How Will Each Southeast Asia Respond to Trump? (Part 8)!

All right, hello everybody and welcome to Geopolitical Trends, where truth matters. Happy Thanksgiving to my American, uh, viewers here, if you celebrate it. So hope you had a good one. So anyway, excited to be with you guys. As, uh, I know last month I didn't have the monthly conversation I do with my dear friend Carlza I just came back from China. It was 2 days before that, and I wasn't up to it, so it wasn't fair that I will put Carl through that. So I decided, okay, we'll wait till next month, and here we are. So we are very excited. I'm gonna just get into it, guys, because we don't have a lot of time to waste, because I like always to really get the insights from Carl that you guys can learn about. So let me bring in Mr. Carlza. Hi, Carl!

Hi David, I'm actually excited to hear about your China trip and your impression.

Oh yeah, I will share some with you, why not, brother? So very excited to have you as always here, Carl. I hope you are doing well, the family is doing well, the baby is doing well. I'm so— it's growing, huh?

They grow quick, very quick.

So anyway, yeah, well, we got a lot to cover, Carl, and I don't even know where to start. But let's start with this China trip that I did. As a matter of fact, I just want to share some things with you and the audience. Uh, I am working on something specific for the audience. I never disclosed what it is. It's in the works, and that's going to highlight my entire trip to China. So it's going to be in a form of a video that is very, uh, some— something special. So that's, uh— but just for you, Carl, to know, it was my first trip to China, and, uh, Boy, was I surprised for what I saw. And what I saw was how much a government invests in its own country, in its own people, in its own infrastructure. That's what, what surprised me. Surprised, it's not the right word for it, because I've been reading enough about China to see what it is, and now I saw it with my own eyes. I just couldn't believe it. I couldn't believe it.

It's a totally different— like, it's a big difference between reading about it and being there firsthand experiencing it. I mean, seeing is believing. Like, this is why I always highly recommend to anyone to visit China. I mean, like, it will be eye-opening if you haven't been there before. And I'm sure that's It's, uh, it's, uh, you, you, you felt that way when you, when you went there, David.

And that's what it was. And I have a visa for 10 years, so I'm already thinking about next year to head out back there. One thing I wanna share with you quickly before we're getting into, it was literally, and I kid you not, Carl, you will understand more than anyone, even though you, you, you are familiar with the West and all that, about the level of energy that I felt walking in into the streets, walking into the old town, for example, in Qibao, in, in, in Shanghai, walking in Guangzhou, walking in Shenzhen, and you feel this energy in the street. But I can't describe it. I can't describe it, but you feel it.

Yeah, you have to experience it firsthand. It's really hard to explain to somebody, say, who is in America, who has never been to China, because as soon as you hit the ground in China, you feel like that dynamism, like the bustling energy just just like rush at you and you feel like, wow, these people are— they have purpose in life, you know, they're going somewhere. Like, you just feel it. It's very different. It's a very different type of energy, uh, when you, when you go to China.

And that's what— well, I was lucky because the first week it coincided with the national holiday. It was, it was like, oh my gosh, you know, I found out— you know what I found out, Carl? 500 million people traveled inside China for that week. 500 million. I was like, oh my God. And you know, when I was in Shanghai, it was orderly, no problems, no fights, no breakout. No, everybody's supposed to do what they're supposed to do, and everybody's enjoying the holidays. And, and the level of energy for it, it was, it was incredible. I enjoyed it. I enjoyed it.

And, and in China, you can drink alcohol on the street. There's no restrictions, unlike United United States, you know. Yeah, you can actually hold a beer or hold a drink, walk into the street and drink in public. Nobody cares. That's, that's— and they don't have problem, you know. Like in United States, you have fights probably, but in China you could drink in public.

Of course.

Yeah, not a problem.

Yeah, there's no responsibility with that. But I did enjoy it. Uh, Chinese people were friendly to me. So kind, even though they don't speak my language. And you can just tell the body language, literally, they're just so kind. So I don't know them, they don't know me. And to me, it was that, you know what it was, Carl? It was that human connection. That's all it was, the human connection. Uh, I didn't come across that like this arrogant American or whatever, because there was no need for that.

Why?

They are a human being from another country. Just, and plus I was a guest in that country, so I observed the laws, the respect to their traditions and whatever. You can't cross in the street when it's a red light, can't do that because out of respect for— that's how the rules are. Plus, you know, it's kind of, if you do, the camera is going to see you and see you, you broke the law, you can't do that. So, but I did enjoy it. I, uh, one of the big surprise, Carl, was when I had the chance by A manager of BYD allowed me to do recording on the, on the floor.

Wow.

Oh my gosh. Oh my God, you saw those cars, how luxurious for like $26,000. That's it. That's it.

And I was like, this is why Trump, this is why Trump and Biden will never allow Chinese EV in America. They will never allow it. That's why there's going to be 300% scared from Chinese EVs because they know if Chinese EV come to America, the, the big Detroit— yeah, they can't compete. They cannot. Yeah, they won't.

There is no way. When I saw that luxury car for that amount and the comfort on it and all this, I was like, heck, I will buy this in no time. One thing before I'll jump to our topic, Carl, I noticed in China something I didn't see You know what I didn't see? Gas station. I didn't see gas station at all.

Wow.

At all.

Wow.

I didn't see it. So it was like, oh my God, uh, it was, it was incredible not to hear the combustion engines running. Just everything quiet. Also, and I ate the stinky tofu. In China first time. I had it, stinky tofu. It was incredible. Pure—

who introduced you?

Uh, it was, it was one of my viewers from Canada. I said, Dr. Oualaalou, if you go, uh, make sure you eat the stinky tofu. I had no idea what it was, so I checked it out and I was like, I did. I did, and I had squid first time in a skewer. So I put some, uh, videos on.

Those are good.

Yeah, yeah, I enjoyed it. I look forward to next year. So, all right, let's get on into our conversation. And once again, Carl, I can't thank you enough on behalf of the community for carving out time for us here, because this is, uh, this channel is about learning. And I always like the community to improve on its, you know, knowledge and so forth. And you are one of the, uh, uh, regular here for the channel on a monthly basis to share with us your knowledge, and we are grateful to that. So, so let's start with the— I want to start with the first, uh, uh, uh, not a question, but rather I'd like to have your assessment about the recent APEC and G20 summit that concluded. What is your assessment? What is you feel about where things going?

