Accenture: Generative AI to usher in a bold new future for business, merging physical and digital worlds 

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99% agree that emerging tech Investments will ensure organizational resilience
98% state that  generative AI pivotal in organisations’ strategies in 3-5 Years

New research from Accenture finds that generative AI and other rapidly evolving technologies are ushering in a bold new future for business as physical and digital worlds become inextricably linked. 
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World economy changing – Americans know, but their leaders don’t

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The year 2020 marked parity between the total GDP of the Group of Seven (the US plus allies) and the total GDP of the BRICS group (China plus allies). Since then, the BRICS economies grew faster than the G7 economies. Now a third of total world output comes from the BRICS countries while the G7 accounts for below 30%.

Beyond the obvious symbolism, this difference entails real political, cultural, and economic consequences. Bringing Ukrainian President Volodymyr Zelensky to Hiroshima to address the G7 recently failed to distract the group’s attention from the huge global issue: what is growing in the world economy versus what is declining.

The evident failure of the economic sanctions war against Russia offers yet more evidence of the relative strength of the BRICS alliance. That alliance now can and does offer nations alternatives to accommodating the demands and pressures of the once-hegemonic G7.

The latter’s efforts to isolate Russia seem to have boomeranged and exposed instead the relative isolation of the G7. Even French President Emmanuel Macron wondered out loud whether Paris might be betting on the wrong horse in that G7-vs-BRICS economic race just under the surface of the Ukraine war.

Perhaps earlier, less-developed precursors of that race influenced failed US land wars in Asia, from Korea through Vietnam to Afghanistan and Iraq.

China increasingly competes openly with the United States and its international lending allies (the International Monetary Fund and the World Bank) in development loans to the Global South.

The G7 attack the Chinese, charging them with replicating the predatory lending for which G7 colonialism was and G7 neocolonialism is justly infamous. The attacks have had little effect given the needs for such borrowing that drive the welcome offered to China’s loan policies.

Time will tell whether shifting economic collaboration from the G7 to China leaves centuries of predatory lending behind. Meanwhile, the political and cultural changes accompanying China’s global economic activities are already evident: for example, African nations’ neutrality toward the Ukraine-Russia war despite G7 pressures.

Dollar at risk

De-dollarization represents yet another dimension of the now-rapid realignments in the world economy. Since 2000, the proportion of central banks’ currency reserves held in US dollars has fallen by half. That decline continues.

Every week brings news of countries cutting trade and investment payments in US dollars in favor of payments in their own currencies or other currencies than the dollar. Saudi Arabia is closing down the petrodollar system that crucially supported the US dollar as the pre-eminent global currency.

Reduced global reliance on the greenback also reduces dollars available to the US government to finance its borrowings. The long-term effects of that, especially as the US government runs immense budget deficits, will likely be significant.

Peace promotion

China recently brokered the rapprochement between enemies Iran and Saudi Arabia. Pretending that such peace-making is insignificant represents purely wishful thinking. China can and will likely continue to make peace, for two key reasons.

First, it has resources (loans, trade deals, investments) to commit to sweeten accommodations between adversaries. Second, China’s stunning growth over the last three decades was accomplished under and by means of a global regime mostly at peace. Wars then were mostly confined to specific, very poor Asian locations. Those wars minimally disrupted the world trade and capital flows that enriched China.

Neoliberal globalization benefited China disproportionally. So China and BRICS countries have replaced the United States as the champions of continuing a broadly defined global regime of free trade and capital movements.

Defusing conflicts, especially in the contentious Middle East, enables China to promote the peaceful world economy in which it prospered. In contrast, the economic nationalism (trade wars, tariff policies, targeted sanctions, etc) pursued by Donald Trump and Joe Biden has struck China as a threat and a danger. In reaction, China has been able to mobilize many other nations to resist and oppose US and G7 policies in various global forums.

