Afghanistan vs. China

Ahmad Shah DURRANI unified the Pashtun tribes and founded Afghanistan in 1747. The country served as a buffer between the British and Russian Empires until it won independence from notional British control in 1919. A brief experiment in increased democracy ended in a 1973 coup and a 1978 communist countercoup. The Soviet Union invaded in 1979 to support the tottering Afghan communist regime, touching off a long and destructive war. The USSR withdrew in 1989 under relentless pressure by internationally supported anti-communist mujahidin rebels. A series of subsequent civil wars saw Kabul finally fall in 1996 to the Taliban, a hardline Pakistani-sponsored movement that emerged in 1994 to end the country's civil war and anarchy. Following the 11 September 2001 terrorist attacks, a US, Allied, and anti-Taliban Northern Alliance military action toppled the Taliban for sheltering Usama BIN LADIN.

A UN-sponsored Bonn Conference in 2001 established a process for political reconstruction that included the adoption of a new constitution, a presidential election in 2004, and National Assembly elections in 2005. In December 2004, Hamid KARZAI became the first democratically elected president of Afghanistan, and the National Assembly was inaugurated the following December. KARZAI was reelected in August 2009 for a second term. The 2014 presidential election was the country's first to include a runoff, which featured the top two vote-getters from the first round, Abdullah ABDULLAH and Ashraf GHANI. Throughout the summer of 2014, their campaigns disputed the results and traded accusations of fraud, leading to a US-led diplomatic intervention that included a full vote audit as well as political negotiations between the two camps. In September 2014, GHANI and ABDULLAH agreed to form the Government of National Unity, with GHANI inaugurated as president and ABDULLAH elevated to the newly-created position of chief executive officer. The day after the inauguration, the GHANI administration signed the US-Afghan Bilateral Security Agreement and NATO Status of Forces Agreement, which provide the legal basis for the post-2014 international military presence in Afghanistan. After two postponements, the next presidential election was held in September 2019.

The Taliban remains a serious challenge for the Afghan Government in almost every province. The Taliban still considers itself the rightful government of Afghanistan, and it remains a capable and confident insurgent force fighting for the withdrawal of foreign military forces from Afghanistan, establishment of sharia law, and rewriting of the Afghan constitution. In 2019, negotiations between the US and the Taliban in Doha entered their highest level yet, building on momentum that began in late 2018. Underlying the negotiations is the unsettled state of Afghan politics, and prospects for a sustainable political settlement remain unclear.

China's historical civilization dates from at least 1200 B.C.; from the 3rd century B.C. and for the next two millennia, China alternated between periods of unity and disunity under a succession of imperial dynasties. In the 19th and early 20th centuries, the country was beset by civil unrest, major famines, military defeats, and foreign occupation. After World War II, the Chinese Communist Party under MAO Zedong established an autocratic socialist system that, while ensuring China's sovereignty, imposed strict controls over everyday life and cost the lives of tens of millions of people. After 1978, MAO's successor DENG Xiaoping and other leaders focused on market-oriented economic development and by 2000 output had quadrupled. For much of the population, living standards have improved dramatically but political controls remain tight. Since the early 1990s, China has increased its global outreach and participation in international organizations.

frequent typhoons (about five per year along southern and eastern coasts); damaging floods; tsunamis; earthquakes; droughts; land subsidence

volcanism: China contains some historically active volcanoes including Changbaishan (also known as Baitoushan, Baegdu, or P'aektu-san), Hainan Dao, and Kunlun although most have been relatively inactive in recent centuries

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23 provinces (sheng, singular and plural), 5 autonomous regions (zizhiqu, singular and plural), and 4 municipalities (shi, singular and plural)

provinces: Anhui, Fujian, Gansu, Guangdong, Guizhou, Hainan, Hebei, Heilongjiang, Henan, Hubei, Hunan, Jiangsu, Jiangxi, Jilin, Liaoning, Qinghai, Shaanxi, Shandong, Shanxi, Sichuan, Yunnan, Zhejiang; (see note on Taiwan)

autonomous regions: Guangxi, Nei Mongol (Inner Mongolia), Ningxia, Xinjiang Uyghur, Xizang (Tibet)

municipalities: Beijing, Chongqing, Shanghai, Tianjin

note - the Ministry of Justice licensed 72 political parties as of April 2019 

Prior to 2001, Afghanistan was an extremely poor, landlocked, and foreign aid-dependent country. Increased domestic economic activity occurred following the US-led invasion, as well as significant international economic development assistance. This increased activity expanded access to water, electricity, sanitation, education, and health services, and fostered consistent growth in government revenues since 2014. While international security forces have been drawing down since 2012, with much higher U.S. forces' drawdowns occurring since 2017, economic progress continues, albeit uneven across sectors and key economic indicators. After recovering from the 2018 drought and growing 3.9% in 2019, political instability, expiring international financial commitments, and the COVID-19 pandemic have wrought significant adversity on the Afghan economy, with a projected 5% contraction.

