Author: Yan

I am an Adjunct Professor, Griffith Asia Institute, Griffith University, Brisbane, Australia. I am also a former Chief, Labour Market and Employment Policies Branch, ILO, Geneva. I was educated as an economist at Manchester, Western Ontario and Cambridge. I am one of the founding editors of the Journal of Asia Pacific Economy (Routledge, London and New York).
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A world apart: Israel’s attack on Iran and the West vs the Rest

In 1990, the late Charles Krauthammer observed in a much-noted article in Foreign Affairs:

“The most striking feature of the post-Cold War world is its unipolarity. No doubt, multipolarity will come in time. Perhaps another generation or so, there will be great powers coequal with the United States, and the world will, in structure, resemble the pre-World War I era. But we are not there yet, nor will we be for decades. Now is the unipolar moment….

a single pole of world power that consists of the United States at the apex of the industrial West. Perhaps it is more accurate to say the United States and behind it the West, because where the United States does not tread, the alliance does not follow. “

The predictions of Krauthammer turned out to be true in two respects. First, ‘multipolarity’ in some form has arrived within decades – China, Russia, and the global South in general have their distinctive views and voices clearly articulated in international forums.  Second, it is still the case that the so-called ‘industrial West’ follows the United States and dare not tread where the United States will not go. This has happened even though Europe, as the indispensable part of the ‘industrial West’, has been publicly rebuked and humiliated by the Trump administration for depending on the USA for its collective security.

The slavish allegiance of the West to the United States became embarrassingly evident when Israel pre-emptively attacked Iran on June 13. Did the avatars of the ‘rules-based’ condemn Israel and uphold the sanctity of such rules? No! Instead, the G7 offered a moronic proclamation. This statement reflects a predominantly white man’s club, with a history of engaging in genocide of indigenous populations, while, ala Krauthammer, ensuring that it stays closely behind the United States. Collective obedience represents the norm rather than the exception. One cannot upset Israel even with faint criticism because the United States will be upset. As a Guardian columnist observes with considerable dismay: “G7 leaders are paralysed by their fear of upsetting Donald Trump”.

“”The Magnificent Seven.”

June 16, 2025

Kananaskis, Alberta

We, the leaders of the G7, reiterate our commitment to peace and stability in the Middle East.

In this context, we affirm that Israel has a right to defend itself. We reiterate our support for the security of Israel.

We also affirm the importance of the protection of civilians.

Iran is the principal source of regional instability and terror.

We have been consistently clear that Iran can never have a nuclear weapon.

We urge that the resolution of the Iranian crisis leads to a broader de-escalation of hostilities in the Middle East, including a ceasefire in Gaza.

We will remain vigilant to the implications for international energy markets and stand ready to coordinate, including with like-minded partners, to safeguard market stability.”

Hmm…Only Israel has the right to defend itself; Iran does not. Indeed, no country has the right to defend itself other than Israel. Such is the perverse logic of this thesis.

The rest of the world can see that the ‘emperor has no clothes’. Hence, 10 member states of the Shanghai Cooperation Organization, led by China, offered the following statement on June 14:

“The member states of the Shanghai Cooperation Organization (SCO) express serious concern over the escalating tensions in the Middle East and strongly condemn the military strikes carried out by Israel on the territory of the Islamic Republic of Iran on June 13, 2025.

Such aggressive actions against civilian targets, including energy and transport infrastructure, which have resulted in civilian casualties, are a gross violation of international law and the United Nations Charter. They constitute an infringement on Iran’s sovereignty, cause damage to regional and international security, and pose serious risks to global peace and stability.

The SCO member states firmly advocate for the resolution of the situation surrounding Iran’s nuclear program exclusively through peaceful, political, and diplomatic means.

The SCO member states extend their sincere condolences to the people and government of the Islamic Republic of Iran.

The SCO member states, strictly adhering to the principles and norms of the UN Charter and the SCO Charter, consider any unlawful actions directed against SCO member states unacceptable and reaffirm their unwavering commitment to strengthening international peace and security.”

Reinforcing the SCO collective statement is the proclamation by 21 Arab and Islamic states on June 16, issued in Qatar. Note that some of them (Bahrain and UAE) have entered into so-called ‘Normalization Accords’ with Israel.

