EXCLUSIVE INTERVIEW: Geopolitical Situation in Asia with Marc Saxer by TenGer TV, Mongolia

Marc Saxer, FES Asia Director, reviewed geopolitical situation in Asia at TenGer TV in Mongolia.

Tenger TV: Since you are a geopolitical analyst and in charge of Asia how do you perceive the evolving geopolitical situation in Asia, specially the biggest player China’s, Japan’s and India’s role in this region?

Marc Saxer: Well, I think it’s important that we try to look at the situation from different perspectives at the same time so that we can understand the motivations of the big players. I think, China looks at the map of Asia and feels encircled by the USA and its Allies and feels in particular worried about the strait of Malacca, which is a very narrow choke point off the coast of Singapore. So you can interpret everything that China has been doing the last 10 years as an attempt to break out of this encirclement. Westward towards Europe is the Belt and road initiative and has very important side arms through Pakistan and Myanmar, which actually helps China to circle the strait of Malacca and access the Persian Gulf and actually have secured energy supplies. Eastward it pushes into the south and east China sea. The neighbours Japan and the ASEAN countries certainly feel threatened by this behavior. Ultimately, I think what China tries to do is to push into the open pacific.

And if you look at that same action from the perspective of Washington, they feel that this is an aggressive military peer that is pushing into the Pacific for the first time since Pearl harbor. Therefore, threatens the US positions on Guam Hawaii in the west coast. So, it’s important to understand that for both of them, the way they look at it, this is a national security risk of the highest level and it culminates all in the Strait of Taiwan.

Tenger TV: When we talk about China, we need to talk about Taiwan. Before we talk about the election, how do you see China and Taiwan’s relationship in the near future and what does One-China-Policy mean for most of the states? Do they mean they support China or the succession of Taiwan?

Marc Saxer: Well, most of the states around the world including my country Germany, recognized One-China-Policy. US position has been consistent for pretty much 50 years in this topic and they will basically accept whatever the outcome China and Taiwan negotiate as long as it’s peaceful and on mutual consent.

But there has been, from both sides, certain visits and military moves in the last two or three years, that actually made the situation way more complicated. So, the US concern is, whatever form of reunification with mainland China would be done by force, this is where the US actually draws the line. That’s why the two sides, the US and China, need to talk about their red lines. And if you watched presidents Biden and Xi in San Francisco at the sidelines of the APEC summit that’s exactly where they were talking about “This is my redline, this is your redline”.

Tenger TV: How do you think the results of Taiwan’s election will impact its relation with China and what role does this Taiwan Strait play in the broader geopolitical dynamics of the Asia Pacific region?

Marc Saxer: First we have to see how it ends. Obviously, the concern in Beijing would be the possibility of an unilateral declaration of independence. And that is one of the red lines that China would not be willing to accept.

The Taiwan Strait is where the two spheres of two superpowers contact. But the concern is that this so far relatively peaceful state would erupt and could be the trigger point of a larger war between two nuclear armed superpowers, and it could quickly escalate into a regional war, drawing in the neighbors in the Asia-Pacific and with larger global implications.

Tenger TV: Concerning the war between Russia and Ukraine, what are the key geopolitical factors influencing this crisis and what are the potential consequences of this conflict for European security stability?

Marc Saxer: I think on a larger picture, we have not only one war but a couple of conflicts erupting all around the world. So it seems to be an indication, that the Pax Americana is coming to an end. And we're entering a new era, a new global constellation. There are a couple of powers that actually want to see a different order, Russia being one of them. So what Russia did is, actually it violated the letter as well as the spirit of the “Charter of Paris”, which is the security architecture of Europe. So that means the European security order has been up ended and we are in an open and extremely unstable situation and have to find a way forward how we can actually reconstruct one. I would assume that Putin is waiting for the result of the American election, which means that the beginning of 2025 would be suitable where new judgements can be made. But that would mean we are quite likely to see one more year of war.

Tenger TV: In your opinion which region is more effected by this war and specifically how do you foresee it affecting the alliances and the partnerships among the EU and NATO?

Marc Saxer: It’s obviously a war in the middle of Europe, so of course Europe is directly impacted by this in a very direct way. But there’s been global effects and shockwaves. If you could think about food security, inflation and the spike in the energy prices, which were really felt all around the world. I assume the worry is that the American security blanket is too short. So, when the US talks about pivot to Asia, the Europeans get a bit nervous and if the US is bocked down around the conflict in Ukraine, then its allies in Asia-Pacific get nervous. I think that is how it impacts the dynamics in the short run and certainly strengthens the unity of NATO. We see a more active NATO and it’s actually growing with Sweden and Finland joining the alliance. This actually creates quite a difficult situation for Russia in the Baltic sea, which I would say is the direct impact.  

Tenger TV: Considering the existing tension crisis in the Middle East, how would this ongoing crisis influence the global balance of power?

Marc Saxer: That kind of adds to that dynamic that I was already alluring to. It is one more conflict. We do not know how far it will escalate if you see that there have been attacks on the container ships in the Red sea by the Houthi Rebels in Yemen, who have patrons in the region. You can see there is always a potential for this conflict to escalate beyond the near east and the United States as the security guarantor or the guarantor of open ceilings in the world will have a role to play in this conflict. But it is the second massive conflict in the world. So, I think the concern in Washington, concern of American allies, is what happens it there is a third and a fourth conflict like this, how much capacity do you actually have? The question that we are talking about is American overstretch. 