I mean, it, it's a real sharp contrast to how US play its role in the APEC meeting and, and G20 versus China. Because when Xi Jinping arrived in Lima, Peru for APEC meeting, he announced the, the, the completion of the 3.5 billion megaports the Changkai Megaports China just completed for Peru. And the next day, Tony Blinken, in order not to be outdone, he came out with an announcement that United States is helping City of Lima building a passenger rail line, right? And sounds very good. What's like, wow, US is actually doing something. And so when people start digging around what Tony Blinken is actually talking about, he's talking about the Caltrain., in, in California that's retiring its older diesel engine cars because the Caltrain's finally getting electrified. So they have these old obsolete, uh, diesel engine cars. They're selling— they're not giving them away, they're selling them to Lima, Peru for $6.3 million. So that's what they meant by helping the city of Lima building a passenger line. This United States is not helping the building of rail line. They're selling them some old, uh, diesel engines, and they, they try to pass it off as like, oh, look, look what we have done for, for Peru. Forget about the Chinese mega ports, you know, only a few billion dollars. We have these like nice diesel engine car for sale. It's ridiculous. It's a ridiculous comparison. Um, and, and the, the, the, the port, the port that China built in Peru will fundamentally change how the commerce will be conducted throughout South America, because the— it's not only a port for Peru, uh, it's going to be a port for all of South America. That about 40 to 60% of the traffic is going to be coming from outside of Peru. It's going to come from Brazil, come from Bolivia, Chile, all the surrounding countries, and the northeast Brazil, where it's a lot of agricultural produce that gets exported to China.

Nor—

traditionally they will have to go through Panama Canal, which is congested. Often they have to wait. And then after they get through Panama Canal, sometimes they go— have to go to the mega ports in, uh, big ports in Mexico or Los Angeles where they get loaded on super containers, then to China. Now they can just ship, uh, across the Amazon, uh, go Now there's already a transoceanic, uh, highway linking Brazil and, and the port in Peru. So, so all these trucks can haul the containers across the Andes, loaded onto, uh, ships in the, in the megaport. So, so the one of the things is megaport is it can't handle the world's largest container ships. Um, you know, the, the reason like, uh, you know, it's not just a port because some ports, they cannot handle larger ships. This, this port can handle world's largest container ship. Those ships can't even go past through Panama Canal. And, and the reason that, you know, traditionally the, the agricultural produce from Northeast Brazil, after they go through Panama Canal, they have to go, uh, go to the port of Los Angeles to get reloaded. Is because some of the biggest ships cannot pass through Panama Canal. So now all this agricultural product in Brazil, they can completely bypass Panama Canal. They'll just get on trucks, get loaded, uh, dropped off in, in, uh, in the port in Peru, load and go directly to Shanghai. It will shave off the traffic, well, 15 days. That's 2 weeks. It can sh— they can shaved 2 weeks off the, off the transit time, which is huge, um, especially for agricultural products. And, and there's a lot of agricultural products that Brazil is exporting to, to China. And this is not the end because currently the Transoceanic Highway that crossed the Andes has still have limitations. You know, some of the bigger trucks cannot go. So China is in talk with Brazil Peru, etc. They're going to build a transoceanic railway that connects northeast Brazil, southeast Brazil, all funneled through, through the Andes to the port. And China has a lot of experience building rail, especially punching holes through mountains. You know, China built a high-speed rail in Tibet, so they, they will be able to provide the expertise and the capital to connect the whole region. And, and it's, it's, it's, it's such, it's such a big deal that, you know, it has, of course, have US politicians worried. The, the Trump, Trump advisor is saying now they're not only just going to slap tariffs on Chinese goods, they're going to slap tariffs on any goods that come out of the Shanghai Port in Peru, which is completely ridiculous. I mean, like, but, but that's, that's kind of the US mentality, zero-sum mentality. The port, uh, you know, they always say, oh, China is trying to control South America through the port. But look, it's a port on the ocean. It's not just the Chinese ships that will come in. Anybody can come in to use the port. The whole, whole point is increasing global connectivity, and, and US has nothing to compete with that, you know. Like, that's the, the, the Caltran engine, that's, that's a joke compared to this work. Uh, and then you have, uh, of course you have Biden's usual performance, wandering after giving his speech, wandering off in the Amazonian jungle, providing the comedy hour. Uh, that's like Xi Jinping came to Peru, Xi Jinping can go to Brazil, he gets the like highest honor, right? And, and, and, and whereas Biden during the G20 family group family photos Biden was late, so they just took the photo without Biden. You have all these journalists yelling on the side like, wait, you have to wait for Biden. Now can you take picture? Now let's just take pictures and then picture and left.

Move on. Well, I did, uh, during that time of when President Xi Jinping, uh, inaugurated the port. There were comments coming out of Washington, and, and I remember one specific one, and I'm paraphrasing here, stating the, the likes of, uh, US's concern about China's influence in the US backyard. And I was like, hold on a second, hold on a second, what the heck are you guys saying? What backyard are you talking about? That's Latin America. Those are sovereign states. But right there also became clear to me that the mindset in Washington still operates on the Monroe Doctrine, that it never left. And I kind of like, the world has changed.

And the physical distance between Shanghai Port, which China built, to United States is 6,000 kilometers. Kilometers. That's a— what kind of backyard is that? 6,000 kilometers away.

Yeah, yeah, it didn't make sense when I heard that. And right there it became clear to me they are really not understanding, you know, whomever is issuing those policies or those statements, that they don't have a grasp of the need for the economic developments. And I think that's why Peru wants— as a matter of fact, Carl, and correct me if I'm wrong in my assessment, with this outcome, with what you just stated, do you believe that's why Argentina wanted now to go back to China? Is this why?