Doha – June 16, 2025

“In light of the rapidly evolving regional developments and the unprecedented escalation of tensions in the Middle East, particularly owing to the ongoing military aggression of Israel against the Islamic Republic of Iran, the Foreign Ministers of the State of Qatar, People’s Democratic Republic of Algeria, the Kingdom of Bahrain, Brunei Darussalam, the Republic of Chad, the Union of the Comoros, the Republic of Djibouti, the Arab Republic of Egypt, the Republic of Iraq, the Hashemite Kingdom of Jordan, the State of Kuwait, the State of Libya, the Islamic Republic of Mauritania, the Islamic Republic of Pakistan, the Kingdom of Saudi Arabia, the Federal Republic of Somalia, the Republic of the Sudan, the Republic of Türkiye, the Sultanate of Oman, and the United Arab Emirates hereby affirm the following:

•⁠  ⁠The categorical rejection and condemnation of Israel’s recent attacks on the Islamic Republic of Iran since the 13th of June 2025, and any actions that contravene international law and the purposes and principles of the Charter of the United Nations, while emphasizing the necessity of respecting the sovereignty and territorial integrity of states, adhering to the principles of good neighbourliness, and the peaceful settlement of disputes.

•⁠  ⁠The imperative need to halt Israeli hostilities against Iran, which come during a time of increasing tension in the Middle East, and to work towards de-escalation, to achieve a comprehensive ceasefire and restoration of calm, while expressing great concern regarding this dangerous escalation, which threatens to have serious consequences on the peace and stability of the entire region.

•⁠  ⁠The urgent necessity of establishing a Middle East Zone Free of Nuclear Weapons and Other Weapons of Mass Destruction, which shall apply to all States in the region without exception in line with relevant international resolutions, as well as the urgent need for all countries of the Middle East to join the Treaty on the Non-Proliferation of Nuclear Weapons (NPT).

•⁠  ⁠The paramount importance of refraining from targeting nuclear facilities that are under International Atomic Energy Agency (IAEA) safeguards, in accordance with relevant IAEA resolutions and United Nations Security Council decisions, as such acts constitute a violation of international law and international humanitarian law, including the 1949 Geneva Conventions.

•⁠  ⁠The urgency of a swift return to the path of negotiations as the only viable means to reach a sustainable agreement regarding the Iranian nuclear program.

•⁠  ⁠The importance of safeguarding the freedom of navigation in international waterways per the relevant rules of international law, and refraining from undermining maritime security.

•⁠  ⁠That diplomacy, dialogue, and adherence to the principles of good neighbourliness, in accordance with international law and the UN Charter, remain the only viable path to resolving crises in the region, and that military means cannot bring about a lasting resolution to the ongoing crisis.”

Of course, these statements, however noble, will not safeguard Iran’s security against Israeli aggression. None of the countries, including China and Russia, have, so far, offered material and military support to Iran. It is fighting a nuclear state on its own, and that too a state that is being unconditionally backed by the United States. Nevertheless, the competing statements from the G7, SCO, and the Arab and Islamic countries reveal a world that has drifted apart and is moving toward a more multipolar structure. The G7 can no longer rely on the unipolar moment. No amount of duplicitous manipulation of the notion of ‘rules-based’ international order by the G7 and its cheerleaders will be able to repair its tarnished moral standing. Ironically, countries that are dismissed by the West as authoritarian and autocratic have taken on the responsibility of defending a rules-based global order at the core of which lies UN-led international law.

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The political journey of a nobel laureate

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It is February 2007. Only a few months ago, in December 2006, Muhammad Yunus earned the unique distinction of being the first ever Bangladeshi to win the Nobel Peace Prize for his pioneering work on micro-credit to the poor as a primary vehicle for lifting millions out of poverty. The institution that he led – Grameen Bank – shared the Nobel Prize.