Hybrid model

The source of China’s remarkable economic growth, and the key to BRICS countries’ now successful challenge to the G7’s global economic dominance, has been its hybrid economic model.

China broke from the Soviet model by not organizing industry as primarily state-owned-and-operated enterprises. It broke from the US model by not organizing industries as privately owned and operated enterprises. Instead, it organized a hybrid combining both state and private enterprises under the political supervision and ultimate control of the Communist Party of China.

This hybrid macroeconomic structure enabled China’s economic growth to outperform both the USSR and the United States. Both China’s private and state enterprises organize their workplaces – their production systems’ micro-level – into the employer-employee structures exemplified by both Soviet public and US private enterprises. China did not break from those microeconomic structures.

If we define capitalism precisely as that particular microeconomic structure (employer-employee, wage labor, etc), we can differentiate it from the master-slave or lord-serf microeconomic structures of slave and feudal workplaces. Following that definition, what China constructed is a hybrid state-plus-private capitalism run by a communist party.

It is a rather original and particular class structure designated by the nation’s self-description as “socialism with Chinese characteristics.” That class structure proved its superiority to both the USSR and the G7 in terms of its achieved rates of economic growth and independent technological development. China has become the first systemic and global competitor that the United States has had to face in the last century.

Lenin once referred to the early USSR as a “state capitalism” challenged by the task of making a further transition to post-capitalist socialism. President Xi Jinping could refer to China today as a hybrid state-plus-private capitalism similarly challenged by the task of navigating its way forward to a genuinely post-capitalist socialism.

That would involve and require a transition from the employer-employee workplace structure to the democratic alternative microeconomic structure: a workplace cooperative community or a workers’ self-directed enterprise.

The USSR never made that transition. Two key questions follow for China: Can it? And will it?

The United States also faces two key questions. First, how much longer will most US leaders persist in denying its economic and global declines, acting as if the US position had not changed since the 1970s and 1980s? Second, how can such leaders’ behavior be explained when large American majorities acknowledge those declines as ongoing long-term trends?

A Pew Research Center random poll taken among Americans between March 27 and April 2 asked what they expected the situation of the United States to be in 2050 compared with today.

Some 66% expect the US economy will be weaker. Seventy-one percent expect the United States will be less important in the world. Seventy-seven percent expect the United States will be more politically divided. Eighty-one percent expect the gap between rich and poor will grow.

The American people clearly sense what their leaders desperately deny. That difference haunts US politics.

This article was produced by Economy for All, a project of the Independent Media Institute, which provided it to Asia Times.

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Washington’s self-defeating foreign policy

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If I were a shovel manufacturer I could make a lot of money in Washington, because Washington policymakers are digging deeper and deeper holes for the United States.

Washington is not alone: the Biden folks are getting “help” from the Europeans and Japan. But how long will that last and, in any case, what is it worth?

By now anyone who can read must realize that the best case for Ukraine is a stalemate, but the more likely case is the Kyiv regime will collapse. There are plenty of alternative scenarios but, just going on numbers, it makes little sense for Kyiv to keep playing the existential roulette wheel.  

It is true that the war is putting great psychological stress on Russia. But the appearance of Valery Gerasimov, the Russian Army chief of staff, physically present leading the battle in the Zaporizhia region, where part of the Ukrainian offensive may have started, indicates the Russians are stepping up their effort not only to block the offensive but to start up one of their own.

Vladimir Putin still has to deal with many operational problems on the war front, and some at home: but so did Washington, Lincoln, Roosevelt, Truman and Eisenhower.

This is not to say that the wars those American presidents presided over are, in any way, comparable to Ukraine operationally, politically or morally. It only says that wars cause confusion and political problems.

Ukraine is more adept at psychological warfare than the Russians (see, for example, Ukraine’s latest fake Putin broadcast), and that also causes difficulty.

But probably Russia’s biggest issue is Yevgeny Prigozhin, the head of the “private” Wagner Group. Prigozhin has become an uncontrolled trouble maker and it is harming Putin as much as Prigozhin harms the Russian army.

