Wednesday, May 15, 2024

Sanction threat: US in-denial of changing world order

Last week on May 9th, the US Treasury Undersecretary Brian Nelson came to Malaysia to meet Home Minister, Dato Saifuddin Nasution to discuss a security matter but sugar coated as "focus on unified global response to threat" and "environmental risks" concern. 

There were Malaysian businessmen nervously reading it as a sanction threat against Malaysia. Their suspicion being why an American civil servant not meet their civil servant counterpart at the Treasury, but with the Minister in charge of security had it not to deliver a message from their political master?

Saifuddin expressed willingness to engage with the US but he "nicely" told them off. Malaysia took the bold position that as a sovereign nation and member of the United Nation, it has the right in its refusal to recognise unilateral sanction towards another sovereign state and will only support a UN-endorsed sanction. 

Malaysians, who understood the potentially serious implication it could have on the Malaysian economy, had cold feet to Saifuddin's reply and Anwar's "dangerous game" to meet Hamas leaders in Qatar yesterday

Prior to the meeting, international news agencies were reporting on transshipment of Iran oil off the coast of Malaysia destined for China, North Korea and other destinations. Sources claim such activities happened off the coast of Johor.  

After the meeting, Brian Nelson revealed four Malaysian based companies were sanctioned in December for assisting Iran's drone production that was supplied to Russia and Middle East proxy, namely Hamas. 

Among the companies found in the Office of Foreign Asset Control websites are Arta Wave Sdn Bhd and Nava Hobbies Sdn Bhd. Both linked to a person by the name of Hossein Hatefi Ardakani. Source claimed Arta Wave have a front company which is a subsidiary of a PLC.  

While the reports potrayed the US understand Malaysia's position, which is in tune with Anwar's "don't tell us what to do" speech at the World Economic Forum, and the Embassy denied economic sanction threat, it was not absent in the tone of Undersecretary's interview at Amcham. He said sanctions are impactful and reminded all transactions will involve the US financial system. 

Anwar has already denied there is any proof of a ship-to-ship transfer of Iranian oil with Malaysian service providers involve as claimed by Western media.

It is an interesting development when seen in context of Reuters report that US is unlikely to undertake a dramatic sanction against Iran after their drone attack on Israel. The Malaysia visit then is presumably a soft approach against Iran. 

Blinken failed China visit

The same with Blinken visit to China which was seen as a warning for supporting Russia in the war against Ukraine, but again sugar coated as though to temper down public acrimony that brought ties to historic low last year. 

Behind the back, US has in place plan to sanction Chinese companies beyond Tik Tok and Hua Wei, but a list of 500 companies. China responded with the vow to protect and safeguard their lawful rights

Apparently at the end of the heated exchanges, an unconfirmed Iranian report claimed China warned US to not interfere with Chinese and Iranian business. It is not surprising because BNN Bloomberg reported US cannot stop the trade in Iranian oil

The Indian portal, First Post explained the US visit failure in the extract below: 

China is now challenging US power. The equations between the two countries have changed. China, as the second largest economy, a huge market and the biggest exporting nation, with its tentacles now spread all over the globe through its Belt and Road Initiative, cannot be either ignored or contained. The US, European and Japanese economies are far too linked with the Chinese economy to risk a rupture.

The US now sees China as its principal adversary and is forging policies that would rebuild its own industrial strength in critical areas in order to reduce dependence on China, as well as to slow down China’s technological progress through denial of the latest western technologies. It is also putting pressure on Europe to follow suit.

If the US intends to blunt the China challenge, its geopolitical strategies are not in tune with this objective. It is seeking to simultaneously contain both Russia and China, giving both the incentive to support each other, which adds to the challenge the US faces. While the US claims it can handle conflicts both in Europe and Asia, and that its proxy war against Russia does not deplete its capacity to thwart China’s expansionism in the western Pacific, the reality is different. The US has already lost ground in West Asia to China as well as Russia. China has played a role in the Iran-Saudi Arabia reconciliation process. Saudi Arabia and the UAE have joined BRICS which has multipolarity as a major objective, as well as promoting trade in national currencies to reduce transactions in US dollars.

The end of unipolarity

Professor Glen Diesen from the University of South Eastern Norway highlighted in Lena Petrova podcast that BRICS was able to congregate feuding nations and allies of the West such India vis-a-vis China, Saudi Arabia vis-a-vis Iran etc for the single purpose to end the unipolar world order of a American liberal hegemony.

That message seemed to be lost to the those taking a snapshot view of BRICS at its infancy. At any initial stage, it will naturally start out as a discussion platform and politics before firming up with any plan of action.

Given the unity of purpose to end the unipolarity for a multipolarity and reaction to the possibility seizure of sovereign asset as imposed on Russia will recur, a new order to counter the over reliance on US dollar will evolve.   

The American can continue to prop up the US dollar as safe haven and high interest rates, but it is not sustainable. Its a question of when before the huge economic inequality, massive debt, money printing, inflation, and political instability will catch up.

The You Tube below is a compactful analysis:

On the unprecedented use of sanction as tool imposed by the West on Russia, China and weaker countries, it is not producing the same result as before. After two years and thousand of sanctions, Russia is forecasted to grow faster than Europe and US. All EU countries are performing poorly with UK being the worst.

Prof Diesen is of the view that the sanction propaganda is only effective in the 90s when there was only one game in town. Countries can develop new market with other countries. Is this Anwar's consideration in his response to call the American bluff? 

To early to assume the Malaysia visit failed.

Nevertheless, consider that within only 30 years, the liberal hegemony of the US are already reaching to the end after in existence at the end of the Cold War. 

Prof Diesen see unipolarity as an unstable order in absence of competing powers to provide stability and for system to evolve. Part of the American debt problem is attributed to unipolarity. It cost money to get its allies fulfill its wishes. 

Biden just got Congress to spend USD30 billion of taxpayers money for the losing cause of Ukraine plus more billions for conflicts involving Israel and Taiwan. Expensive cost to sustain dominance

In a world of growing interdependence between countries, the American and European failed to realise this. 

With a 333 million population in American and low birthrate throughout Europe and developed countries, it is not comparable to the 1.4 billion in India, 1.4 billion in China and 666 million in ASEAN. Bangla Desh population itself is half that of the US. While BRICS covers 40% of the world populations

The American foreign policy is self defeating and working against its own national interest. Sanction threat will only make countries distance itself from US and grow closer to China and Russia. No countries would want to risk being overdependent on a single country. 

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