Acceding governments have recognized the central role that joining the WTO plays in cementing domestic reforms and improving the business and investment environment. For instance, officials from Kazakhstan stated that the ‘main goal of WTO accession is improving the country's investment climate’ (Turebekova, 2015). At the same time, exporters, importers and investors are continuously scouting for new business opportunities. Recently acceded members (i.e. members that have joined the WTO as per the procedures contained in Article XII of the Marrakesh Agreement Establishing the World Trade Organization, or WTO Agreement) represent tangible market access opportunities for goods and services, based on the commitments reflected in their respective schedules and their working party reports.

Acceding governments negotiate their accession terms by way of engaging in negotiations with WTO members within the framework of Article XII of the Marrakesh Agreement Establishing the World Trade Organization (WTO Agreement). The outcome of the negotiations is included in an instrument referred to as the accession protocol that in turn is integrated into the WTO Agreement. In order to understand the negotiating process, it may be useful to keep in mind the final objective, i.e. to determine the scope and contours of the WTO Agreement that the acceding government will accept to abide by upon successful conclusion of the negotiations and the consequent assumption of WTO membership.

The WTO Agreement may be divided broadly into two parts: the global, rules-based undertakings that all members have to comply with, and the member-specific commitments in the schedule, which are binding on the member concerned.

The book you are about to close picked up on the evolving discussion on accessions and trade multilateralism. The first book on the subject, WTO Accessions and Trade Multilateralism: Case Studies and Lessons from the WTO at Twenty, looked back. It took stock of two decades of accessions to the WTO, their welfare and development outcomes, the resulting improvements to market access, and their contribution to domestic reforms and to the rules-based multilateral trading system. It shone a powerful light on the GATT/WTO accession procedure – a process hitherto viewed as lacking transparency and complicated by its esoteric vocabulary and apparent detachment from the day-to-day conduct of trade.

This book looks forward. It focuses on the future of the multilateral trading system and the role of accessions in shaping it. It highlights the challenges of maintaining the system in a global economic and trade policy environment marked by radical transformation and uncertainty accentuated by fast-paced technological changes.

Clearly, the multilateral trading system needs to transform and adapt to this continually evolving environment. While it must remain a ballast for stability and global order, for policy relevance it must also adjust to the complex realities of a different age, an age in which one size cannot possibly fit all. The architecture of the rules-based system requires flexibility to adapt to the different needs of its members in different configurations, ranging from those focused on domestic policy reforms to those motivated by bilateral, plurilateral or regional trade integration priorities. A self-learning and adaptive multilateralism can accommodate these opposite pulls and pressures in a rules-based order. But multilateralism is only one piece of the puzzle and its abundant benefits are accompanied by a price. The price of multilateralism is constant adaptation, operation in different formats and in step with a complex reality. As argued elsewhere, there is a case for a ‘messy’ multilateralism, because ‘multilateralism is not one thing, but many’ (Haass, 2010).

The new realities of the twenty-first century require an upgrade of the multilateral trading system by erecting its upper floors on the foundation of the existing trade rules and the accumulated acquis.

At the launch of the first volume of our collection on accessions in September 2015, I said that our work in this area was a major success story for the organization. That remains the case today. Since then we have welcomed another three new members to the WTO, taking the membership to 164. As of early 2017 there were twenty-one ongoing WTO accessions, including eight least-developed countries. In total, fifty-seven applicants have expressed their interest in joining the WTO through the Article XII process since its establishment in 1995.

Empirical evidence suggests that the WTO accession process, which normally entails a range of domestic reforms, has had an overall positive impact on the economic performance of the participants. Looking at the remaining accessions, which involve a large number of economies that are dominated by a relatively narrow range of export products, the agenda for structural reforms will be vital for economic diversification, increased competitiveness, private sector development and improvements in the business environment and governance. In this way, the accessions process can make a significant contribution to the overall goal of faster growth, development and job creation.

The 2015 book WTO Accessions and Trade Multilateralism: Case Studies and Lessons from the WTO at Twenty (WTO/Cambridge University Press) was focused on the contributions of accessions to the multilateral trading system and the impact of accession on recently acceded WTO members. This follow-up volume Trade Multilateralism in the Twenty-First Century: Building the Upper Floors of the Trading System Through WTO Accessions draws on recent accession experiences to distil the impact of accessions on the constantly evolving architecture of the multilateral trading system.

This book pulls together a wide range of topics related to the impact of accessions and it draws on a broad range of contributors – from politicians and chief negotiators to academics and trade practitioners. All of them have been directly involved in the accession process and are uniquely placed to provide new insights on how accessions can help to reshape trade multilateralism for the twenty-first century.