So Javier Milei, the Argentinian president, he came to the— before he came to the presidency, he's like, oh, I, I'm not gonna deal with those commie bastards in China, you know. I want to have nothing to do with them. But recently he, uh— but then China came through with the currency swap that saved Argentina from bankruptcy. And, and recently, Javier Milei had an interview with Economist, and the Economist journalist asked him, you know, you know, let me tell, tell me about your relationship with, with China. He said, it's great. These guys, they don't, they didn't ask any questions. They didn't, you know, they're, they're happy to do investment, and they're not even asking anything in return. It's great, it's awesome. And, and then, then the, the journalist like, wait, didn't you say something about China, the government of China, before you became president? And he said, oh, okay, it's trade, trade. We— trade is exchange between people, it has nothing to do with government. He was backtracking furiously. Basically, you know, that's how China does business with anybody. They China's business is business. They came here to trade. They don't come here to interfere your, your domestic politics. They don't care about your domestic policy. They could care less whether you're, you know, the Javier Milei wants to, uh, do like, uh, uh, uh, uh, uh, uh, like, uh, any kind of cuts internally, whatever. China don't care. China just want— okay. We know Argentina had a lot of agricultural commodities. We want to buy those agricultural commodities, and we're willing to give you top dollars for it. That's it. It's very simple. This is why, like, Javier Milei was surprised. I mean, he's the president, and it tells you what kind of homework he did. But he was surprised, like, China just literally came in, no strings attached, provided the investment, provided the currency swap, and and, and save Argentina's ass, essentially. So this is, this is why China's business model has a lot of appeal, uh, across the Global South. And this is why United States and Western countries find increasingly difficult to compete with that, because usually the IMF and World Bank will place very stringent requirements. You know, they usually require to privatize to cut your, uh, uh, to cut your public funding, cut your education, cut your healthcare, and cut pensions. China does— China's investment come with no strings attached. So this is why they complain about Belt and Road Initiative all the time. They think this is a nefarious Chinese plot to take over, but really it's because United States find increasingly difficult to compete.

Well, speaking of the IMF, and Argentina is the example, I remember when they got the loan back in the '80s. That loan has not been paid yet, and Argentinians were like furious because it impacted their livelihoods. And we all saw what happened of that. So you're absolutely correct. As a matter of fact, Carl, just to move to another topic, but within the same theme, when we talked about China just thinks about business, Uh, you were aware of the technical stopover of President Xi Jinping in Morocco on his way back to China. So, and I was like, well, wait a minute, wait a minute, wait a minute. Wasn't 2 years ago that the Royal Palace turned down the offer from China to develop the city of Tangier? And China said, sure, no issues, if you don't want it, that's fine with that. And now all of a sudden They are welcoming President Xi, and what's the catch there?

Well, uh, so, so China always have tried to engage North Africa, but traditionally China's biggest investment part, trade business partner, is mostly two countries, Egypt and Algeria, because China has a long-standing history with both Egypt and Algeria dating back from the days of anti-colonial struggle because China supported Algeria in its independence against France, and China has supported Egypt during the, uh, Suez Canal crisis. And, and, and, and now China is trying to also trying to branch out, uh, but Morocco is interesting case because Morocco is one of the North African countries that has closest tie with Europe. You know, traditionally Morocco has a very strong tie with Europe, and now at this particular juncture, European, uh, lawmakers in EU, they're trying to shut out the Chinese EV from the European market by placing, uh, high tariffs, you know, at behest of Washington, basically, because Germany didn't want to do that. Germany actually voted against putting, uh, tariffs on, on EV. But, but France, Italy, and everyone else voted for it. And, and Morocco is located very in a strategic location in the South Mediterranean. It's very close to European market, and it has, uh, has large lithium and phosphate deposit, which are the essential ingredient to make batteries for EVs. So the Chinese EV, uh, Chinese, Chinese European battery maker Gotion High-Tech They, they announced back in June to build Africa's first Gigafactory, uh, just north of Moroccan capital, uh, at the cost of $1.3 billion. And, and that's not the only one. There's another Chinese battery maker, BTR, that's building $300 million cathode factory in Morocco. And another Chinese anode producer, Xinshun, is building $690 million annual factory in the country. So these are not small change. There's a lot of Chinese investment coming to Morocco to leverage Morocco's lithium and phosphate deposit. They're producing for, uh, for batteries, for, for, for, for making EV. And, and, and one of the thing, uh, I think this is one of the strategy for China to getting around the EU, um, tariff on Chinese-produced EVs is to try to produce them locally. You know, they're, they're building EV factories in Serbia, in Hungary, and, and, and, and they can be supplied by their, the batteries factories in Morocco. So they're, they're building a whole, uh, connected, uh, regional supply chain, uh, in the, in the, in the Mediterranean region. Morocco being one of the countries that has closest ties with the West, with Europe, is a perfect launching point. So this is why Xi Jinping made a short stop in Morocco to shore up the relations.

Yeah, but will there be some sort of a geopolitical angle to President Xi's trip to Morocco? Because the way I look at it, Carl, and please correct me if I'm wrong, the way I'm looking at it geostrategically is also that President Xi Jinping is aiming also at pushing the EU out of the African market. Would it be a fair assessment?

Well, I think it's both ways. You know, one is, you know, why is this— there's a business opportunity, right? For China, business is always business. And two, um, uh, you know, it's, uh, it's— Morocco has a strategic location being close to Europe, uh, to act as a suppliers for, for, um, for, for batteries, for, for, for EVs to be exported to, to Europe. And, and if the Europeans— and Europeans are not investing in this, then why not us? That's for China, um North Africa is always very important, uh, for both its, uh, a strategic location, being it's very close to Europe, and, and it's close to, uh, the Middle East, which is vitally important to, to China. Uh, I mean, China just have an interest for all different kind of reasons to develop relations in the area, and, and, and they are diversifying, you know, like like I said, traditionally their strongest partner is Egypt and Algeria, but now, now they're also trying to branch out to the rest of, uh, North Africa. Uh, but, but whether it's to push out Europe, I think it— I mean, when Europe is not investing and China is, it just happened kind of naturally. That just happened. It's, it's because, uh, for whatever reasons, European multinationals Uh, they're hesitant to put a lot of capital in Africa because, you know, whether they feel like it's not stable or, or for whatever reason, whereas China is, is willing to come up with the money. You know, it's like the Jerry Maguire movie, show me the money, show me the money. Chinese is the one that's willing to put the money up front, so of course they're gonna win out. And this is, again, this is actually, um, a, a good opportunity for, for, for Africans because Before, their source of funding and investment had primarily been Europe, you know, they didn't have much elsewhere to turn. Now China provided alternative. So this is a competition. If Europe want to retain its traditional influence in Africa, well, you either put up or shut up. You got better put up some money, some real money to, to, to, uh, to compete with China for, for the same influence.

