Promoting Infrastructure Development in Central Asia Through Public-Private Partnerships

By Maribeth Hunsinger, JD Candidate 2019

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Image Credit: PowderPhotography 

 

The relatively young nations of Central Asia have been slowly opening their economies to foreign investment over the past twenty years. However, infrastructure shortfalls in the region, including failing transportation and utility networks, are hampering continued economic growth and development.

The World Bank estimates that over $1 trillion a year in additional infrastructure investment will be required to meet the current demand shortfall in emerging markets and developing economies. The gap in global infrastructure investment has a tangible impact on quality of life worldwide: 2.6 billion people have no access to electricity, while 800 million people have no access to clean water. Infrastructure spending differs not only across regions, but also across countries within the same region, depending on factors such as government funding, legal frameworks, and security issues.

Inadequate infrastructure can reduce output, lower productivity, impede the flow of people and goods within and between countries, and impose higher transaction costs. However, the governments of most Central Asian states have relatively limited financial capacity to rehabilitate existing infrastructure or fund new infrastructure. These nations are facing declining growth projections and budgets following the 2014-15 drop in global oil prices, and they will likely need to find different methods of financing their widening infrastructure gaps. Continue reading Promoting Infrastructure Development in Central Asia Through Public-Private Partnerships

Taiwan at the Crossroads: To Breathe in the Air of Global Sky, or the Air of Her Independence?

By Huan-Ting Wu, J.S.D. candidate, University of California, Berkeley

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Photo Credit: Huan-Ting Wu of Taipei 101

 

Once every three years the International Civil Aviation Organization (ICAO), a UN specialized agency, meets. The Assembly just finished having its 39th Session in Montreal with Taiwan knocking on the door outside for months but not getting any answer back nor permission to enter. It is a sharp contrast compared with the situation in 2013, when Taiwan participated as an invited guest of the then-ICAO Council President, to attend the 38th Session of the ICAO Assembly.

Although excluded from ICAO since 1971 when they lost their seat in the UN, Taiwan still voluntarily follows the Convention on International Civil Aviation (the Convention), which has been one of the significant pivots of air traffic in East Asia, as well as the world:

The Taipei Flight Information Region (FIR) covers 180,000 square nautical miles and borders four other FIRs. In 2015, Taiwan’s Civil Aeronautics Administration handled fifty-eight million incoming and outgoing passengers. In addition, Taiwan’s Taoyuan International Airport in 2015 ranked eleventh in the world in passenger volume and sixth for cargo. Seventy-four airlines operate passenger and cargo flights in and out of Taiwan following 301 scheduled routes that connect the country to 135 cities globally.

However, constrained by the fact that Article 1 of the Convention defines contracting States as those that have “complete and exclusive sovereignty over the airspace above its territory,” Taiwan’s international status after 1971 makes it hard for them to take part in this UN-colored organization as a contracting State.

Given these legal hurdles, what made Taiwan’s presence in the 38th Session of the ICAO Assembly in 2013 workable? First, the U.S. government played an important role in the process. A Taiwanese researcher describes the U.S. as a “facilitator” of Taiwan’s international participation. Following the U.S. Department of State’s policy of “encouraging Taiwan’s meaningful participation in international organizations where its membership is not possible,” U.S. President Barack Obama in July, 2013 signed into law H.R. 1151 to (1) develop a strategy to obtain observer status for Taiwan at the next ICAO Assembly in 2013; and (2) instruct the U.S. Mission to the ICAO to officially request observer status for Taiwan and urge ICAO member states to support Taiwan observer status and participation in the ICAO.

On the other hand, fearing that the island’s increasing global participation independent from the Mainland will be used to reinforce Taiwan’s push for de jure independence, China’s government complained in a statement that the Act has intervened with China’s “internal affairs” and seriously violated the one-China policy. This Chinese policy defines Taiwan as “part of [China’s] territory,” and that “The joining of international organizations like ICAO by Taiwan compatriots is a matter for the Chinese people.” However, this position did not preclude China’s support for Taiwan to take part in the Assembly in 2013. In fact, from China’s perspective, Taiwan’s success in the participation was solely because of China’s mediation (ICAO Council President González said he invited Taiwan because of China’s suggestion). China’s position is clear: Taiwan is allowed to join international events, but only after having consulted with China, and used China as the window representative to contact the world, thereby following the one-China frame work. Several Taiwanese international law scholars criticized the practice, arguing that Taiwan was invited as merely an auditing “guest” under the identification of “Chinese Taipei,” not as an “observer” who has permission to speak.