Current political parties' power-sharing agreement following the September 2019 presidential elections as well as ongoing Taliban attacks and peace talks have led to Afghan economic instability. This instability, coupled with expiring international grant and assistance, endangers recent fiscal gains and has led to more internally displaced persons. In November 2020, Afghanistan secured $12 billion in additional international aid for 2021-2025, much of which is conditional upon Taliban peace progress. Additionally, Afghanistan continues to experience influxes of repatriating Afghanis, mostly from Iran, significantly straining economic and security institutions.

Afghanistan's trade deficit remains at approximately 31% of GDP and is highly dependent on financing through grants and aid. While Afghan agricultural growth remains consistent, recent industrial and services growth have been enormously impacted by COVID-19 lockdowns and trade cessations. While trade with the People's Republic of China has rapidly expanded in recent years, Afghanistan still relies heavily upon India and Pakistan as export partners but is more diverse in its import partners. Furthermore, Afghanistan still struggles to effectively enforce business contracts, facilitate easy tax collection, and enable greater international trade for domestic enterprises.

Current Afghan priorities focus on the following goals:

• Securing international economic agreements, many of which are contingent on Taliban peace progress;
• Increasing exports to $2 billion USD by 2023;
• Continuing to expand government revenue collection;
• Countering corruption and navigating challenges from the power-sharing agreement; and
• Developing a strong private sector that can empower the economy.

Since the late 1970s, China has moved from a closed, centrally planned system to a more market-oriented one that plays a major global role. China has implemented reforms in a gradualist fashion, resulting in efficiency gains that have contributed to a more than tenfold increase in GDP since 1978. Reforms began with the phaseout of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, growth of the private sector, development of stock markets and a modern banking system, and opening to foreign trade and investment. China continues to pursue an industrial policy, state support of key sectors, and a restrictive investment regime. From 2013 to 2017, China had one of the fastest growing economies in the world, averaging slightly more than 7% real growth per year. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2017 stood as the largest economy in the world, surpassing the US in 2014 for the first time in modern history. China became the world's largest exporter in 2010, and the largest trading nation in 2013. Still, China's per capita income is below the world average.

In July 2005 moved to an exchange rate system that references a basket of currencies. From mid-2005 to late 2008, the renminbi (RMB) appreciated more than 20% against the US dollar, but the exchange rate remained virtually pegged to the dollar from the onset of the global financial crisis until June 2010, when Beijing announced it would resume a gradual appreciation. From 2013 until early 2015, the renminbi held steady against the dollar, but it depreciated 13% from mid-2015 until end-2016 amid strong capital outflows; in 2017 the RMB resumed appreciating against the dollar - roughly 7% from end-of-2016 to end-of-2017. In 2015, the People's Bank of China announced it would continue to carefully push for full convertibility of the renminbi, after the currency was accepted as part of the IMF's special drawing rights basket. However, since late 2015 the Chinese Government has strengthened capital controls and oversight of overseas investments to better manage the exchange rate and maintain financial stability.

The Chinese Government faces numerous economic challenges including: (a) reducing its high domestic savings rate and correspondingly low domestic household consumption; (b) managing its high corporate debt burden to maintain financial stability; (c) controlling off-balance sheet local government debt used to finance infrastructure stimulus; (d) facilitating higher-wage job opportunities for the aspiring middle class, including rural migrants and college graduates, while maintaining competitiveness; (e) dampening speculative investment in the real estate sector without sharply slowing the economy; (f) reducing industrial overcapacity; and (g) raising productivity growth rates through the more efficient allocation of capital and state-support for innovation. Economic development has progressed further in coastal provinces than in the interior, and by 2016 more than 169.3 million migrant workers and their dependents had relocated to urban areas to find work. One consequence of China's population control policy known as the "one-child policy" - which was relaxed in 2016 to permit all families to have two children - is that China is now one of the most rapidly aging countries in the world. Deterioration in the environment - notably air pollution, soil erosion, and the steady fall of the water table, especially in the North - is another long-term problem. China continues to lose arable land because of erosion and urbanization. The Chinese Government is seeking to add energy production capacity from sources other than coal and oil, focusing on natural gas, nuclear, and clean energy development. In 2016, China ratified the Paris Agreement, a multilateral agreement to combat climate change, and committed to peak its carbon dioxide emissions between 2025 and 2030.