Very interesting. I just had to think about that because I was like, was aware of what took place 2 years ago. But you're absolutely correct. If China's thinking only in terms of business, hey, they're gonna move forward with it. If countries wants to sort of, uh, prosper economically, they will get involved, uh, with the Chinese ventures and so forth. Let's, uh, let's go back to— I'd like to get your take on— we're gonna go back to APIC, again, the, the Asia-Pacific, uh, uh, economic cooperation meeting that I know it took place a while. But, uh, by the way, guys, I did a video for you about this. This is different here because that's why we have Carl here, because we wanted to have different insights for you to expand that knowledge. And that's the reason why I wanted to address this topic here. So, so if we are to think about the meetings President Xi has conducted with specific key leaders of Southeast Asia, like Lawrence Wong of Singapore, like the Prime Minister of Thailand, like also the, uh, the, the what's-his-name from Latin America, and another one from, I think, the Prime Minister of Japan, if I'm not mistaken. Uh, I want to specifically focus on Thailand. Where do you see the importance of this meeting that took place, and what could come out of it moving forward?

Well, first of all, for, for Thai government, this is very important because there has been a problem with political instability in Thailand for the, for the past, uh, few years. So a new government, uh, in Thailand has been installed with a new prime minister, and by meeting with the world leaders like Xi Jinping, this helped bolster her own legitimacy at home. And Thailand traditionally has a very close tie with China, um, economically and also militarily, because Thai military purchased their navy warships from China, uh, and tanks. And, and, and, um, and so it's very vital to see that the, the current government is on good terms with China. But China always work with any legitimate government. You know, they, they, they, they're interested— they're not, not interested in internal Thai politics. So they will make deal with whoever is Thailand's government, who is representative of Thailand. So, so in a way, Thailand and China, they're reconfirming their traditional relationship, um, which has been very close and it will only grow closer with— now there's a lot, a wave of Chinese investment coming to Southeast Asia. A lot of people don't know, but China's largest trading partner is no longer United States, is ASEAN. ASEAN being the, the nations of Southeast Asia. And Thailand is placed right in the center of ASEAN. And, and so, uh, China is Thailand's largest foreign, uh, trade partner, largest foreign investment source. Um, so there's a very, uh, it makes sense for the new government of Thailand to work closely with, with China, um, on, on bilateral issues. So, so this is why, like, this, uh, this meeting is important for both countries. Very, very—

and I was, I was very surprised to see that one. So, uh, let me, uh, shift the gears here towards Indonesia because it's very important, especially with the recent trip of Prabowo to Beijing. And I know he was given the red carpet treatment. To me, uh, I, I pay attention to this kind of details. It signifies a lot. And the reason for that, I'm like thinking about this one, is because the deals that China and Indonesia agreed upon, those are economic, worth about $10 billion to my knowledge. So is Indonesia, in your opinion, setting the tone for Southeast Asian nations, including those in ASEAN, to kind of— this is not about choosing China or America, it's just setting the tone for what President-elect Donald Trump is saying, that he's gonna impose the 60% tariffs on China, but also his policy towards Southeast Asia in general term. Is this what Prabowo was aiming at?

