Can The Cloud Of Coronavirus Have a Silver Lining For Global Diplomacy?

In a year that has already been roiled by major news events both long-awaited (the Democratic presidential primaries and Trump Senate trial) and unexpected (the assassination of Iranian General Qasem Soleimani), none have cast a greater shadow over the world than the Coronavirus epidemic. Emerging in the province of Wuhan in China, the disease has now spread to every continent on Earth save for Antarctica, leaving a grievous human and economic toll in its wake.

First world panics caused by new viruses emerging from the developing world are nothing new, and in the 21st century they have become something of a bi-annual media event. The SARS outbreak in 2003, the avian flu outbreak of 2005, the swine flu in 2009, and the Zika scare in 2016 all had nightmarish holds on the public imagination, fueled in part by media coverage that in retrospect comes off as excessively hypothetical to the point of comedy. Initially seeming to be in line with these types of outbreaks, coronavirus’ impact has already shown itself to be on another level entirely.

In early February of 2020, the coronavirus’ death toll surpassed 774, which had been the total number of lives claimed by SARS. And the rate of increase has only gone up since then, surpassing 3,000 worldwide as the month of February ended. The majority of the deaths have been in East Asia so far, but that has begun to change, as February saw the virus claim its first death in the United States.

Beyond the toll on human life, the coronavirus has also had a major adverse affect on global financial markets. During the last week of February, the coronavirus caused stocks to take their worst downturn since the financial crisis of 2008

. According to the Dow Jones, more than $6 trillion in market value was erased during that week. Market fears have been raised by several factors including worries about China’s response to the outbreak, as well as concern that it will cause an unprecedented disruption in global supply chains.

Of particular concern to market observers is the fact that a financial shock precipitated by a supply disruption would be particularly difficult for the world’s central banks to deal with. As the crisis first unfolded, the Federal Reserve had been relatively taciturn in its public statements on the issue, but the drastic downturn in the markets demanded a response, finaly given at the end of February.

United States Federal Reserve Chairman Jerome Powell issued a statement which addressed the issue head on. While Powell insisted that the U.S economy overall was strong despite the market downturn, he acknowledged the “evolving risk” that the coronavirus represents, promising swift action from the Fed if necessary. However, the financial challenges posed by the coronavirus may be more tricky for Fed and the world’s other main central banks to deal with than previous crises that they have handled in the past.

One of the main ways that the Federal Reserve and other central banks responded to the 2008 financial shock was by lowering interest rates and injecting liquidity into the markets. However, the Federal Reserve can print as much money as it likes, but that will not restart production in China, South Korea, and other nations critical to global supply chains if they cannot be online due to the virus.

Furthermore, interest rate levels have continually been kept at historic lows ever since the 2008 crash, meaning there is a limit to how much more they can be lowered. Nonetheless, Goldman Sachs did issue a new report that the Fed will move to cut rates as aggressively as it can in response to the crisis. On a more optimistic note, University of Oregon economics professor Tim Duy wrote that action to cut rates by the Fed would have a positive impact, by “short-circuiting panic on Wall Street and preventing that panic from spreading to Main Street.”

This shock to the system of global supply could affect a number of economic sectors, with tech and apparel being among the most impacted according to Barron’s. The travel industry has suffered its worst downturn since the terrorist attacks of September 11, 2001.More perilously in terms of human impact, panicked shoppers could make a run on grocery stores, as they hope to stockpile water, staple foods like beans and rice, and more. This has been particularly pronounced on the West Coast of the United States, which is more at risk to cases of the virus due to its greater exposure to goods and people from East Asia compared to much of the rest of the country.

The spread of the virus cannot be directly correlated to proximity to or trade with the Far East, however. The country in Europe most affected by the virus so far has been Italy, in fact it has been the country in the world outside of Asia most affected by the spread of the disease, with over 1,700 cases and thirty four deaths so far. The cases in Italy have so far been concentrated in its more populous and wealthy northern regions, in particular Lombardy, which is home to the city of Milan. Eleven total towns in the region have been placed under quarantine, with residents cut off from the outside world.

The virus has even impacted the world of sports, illustrated by television in the starkest possible terms. The highest-profile case thus far has been with leading Italian football club Inter Milan. Inter has already had to play its Europa League tie against Bulgarian club Ludogorets in an empty stadium, as local health authorities ruled it unsafe.

An even more high profile instance of this is yet to come, as Inter is due to play against rival Juventus. Both clubs are among Italy’s most celebrated, and the match would normally draw tens of thousands of supporters of either side. But due to the virus, tv cameras will show Cristiano Ronaldo, Alexis Sanchez and the rest of the teams’ star-studded lineups playing to row upon row of empty seats. And that same emptiness could play out on even bigger sports stages as the year unfolds.

This summer, the center of the sports universe will be Tokyo, Japan. The city will host the Summer Olympics, but Japan has been among the countries most affected by coronavirus. Already, the 2020 Tokyo Marathon took place on empty streets, with a restricted participation list. Just as with Italy’s football matches, the preseason games for the NPB, Japan’s professional baseball league, have been played without any spectators.

Tokyo and other large Japanese cities such as Osaka have also suspended high school graduation ceremonies, in an effort to curb large public gatherings across the board. None of this bodes well for the imminent Tokyo Olympics. So far, the organizers of the games have downplayed any speculation that the virus will disrupt the Olympics in any way, but nonetheless speculation has persisted.

International Olympic Committee member Dick Pound acknowledged that the epidemic would have to get even worse than it currently is in order to truly imperil the games, but nonetheless cautioned that the organizers should be prepared for any eventuality that might arise. Already the organizers of the games have been criticized for not doing enough to stem concerns about the implications of the virus for the games. In an ideal scenario, the virus will subside in time for the Games to proceed as planned, but all eventualities should be prepared for.

