Threats to the multilateral trading system dominate Japan dialogue

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On 4 October 2022 the Australia-Japan Research Centre (AJRC) co-hosted a Public Forum with Japan’s Ministry of Economy, Trade and Industry’s Research Institute of Economy Trade and Industry (RIETI) at International House in Tokyo, on economic security in Asia. Over a hundred distinguished participants from the Japanese policy community attended the event.

Professor Peter Drysdale opened the forum with a keynote speech reflected on the looming threats to multilateral economic institutions and the consequences of a retreat from economic interdependence for Australian and East Asian economic security.

‘The major powers are weaponizing international trade’, he said. ‘The global political and economic order which for over half a century underpinned the transformation of the East Asian and international economy, has been shaken not just by the US–China trade and technology war, but also by the global pandemic which has exacerbated the move towards economic nationalism and autarkic programs of national resilience and now by the Russian invasion of Ukraine the war in Europe’.

The G20 summit schedule next month would likely not happen around the global geopolitical fractures but for Indonesia’s convening power, Just keeping the G20 together, has been a major challenge.

Professor Drysdale set out the, the stark costs to East Asian economic and political security from the breakdown of the multilateral economic order and urged regional think tanks to keep reminding policy leaders of their dimensions.

Although the United States was likely to be out of play for some years’, he said, ‘and the system’s become messy, the WTO still works and Australia, Japan and East Asia now have a primary responsibility in defending it’, he said.

In panel discussion with Indonesian and Japanese experts Dr. Shiro Armstrong argued that multilateral principles and the architecture they underpin are crucial to middle powers’ ability to avoid the worst consequences of the great power decoupling. Despite powerful structural pressures towards unwinding integrated regional and global supply chains, East Asia’s economic prosperity and security depends on pushing back, he said.

Countries on the frontlines of this technological chasm, such as Japan and South Korea, face a lethal threat to technological industries on which the vitality of Asian economies increasingly depend. ‘Australia and Japan together ASEAN, whose futures are tightly woven into the multilateral economic order, have a central role to play in reinforcing the rules-based order’, he said.

The Public Forum was followed by an ANU Alumni and AJRC event at which current Bank of Japan Governor, Haruhiko Kuroda was awarded the ANU’s highest honor, an Honorary Doctor of Law by Vice-Chancellor Brian P. Schmidt.

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