In Geopolitics Today: Friday, November 17th
US and Philippines Ink Nuclear Cooperation Deal, New Maldivian President Pledges Removal of Indian Military Presence, and other stories.
US and Philippines Ink Nuclear Cooperation Deal
The United States and the Philippines have signed a nuclear cooperation deal that allows Washington to export nuclear technology and material to Manila. This comes as the Philippines explores nuclear power to boost energy security. The deal enables nuclear cooperation in line with non-proliferation requirements, pending US Congress approval.
The nuclear pact demonstrates deepening economic and strategic alignment between the US and the Philippines. For Manila, it provides access to advanced nuclear technology to meet rising power demands. For the US, it is an opportunity to counter growing Chinese influence in the region by directing US investment and export of exclusive technologies to the Philippines. This helps prevent China from establishing itself as the key provider of nuclear energy capabilities in Southeast Asia. Further agreements on financing and technological aspects are likely to follow.
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China's CXMT and YMTC Secure Funding for Semiconductors
China's homegrown memory chipmakers ChangXin Memory Technologies (CXMT) and Yangtze Memory Technologies (YMTC) have raised billions in new capital. CXMT received $5.4 billion to complete a new DRAM factory, while heavily-sanctioned YMTC raised several billion after being cut off from key US suppliers. The funding allows them to develop domestic alternatives and reduce reliance on US, Japanese and European equipment. It aligns with China's broader push for semiconductor self-sufficiency amid tensions.
The developments highlight China's determination to build domestic chip capabilities and gain strategic advantage in semiconductors. While progress has been slower than expected, China is methodically nurturing its memory chip industry through heavy state subsidies. Developing advanced semiconductor technology domestically remains challenging, but even partial success would boost China's tech autonomy. The US still dominates high-end semiconductors, but China's rise could gradually erode this edge over time. Much depends on how fast China can climb the learning curve and how effectively the US calibrates its restrictions.
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Kishida and Xi Seek Solutions in Bilateral Meeting
In their first meeting in a year, Japanese PM Kishida and Chinese President Xi agreed to find solutions to their differences over Fukushima wastewater discharge. Kishida called for a calm, a scientific approach and demanded China ends its import restrictions on Japanese seafood. The leaders also discussed contentious issues like the East China Sea, detained Japanese citizens, and Taiwan. This signalled a shift toward a more constructive tone after years of deteriorating ties.
The meeting highlights efforts by Japan and China to stabilize relations and build trust, despite lingering disagreements. With China-US tensions and regional uncertainties persist, neither seeks worsening ties. However, challenges remain with military activities, economic coercion, and divergent interests over Taiwan. While a reset of ties is unlikely in the near-term, increased communication could help manage specific issues and risks. Restoring high-level economic dialogue would also be a positive step, but fundamental differences in political systems and regional visions will continue driving friction.
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Russia and China Agree Major Grain Deal
Russia will supply China with 70 million tons of grain over 12 years, as the two Eurasian powers deepen economic ties. This is a joint effort to expand trade infrastructure like railways for high-volume transit. Steadily growing agricultural cooperation paved the way for this deal.
The deal's implications could be mixed. The deal is a part of Russia's economic pivot towards the East in a bid to counteract the loss of European markets. For China, it provides supply security, as it is a power heavily dependent on imports to meet its domestic needs. Both powers understand that the infrastructure supporting these trade deals is sorely lacking, and may soon work to speed up efforts to establish infrastructure that better facilitates trade.
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Drone Proliferation Threatens Chaos in Yemen
Yemen faces a cycle of escalating drone attacks as the technology spreads among rival armed groups. Houthi rebels currently have the most advanced drones, enabling attacks on the government and infrastructure. But their rivals are rapidly acquiring similar capabilities, helped by the commercial availability of drones and parts.
Yemen provides a concerning case study of how drone proliferation can sustain conflict in fragile states. This diffusion is enabled by Yemen's status as a hollowed-out failed state where non-state actors fill power vacuums. As capabilities spread, no side can gain decisive advantage, perpetuating instability. Drone attacks on infrastructure also deter investment and development. While Yemen was troubled before, drones exacerbate existing grievances and power struggles. As drones spread globally, more states risk getting trapped in this escalatory spiral.
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New Maldivian President Pledges Removal of Indian Military Presence
The newly elected President of the Maldives, Mohamed Muizzu, vowed to expel Indian military personnel deployed in the archipelago. He stated the Maldives will have no foreign troops, while respecting others' red lines. This reaffirms his election pledge to remove the small Indian force present in the country, as he balances ties with rivals India and China.
Muizzu's stance asserts the Maldives' sovereignty while navigating its strategic location where India and China compete for influence. While he values ties with both Asian powers amid massive debt, removing Indian troops appeals domestically. However, New Delhi sees the islands as under its sphere of influence and may resist efforts to expel its troops. Tensions could rise if India perceives the move as bolstering China's foothold. But ultimately, the Maldives' economic reliance on economic links to both powers may compel pragmatic balancing.