Fresh from his global triumph, Yunus set his sights on the Bangladesh political landscape. Much to the surprise of mainstream politicians and the general populace at large, Yunus publicly launched a new political party Nagorik Shakti (Citizen’s Force) on 18 February 2007, which, he proclaimed, would contest in 300 constituencies whenever an election was announced. Thus, Yunus, ‘the banker to the poor’ emerged as a politician who embraced secularism and progressive, pro-poor politics and sought to lead the country into a new direction. Bangladesh, he felt, was in the grip of capricious, highly partisan, and short-sighted career politicians who were represented by the two biggest parties in the country: Bangladesh National Party (BNP) and Awami League (AL). Yunus declared:

“There is no way I can stay away from politics any longer. I am determined…and it does not matter who says what about me,” 

Unfortunately, the determination and enthusiasm associated with a new political party did not last long. Yunus withdrew from this new venture because it did not garner enough support. Nagorik Shakti was abruptly disbanded on 3 March 2007, that is, roughly two weeks after it was created. He ruefully acknowledged:

“I have decided to back out from my efforts for forming a political party, bowing to the practical aspects of the situation.” 

Yunus, the failed politician of 2007, did not anticipate that further trouble was brewing that would affect his global image. Unknown to him, Tom Heinemann, an award-winning Danish investigative journalist, started his intrepid field work on microcredit schemes in 2007 across three countries, Bangladesh, India and Mexico. This laid the foundation for an explosive 2010 documentary in which Heinemann argued that micro-credit, far from being an instrument for lifting people out of poverty, mired the poor and vulnerable in unsustainable ‘micro debt’.  A new documentary by DW (2025) substantiates the findings of Heinemann. Subsequent professional evaluations have found that the impact of micro-credit schemes on poverty ranged from ‘zero’ (Roodman, 2012) to ‘weak’ (Churchill, 2020).

Tom Heinemann

Heinmann also made the sensational claim that Yunus engaged in financial malfeasance. This allegation was not proven in an investigation by the Norwegian government which exonerated him from any financial and unethical wrongdoing.

Unfortunately, the Heinemann documentary added grist to the mill of then Hasina regime that was bent on a sustained campaign of persecution against Yunus. He lost his custodianship of Grameen Bank and became embroiled in all kinds of legal cases. Was Yunus being punished by a ruthless government for daring to challenge the political status quo as he briefly did in 2007? Probably.

Yunus managed to activate his formidable PR and political skills to portray himself as a noble victim of an authoritarian government and elicit both global and national sympathy for his predicament. At that point, one doubts whether he even imagined that he would be able to re-emerge as a politician and be at the helm of national affairs. This is what happened in August 2024. The long reign of the AL led by Hasina came to an abrupt and ignoble end as self-appointed student leaders, supported by the masses, unleashed a bloody and violent uprising and forced Hasina to seek refuge in neighbouring India.

After the failure of 2007, Yunus made a triumphant return to national politics, while his arch-nemesis Hasina languished in India. Under the recommendation of the student leaders, Yunus was appointed Chief Adviser to an Interim Government supported by an Advisory Council.

Has Yunus learnt the lessons of his 2007 short-lived experiment to engage in politics? In some respects, yes. There is indeed a new political party called Jatiya Nagorik Party (National Citizens Party -NCP). The similarity of this label to Nagorik Shakti can be readily detected. The key difference is that it is being run by student leaders of the anti-Hasina movement. So, in formal terms, there is a discreet distance between NCP and Yunus, but there is a widely understood notion that the NCP has the blessings of the interim government. Yunus appears to have the best of both worlds. He will not be held responsible if NCP fails to sustain itself electorally. If NCP emerges as a major electoral force, then Yunus has a lot to gain. He will indeed reign supreme and succeed in his long-standing quest to break the political status quo in Bangladesh.

Yet, the future for Yunus is not so clear. In seeking political redemption and retribution, the noble laureate has experienced several setbacks – such as the rise of Islamic radicalism, diluting the integrity of the judicial process, failure to improve the law and order situation, being evasive about holding elections, unable to engage in policies that can revive economic growth, reduce poverty and create jobs. While Yunus has actively courted one influential constituency —the self-appointed student leaders and Islamist parties —he has found himself at odds with the BNP. Bangladesh’s largest political party has insisted that an unelected, interim government must be quickly replaced by an elected parliamentary government by December of this year. The powerful Bangladesh Army has lent support to the BNP’s stand.

How does Yunus, the politician, respond under such challenging circumstances? Even a global icon like Yunus has limits to his authority and influence if he lacks electoral legitimacy. A sustainable pathway to power does not lie in prolonging the life of an unelected interim government or in offering preferential treatment to an upstart political party like NCP. Perhaps he should pay heed to the sagacious advice of one of his well-wishers:

” Yunus is 84 years old. His best bet to protect his legacy is to avail a safe exit by holding a free and fair election and facilitating a peaceful transition to a democratically elected political government, which would have more legitimacy than his interim administration and be in a better position to move the country forward.”

