

Pompeo has been vocal in criticizing China on a range of issues from the origins of the coronavirus pandemic to its Hong Kong policy to the treatment of its ethnic and religious minorities,

The U.S. State Department and the Chinese embassy in Washington did not immediately respond to requests for comment.

Hong Kong's South China Morning Post newspaper cited an unidentified source as saying that Yang, a state councilor and member of the Communist Party Politburo, will represent the Chinese side for the meeting.

Relations between the countries have deteriorated in recent months, and U.S. President Donald Trump has said he could even sever relations.

Pompeo said last month that China could have prevented the deaths of hundreds of thousands of people around the world by being more transparent about the coronavirus and accused it of refusing to share information.

He also said Chinese plans to impose national security laws on Hong Kong would be the "death knell" for the former British colony's autonomy.



(Reporting by Mohammad Zargham, Additional reporting by Winni Zhou and Andrew Galbraith; Editing by Sonya Hepinstall and Kim Coghill)

----
World

China Finishes Its Second Large Amphibious Assault Ship

Click here to read the full original article.

The Chinese Navy has now launched a second large amphibious assault ship engineered to carry weapons, helicopters, troops and landing craft into war, a move which further changes international power dynamics by strengthening China’s ability to launch expeditionary maritime attacks.

The ship is described at the second Type 075 Landing Helicopter Dock (LHD), somewhat analogous to the U.S. WASP-class. This Chinese amphibious assault ship reportedly displaces as much as 30,000 tons and is able to carry as many as 28 helicopters, a report from Naval News states. The report adds that the new People’s Liberation Army Navy LHD is likely powered by a diesel engine with 9,000kW, four Close In Weapons Systems and HQ-10 surface-to-air missiles. The new ship’s “aim is likely to increase the “vertical” amphibious assault capability with the very mountainous East Coast of Taiwan in mind,” the Naval News report writes. 

The addition of more LHDs certainly increases China’s maritime attack power, making it a formidable threat along the Taiwanese coastline. Photos of the ship show well-deck in back, capable of launching ship-to-shore transport craft similar to the U.S. Navy Landing Craft Air Cushion or newer Ship-to-Shore Connector. Such a configuration makes it appear somewhat similar to U.S. Navy WASP-class which, unlike the first two ships of the America-class, also operates with a well-deck from which to launch large-scale amphibious assaults. 

The Chinese LHD operates with a displacement of roughly 10,000-tons less than its U.S. counterpart. However, despite an apparently smaller size, it may operate with as many or more helicopters; if reports that the Chinese LHD can operate 28 helicopters are true, that would appear to be a larger number than the roughly 22 operated by U.S. LHDs. Regardless, it does not appear as though the Type 075s operate anything like the Short-Take-off-and-Landing F-35B stealth fighter which launches from U.S. LHDs. F-35Bs, combined with Harrier Jets and Ospreys are likely to push the number of aircraft operated by U.S. LHDs somewhat higher than that Type 075. The aviation centric first two America-class ships and the legacy WASP boats both now operate with F-35s.  Having the F-35 is likely to give U.S. LHDs a decided advantage over these emerging Chinese counterparts; not only does it bring the prospect of stealth and air support, but also brings new dimensions of ISR to maritime warfare. The possibility of establishing air supremacy during an amphibious assault with an F-35 or even merely fortifying an advance with 5th-generation air power, is reshaping amphibious attack strategy with unforeseen advantages. 

While threats to Taiwan may jump out as the first and most apparent area threatened by expanding Chinese amphibious forces, the South China Sea will also be increasingly vulnerable. In particular, when it comes to ship-to-shore transports, a Type 075 could dispatch groups of troops, weapons and even armored vehicles for attack, as well as large numbers of amphibious assault vehicles. Several of these ships operating in tandem would easily enable a Chinese amphibious assault to annex or overwhelm large areas of the disputed island areas. Also not likely to be lost on U.S. observers is that two capable LHDs of this kind massively increase China’s expeditionary capability, introducing new dimensions to the prospect of large-scale amphibious attacks against major-power target areas around the globe. 

Kris Osborn is the new Defense Editor for the National Interest. Osborn previously served at the Pentagon as a Highly Qualified Expert with the Office of the Assistant Secretary of the Army—Acquisition, Logistics & Technology. Osborn has also worked as an anchor and on-air military specialist at national TV networks. He has appeared as a guest military expert on Fox News, MSNBC, The Military Channel, and The History Channel. He also has a Masters Degree in Comparative Literature from Columbia University.

Image: Reuters

Click here to read the full original article.

----
Reuters

U.S. Senate panel authorizes $9.1 billion for 95 F-35 jets made by Lockheed

WASHINGTON (Reuters) - The U.S. Senate Armed Services Committee said on Thursday it had authorized $9.1 billion to procure 95 F-35 aircraft in its version of the 2021 National Defense Authorization Act, or NDAA, an annual bill setting policy for the Department of Defense.