The government's 13th Five-Year Plan, unveiled in March 2016, emphasizes the need to increase innovation and boost domestic consumption to make the economy less dependent on government investment, exports, and heavy industry. However, China has made more progress on subsidizing innovation than rebalancing the economy. Beijing has committed to giving the market a more decisive role in allocating resources, but the Chinese Government's policies continue to favor state-owned enterprises and emphasize stability. Chinese leaders in 2010 pledged to double China's GDP by 2020, and the 13th Five Year Plan includes annual economic growth targets of at least 6.5% through 2020 to achieve that goal. In recent years, China has renewed its support for state-owned enterprises in sectors considered important to "economic security," explicitly looking to foster globally competitive industries. Chinese leaders also have undermined some market-oriented reforms by reaffirming the "dominant" role of the state in the economy, a stance that threatens to discourage private initiative and make the economy less efficient over time. The slight acceleration in economic growth in 2017-the first such uptick since 2010-gives Beijing more latitude to pursue its economic reforms, focusing on financial sector deleveraging and its Supply-Side Structural Reform agenda, first announced in late 2015.

despite decades of war, Afghanistan has successfully rebuilt infrastructure to create a functional telecom sector that covers nearly all of the population; due to mountainous geography, country relies on its mobile network; mobile broadband penetration growing, but is still low compared to other countries in Asia; operator launched LTE in Kabul; World Bank and other donors support development of a nationwide fiber backbone; terrestrial cable connectivity to five neighboring countries; work on the `Wakhan Corridor Fiber Optic Survey Project' to connect to China is nearing completion; major importer of broadcasting equipment from UAE (2020)

Afghan, Coalition, and Pakistan military meet periodically to clarify the alignment of the boundary on the ground and on maps and since 2014 have met to discuss collaboration on the Taliban insurgency and counterterrorism efforts; Afghan and Iranian commissioners have discussed boundary monument densification and resurvey; Iran protests Afghanistan's restricting flow of dammed Helmand River tributaries during drought; Pakistan has sent troops across and built fences along some remote tribal areas of its treaty-defined Durand Line border with Afghanistan which serve as bases for foreign terrorists and other illegal activities; Russia remains concerned about the smuggling of poppy derivatives from Afghanistan through Central Asian countries

China and India continue their security and foreign policy dialogue started in 2005 related to a number of boundary disputes across the 2,000 mile shared border; India does not recognize Pakistan's 1964 ceding to China of the Aksai Chin, a territory designated as part of the princely state of Kashmir by the British Survey of India in 1865; China claims most of the Indian state Arunachal Pradesh to the base of the Himalayas, but the US recognizes the state of Arunachal Pradesh as Indian territory; Bhutan and China continue negotiations to establish a common boundary alignment to resolve territorial disputes arising from substantial cartographic discrepancies, the most contentious of which lie in Bhutan's west along China's Chumbi salient; Chinese maps show an international boundary symbol (the so-called "nine-dash line") off the coasts of the littoral states of the South China Sea, where China has interrupted Vietnamese hydrocarbon exploration; China asserts sovereignty over Scarborough Reef along with the Philippines and Taiwan, and over the Spratly Islands together with Malaysia, the Philippines, Taiwan, Vietnam, and Brunei; the 2002 Declaration on the Conduct of Parties in the South China Sea eased tensions in the Spratlys, and in 2017 China and ASEAN began confidential negotiations for an updated Code of Conduct for the South China Sea designed not to settle territorial disputes but establish rules and norms in the region; this still is not the legally binding code of conduct sought by some parties; Vietnam and China continue to expand construction of facilities in the Spratlys and in early 2018 China began deploying advanced military systems to disputed Spratly outposts; China occupies some of the Paracel Islands also claimed by Vietnam and Taiwan; the Japanese-administered Senkaku Islands are also claimed by China and Taiwan; certain islands in the Yalu and Tumen Rivers are in dispute with North Korea; North Korea and China seek to stem illegal migration to China by North Koreans, fleeing privation and oppression; China and Russia have demarcated the once disputed islands at the Amur and Ussuri confluence and in the Argun River in accordance with their 2004 Agreement; China and Tajikistan have begun demarcating the revised boundary agreed to in the delimitation of 2002; the decade-long demarcation of the China-Vietnam land boundary was completed in 2009; citing environmental, cultural, and social concerns, China has reconsidered construction of 13 dams on the Salween River, but energy-starved Burma, with backing from Thailand, continues to consider building five hydro-electric dams downstream despite regional and international protests

Tier 3 - Afghanistan does not fully comply with the minimum standards for the elimination of trafficking in persons and is not making significant efforts to do so; the government decreased law enforcement efforts against civilian and official perpetrators of trafficking, and officials complicit in recruitment and use of child soldiers and the sexual exploitation of boys continued to operate with impunity; authorities continued to arrest, detain, and penalize many trafficking victims, including punishing sex trafficking victims for "moral crimes"; the judiciary remained underfunded, understaffed, and undertrained (2020)