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The parable of the iconic film Sagina Mahato- does it foretell a path trodden by a Nobel Laureate?

By Aunul Islam

 Aunul Islam, read for his PhD at Imperial College, London. He graduated from The University of Manchester. He is a Quality Assurance Specialist in Higher Education and a Technology Consultant. He is an ex-civil servant of the UK government. A keen gardener, he finds solace through nature in this dysfunctional world order.

Figure 1 Legendary Indian actor Dilip Kumar as Sagina Mahato

Figure 2: Prof Yunus, who leads the Interim government of Bangladesh

The political drama continues to unfold after the fall of Sheikh Hasina, Prime Minister of Bangladesh, in August 2024. It has been more than seven months since that epochal event. I have tried to understand and fathom the various twists and turns that are taking place.

At the helm of the interim government is Prof. Yunus, a Nobel Peace Prize winner (Unlike prizes in science, literature, etc, which are very much technically vetted, the Peace prize has its own controversy as it is influenced by political manoeuvring, particularly by the USA).  According to Yunus, the students put him there to lead the nation and were supported by various advisers with different portfolios. Having seen much news, podcasts, political analyses, and – at the core-  several interviews given by Prof. Yunus himself, my mind cast back to a decades-old Bengali Film, based on a true story,  entitled “Sagina Mahato” (1970).    At the core of the narrative lies the story of how a factory worker, from North Bengal, Sagina Mahato, is manipulated by powerful, behind-the-scenes actors (represented by Amal) into becoming a labour leader and ends up as an apparent traitor to the cause of his comrades.

At this juncture, my analysis of the present political scenario in Bangladesh will be based on the two characters, Sagina Mahato and Prof. Yunus. One can understand how Sagina Mahato, a labour worker, who had no education and political knowledge and acumen, can easily be led to his personal and political doom. I fail to understand why Prof. Yunus should be in such a position, which, in my opinion, is spiralling into an abyss.

Several issues stand out. First, the rise of Islamic radicalism in Bangladesh is being tolerated by the Yunus regime, as the New York Times claims in a recent piece. Second, he continues to blame the ousted Hasina regime for the fragile law and order situation in the country, but how long can the Hasina regime be the scapegoat for the ills of today? Third, he has been evasive about holding elections, other than suggesting that they will be held sometime between December 2025 and June 2026. This ambivalent approach has perturbed even his well-wishers, such as Mahfuz Anam, editor and publisher of the prominent Bangladesh newspaper The Daily Star. Is the ambivalence merely a way for Prof. Yunus to cling to power by stealth? As Anam says:

“As his lifelong admirer and sincere well-wisher, I think that an undue extension of his tenure would mire Prof Yunus into unnecessary and, for him, undignified controversies”.

Sagina Mahato’s failure had led to affecting the lives of a few thousand workers, whereas the missteps by Prof. Yunus will affect a whole nation of approximately 18 million people. It is unfathomable why he should do so.  I leave it to experts in social theories of human character and leadership to fully understand him.

I can only leave a final thought by sharing two quotes:

“If you don’t know how to lead, why put us in this death trap”? – An unknown soldier.

“When a clown moves into a palace, he doesn’t become a king. The palace becomes a circus.” — Turkish proverb.

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Trump tariffs and the US-China trade war

Source: Financial Times

President Trump and his loyalists are true believers in the omnipotence of tariffs. They believe such taxes on imports will deliver economic nirvana to Americans. Tariff-jumping companies – both of US parentage and beyond – will return to US shores to jump-start manufacturing and create much-needed jobs, especially for the residents of the American ‘red states’.  Revenues from higher tariffs will fill the coffers of the Treasury enabling Trump to engage in pork-barrelling and funding pro-rich tax cuts.

Trump and his acolytes despise bilateral trade deficits. Such deficits reflect an underlying malaise: tthe rest of the world is allegedly ‘ripping off’ the US. Hence, the idea is to ‘carpet bomb’ hundreds of countries with punitive tariffs with China becoming a particular target of opprobrium. The global effective tariff rate is now the highest in the world since the turn of the 20th century.

