China and its near-abroad

As China’s global rivalry with America intensifies, the main zone of contention will be South-East Asia. The region has no clear battle-lines, but that makes the competition only more complex. China is the region’s biggest trading partner and pumps in more investment than America does, and so looks the more likely prizewinner. But its ties with the region are fraught and its bid for hegemony far from assured. Like all middling powers, the big countries of South-East Asia have every incentive to hedge their bets, especially in light of China’s tendency to bully countries that anger it. Nor has China’s image been enhanced by its behaviour in Hong Kong, where it seems keener to suppress dissent than to respect the agreement it reached with Britain in 1984 on the territory’s future.

It is widely assumed that the technology industry is dominated by monopolies. But the once ossified business is entering a dynamic phase. The big firms (Alphabet, Amazon, Apple, Facebook and Microsoft) are wrestling over customers and data. For example, Facebook and Apple are tussling over Apple’s plans to tighten restrictions on the way advertising platforms can gain access to data. Oligopolistic competition could benefit consumers, boosting choice and raising standards. Meanwhile, governments, beginning to look beyond the pandemic, are pondering what role they can play in enhancing innovation and productivity. Britain’s successful translation of life-science research into covid-19 treatments suggests some measures that can make a difference.

As America passed 500,000 deaths in the pandemic, one obvious question was what had gone wrong in the country’s response to it. A full accounting will have to weigh not just political but other factors, such as obesity, diabetes, care for the elderly and genetics. One part of America’s response, however, is a national fiasco: the failure to get millions of its children back to school. This has taken some mothers out of the workforce. The virus has also suspended school exams, strengthening the opposition that has been building for years to standardised testing in public schools. Around the world school closures have persuaded some parents that home-schooling is better anyway. Lockdowns, however, will not last forever: evidence is emerging of the efficacy of vaccines.

Pollution from the burning of fossil fuels kills millions each year, as well as contributing to potentially disastrous climate change. Estimates of the cost of reducing greenhouse-gas emissions vary widely, complicating discussion of the cheapest ways to make the cuts. Meanwhile, as investors become cheerier about the pace of vaccinations and the speed of economic recovery, the price of carbon is soaring in the world’s biggest, most liquid emissions-trading market, the EU’s. That caps the supply of emissions permits based on politically determined targets. China’s carbon-trading market has also gone live this month. But there are reasons to worry China may not get carbon-trading right: the first phase of the scheme covers just a small fraction of emissions.

Politics costs money everywhere. But the link between cash and power is especially corrosive across much of Africa. In many countries aspiring politicians pay vast sums to run on a party ticket and then shell out even more to cover their own costs. Once in office, they keep spending—with individual politicians acting in effect as mini welfare states. As Africa has grown more democratic in the past 30 years, politics has become more competitive. The next step is to make it less costly. In Latin America, too, corruption is endemic. The Lava Jato probe in Brazil of the corrupt links between business and politics seemed to mark an unprecedented push to reduce graft across the continent. The winding up on February 3rd of the task force leading the probe marked its demise, suggesting Latin America is almost back to square one.