The contributions contained in these pages are directed towards a broad audience of international trade and economic policy-makers, practitioners and scholars in related fields, as well as business people.

Trade multilateralism at a crossroads

Trade multilateralism has been under stress following the transformation of the global environment in recent years. Political developments have revealed a fraying consensus on the benefits of international economic cooperation. While trade integration has helped to drive economic growth across the world for decades, recently an uptick in protectionism and inward looking policies have been a drag on trade and growth.

Afghanistan is a landlocked least-developed country (LDC). Its territory covers about 652,000 square kilometres and it has a population of approximately 32 million. It is bordered by Pakistan in the south and east, Iran in the west, Tajikistan, Turkmenistan and Uzbekistan in the north, and China in the far north-east. Several decades of war and disorder have had a devastating impact on the Afghan people. Millions have been killed and millions more have been forced to flee their homes.

Stability is still a major concern and the economy remains weak. Commercial connections to regional and global economies have been severely disrupted by the civil conflict. Hard infrastructure, including roads and reliable supplies of water and power, has largely been destroyed and is inadequate to support rapid, sustained economic growth. Soft infrastructure, including human and institutional capacity necessary for an economy to function, also remains limited.

After many years of instability, Afghanistan continues to face daunting challenges. The perilous security situation has hurt confidence and growth. Afghanistan is undergoing a challenging political, security and economic transition necessary for robust and inclusive economic growth.

Introduction

Indonesia is rich in energy and mineral resources and it has allowed foreign companies to explore and exploit its oil and gas reserves sincethe early 1960s. Chinese national oil companies (NOCs) have long demonstrated interest in Indonesia's energy resources and they have developed many oil and gas exploration projects there. After the global financial crisis in 2008, China accelerated its foreign direct investment (FDI) to Indonesia and, for the first time, China was among the top five countries for levels of FDI to Indonesia in the last quarter of 2014. This may elevate energy cooperation to a new level.

However, although Chinese government has planned to stake a long-term strategic energy investment in Indonesia through a range of policy incentives and Chinese capital has poured into resource and energy-related infrastructure sectors, emerging factors have been pushing the two countries’ energy ties toward difficulties and competition. Concerns in Indonesia that an increasing trade deficit with China will affect national economic security have stirred debates over how to protect Indonesian resource and mineral industries while maintaining trade ties with Beijing. Fearful of falling into a relationship of “dependency development” with China or other foreign mineralinvesting country, Jakarta implemented a new law banning the export of unprocessed ore in January 2014. Although the law aims to increase added value for mineral resources prior to export, the new regulations will affect Sino–Indonesian energy resource cooperation. Within this context of fraught political and economic relations, this chapter addresses the following questions: In what direction is the China–Indonesia energy tie going — towards cooperation or conflict? And can it provide a basis for a broader bilateral relationship?

Overview of the Indonesian Energy Sector

Historically, Indonesia has been an attractive country for mineral investors because of its rich mineral wealth.

Introduction

This chapter shows how the patterns and practices of Chinese investments in Philippine mining differ from conventional multinational mining investments. While Ching Kwan Lee has previously argued that there are different practices between Chinese and multinational mining companies in Zambia, the author suggests that Chinese investment in the Philippine mining sector presents an analogous case. First is the method of production. Multinational mining companies focus on large-scale mining (LSM), but Chinese investments tend to gravitate towards artisanal small-scale mining (ASM) to evade scrutiny from national authorities and hostile reactions associated with current territorial disputes between the two countries. Second is the method of accumulation. While multinationals use capital-intensive infrastructure and formalized ways of pursuing extraction, ASM capitalizes on multiple methods and ways: labour-intensive extraction, communitycentred and house-driven support, and flexible infrastructure. And last are the host country linkages. While multinational mining companies need the support of national government agencies to pursue resource extraction, Chinese mining relies more on connections with overseas Chinese communities in the Philippines to access subnational political elites, such as regional politicians, governors, and local officials.

Introduction

When the Philippine Supreme Court issued a Temporary Environmental Protection Order (TEPO) against ninety-four “small-scale mines” in the Province of Zambales in 2013, the media touted the decision as anti- China, rather than pro-environment or anti-mining. Many of the big small-scale mines enjoined by the TEPO to “perform or desist from performing an act in order to protect, preserve, or rehabilitate the environment” are reported to be dummies of Chinese firms. The case was filed by concerned members of local communities of the province who complained that the mining operations were allegedly outside the designated allowable mining area, were polluting the environment, were unregulated and untaxed. Local and national government officials were also respondents to the case.