While countries such as Vietnam have capitulated by offering to implement zero tariffs on American goods and services, and while some long-term allies, such as Australia, have offered no retaliation, China has taken a different approach. It has engaged in an active trade war with the USA by imposing retaliatory tariffs – see Exhibit 1 – and has announced complementary restrictions on American companies doing business with China.

Exhibit 1

Source: New York Times, 11 April, 2025

Which party will prevail in this clash of two titans of global commerce? To start with, Trump has blinked, despite his asinine proclamation that various countries of the world are prepared to ‘kiss his ass’. (warning: distasteful video content). He has been humbled by developments in global financial and bond markets. Stock market prices have declined sharply in response to the Trump tariffs. More importantly, one detects a restive bond market with returns on long-term US Treasury bonds rising sharply to 5 percent.

This has ominous implications for US borrowing costs as well as the cost of financing sovereign bonds in other parts of the world. Trump was forced to engage in strategic retreat by imposing a ’90 day’ pause on tariffs worldwide with the conspicuous exception of China. But…the Chinese authorities must have noted, in common with others across the world, that Trump’s seemingly invincible aura has been tarnished.  

Furthermore, many of the supposed benefits of the Trump tariffs represent wishful thinking rather than a pragmatic assessment of likely outcomes. Thus, the idea of tariff-jumping companies relocating to the USA is far-fetched, given that this is a process that takes time and relies on a predictable tariff regime. Trump has shown that the trajectory of tariffs under his regime will be highly erratic shifting with shifting economic and political circumstances.

The notion that tariffs will yield a revenue bonanza for the US government also ignores empirical regularities. Many decades ago, economist Arthur Laffer discovered the Laffer curve on the tax-revenue relationship: very low taxes lead to very low revenue collection, but very high taxes also have the same result. The Laffer curve is valid for the tariff-revenue relationship as well. At current prohibitive rates, the Trump tariffs are unlikely to yield a revenue bonanza – see Exhibit 2 – as the ‘volume effect’ of import compression will more than likely offset the ‘value effect’ of higher import duties.

Exhibit 2

Source: https://asiatimes.com/2025/03/tariffs-have-a-laffer-curve-too/

Once again, the Chinese authorities are likely to conclude that the incidence of the Laffer curve will prevent the Trump administration from building a war chest that it can draw on in its trade war with China.

Other factors at play put China at a strategic advantage vis-a-vis the USA.

China is no longer a country populated by ‘peasants’ as the American Vice President JD Vance would like to believe. It is now at the forefront of new technologies, ranging across renewable energy, electric cars, robotics, and AI. It no longer relies on cheap imports flooding the US market. Thus, China has undertaken both product and market diversification of its exports. In any case, China has a vast domestic market in which consumption growth is now the highest in the world led by millions of millenials – see Exhibit 3a. This deflates the oft-noted view that the overly centralized Chinese economic system over-invests and under-consumes. China is certainly politically centralized, but this is combined with a radically decentralized economic system that operates at the mayoral level. This is the ‘new China playbook’. (see Exhibit 3b)

Exhibit 3a and 3b–Consumption growth and the new China playbook

China also has a tight grip on rare earth minerals that are critical to the US tech and defense industries. One must not forget too that Elon Musk – the richest man in the world and one of Trump’s main supporters – has heavily invested in China to produce and export Tesla EVs. China, if it really wanted to be mean-spirited, could exploit these US-specific vulnerabilities.

China, as Mahbubani often points out, is the ‘oldest continuous civilization’. Deeply held notions of national humiliation by Western powers in the past (1840-1949) have shaped China’s outlook on contemporary international relations. A civilization is unlikely to be upstaged by an upstart Western power.

One should not, of course, paint a rosy picture in which China wins, and the USA loses in this trade war. Both countries will have bloody noses and will suffer a great deal of pain, as the Yale Budget Lab points out. Other model-driven estimates suggest that the USA will suffer more socio-economic losses relative to China – see Exhibit 4.

Exhibit 4

A US-China trade war will unfortunately impose considerable collateral damage to the rest of the world. Low- and middle-income countries are likely to suffer the most and will become the victims of this US-led, self-inflicted damage to a rules-based global trading system. Even worse, the putative trade war could lead to a catastrophic conflict on a global scale.

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US and Europe: the end of the transatlantic alliance as we know it?