This is all to say that the coronavirus has the potential to be the most catastrophic challenge that the world’s governments have had to deal with since at least the financial crisis of 2008, and could present an even greater danger to global stability and security. However, out of this crisis there is an opportunity for major positive developments in the world- the epidemic poses major risks to all countries regardless of where they stand in agreement or disagreement on various political issues. The outbreak presents an unprecedented opportunity for the world’s countries to set aside their differences and cooperate on coming up with an effective response.

The outbreak has already prompted positive developments in international relations on at least one front. China and Japan have been implacably opposed in geopolitics for the better part of a century. The two countries and peoples have bad blood going back to the 19th century (if not further), when, as a rising expansionist power under the Meiji dynasty, Japan fought and won the Sin-Japanese Wars, conquering several territories and islands from then Imperial China, most significantly Taiwan. The bad blood increased exponentially in the 20th century thanks to World War II, when invading Japanese forces inflicted devastating attacks on the Chinese mainland, most infamously the “Rape of Nanking.”

For its part, Japan refuses to acknowledge responsibility for much of what it did in China in World War II, with long-serving Prime Minister Shinzo Abe doing more than his fair share to stoke controversy on the issue. Several times during his career Abe has visited Yasukuni Shrine, a memorial to Japan’s war dead where among the names honored are over 1,000 convicted war criminals.

Abe and past Japanese leaders have used visits to the shrine in particular, and an unapologetic attitude on WWII in general, to shore up nationalistic feelings among their base of voters domestically, with the aim of achieving Abe’s long held goal of revising the Japanese post-war constitution to allow for an offensive military force once again; the primary purpose of such a force would almost certainly be to be used in the case of a war with China.

This is not to say that China is blameless on the issue of stoking nationalism, far from it. In recent years, the Communist government has been accused of stoking revanchist sentiments among the Chinese people towards Japanese holdings in the East China Sea. In dispute are a series of uninhabited but strategically significant islands that the Chinese call the Diaoyu but the Japanese refer to as the Senkaku. Taken from China during the Sino-Japanese wars, their loss fuels resentment among Chinese nationalists, who have staged protests that feature bombastic, outlandish slogans such as “invade Japan now!” Taken by force over a hundred years ago the islands may have been, but in the here and now such a sentiment seems excessive, to say the least.

In the last thirty years, the conventional wisdom justifying the benefits of globalization held that free trade would eliminate all conflict and hostility between the nations that engaged in it with each other; this view was most notably held by the likes of New York Times columnist and author Thomas Friedman.

China and Japan have to the present served as a counterexample to this line of thinking. Although China is Japan’s second largest trading partner and Japan is China’s third largest, relations between the two countries have continued to be frosty at best. In recent years, Japan has joined with the United States, India and Australia to form “The Quad,” short for Quadrilateral Security Dialogue, which is explicitly tasked with countering China’s rise on the global stage.

However, if free trade may not have been the ingredient to ease these long-standing tensions, the coronavirus epidemic just might be, if new developments are any indication. With the two countries among the most affected in the world by the virus, they are suddenly presented with something that they have not had in a very long time- a common enemy that poses a more imminent threat to both of them than they do to each other. It is only the icing on the cake that this common enemy is a disease and not a neighboring country with weapons and people in it.

In February 2020, China provided special aid for evacuating Japanse expatriates in Wuhan province, the origin point of the virus. Shortly thereafter, Prime Minister Abe played host to Yang Jiechi, head of the Foreign Office of the Chinese Communist Party. At the meeting, Abe spoke of the need for the two countries to cooperate in dealing with the virus, while his own Foreign Minister Toshimitsu Motegi thanked China for its efforts to bring Japanese citizens home.

As the virus is not going away anytime soon, neither will the incentives for China and Japan to work together to contain the outbreak in both of their respective countries. Chinese President Xi Jinping is due to make a state visit to Japan later this spring. This is not the first time that Xi has visited Japan, and none of his previous visits sparked diplomatic breakthroughs. However, with this as a backdrop, Xi’s visit could be a summit to establish a deeper level of coordination and cooperation between China and Japan.

The crisis could possibly provide opportunity for greater diplomatic breakthroughs elsewhere in Asia as well. In February South Korea announced the cancellation of joint military exercises with the United States, exercises which had already been curtailed in the hopes of fostering a new round of peace negotiations with the North.

Artyom Lukin is a scholar of international relations at the Far Eastern University in Vladivostok, a close vantage point of all of these new developments. He observed that there was an unprecedented opportunity for a “coronavirus peace” in the region, and speculated that the suspension in military drills could be a part of it. Whether or not this is correct will play out over the following months of 2020, but one can certainly hope that this will be the case.

Lukin compared this phenomenon to the fact that animals do not hunt or attack each other when faced with a natural disaster, such as a typhoon or a wildfire. Countries such as China and Japan are geopolitically positioned opposite each other in such a way that no external country could realistically present a great enough threat to both of them simultaneously that they would set aside their differences and collaborate. Russia borders both, but is increasingly allied with China in matters both economic and military. Meanwhile, its relations with Japan are lukewarm at best, marred by their own island dispute over Sakhalin. Meanwhile, the United States and Japan are closely allied, while its relationship with China is increasingly hostile.

The coronavirus epidemic fills the role of a hostile external actor that provides an immediate imeptus for China and Japan to cooperate. And while the signs are less tangible, it could have a positive impact on the Korean peninsula peace process, which had previously seemed to be frozen in limbo. Let this be clear, this should not be an excuse for anyone to engage in Pollyanna-ish optimism. No one is suggesting that this will cause the world to break out into a rendition of John Lennon’s “Imagine” any time soon. But in a time where things seem so bleak across the world, hope that positive developments may come out of this are especially welcome.