That brings us to 2016. Taiwanese officials, with U.S. Department of State’s support, bypassed “the window” and applied for attendance at the Assembly in early August. But this attempt was in vain. In fact, the surrounding circumstances have been different.

The political climate in Taiwan has had a landslide toward the Democratic Progressive Party (DPP), which calls for independence from China, in the 2016 Presidential Election in January. The leader of DPP, Tsai Ing-wen, was elected as Taiwan’s first female president, with DPP winning absolute majority in Taiwan’s Congress. The election shows the Taiwanese people’s doubts about predecessor Ma Ying-jeou’s pro-China policies, especially the inclination to the one-China framework. In fact, in Tsai’s inauguration speech, she reflected the people’s will by not mentioning the so-called “1992 consensus,” that is, the one-China principle. In response, China suspended diplomatic contact with Taiwan. As a result, the fundamental basis of Taiwan’s participation in ICAO was undermined. In addition, it is also worth noting that on August 1, 2015, Dr. Fang Liu of China was appointed as the new head of the Secretariat of ICAO, which is the office processing the application. Consequently, we can expect that the influence China can possibly exert is at least no less than it was in 2013.

It is not surprising that Taiwan’s direct application for participation as an observer, even with U.S. and other contracting States’ support, would fail. On the one hand, in 2013 Taiwan joined the Assembly as a guest of the President (if not China); therefore, without ex ante negotiation, there is no reason why China, now the window of both the “one-China frame” and the ICAO, would allow Taiwan to join the event, especially with an “upgrade” of status. China’s strategy to make Taiwan dependent and subordinate is clear: be ONLY China’s guest, or not invited at all. On the other hand, the ICAO is closely related to the UN, so China will not risk any possibility that Taiwan can stand in any international forum as an independent sovereign-like entity, and accordingly make accepted practice.

In response to China’s strong attitude and the failure to take part in the ICAO Assembly, Taiwanese President Tsai Ing-wen replied firmly by reiterating that “we will not succumb to pressure from China.” Given that President Tsai is willing to let the relationship between Taiwan and China chill, it may mean that Taiwan has chosen the air of independence, without the oxygen mask pressed on by China. This decision will either be beneficial to Taiwan’s future participation in global events, or hazardous to those practices Taiwan has established during President Ma’s incumbency. For instance, will this affect the practice of Taiwan joining the World Health Assembly (WHA), an annual event held by World Health Organization in May, as an observer since 2009? Maybe so, since China declared that the reason Taiwan was able to participate in the 2016 WHA was because of its goodwill.

The ICAO incident is just the prelude. We see Taiwanese people made their decision in the 2016 presidential election, and we also see how the Communist Party of China reacted. That being said, we can expect that in the future, it is highly possible that China will keep craning over its “window,” being nosy about Taiwan’s every attempt to cross the “Chinese wall” and expose herself to the air of the global sky. At the moment, we still hope that there could be more goodwill coming from both sides of the Taiwan Strait.

 

This Day in International Law – October 30

On October 30, 1947, the General Agreement on Tariffs and Trade (GATT) was signed by 23 nations in Geneva. The Agreement contained tariff concessions and a set of rules designed to prevent the parties from subverting the agreement. At the time of its signing, it was the sole international instrument governing world trade.

Ironically, the GATT came about as a by-product of the failure of a larger coalition of nations to agree on a charter for the International Trade Organization (ITO). The ITO represented the grand vision of the UN Economic and Social Council following the end of World War II. Its founding charter was signed by 53 nations, but never ratified, so it never came into effect. But while the larger group of nations failed to ratify the provisions of the ITO, a smaller group implemented the GATT among themselves as an interim measure.

The GATT ultimately proved to have much better longevity than the ITO and it remained in effect until 1994, when it was updated by the GATT 1994. Most notably this update included the agreement that created the World Trade Organization (WTO), which subsequently replaced the GATT in regulating international trade.