Analysis

India’s exit makes the pact smaller but clears the path to implementation. After seven years of talks, hopes were high that Asia’s largest proposed free trade deal would finally be ratified by the end of 2019. Then India announced it was quitting. The 10 Association of Southeast Asian Nations (ASEAN) countries and their six trading partners — Australia, China, India, Japan, New Zealand, and South Korea — met in November 2019 to conclude negotiations for the Regional Comprehensive Economic Partnership (RCEP). But domestic opposition and concerns over the potential impact on local producers led India to pull out. “When I measure the RCEP agreement with respect to the interests of all Indians, I do not get a positive answer,” Indian Prime Minister Narendra Modi told other RCEP leaders at the 35th ASEAN Summit in Bangkok, Thailand. “Therefore, neither the talisman of Gandhi nor my own conscience permits me to join RCEP.” India’s withdrawal deals a blow to RCEP but does not necessarily spell disaster for the bloc. If some observers are right, it might even speed up the signing of the pact by removing the deadlock in negotiations between India and China. UNADDRESSED CONCERNS RCEP would improve market access for products, services, and capital within Asia Pacific and become a major force in global trade. With India, it would have accounted for more than 28 percent of global trade. But India was long convinced the terms of the pact would disadvantage the country more than it would benefit it. India runs trade deficits with most of the 15 RCEP members. But it was particularly wary of China, which accounts for a massive 60 percent — or about US$57 billion (€51.8 billion) — of India’s total trade deficit in 2018. It was afraid that joining RCEP would create a de facto trade pact with China […]

Artificial intelligence (AI) is already in use in many sectors. Its contribution is expected to rise steadily, driven by advances in data storage, computer processing power and connectivity. Following the report on AI by the Australian Council of Learned Academies (ACOLA), the Royal Society of New Zealand Te Apārangi has launches a report that focuses on the opportunities and risks the “fourth industrial revolution” might bring to Aotearoa New Zealand. AI, in all its applications, is predicted to contribute some US$15.7 trillion to the global economy by 2030. This represents roughly the combined GDP of China and India in 2018. Australia and New Zealand are yet to develop national AI strategies. The reports look 20 years ahead, which is a useful period for policy development. The explicit focus on well-being provides a helpful frame to start national conversations about how to embrace these new technologies, leading rather than passively accepting advances from offshore. AI in New Zealand New Zealand has started to adopt AI in the government sector, with most government agencies employing some form of it. There are advantages in New Zealand’s small size and strong legal frameworks to develop protocols for data ethics and security, and intellectual property, and to nurture a diverse AI-savvy workforce. Placing equity at the centre of the conversation means that we can choose to adopt AI technologies across education, government and industry in the context of public good. This would mitigate the risk of importing biases from offshore algorithms and allow us to identify areas where AI can benefit all New Zealanders, rather than a small international elite. Within the reports’ 20-year horizon, specialist machine learning and narrow AI (a specific type of AI that outperforms humans in a very narrowly defined task) will help us to start removing the “four Ds” – dirty, dull, difficult, dangerous – from our daily work. Instead, we […]

Journalists, politicians and regular citizens have spent much time in recent years discussing the ‘Chinese dream’. It’s our vision of China’s journey into the future. I believe the Chinese dream will see us break the link between growing incomes, rising production and degradation of the environment. Our businesses should continue to grow even as our cities, farmland and entire ecosystems become greener and more sustainable. Long-term wealth creation should go hand-in-hand with sustainability. Earlier this year, Lyu Jun, Chairman of COFCO Corporation, described how the commercial case for sustainable production is lagging behind the moral one. Since his article was published as part of the World Economic Forum 2019 Annual Meeting, we have been actively demonstrating the commercial value of sustainability. In July, my company partnered with a consortium of 21 banks to engineer a $2.3 billion loan. Under the terms of this loan, we pay a lower interest rate if we can meet a series of annual targets on sustainability. Any interest saved will be re-invested into initiatives that increase our sustainability performance even further. Sustainability earns us money. This loan demonstrates some of the keys to sustainable growth. Here are five of them: Finance is emerging as a major driver of sustainability Government policy and consumer preferences can certainly shift corporate behaviour, as tariffs on soy have shown. And most consumer-facing businesses are adapting to their customers’ preferences for more sustainability. But I see a more interesting role for the banks, whose influence is immense. The financial sector is shifting quickly towards sustainability as the links to reduced risk and better financial performance become clear. In the first half of this year, the issuance of sustainability-linked loans leapt 63% to $44 billion, as much as in all of 2018. Money talks. Innovation will be part of any solution While the public […]

More than one million people have subscribed to a 5G mobile contract in South Korea, meaning demand for the high-speed technology has easily outpaced the country’s adoption of 4G. The need for speed isn’t just essential for rapid telecommunication — we’d all rather communicate using faster and more reliable methods.  5G has created quite the media buzz recently. Although uptake continues to face its challenges, with the Australian government banning Chinese telecommunication giant Huawei’s 5G rollout in the country on national security grounds, the world is racing to implement the infrastructure.  Next generation 5G networks can be 100 times faster than 4G, making communication between devices and servers much faster. This opens up a wealth of possibilities for manufacturing, helping the industry to increase its competitiveness and boost efficiency.  The instant era Manufacturing runs on a tight schedule. Margins are squeezed more than ever as products are increasingly varied, customised and complex. Factories need to receive and transmit a wealth of data to keep their equipment informed — and fast.  Ultra-reliable and low-latency communication (URLLC) is a new service category that will be supported in 5G, created to meet the requirements for 5G in industrial applications.  By making the most of this category, machines can receive greater roaming power. In fact, 5G has very low latency, around 10 milliseconds in comparison to the 20-30 milliseconds with 4G, so equipment can be monitored in real time by human workers. With plans to reduce this latency to as little as one millisecond, the factory floor will receive updates on machinery almost instantaneously. Cutting the cord According to Ericsson’s report on 5G’s potential, enhanced communication will also mean greater flexibility for manufacturing robots. 5G will handle more complex data transmissions, such as cloud robotics where the cloud’s processing is relevant for the immediate […]