The F-35 jet is made by Lockheed Martin Corp <LMT.N>.

The 95 F-35s authorized in the bill are 14 more than requested by President Donald Trump's administration.

The Senate committee also authorized the U.S. Air Force to keep six F-35s originally sold to Turkey.

The jets were never delivered to Turkish soil because of a disagreement over Ankara's purchase of the Russian-made S-400 missile defense system, which the Pentagon said was "incompatible" with the stealthy F-35 jets.

The United States kicked Turkey out of the F-35 program after its S-400 purchase.

(Reporting by Patricia Zengerle and Mike Stone; Editing by Chizu Nomiyama and Peter Cooney)

-----
World

Senate panel OKs $6 billion military fund to confront China

WASHINGTON ― Plans for a Senate-crafted version of the Pacific Deterrence Initiative, a new military fund to boost deterrence against China in the Pacific, is one step closer to becoming law.

The Senate Armed Services Committee has approved nearly $6 billion for the fund in its version of the annual defense policy bill, the panel announced Thursday. It authorizes $1.4 billion in fiscal 2021, which would be $188.6 million above the administration’s budget request, and $5.5 billion for fiscal 2022. The bill also directs the defense secretary to create a spending plan for all of the funds.

“The best way to protect U.S. security and prosperity in Asia is to maintain a credible balance of military power, but, after years of underfunding, America’s ability to do so is at risk,” the committee’s summary stated. “The FY21 [National Defense Authorization Act] establishes the Pacific Deterrence Initiative (PDI) to send a strong signal to the Chinese Communist Party that America is deeply committed to defending our interests in the Indo-Pacific.

“PDI will enhance budgetary transparency and oversight, focus resources on key military capability gaps, reassure U.S. allies and partners, and bolster the credibility of American deterrence in the Indo-Pacific.”

Though not all details of the fund were immediately made public, SASC Chairman Jim Inhofe, R-Okla., and ranking member Jack Reed, D-R.I., previously said they would sponsor a measure to enable U.S. military operations in the region, beyond supporting new weapons platforms.

Defense Secretary Mark Esper has said China is his department’s top adversary, but said Congress has worked to sharpen the Pentagon’s spending and focus in the region. The PDI would follow the form of the multiyear European Deterrence Initiative, which has consumed $22 billion since its inception after Russia annexed Crimea from Ukraine in 2014.

Congress will have to internally negotiate the final dollar amount for PDI and what those funds would buy, but House Armed Services Committee Chairman Adam Smith, D-Wash., and ranking member Mac Thornberry, R-Texas, have expressed support for the idea. Though the Senate’s approach differs, Thornberry has also proposed spending $6 billion―all in FY21―on priorities that include air and missile defense systems as well as new military construction in partner countries; Smith hasn’t released his own plan.

Once approved by the full Senate, its version of the NDAA would be reconciled with the House’s version, which the HASC is expected to make public late this month before it goes through markup July 1 and advances to the House floor.

With an eye on China beyond the PDI, the SASC bill also encourages the Air Force to establish an operating location in the Indo-Pacific region for F-35A fighter jets and to allocate “sufficient resources and prioritize the protection of air bases that might be under attack from current or emerging cruise missiles and advanced hypersonic missiles, specifically from China."

There are also a number of provisions aimed at safeguarding America’s technology and industrial base from Chinese intellectual property theft and “economic aggression,” according to the summary. The bill would also require reports from the Pentagon on how to mitigate the risks from vendors like Chinese telecom firms Huawei and ZTE when basing U.S. troops overseas.

The SASC summary said its proposed PDI would:

  • Increase lethality of the joint force in the Pacific, including by improving active and passive defense against theater cruise, ballistic and hypersonic missiles for bases, operating locations and other critical infrastructure.

  • Enhance the design and posture of the joint force in the Indo-Pacific region by transitioning from large, centralized and unhardened infrastructure to smaller, dispersed, resilient and adaptive basing; increasing the number of capabilities of expeditionary airfields and ports; enhancing pre-positioning of forward stocks of fuel, munitions, equipment and materiel; and improving distributed logistics and maintenance capabilities in the region to ensure the sustainment of logistics under persistent multidomain attack.

  • Strengthen alliances and partnerships to increase capabilities, improve interoperability and information sharing, and support information operations capabilities with a focus on countering malign influence.

----
Business

Two of America's Most Powerful Aircraft Carriers Have Just Joined Forces

Peter Suciu
The National Interest

Click here to read the full original article.