Mining in general in the Philippines has been controversial and divisive. On the one hand, mining operations have been described by civil society groups and the Catholic Church as destructive to traditional livelihoods. On the other hand, mining has also catalyzed vibrant economic activities through job creation, infrastructure works and business establishments in economically stagnating localities. Thus, government officials and businessmen tend to favour and endorse mining projects.

Introduction

Across Southeast Asia, the “rise of China” has inspired both anticipation and anxiety. A common aspiration throughout the region is that a strong China means economic prosperity for all. The prevailing wisdom is that the sheer size of the world's second largest economy and its demands for trade will translate into jobs, business opportunities, and economic growth for neighbouring countries. These aspirations have been bolstered by China's leadership in establishing the US$100 billion Asian Infrastructure Investment Bank (AIIB), as well as its ambitions to retrofit ancient trade routes with twenty-first century infrastructure as part of its “One Belt, One Road” initiative. Now with hints of American influence in decline, many eyes are looking to China as the region's new benefactor.

If anticipation has been fuelled by visions of economic splendour, the anxieties have been more polysemic. Influxes of Chinese investment have been accompanied with waves of Chinese companies, workers and migrants, whose intermixing with local populations has generated both enthusiasm and distrust. The Chinese knack for keeping costs low has come with familiar concerns about social and environmental management practices, exploitation of local labour, and networks of chronyistic corruption. China's territorial claims and expanding military installations in the South China Sea have only helped to heighten geopolitical tensions both within and among individual Southeast Asian nations. Hence, while Chinese economic influence has been welcome, a stronger political, military and socio-demographic presence has been met with more equivocation, if not outright consternation.

Amid these tensions, Chinese resource sector investments have emerged as flashpoints of protest and controversy. From government orders to suspend the Chinese-backed Myitsone dam and Letpadaung copper mine in Myanmar to national protests over Chinese resource sector investments in Vietnam, the Philippines and elsewhere, resource projects have come to be a “focal point” for tensions and anxieties surrounding China's rise in Southeast Asia. Indeed, resource development is an interesting angle from which to examine China's future roles in Southeast Asia precisely because it reflects the contested nature of development.

Resource development is contested development. From “conflict minerals” to “resource curses”, political economies of resource development have been known to incite inter- and intra-state conflict, hinder socio-economic development, and bind already poor countries and communities into dependent relations with other more powerful nations.

Introduction

Southeast Asia is one of the only regions in the world in which coal will constitute a greater share of the energy mix in the future. China is the world's top producer and consumer of coal, while Indonesia holds these same titles within Southeast Asia, producing 89 per cent of the coal in Southeast Asia. Indonesia is also the world's largest coal exporter. The coal industry has major political sway in both countries. China and Indonesia have become politically and economically entangled through coal trade and investment. For the past several years, their intimate import–export relationship has dominated global steam coal trade in both volume and market power. Although other regional partners, namely Australia, are major suppliers of coal to China, this chapter focuses on Indonesia due to the growing importance of the China–Southeast Asia relationship for global resource governance. Southeast Asia has a huge natural resource endowment, including biodiversity and carbon stocks in its forests, major fossil fuel reserves, minerals, and ores.

Introduction

Since market reforms in the 1980s, foreign investment has been and continues to be a driving force for Vietnam's economic development. Since normalization of bilateral relations in 1991, Chinese economic investments in Vietnam have increased dramatically. More recently, they have also shown a growing interest in Vietnam's rich mineral and energy resources. Geographical proximity makes Vietnam particularly interesting to Chinese resource companies, especially for minerals that have high transportation costs. Furthermore, shared histories, cultures and socio-political organizations have facilitated trade and business relations between these two nations.

On the surface of it, Chinese demand for natural resources and Vietnam's need for foreign investment is a perfect match. Yet one does not have to dig very deep below the surface to find a much more problematic situation. Recently, the General Director of the Department of Geology and Minerals of Vietnam publicly complained that up to 60 per cent of mineral licenses in northern Vietnam showed “Chinese traces”. It was as if, he suggested, “the Chinese were standing behind our back and controlling our own mining industry”. While the widespread opposition towards Chinese involvement in bauxite mining in the late 2000s was perhaps a first signal of unrest, the riots that targeted mainland Chinese workers at a Taiwanese-owned steel factory in Central Vietnam in 2014 demonstrated just how grave the matter can become.