So, I already mentioned ASEAN is China's largest, uh, foreign trade partner now, and Indonesia happened to be the largest country in ASEAN. It has— it's actually the fourth most populous country in the world, just after China, India, United States. Um, and it, it has a huge population. It's one of the largest country in, uh, Southeast Asia. You know, if you superimpose a map of Indonesia on the map of Europe, Indonesia will stretch from the city of London to the border of Afghanistan. Indonesia is huge. It has a lot of resources. It has tons of resource, both in minerals and oil and gas. And it's also the largest recipient, uh, you know, the, the China is the largest foreign investor in Indonesia. So when Prabowo was first elected, when he was still president-elect, he made, he, he made it immediately, made a trip to China. And in Prabowo's own words, he was expecting to be like an informal trip, like where, you know, he's just being introduced to Chinese leadership. He was surprised back then as a president-elect. He, he received a big warm welcome, you know, from, from, from Xi Jinping. And so his first state visit right after he became the president is to China, and that's a big signal. That's an important signal to show how Indonesia values this relationship. And of course, China rolled out the red carpet for him. Uh, I watched the whole, um, a welcoming ceremony. And, and I saw a lot of comments from Indonesians. They're like, oh, we're so proud, you know, like, it's— China is really showing, uh, the respect to the leader of Indonesia. And, and, and, and, you know, what Indonesia wants to do is just like what every other Southeast Asian nations— they want to be able to trade with both China and United States. And this is very important because this is at the time when Donald Trump is saying they're going to put 60% tariff on all Chinese products. And so already a lot of, uh, Chinese factories, uh, Chinese factory owners, they're already coming to Southeast Asia. Uh, this process only accelerated by, by the trade war initiated by United States. Before, when the wage labor goes up, cost goes up in China, there was already, uh, you are seeing offsource of labor-intensive manufacturing from China to Southeast Asia, but the US tariff will accelerate that process. So, so there's right now there's a lot of Chinese investment coming, going to Vietnam, Indonesia, you know, all the Southeast Asian countries that have a large surplus labor. And, and, and these countries, they, because The Chinese producers will come to these countries, set up infrastructure, then set up factories, and then they will continue to export to United States. And so if you look at the trade figures, if you look at the, the trade numbers between, uh, if you look at the decline of US-China trade, it's kind of made up by the, the rise in the trade between US, Southeast Asia, and Mexico. And then if you look at the, the trade number between China and Southeast Asia and Mexico, those numbers match almost perfectly. So what that means is that those Chinese goods that previously get exported directly to United States, now they go through, uh, they go through, they take a wrong trip that go through Southeast Asia, you know. Now, now they're produced by Chinese-owned factories in Vietnam, in Indonesia, and then, then get exported to United States. Now, this, this process benefits Southeast Asia. This benefits, uh, countries like Vietnam, like, like Indonesia. It provides jobs and, and you also, uh, provides infrastructure because Chinese, uh, firms are not only going there just to set up manufacturing, they're also trying to build up the infrastructure which enables the manufacturing. You know, like, like I already mentioned here, my electricity here is provided by Chinese-built power plants in north of Bali, and we're running on Huawei-built 4G network. They already have 5G in the, in the center of Bali, but I live in the boondocks, so I only get 4G where I am, um, but everything is built by Huawei. And, and, uh, and, and, and, and China is also helping Indonesia to reach its goal, to, to reach its ambition to be the big, uh, cobalt and nickel producer. So traditionally Indonesia, they export raw materials, export ores, nickel and cobalt ore which will be refined elsewhere because Indonesia lacks a refining capability. But Indonesia passed a law say we're no longer going to export nickel abroad. And so this— the goal is to be able to refine themselves to capture more of the, uh, profit margin. So, so this attracted a lot of Chinese investment. Now Chinese investment dominate the, the cobalt nickel, uh processing, um, processing factories in Indonesia. China— so China is helping Indonesia to set up its own refining capabilities so it no longer has to export this ore abroad to be refined. All these cobalt and, and nickel will be refined in Indonesia. And cobalt and nickel are very important for EV batteries. They're very important for EV. And, and, and Chinese EV makers like BYD They're also coming to Indonesia to set up factory to produce EVs. You know, you know, Biden, EU are slapping 100-300%, uh, tariffs on Chinese EV, but it doesn't matter right now. You— this is why you don't see Chinese— Chinese are not exporting EV directly to United States. The only Chinese-made EV that's exporting to United States right now is Tesla. Okay, Tesla is the one that's gonna get— that takes a hit because there's a lot of their EV in their Shanghai Gigafactory. But a lot of the Chinese-branded EVs, they are exporting to Global South countries like Southeast Asia, like Indonesia, and like Brazil, and, and, and Mexico. And so, so Indonesia is a recipient a lot of these Chinese investment And, and, and they are, they're benefiting also as an intermediary when, when the US tariff hits. All these, all these manufactured goods going to reroute from China, then re-export it from Indonesia to United States. So, so this is why Prabowo, he understands this. He's treating this China-Indonesia tie very— he's taking it very seriously. This is why his first, uh, trip abroad, his first state visit is to China. China also understands this relationship is very important because Indonesia is only the largest country in Southeast Asia, it's also the largest Muslim-majority country in the world, right? So, so in many ways, China wants to, uh, improve its relation continually upgrade its relationship with Indonesia. Like, China already built a high-speed train from, um, Jakarta to Bandung, and there's a highly likely possibility they're going to extend that high-speed rail from Bandung to Surabaya. And, and, and probably it's going to be another Chinese, uh, project to, to complete that.

So that's probably— will cut the travel by, uh, I don't know how far is the distance, but If I am to think in terms of Beijing and Shanghai, you know, 4 hours and you are with the high-speed train, which, you know, to me it's incredible.

Wish we had something like that here, Carl. Well, the current speed of the Jakarta-Bandung high-speed rail is 350 kilometers per hour. So it's, it's, uh, you know, it's, it's funny because whenever, uh, Indonesia has high, high-speed rail travel before United States, right, like people often think about Indonesia, oh, third world country, but guess what? Indonesia have high-speed rail, United States doesn't.

Yeah, which usually that reflects on where the country is economically speaking. So now before we move out to another topic, I still want to go back to this issue of— not an issue, rather it's just the, uh, the visit of Prabowo. And I read some white papers and all that, that's how I keep up with all this stuff. The deal that they signed, the $10 billion deals that Prabowo signed during his visit to Beijing. Now, there are some who argued, and those are from Western think tanks, and I just want to get your take here because I like to provide both sides of the argument. There are those who argued that these deals sort of includes controversial agreements on economic activities in areas surrounding Natuna Islands in the South China Sea. We all know where the issue is. And what I want to get your take on this, Carl, because you, you, you are in the area, you live there, you know how it is. I would like you just to provide my community here with the understanding of this— why is this controversial— and tie it to the maritime law that Marcos Jr. just signed. So what does it mean?

First of— yeah, so you're right, you're absolutely right. A lot of the Western-funded think tanks, a lot of the Western-leaning, uh, liberals especially, they are criticizing Prabowo's agreement with China in, in terms of settling, uh, the, the maritime dispute in South China Sea. Now Officially, Indonesia and China do not have territorial dispute. Um, Natuna Islands is Indonesian territory. China do not dispute that. What, what is this in dispute is there's a dispute about Exclusive Economic Zone, EEZ. So, so it, um, according to the, uh, UNICLAWs, the UN's Law Convention of the Sea, you— each country get to define, uh, like 200 nautical miles from your territory can be defined as your, uh, exclusive economic zone, right? Um, but that's if there's no counterclaim. But if there's another country whose, whose territory kind of, with like 400 nautical miles, and then there's an overlap of, of, of, uh, claims, and that's where you have a maritime dispute. Um, and, and so this is the case. The case is about maritime, uh, dispute about fishery rights, fishing, basically fishing rights, and, and the rights to exploit, uh, deposit on in that, in the, in that maritime zone. So, um, it's— first of all, it's not a territorial dispute, it's a maritime dispute regarding to, um, economic exclusive economic zones. Now, Prabowo and Xi Jinping signed agreement says let's put aside our disagreement, let's do a joint development of this areas, or, you know, where both China, Indonesia putting capital to jointly develop the deposit of this area, which very sensible, you know, very sensible plan. Like, let's put aside our disagreement, our dispute. Let's both explore this area together. Let's both, uh, uh, uh, uh, uh, you know, like jointly develop this area. This is how— this is what I would say, this is kind of model resolution for how people should, should be helping this dispute. But, but people are now calling Prabowo, say, oh, he's selling out, he's selling out the Indonesian interest, whatever. But it's a very pragmatic solution, I would argue, because what happened, what happened currently when area under dispute is really neither side get to develop it, right? Like, is it because of the dispute there's some— there neither side get to enjoy the resources in the disputed area. This is two sides sitting together and say, let's— okay, let's both— let's both enjoy exploring this area together. We can both put our capital together to do a joint exploration. Um, and, and this, this could mean like a joint exploration of possible oil and gas deposit in the region, um, because South China Sea is known to have, uh, some deep sea oil and gas deposit. Now these, these kind of exploration require a lot of capital. It's very capital intensive up front because the deep sea drilling is not cheap. It's not like Saudi Arabia, you just dig a well and the oil come up, and, and you need to have a lot of capital investment to build like deep sea oil rigs and stuff to, to, to, to first find the oil and then to, to get it out of the, the, the deep crust. And that requires a lot of capital. This is where China, Indonesia can work together, where China can provide the capital, for example, to do, do this kind of, uh, exploration. This is very sensible. This very This is kind of China's proposal for most of the South China Sea, uh, disputes. It's like, let's do joint exploration, joint, uh, exploitation of the resources. Um, but, but again, we, we know Washington has a vested interest to stir up the hornet's nest by, by, uh, by trying to blow, blow up all these kind of disputes dispute, uh, like what they're doing in the Philippines. They're weaponizing the very similar dispute between the Philippines and China over this maritime claim to, to, to, to, to, to, to weaponize this so US get to place missile, intermediate-range missiles in the Philippines. That was, have always been the US goal, to place US troops in the Philippines, to come back to, to deploy you American military hardware asset in the Philippines. But right now, throughout Southeast Asia, outside of the Philippines, rest of the government all want to work with China. This include Indonesia, this including Malaysia. Malaysia also has maritime dispute with China in South China Sea, but you rarely see these two making a big deal out of it. It's very quiet.

