Reflections from Shanghai Forum

The 9^th Shanghai Forum held from May 24-26, showcased everything that China has come to represent – a clear desire to deliberate and shape geopolitics, efficient organisational capability, large-scale infrastructure to host conventions and a warm hospitality characteristic of Asian culture. The theme was Asia Transforms: Identifying new dynamics.

The resonating keynote was given by the former Prime Minister of South Korea, Dr. Hang Seong-soo. “Asia has grown uninterrupted economically because of political peace”, he said referring to the rising geopolitical tension among the North-East Asian countries – China, Japan, South Korea and North Korea. “There needs to be peace to continue this growth” he added.

This concern reverberated through the discussions that followed at the forum, sometimes with even more anxiety in private offline conversations with fellow delegates. The escalating tensions between China and Japan, Japan and South Korea, China and south-east Asian countries, China and India and of course South Korea and North Korea is weighing on everyone’s mind.

The President of Fudan University, Yang Yuliag, went on further to emphasize that Asia needs not just innovation but a new economic platform that can meet the aspirations of the people – a key point that Gateway House has discussed during our signature annual conference, “Manipal Dialogue”.

Predictably, the western academics such as Robert Shiller (2013 Nobel Laureate) gave interesting interventions but their insights and recommendations seemed disconnected from the theme of the conference.

The forums focused on China’s economic growth, challenges of urbanisation, security considerations in the Asia-Pacific, all issues critical to Asia. The Shanghai Free Trade Zone also dominated the agenda and discussed at length. What did come as a surprise was the high-level roundtable on social enterprise. China’s social enterprise activity remains limited mostly to CSR but their growing interest in this space indicates their willingness to experiment with new models of socio-economic development.

The Koreans, on the other hand, have made more progress on supporting social enterprises, especially in sectors related to affordable housing.

It is ironic that both these countries, where the governments have been responsible for almost all their development, have developed an interest in social enterprise, an endeavour mostly confined to developing countries whose governments don’t function.

As an initiative, the Forum is a telling example of how businesses and think tanks in East Asia are collaborating to create a platform where rich discussions on geopolitics and geoeconomics take place. The Shanghai Forum is an annual event organized by the Korea Foundation for Advanced Studies (South Korea) and Fudan Development Institute (China) but sponsored by the SK Group, a South Korean multinational focused on energy resources which has large interests in the region. There is no direct monetary benefit for their generosity; but the impact of doing something for national and international interest wins them prestige in the eyes of business leaders, government officials, and gratitude of the think tank community in China and across Asia. The SK group already has businesses in India and is currently in the process of partnering with Indian organizations to provide research, funding and operational assistance to local social enterprises.

While China’s main focus at the forum remained on South Korea and Japan, its interest in India has grown. Everyone knew about Modi’s landslide victory in the Indian elections. A front page story in China Daily on May 27, a day after Modi was sworn in, , titled, “Modi to boost ties with China”, with photo of him praying at the Mahatma Gandhi memorial. This was followed by an editorial inside titled, “Congratulations to Modi” with a warm and carefully worded opening sentence, “Our best wishes to the people of India and their new, reform-minded prime minister”. Both reports are an important indicator of their interest in India. Many Chinese scholars believe that the Chinese Premier Li Keqiang’s visit to India as his first foreign visit was not symbolic but a genuine attempt to forge better relations. That the Chinese Foreign Minister is going to become the first foreign bilateral visit for the new government only confirms their desire to strengthen the relationship.

Where India is gaining in Chinese interest, Pakistan seems to be losing. The terrorist activities in Xinjiang with purported roots in Pakistan are finally making some Chinese scholars reassess their foreign relations. There was noticeable recognition amongst some scholars that China’s continued support to Pakistan has been misguided.

The most intriguing intellectual exchange was with a Chinese scholar, who asked whether BRICS as a grouping could boast of “shared values” similar to the values such as freedom of expression, media and enterprise that the West frequently articulates. We discussed political systems, economic determinants, socio-cultural aspirations and institutions of governance. That there are differences in the three democratic countries – India, Brazil and South Africa – and Russia and China was obvious.

Yet, I think there was consensus between us that BRICS countries (and other developing countries) have the opportunity now to define our own shared values. For instance, affordable housing and high skilled education are two aspirations common to citizens of all five countries.

Another scholar wondered whether China should take the lead in BRICS Bank just as the United States did with the World Bank. I cautioned against this, explaining that the BRICS partnership should be on equal terms, not only to avoid political resistance by other four countries for fear of dominance but also so that BRICS avoids the pitfalls of the existing multilateral architecture that has increasingly become unfair and submissive to the objectives of a few powerful countries.

Whether the Chinese scholars accept my feedback remains their prerogative. However, by openly discussing foreign policy issues, it is clear that their interest in learning about other countries through feedback from counterparts is genuine. Shanghai Forum is one such example of this outreach.

Akshay Mathur is Head of Research at Gateway House: Indian Council on Global Relations. He was invited to the Shanghai Forum 2014 by Fudan University.

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