Morris-Jung's introduction to this volume began with a macro analytical framework of China's resource encounters in Southeast Asia. It pulled together a wide diversity of issues covered in the individual chapters to introduce the central framework of this volume, which is a careful and detailed analysis of diverse issues centred on local and national development, environment, justice, power relations, territoriality, sovereignty and many others. Morris-Jung's chapter painted the complexities that all authors in the volume grappled with. How do scholarly works capture the highly-nuanced, contextual and complicated domestic and external factors behind the “new wave” of Chinese investments into the Southeast Asian region, which represents an interplay of both opportunities, challenges and risks? Morris-Jung correctly identified the multi-layered implications of these investments and subsequently each chapter contributor highlighted and surveyed these complex layers through case studies, local-area examples, contextual analysis and empirical data.

What Morris-Jung and the other chapter contributors have highlighted is the complicated ecology of state-owned enterprises (SOEs), private sector firms, local communities, regional elites, nationalpoliticians, Chinese diaspora and bureaucracies interacting with each other. In analysing them, we should not, as Morris-Jung reminds us, fall into a territorial trap of resource extraction based on unquestioned assumptions of (1) territory as geometrically bounded and inwardly focused and (2) the sovereign autonomy of the nation-state. This would unnecessarily delimit the imaginative as well as analytical spaces available, which the rest of the chapter contributors have explored with vigour and incision. Therein lies the most important contribution of this edited volume — a multi-perspective and multi-spatial analysis of the ecology of Chinese mining, resource extraction and investments in the diverse region of Southeast Asia.

Macro-regional Analyses

Philip Andrews-Speed, Mingda Qiu and Christopher Len's chapter “Mixed Motivations, Mixed Blessings: Strategies and Motivations for Chinese Energy and Mineral Investments in Southeast Asia” identified the specific motivations of Chinese enterprises and government in their engagements with Southeast Asia's energy and mineral resources, and examine some of their implications from their mix of corporate and state drivers. In this chapter, the authors argue that the increasing participation and investment of Chinese hydrocarbons, petrochemicals and commodities/resource firms may be showing differential outcomes in Southeast Asian countries due to varying incentives used, state priorities, global business experience, and sometimes less than optimal management. Although these firms attract Chinese funding to the region, it may also bring about negative impacts if project promises are not delivered.

Introduction

In recent years, under the democratizing environment in Myanmar, civil society has mounted forceful campaigns against irresponsible foreign investment practices, which have included Chinese, Thai, Indian and South Korean companies. However, Chinese investments account for about a third of Myanmar's total cumulative foreign investment of US$62.6 billion, as of 2017. Most of the protest has been in the energy and natural resource industries, whose propensities for extensive socioenvironmental impacts have encountered the most resistance. Much of it has been labelled and, indeed, presented itself as “anti-Chinese”. As this chapter demonstrates, however, the causes of protest in Myanmar are multiple and complex.

Protests have played a critical role in compelling Chinese interlocutors — including state-companies, the embassy in Yangon, the Chinese Ministry of Commerce, and Chinese scholars — to confront the demands of Myanmar civil society. This chapter will first provide a brief overview of Chinese investments in Myanmar, followed by an examination of anti-Chinese sentiments as they have emerged through complex historical relations, local politics and Chinese investment practices. It analyses how Chinese interlocutors, whose conventional diplomatic and business approach is to deal predominantly with host governments, perceive and interact with local civil society actors in Myanmar, especially as their protests make these interactions inevitable.

Introduction

“Strategic minerals” can be defined as natural resources that are important to a state's economic development, national security or people's livelihoods. The US Geological Survey (USGS) includes additional criteria for defining “strategic minerals” as commodities that are not easily replaceable yet they are extracted mainly from foreign sources. Among industrialized nations, competition over theexploitation, production and accumulation of strategic minerals have come under international media attention.

As China's economy has been developing rapidly since economic reforms that started in 1979, its consumption and import of strategic mineral resources has also increased significantly. According to the Chinese Academy of Engineering's definition of forty-five strategic minerals, China is in short supply or cannot guarantee adequate supply of twenty-seven different kinds of strategic minerals. More than half of them are currently imported from Southeast Asia and Australia, mineral-rich regions proximate to China. Southeast Asia is also China's most important supplier for nickel, aluminum ore (i.e., bauxite) and coal. As China's demand for strategic minerals is likely to keep increasing, based on projected slowing but continuing growth, China will need to consider several important factors to ensure accurate and realistic assessments of availability and accessibility for long-term resource supplies, especially from its neighbouring regions such as Southeast Asia.

This chapter analyses the key challenges China currently faces in securing supplies of strategic mineral resources from its neighbouring or “periphery” regions (translated as “zhoubianguojia” in Chinese hanyu pinyin romanization), which refer to those countries and regions surrounding the Chinese overland borders and coastal areas. The “periphery” is a necessarily loose categorization, but it has particular significance because of the particular geopolitical and close economic relations that China shares with these countries and regions historically.