Recently, the United States Navy released photos of the USS Gerald R. Ford (CVN 78) and the USS Harry S. Truman (CVN 74) transiting the Atlantic Ocean. This marked the first time that the new Ford-class aircraft carrier has operated with a Nimitz-class aircraft carrier together while underway. The photos provided the best visual comparisons of the two carrier classes to date—highlighting many of the significant improvements that the new $13 billion USS Gerald R. Ford has to offer.

CVN-78 is the lead ship of Navy’s new Ford-class of flattops, and while the class design uses the basic Nimitz­­-class hull form, it incorporates several improvements. These include features that permit the ship to generate more aircraft sorties per day, more electrical power for supporting ship systems, and upgrades that require several hundred fewer sailors than the older Nimitz-class. This could reduce the 50-year life-cycle operating and support (O&S) costs for each of the new Ford-class carriers by about $4 billion, according to Navy estimates.

The U.S. Navy took delivery of the USS Gerald R. Ford in May 2017.

The Drive noted that among the most significant visual differences is the placement of the island superstructures on the two carriers. While the Nimitz-class superstructure has evolved substantially over time and does vary from ship-to-ship, the placement and even size of the island superstructure is quite different on the Ford. It was moved back about 140 feet to provide more deck space and to enhance the operational tempo. The island is both shorter in length, but about 20 feet taller than that of previous carrier class.

The shape of the island was also modified to house the AN/SPY-3 and AN/SPY-4 active electronically scanned array (AESA) Dual Band Radar, which has six separate arrays that provide 360-degree coverage around the ship. The old spinning 3D and 2D radars—which have been staples on earlier carriers—have been eliminated.

The Ford-class of carriers have just three aircraft elevators instead of four, but the placement and larger size will enhance operations. In addition, the Navy has said that the larger flight deck will help the ship reach its goal of being able to execute 25 percent more sorties than its predecessor.

Not so easily seen in the photos are the Ford’s new Electromagnetic Aircraft Launch System (EMALS), which will be used to launch all of the carrier’s aircraft. This has replaced the traditional steam catapults that have been commonplace with U.S. Navy carriers for decades.

The new warship is also equipped with two newly-designed reactors that provide 250 percent more electrical capacity than previous carriers, and from those improvements, the ship will be able to load weapons and launch aircraft faster than ever before.

The USS Gerald R. Ford recently completed tests to prove that it can launch and recover jets, and also completed its first ordnance movement from a lower deck magazine.

While the ships operated together for that Navy photo-op, it was announced last week that the USS Harry S. Truman would finally be returning home sometime this month, after remaining at sea following a deployment to the Middle East the past few months to protect the crew from exposure to the novel coronavirus. In April, the Navy announced that the Harry S. Truman Carrier Strike Group (HSTCSG) would remain at sea off the East Coast of the United States to keep the crew healthy and to remain combat-ready to take on missions if needed.

That move was made after the USS Theodore Roosevelt (CVN 71) was sidelined for almost two months in Guam after a significant portion of her crew was infected with COVID-19.

HSTCSG took part in the first-of-its-kind major exercise in the Atlantic last month in a drill known as Operation Eagle, which was conducted in partnership with North American Aerospace Defense Command, U.S. Transportation Command, U.S. Strategic Command and U.S. Space Command.

Peter Suciu is a Michigan-based writer who has contributed to more than four dozen magazines, newspapers and websites. He is the author of several books on military headgear including A Gallery of Military Headdress, which is available on Amazon.com.

Image: Reuters

Click here to read the full original article.

-----
World

China Just Added Two New Nuclear Missile Submarines to Its Fleet

Kris Osborn
The National Interest

Click here to read the full original article.

The Chinese have just added two new nuclear-armed ballistic missile submarines to their Navy, bringing the total number of so-called SSBNs in the force up to six. While the U.S. operates twice as many, the growing number of Chinese nuclear-deterrence submarines massively expands the ability of Beijing to hold the continental U.S. at substantial risk. 

Nuclear-armed submarines are intended to ensure a second-strike catastrophic response in the event of a nuclear attack, essentially ensuring complete destruction of the attacking country. They quietly and secretly patrol at great depths in undisclosed locations to function as a large deterrent force against a first-strike nuclear attack. 

As recently as May of 2020, two additional “Type 094 SSBNs, had entered service,” according to a Congressional Research Service Report called “China Naval Modernization: Implications for U.S. Navy Capabilities.”  The newest type of SSBN, according to the Navy report, is armed with 12 JL-2 nuclear-armed, submarine-launched ballistic missiles, the CRS report explains. They are also armed with Anti-Ship Cruise Missiles, wire-guided and wake-homing torpedoes and mines. Perhaps of greater concern, the Chinese have already test-fired an emerging JL-3 nuclear armed intercontinental ballistic missile with a reported range of more that 5,600 miles, according to a 2018 CSIS report. The missile is solid fueled.