They're—

the, the Malaysia is working very closely with China. They, they recognize that both have dispute, but they're not sending in their Navy ships to have water cannon fight the way that Philippine is doing. But, and we know the only reason Philippine is doing that is because US is back— US is pushing them to do it. Uh, even when China tried to resolve the issue like back in Remember last time I think I was, uh, on talking with you, I talked about a, a, a brief rest, a solution where China sat down with Philippines, say, hey, let's return to 2014 gentlemen agreement where we allow the Philippine Navy ship to bring supplies, but you have to promise not to bring building materials. So after that, there was one successful Filipino Navy supply ship run without interference from Chinese Coast Guard. But immediately after that, U.S. came, came out with $500 million military aid to the Philippines, and Marcos changed his line, and always the conflict is back on again. So, so, you know, it's United States that's stirring the pot, uh, but the other countries in the, in the region, they're not— by— they're not biting it. They're not biting. They are— they're all trying to work with China on this issue.

Yeah, well, Philippines is easy target because the, uh, let alone the amount of corruption or the massive amount of corruption that exists within their elites. So we find it very convenient to use it as like other countries, you know, the likes of Australia and Japan and South Korea, and you got the idea. So that's the— so I was just, uh, very, very wondering how this is gonna work with what that those white papers that I read, uh, specifically focusing on this area regarding South China Sea, knowing that which I had an understanding of and knowledge about, uh, the idea of the oil and gas in South China Sea and how the US will be pushing Philippines to the forefront regarding those settled tensions. Now, like, I always wondering now, what will Trump policy towards Southeast Asia is going to be, how the country is going to now navigate this kind of— because it's a delicate matters, and we all know all this aimed at China. So that's, that's one of the reasons why I wanted to address this with you. So, well, I don't think, uh, let me talk.

Yeah, okay. I don't think— I don't think Trump has a concrete policy towards South China Sea, let's face it. Like, he, he probably not even aware what the issue is. He will, he will just let his cabinet handle it. Now we know his cabinet, full of neocons. So, you know, it's going to be the same as— nothing is going to change. Basically, the US foreign policy is going to be the same. They're going to have the same hard-on for conflict with China. And, and, and, and, and, and all that, that posturing about being the anti-war candidate, you know, that Trump— it's— that's That's all bogus.

This is—

we, we, we've seen it now. It's— we're— this is gonna— it's all about staying the line, staying— the US is going to do the same thing it has always done.

Yeah, and in this case, using the Philippines. And I hope, uh, it looks like— I mean, I don't know, is the Filipino people that have to decide, but there's already— I had the— I had on the channel here, uh, Miss Anna, uh, uh, Malandar. She's a writer for the Manila Times, and also she's very, very knowledgeable. So, and to my surprise, I didn't realize how many Filipinos listen to what she has to say. I really was very surprised. So it became clear to me that there are tensions inside Philippines. Those who are saying, what the heck with Marcos? What is he embarking or dragging the country into. And, uh, so it'd be interesting to say what lies ahead.

There's a big tension right now between the vice president of the Philippines, Duterte's daughter, and Marcos. And, and then the big, the big headline recently is, uh, uh, um, uh, uh, the vice president of the Philippines happened to be Duterte's daughter. She said, she said that, uh, there might be a plot to kill her. And but she said if, if she gets taken out, if she gets assassinated, then she will make sure there will be payback from, for Marcos. That Marcos, if she gets taken out, then Marcos will be next. Wow. Now it's a big, you know, it's a big political political issue in the Philippines. And because the, the Duterte, uh, Marcos, Papa Marcos, initially he, yeah, well, during the election he tried to align himself with Duterte's, uh, policies and factions. And that's why, you know, Duterte's daughter ran as his vice president. But now that there's a very visible split between the Duterte family and the Marcos and And, uh, you know, there's a lot of internal opposition to Bongbong Marcos in the Philippines. We'll have to see how that pans out. You know, of course, United States have a lot of influence in that country. Um, you know, they, they're gonna back Marcos to the tilt. But like you say, it's up to the Filipino people to decide.

People, yeah. And, and, you know, I, I met some Filipino people in China And when, uh, sort of, uh, start to mention few things, you know, without going into detail with them, they kind of— I could tell how pissed they were about where the country is headed economically speaking. And they had no love for Marcos Jr. as far as his alignment with the United States. And they kind of like, wow. And it's like, yeah, we don't know where he's dragging our country for.

Person.