It goes without saying that Putin has to understand this and will have to act. If Putin sits on his hands, he will lose and surely he must understand that.

The missing ingredient, so far as I can tell, is that the Russian army leadership (not Shoighu, the defense minister, who is really a non-factor) has to bring its complaints directly to Putin. That will be up to Gerasimov and probably awaits the outcome in Zaporizhia.

Prigozhin says Russian military fired on Wagnerites: mercenaries take Russian lieutenant colonel prisoner
Prigozhin (center). Photo: www.pravda.com.ua

Assuming that the Russians despite their difficulties stay in the war and make a strong effort, Ukraine will pay a huge price in material and manpower.  

In their latest operations, which stretch all along the eastern front and down to Zaporizhia, the Ukrainians are making minimal gains at a high cost. They are attacking in many sectors at one time, but so far are not gaining much that can be considered strategic.

The two best efforts have been a counter-offensive on the flanks of Bakhmut, aimed at Soledar, and the attack in the Zaporizhia direction – so far involving three settlements, which the Ukrainians may be able to hold for a short time.  

At least in Zaporizhia the Ukrainians are using two reserve brigades, the 23rd Mechanized and the 31st Mechanized. These brigades were stood up only this past February, but they are being supported by numerous battle-tested units. There are reports that in the Novodonetsk settlement the Ukrainians have used Bradley fighting vehicles and other Western equipment possibly including Leopard tanks.

In these battles the Ukrainians have so far lost 17 armored personnel carriers, 11 infantry fighting vehicles and nine tanks. They have also lost, according to the Russians, 900 men. If you add in the other fighting in eastern Ukraine, Ukrainian manpower losses on June 4 and 5 amount to 2,000 troops killed, wounded or missing.

The 23rd and 31st mechanized brigades do not have Western equipment, which means that other, more experienced units were thrown into the fighting.

The Russians have put together elaborate defenses in Zaporizhia. stretching all the way to the Kherson area. This can be interpreted to mean that the Russians have no intention of going on the offensive in these areas but, rather, intend to block the Ukrainians and extract a very high cost to them in equipment, war stocks, and manpower.

It would appear, therefore, that if the Russians decide to launch an offensive operation of their own, it will be elsewhere, probably from either Donetsk or Luhansk heading in the direction of the Dnieper River. If the Russian army should move that way, it could cut off Ukraine’s communications and supply lines to its clustered forces in the east and southerly direction, and even threaten Kyiv if it wins a number of battles on the way.

US weakened in the rest of the world

No matter what Zelensky wants, he has crippled US fighting capability in the rest of the world. That is already clear in the Middle East, where the shovelers, partly for ideological reasons, have lost their standing with Saudi Arabia and the UAE. The UAE has suspended its participation in the US-led Maritime Force in the Persian Gulf. The Saudis have decided to cut oil production again, forcing a price rise for petroleum, challenging Biden who demanded lower prices.

Meanwhile, the shovelers are carrying on “secret” negotiations with Iran (at the potential expense of all US regional allies and friends), trying to counter the initiatives of the Chinese and Russians. The Iranians will take free handouts from Washington, including $9 billion in frozen Iranian funds in South Korean banks.

They won’t of course change their nuclear plans, but Washington wants a fake deal so it can have a “strategic” relationship with Iran, which anyone with common sense knows is worthless when you are dealing with religious fanatics.

Israel is organizing its own approach to growing threats from Iran. The existing Israeli formula, maximal defenses at home, won’t cut it with the Israeli public much longer. There are too many rockets and major urban areas are threatened. Either Israel will directly attack Iran, which is a real option, or they will look to push Iran’s influence back in the neighborhood: Gaza or Syria or Southern Lebanon. This means a boots-on-the-ground operation, something we have not seen from Israel for many years.

A key takeaway is that the US has lost much of its influence in the Middle East, and its clumsy and doomed effort to placate Iran tells everyone in the region that the real loser is Washington.