Tenger TV: Then what impact could this middle east crisis have on Asia, particularly in terms of energy and regional stability?

Marc Saxer: It already has a massive impact on Asia. Most of the trade routes of the world go to the Suez Canal, which is now blocked so the container ships have to go around Africa basically, which adds a lot of time and cost. That means the Asian exports are also impacted at the same time. This is still the most important region when it comes to energy supplies and stability. There’s always risk for energy security everywhere in the world, certainly on the price level but also when it comes to the actual supplies. So, there’s a couple of implications that actually go beyond the immediate security implications, and enter the realm of economics.

Tenger TV: Back to the topic with Asia-Pacific region. Do you see the impact of China is playing a big role in this region and how, since it just got out from its Covid lockdown only a year ago?

Marc Saxer: China itself has a massive impact on the region obviously. The Dynamic of the Chinese economic development is the local mode, if that is pulling most of the economies in the region, including your country Mongolia. It is a concern for the neighbors, that the recovery after the Covid crisis is not as good as everyone hoped it would be. But beyond the immediate impact the confrontation, and the strategic competition between the US and China also creates a lot of effects.

So, you see a couple of economic dynamics playing out, both the US and China are politicizing market access. Which means that you’re my friend you can come in, you’re not my friend you can go out. You see a weaponization of technology and technology transfer. We see a re-organization of global supply chains. The magic word here is near-shoring, some of the production facilities could go back closer to the old industrial countries, or friend-shoring, which means that the investments in a production as well as in infrastructure goes to those countries that are on the right side of this conflict. There is currency conflict going on over the role of the US dollar. De-dollarization is the catch word here. So, there’s a couple of developments that if you take them together looking from a perspective of a development country in Asia, there is a concern that this will negatively impact on the development model. So, if you look at what most Asian economies have been doing for up to last 50 years. It is based on cheap labor, export-led growth and catch-up industrialization.

But, if you actually have to compete against machines, robots, and AI your comparative advantage of cheap labor will no longer be as big if technology transfer is not happening or you’ve been cut out of the global supply chains. Then you cannot catch up and industrialize. And if your export markets are freezing up because there is a political entry tickets, to say, that will actually affect your export. So, every country in Asia right now is thinking very hard on the next development model.

Tenger TV: How do you see India’s developing economy?

Marc Saxer: India still has a growing population, China has not. In that sense the Indian economy is also growing because the population is growing quite considerably. Projections show that until the middle of this century 2050 India could grow up all the way to 1.6 billion people, which make it probably quite a bit larger than China at that point, which is shrinking. Economically India is attracting a lot of foreign direct infrastructure investments. I think India at this moment is in a sweet spot. So, the question is what model will India use and how far can this growth actually go? India cannot copy the development model that was successful for China because that world of open world markets and technology transfer may not exist any longer.

Tenger TV: What’s your opinion on the 80 elections for this year, as experts are saying that this year is a challenge for democracy in the world?

Marc Saxer: That is 80 elections in all parts of the world in totally different countries with totally different situations. It could be festival of democracy, but it could also show a lot of attacks on democracy. I think it’s difficult to say with the broad brush. Most certainly what it adds on top of all these conflicts is a lot of uncertainty, because for a few countries, it may be possible that the government is changing, and therefore the geopolitical orientation is shifting. This is why I called this situation a strategic uncertainty, because all the countries in the world, including Mongolia have to make very far reaching decisions now, but to be honest, we don’t know how the end of 2025 looks like.

Tenger TV: Considering the fact that Mongolia is sandwiched between two autonomic region, what’s your opinion on how the economy and technology development is affecting our country?

Marc Saxer: I think the development model needs to be checked and maybe adopted because we are not really going into the “deglobalization” but we are still seeing a wave of protectionism around the world. We see that the countries no longer let you into the markets the way it used to be 20 years ago at the peak of the liberal globalization. So, a country that is highly active in commodities exports has to see how that sector will develop with all its volatility, which kind of imports instability into a commodity exporting economy. The development model also needs to be careful when it comes to the issues, which are in the very center of the geopolitical competitions, where increasingly the market logic is being replaced for geopolitics logic. 

Tenger TV: Except two neighbors Mongolia is located in a very challenging region as well. How do you see North Korea’s action in the north east Asian region?

Marc Saxer:There have been series of publications I understand and if you speculatively connect our conversation about American stretch, we could notice that there has been a summit between Russia and North Korea in September. On paper it was about the delivery of Tillery Shelton but it seems to be little bit more than coincidence that these provocations are coming now. And I think it will create a situation where there’s just one more conflict in the world to attend to. It does not mean that this will go all out but if it’s just another hotspot of concern.

Tenger TV: The last question, as a geopolitical analyst how are you predicting this year in global security affairs?

Marc Saxer:It will be another year of instability, a year with the conflicts that have already started and may go on one way or the other. Unfortunately, I would not be surprised if more conflicts would be added to the mix. I think it is a year of instability and uncertainty.

Tenger TV: Sadly, I have the same opinion. Thank you very much for accepting our invitation.

Marc Saxer:Thank you for having me.

Marc Saxer, FES Asia Director, reviewed geopolitical situation in Asia at TenGer TV in Mongolia.