Uh, let's address one last topic here, Carl, before I let you go. And this one has to do— I am following a story development, by the way, guys. I might do a video for you next week. I haven't decided yet till I confirm some information, and, uh, before I do that. But I wanted to address it with Carl because it just came under my radar literally, uh, with about this morning. So This one has to do with AUKUS in Guam. Now, if you are to think about a USS aircraft carrier, or USS in this case Minnesota, in Guam, especially when you consider the Virginia-class capabilities will be brought to the Western Pacific, what does it mean? What are we looking at here, Carl?

Well, Guam is US forward base, uh, right now in the Western Pacific against China. I mean, like, even back in Donald Rumsfeld's days, he's— at that time he was talking about pulling back from Okinawa to shore up Guam because Okinawa is too, too exposed. It's too close to China. And, and because it's It falls squarely within the range of the Chinese missiles, uh, that can be launched from, from Chinese mainland. So, uh, so their idea is to build up Guam as this giant military base, uh, US forward base for, for Western Pacific, because that— because they, they don't, they don't expect to hold Okinawa. The, the, the recently the US Indo-Pacific Command Admiral, um, has said, you know, he was quoted by General Petraeus. I think he watching them, uh, in, uh, in Wall Street Journal or Washington Post. He, he was quoted saying, oh, we can turn the Taiwan Strait into a hellscape for the Chinese by using the thousands of unmanned vessels, unmanned drones, and uh, etc., etc. So he was questioned about this in a recent interview, and they say, oh, they question about him, the hellscape. He said, well, yes, um, the real problem is what do you do after— afterwards? Um, you still have to maintain air and sea superiority in order to protect our base in Okinawa. And then he said How do I do that? How the hell do I do that? I mean, he, he basically admitted, talking aloud, a reality that many military observers know. Like, you are all gonna be in the target zone of, uh, coming from within the range of the Chinese missiles that could be launched from the Chinese mainland. It's, uh, and, and of course, this talk of hellscape is ridiculous. I mean, how are you going to compete with China in, in terms of drone production? You're not going to compete with China in manufacturing capacity, you know, like the, the ship— okay, we already know the shipbuilding. China has 230 times the ship building capability than United States. That's just— that's building regular ships. If you're, you, you want to talk about manufacturing of drones China have all these like lights-off automated factory that, that's run— that's— that can crank out cruise missiles and drones like nonstop, 24/7. How can you compete with that? It's, it's kind of ridiculous to think that US can compete with that kind of manufacturing capability. And, and so now that's why they're, they're talking about, okay, building up Guam using leveraging AUKUS, leveraging our Australian allies. What they're really talking about is, you know, the AUKUS, the whole AUKUS deal is centered around selling nuclear submarines to Australia. But Australia is actually not going to receive those nuclear submarines until like 2040 or something like that. And but so, so it's not really about Australia receiving the nuclear submarine. Submarines. It's the deal is in order for Australia to receive the nuclear submarines, they have to build a nuclear submarine base in Western Australia in Perth. So in those 20 years while Australia are not receiving their nuclear submarines, in those 10, 20 years, you American nuclear submarine will be able to park themselves in Perth in this nuclear submarine base Australia is going to build for them. So this is the whole— so whole deal is, is Australia is paying for the privilege of hosting American nuclear submarines on their own soil. Um, and a lot of Australians understand this. They know this is a raw deal, but the Australian leadership have been so captured by Washington, there's not much they can do. Yeah. Uh, which is really crazy because Australia's economic lifeline is tied with China. China is their largest export market, and they want to do what? They want to use nuclear submarines to do what? To sink all the, all the ship— all the ships that's shipping iron ore from Australia to China? It's ridiculous. But, uh, this is what the United States is trying to user allies or, or vassals as expendable resources during a conflict. You know, the idea is, you know, it's going to be Japan, Okinawa, Australia, Philippines— it's going to be these countries that's going to act as a sponge to absorb the Chinese incoming Chinese missiles. So there will be less missiles hitting the American fleet, you know, hitting Guam. That's the idea. But, uh, yeah, I, I hopefully you will never come to that. Maybe right now, right now this is a lot of the talks, like, um, it's on the paper stage, right? There's the, the military, they always have contingencies for everything, but, uh, it's, it's really unnecessary. I mean, especially for Australia, they're the one whose economic lifeline is going to get threatened by a war, um, and, and, and yet they're paying for it, uh, um, but yeah, here we are because their leader cannot say no to United States because there's always— there's, uh, Australia have this complex because they're being the white colonies out there hanging off on the side of Asia, you know, to their, to, to their north there's like 200 million Indonesians right? Just like they're always scared there's a horde of Asians going to come down and take them over, and they feel like United States, a big brother, is their one last hope. And it, it's very irrational.

It's—

but irrational fear is pushing them to do all these things not advantageous to themselves.

Yeah, but you will think they will learn that the US is not going to come to their defense. They're going to be in front line. At the same time, China is already— I will not be surprised— China already has a plan for the South China Sea, the Malacca, especially the Malacca Strait. I am certain they've already have plan in place just in case, because that's one of the things the US and its allies in the region will focus on, literally choking trying to choke China through the Malacca Strait, but I don't think so it's going to work.

I don't think that's— yeah, I don't think that's realistic because how do you— like, has US Navy ever practiced to choke off the Malacca Strait? How do you practice? I think that the problem is you, you, you're going to stop every ship on the Malacca Strait to check whether they're Chinese or going to China, they're essentially going to stop all the maritime traffic through Malacca Strait. And by, by now, you're not just blockading trade to China, you're blockading all the East Asia. You are, you're blockading half the world. And, and, and, and, and that makes you an enemy not just of China but, but, but all of East Asia. So it's, it's kind of ridiculous, uh, uh, uh, to, to, to even think about it, but But China always— the China's strategy of Belt and Road project and building ports everywhere is to build redundancy, you know. It's not— so if we don't— for some reason we can't use Strait of Malacca anymore, well, we can still travel through the Arctic route to go to Russia. We can, we can still go elsewhere. We can travel across the Pacific to Peru. That's the, the whole point of Belt and Road Initiative is build redundancy. So, so there's no one singular choke point for US Navy because US Navy cannot be at all place at all time. They don't have the resource for that. And, and, uh, and this is, uh, this is, this is, um, what, what the US calls the China's String of Pearls strategy. You know, the pearl is scattered all over the world. You can't You can't just focus on one particular spot.