The newly appointed US secretary of defence, Pete Hegseth, made his inaugural speech to NATO and European allies at a Defence Ministerial on February 12. As a Trump loyalist, he conveyed his forthright message to an august audience. His speech was received in stony silence by grim-faced European officials and politicians.

Exhibit 1: Hegseth speaks to NATO allies…

His proclamations portend a major rupture in the transatlantic alliance that has endured since the 1950s. Thus:

  • European security should be the sole responsibility of Europe
  • Rich European countries should not expect the US to continue to act as Europe’s security guarantor through NATO
  • These countries should aim to spend 5% of GDP on defence even if the US does not.
  • The priorities of USA lay in Asia and in securing its own borders against millions of illegal migrants seeking to enter the USA from South America.

Perhaps the most conspicuous statements by Hegseth pertained to the way the US perceives the future of Ukraine.

Thus:

  • It is unrealistic to expect Ukraine – and Europe at large – to return to ‘pre-2014 borders’, that is, Russia can expect to retain Crimea and probably the vast bulk of Ukrainian territory that it has acquired since the Russo-Ukraine war that started on February 24, 2022
  • It is unrealistic to expect Ukraine to become a member of NATO.
  • Any ceasefire agreement between Russia and Ukraine would have to be monitored by European and non-European troops – but not NATO and certainly not by the USA.

There were understandably adverse reactions from Europe, although the British Defence Minister, evoking the long-standing British tradition of understatement, simply said to Hegseth, ‘we hear you’.

President Zelenskyy was clearly crestfallen but put on a brave face. This did not restrain the editor of the Kyiv Post from lamenting that God Bless ‘America,’ but God Help Ukraine and Europe Fend for Themselves!

European and Ukrainian fears were exacerbated when Trump held a telephone discussion for 90 minutes with Putin. Both leaders agreed that they should meet at a summit in Saudi Arabia where they would finalize the contours of a ceasefire plan that clearly favoured Russia. The embattled Zelenskyy was given a consolation prize by receiving Trump’s post-Putin courtesy phone call.

Exhibit 2: Trump and Putin talkfest

Trump sought from Ukraine a formal agreement to gain preferential access to its rich mineral deposits which he saw as richly deserved compensation for the billions that the USA poured into Ukraine to fight Russia.

Trump also noted that Putin was right to raise concerns about Ukraine not joining NATO as far back as 2007. He felt that Russia should be part of the G7.

Russo-phobic European leaders were apoplectic but there was little that they could do to stop the Trump juggernaut on the ‘America First’ foreign policy that was taking shape in front of their disbelieving eyes. What happened, they wondered, to commitments by the previous US administration that said that Ukraine was on an ‘irreversible’ path to NATO membership? What happened to Biden’s promise that Ukraine would receive its unconditional support and poured billions into sustaining its proxy war against Russia even during the dying days of his administration?

The US Vice President, JD Vance, went even further than Trump and Hegseth. He noted that an enormous and probably unbridgeable chasm has opened between Europe and USA. It was a clash of views and values about the world at large. Unless centrist politicians in the region respected views and voices of American, MAGA-inspired nationalism in Europe, America had nothing to do with Europe. To Vance and fellow travellers, the far-right AfD in Germany was worthy of an audience but not Olaf Scholz, the beleaguered German chancellor. He and his entourage did not even bother to listen to speeches by French President Macron and the EU president Ursula Von der Leyen.

Exhibit 3: Vance issues a stern lecture to European leaders….

It is remarkable that, in the space of a few days, the Trump administration appears to have reconfigured the basic tenets of the transatlantic alliance that was consolidated during the Cold War. It is pathetic to watch Zelenskyy take on the mantle of European leadership. He made the delusional proclamation of forming a formidable European army in which Ukraine would play a pivotal role to deter Russian aggression in the absence of any tangible support from USA.

The harsh reality is that the European leaders allowed themselves to become subservient to the US and simply followed the Russo phobic policy of previous US administrations that reached its zenith under Biden. They tried hard to cling to the fantasy that Russia really does not belong to Europe and that it ought to be isolated and defeated diplomatically economically and militarily even if it means pouring billions into broken nation like Ukraine – billions that could have been spent on the welfare of European citizens. Along comes someone like Trump and ruptures such a fantasy.