China clearly appears to be expanding its nuclear-armed submarine reach on a global scale, as there have been several news reports of Chinese SSBNs seen in various hot-spots around the globe. 

The CRS report estimates that, by this year, the Chinese are operating 55 diesel-electric submarines and seven nuclear-powered submarines. 

Overall, the Defense Intelligence Agency estimates that China may operate as many as 70 submarines, according to the CRS assessment; in addition, the CRS report estimates that China will have as many as 8 SSBNs and 76 submarines overall by 2030. Most of China’s submarines are non-nuclear, and according to the CRS’ reference to the Office of Naval Intelligence, “China’s submarine force continues to grow at a low rate, though with substantially more-capable submarines replacing older units. Current expansion at submarine production yards could allow higher future production numbers.”

While there is likely little known about the exact technological make-up of the emerging Chinese Jin-class SSBN, it may not rival the emerging U.S. Columbia-class submarines. The new, now-in-development Columbia class may be the quietest undersea boat ever to exist. It uses a quiet, efficient electric-drive and a differently configured X-shaped stern. 

What is known about the Chinese Jin-class is that it will be armed with an extremely lethal, 5,600 mile range nuclear armed ballistic missile, the JL-3. For instance, a 2018 CSIS report says the Chinese have already test fired the weapon which, by any estimation, could easily hold the continental U.S. at great risk. 

Kris Osborn is the new Defense Editor for the National Interest. Osborn previously served at the Pentagon as a Highly Qualified Expert with the Office of the Assistant Secretary of the Army—Acquisition, Logistics & Technology. Osborn has also worked as an anchor and on-air military specialist at national TV networks. He has appeared as a guest military expert on Fox News, MSNBC, The Military Channel, and The History Channel. He also has a Masters Degree in Comparative Literature from Columbia University.

Image: Reuters

Click here to read the full original article.

---
Business

A U.S.-China Cold War Could Be Good for Investors, After All

Christopher Anstey
Bloomberg
A U.S.-China Cold War Could Be Good for Investors, After All
A U.S.-China Cold War Could Be Good for Investors, After All

(Bloomberg) -- A stock analyst who gained attention for emphasizing the theme of inequality a decade-and-a-half ago is now promoting the idea that the U.S.-China showdown for economic supremacy could prove a boon for investors.

The escalation in U.S.-China tensions since President Donald Trump took office in 2017 has largely been viewed as a negative by traders. And headlines announcing fresh tariffs or other protectionist moves by either country have roiled equities on any given day -- though they didn’t prevent global shares from hitting record highs before the coronavirus crisis.

Ajay Kapur, head of Asia and global emerging-market strategy at Bank of America, says that the rivalry could have many benefits, particularly in driving investment and innovation. Stronger productivity gains would help propel investment returns in a variety of assets, he wrote with colleagues in a June 7 report.

“For equity investors, especially growth investors, the seeds of new military-civilian technologies that are germinating today will be irrigated by the full-blown great power rivalry, and blossom in unknown ways in the coming decades,” Kapur wrote with colleagues Ritesh Samadhiya and Aritra Baksi.

The team cited historical examples such as rivalry between the U.K. and Germany in the late 1890s to early 1900s, along with the U.S.-Soviet conflict, as periods when big rivalries acted as a spur for technological development.

Among the investment implications of a reduced emphasis on global supply chains and increasingly nationalistic strategic policies from the world’s top two economies, the Bank of America strategists highlighted the following:

“Technology is the biggest winner,” they wrote. Robotics, space research, cybersecurity and artificial intelligence along with semiconductor makers and chip designers are “logical” candidates.Asian equities in particular, with their “technology bias,” are likely winners, they argued.Government bond yields will be kept low, so aren’t likely to be good hedges for equity portfolios, they wrote. Cash could be a “temporary fix,” though gold and blockchain-based currencies could take a bigger diversification role, they wrote.Media firms will play a role in the communications war, and patriotic and nationalist-leaning ones could benefit, they wrote.Defense and financial-technology providers should be other beneficiaries, they concluded.

“Two competing great powers, using the government balance sheet and zero real interest rates from the savings glut” generated by the ultra-wealthy and high-savings societies such as Japan, Kapur and his colleagues wrote. Kapur in the mid-2000s used the term “plutonomy” to describe economies with increasing inequality.

Read more: Inequality Play Is Over, Says Analyst Who Coined ‘Plutonomy’

“Re-shoring, reinvigorating these domestic supply chains and creating domestic upstream suppliers in critical technologies is likely in both the U.S. and China,” the Bank of America team wrote. “Tomorrow’s iPhone, a substantial beneficiary of military research, is probably incubating in military-financed research labs or projects.”

For more articles like this, please visit us at bloomberg.com

Subscribe now to stay ahead with the most trusted business news source.

©2020 Bloomberg L.P.