Yeah, well, and speaking of the— this, this Malacca, while I'm thinking about it, if the US even thinking in those terms, we couldn't even deal with the Houthis in the Red Sea. What makes us think we can not be dealing with— I mean, it's— I'm not laughing here because to me it's the stupidity in Washington that they don't 4th thing in terms of by 2030 China will have over 430 types of naval ships. What have we built? So, I mean, it's kind of like the—

right now I think, uh, they, they are brainstorming all kind of scenarios, but it's not hinged on reality. You know, recently Matt Waltz, the new, uh, going to be news advisor to Trump. He has said we have to— the way to stop, resolve the issue in Gaza and Ukraine is we got to choke off Iran's, uh, oil revenue. And since 90% of Iran's oil export is to China, we're gonna, we're gonna force China to, to stop China from buying Iranian oil and gas. Like, why would China listen to you? Like, right now, United States is always demanding China, you do this, you do this, you do this. But why, why should China do as you say? I mean, they still think they can dictate to the rest of the world, even to countries like China and Russia, what to do. But that, that, that era is gone. That, that, you know, they have to come to realize they live in the 21st century now. You know, they can't, they can't be dictating it to anybody. They don't, they don't have— they cannot speak to China on the, from the position of strength. Like the former Chinese diplomat said, you are United States in no position to speak to us from a position of strength.

That's true. That reminds me of your post on X. Uh, let me share it with the audience here. Just, uh, with the community. Just for you guys, if you follow Carl on, on X, Twitter, he's @carlza. Just follow him there, guys, because he posts some interesting stuff and I read them regularly. Here's one I'm going to share with you just for you guys to see, in line with what he, uh, Carl just mentioned. Check this out. You remember this one, Carl? And the German foreign minister foreign minister, German, and I quote, the German foreign minister has warned Beijing of consequences for allegedly supporting Moscow. How delusional these people are.

It's, it's crazy.

It is crazy. So, well, Carl, I can't thank you. Let me see first of all, uh, if there's a question here. No, there's— I think there— I'll take one here, but before I'll do this I want to say thank you to Juniper Lee. Thank you so much for your Super Sticker, truly appreciate you. And Danny Tadashi, thank you so much for your Super Sticker, truly appreciate you. And I'll take this question from Doggy 5. Question: Singapore's former Prime Minister just went to China and met with Xi Jinping to celebrate the 30th anniversary of the Shenzhou Industrial Park. What is the geopolitical significance of this?

Well, Suzhou Industrial Park has been kind of the baby of Singapore government for the longest time. It's— this is where, uh, China basically just gave up this piece of land in Suzhou, say, hey, like, Singapore, we, we, we saw that you, you did a great job, uh, in your own country We want you to replicate your success. You know, this— make it a joint project between you and me. We will provide the land and you will provide the management. And this is how Suzhou is one of the, uh, most developed city in China right now. I mean, it's just like 30 minutes north of Shanghai, um, and it's, it's one of the flagship project of Singapore's, uh, investment into China. It's not just— this is not just private business. This is like a Singapore government committed project, uh, to, to, uh, to build up, build out this industrial park in Suzhou. This has been in existence for 30 years. So this is the time for Singapore— actually, it's opportunity for the Singapore, uh, government to reaffirm their ties with China, their Singapore— people don't realize Singapore and China, they only normalized ties like in the 1990s, um, you know, pretty, pretty, pretty late. But for the past 30 years, they have worked very closely together, um, and Singapore is also one of those, uh, Southeast Asian nations that have very close ties with United States, right? But At the same time, it's very— has very deep economic integration with China, um, and, and, you know, like, they, they kind of can serve a sort of a bridge to, like, kind of the East and the West, and a conduit also for, for, for example, for, for China to pass information through to the United States, you know. So sometimes if they, they might not listen to the Chinese official, maybe they will listen to the Singaporean officials. And, and, and, and right now, most of the Southeast Asia, whether Singapore, Malaysia, Indonesia, Thailand, they all want to work with China. They don't want to have a war. They don't want to be put in a situation where they have to choose between United States and China. This is a message that you US government need to to understand is it's the US right now that's forcing people to choose, you know. It's— you are either with us or against us. Most of them like, look, why don't we just do business? Why can't we just trade? We want to trade with everyone, you know. Most of Southeast Asia, they want to be enemy of none and friends to all, and that's a great policy. And, and, and, and Singapore, I think, kind of exemplifies this because, you know, for its own reasons. Singapore has a very deep cultural ties, uh, with China, and, and he very much like to see his own investment in China take off, continue to flourish. So it does not want to jeopardize that by, you know, uh, having like a US-China conflict. Uh, this is, this is not, this is no, in, in the interest of almost nobody. East Asia, except for very few in Washington and, and very few arms dealers in, in United States.

That's true, that is true. I want to say thank you quickly to George Choi here. Thank you so much for your Super Sticker. I truly appreciate you being here. So, well, Carl, I can't thank you enough, my friend, for really carving out time for us here to share your knowledge, your insights, your analysis. It's always, always enlightening to have a conversation with you. I always come out with something new to learn about, and I greatly appreciate you. On behalf of the entire community, we say thank you to you, and we look forward to seeing you next time.

Thank you. Thank you.

All right, wait for me here. Let me say, all right guys, hope you enjoyed this conversation with Carl. As always, very insightful. Uh, I never want you to miss this monthly conversation that I, uh, Carl and I, we came to the decision to, to do on a monthly basis. It's, it's a knowledge you're not gonna get anywhere else, and Carl has a lot of knowledge to share. So, and I did see some comments there that I had to remove those individuals because if you are not to contribute to the conversation, I will kick you out. I have no problem about doing that. So, uh, uh, and I can't tell who's who, but anyway, hope you enjoyed it. By the way, guys, remember to join me tomorrow for our community conversation, the monthly one I'm going to be doing tomorrow at 12:15, uh, Central Standard Time. I look forward to seeing you tomorrow. As always, remember, geopolitics impacts your daily life in more ways than one. Till next time, guys, bye-bye.