It is, likewise, getting pretty dicey in the Pacific, most notably close to Taiwan.

A Chinese warship, LY-132, a fast corvette built in 2016 and probably named the Xuancheng, a ship in the Type 056 Jiangdao class, overtook the USS Chung-Hoon, an Arleigh Burke-class missile destroyer in the Taiwan Strait. (For the record, Gordon Paiʻea Chung-Hoon was an admiral in the United States Navy, during World War II.  He was the first Asian American flag officer and the destroyer is named after him.)

The guided-missile destroyer USS Chung-Hoon (DDG 93). Photo: US Navy Mass Communication Specialist 2nd Class Sean Furey

The Chung-Hoon was on a “freedom of navigation” mission when the Xuancheng overtook it on the port side and then ran in front of the US destroyer at a range of 150 yards. In misty, overcast weather, the Chung-Hoon was forced to take evasive maneuvers to avoid a collision.

More importantly, the Chinese announced that they rejected the legality of “freedom of navigation” exercises in the Taiwan Strait and elsewhere in the South China Sea, considering these exercises a provocation. While the US so far has stuck to its position on conducting such operations, it remains to be seen what the Biden administration will do next. The betting is that freedom of navigation operations won’t take place for a while, maybe longer.

Of course the Defense Department, including Secretary of Defense Lloyd Austin, wants to continue these operations, but the Biden administration is tilting towards China, sending all sorts of high level delegations to Beijing. Taiwan and the US Navy, in this context, do not align with Biden administration policy.

China is an economic mess and many foreign companies are pulling out, where they can do so. Even such a major company as Foxconn, which makes iPhones and other consumer products and employs nearly one million Chinese, is starting to relocate some of its operations, focusing on India. Foxconn is owned by Hon Hai Precision Group, the world’s largest electronic manufacturer. It is a Taiwan-owned company with revenues around $215 billion.  

It would be logical for Washington to pull back and not fuel China’s recovery and growth.  But the Biden administration is heading in the opposite direction.

Washington is also behind the power curve in supporting Taiwan, pushing vital war material to Ukraine at Taiwan’s expense. Some delays – the one involving the HIMARS weapons system, for example – are caused directly by the Ukraine war. Others are US domestic manufacturing problems, including difficulties with supply chains and shortages of qualified employees in US defense companies.

But some delays, most notably the F-16, raise serious questions that remain unanswered.  The Biden administration says it is working on fixing the problem, but the proof will come if F-16s are delivered soon.  That is not likely.  According to Lockheed and reports from Taiwan, the problem is not manufacturing but software. 

That is incredibly odd because this type of F-16 is the same as ordered by Bahrain and the first F-16V has already been delivered to that country. The delays look more like a politically manufactured mess than an assembly-line or coding problem.

One presumes China is happy Taiwan won’t get its new F-16V aircraft anytime soon.  Is this another Biden shovel operation?

Hooray for the shovel business!

Stephen Bryen is a senior fellow at the Center for Security Policy and the Yorktown Institute. This article was originally published on his Substack, Weapons and Strategy. Asia Times is republishing it with permission.

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Prigozhin’s ‘warrior class’ threatens Putin from the Right

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Yevgeny Prigozhin, the creator of Wagner Private Military Company( PMC ), gave another of his fierbrand interviews as he declared victory in the Bakhmut battle.

He vehemently denounced the Russian defense minister and his chief of staff, Russia’s” heavy state ,” which included the political administration, the” quasi-defense” establishment, and the elites who protect their children from the front lines of battle.

He admitted that he doesn’t know why the war in Ukraine is being fought, but added that” as long as there is a battle, we have to battle it well.” How Prigozhin gets away with it when people are receiving jail terms for much milder criticisms begs the question of how he spoke the terrible truth in this.

He represents the opinions of a sizable portion of Soviet culture, is the answer. These people support conflict, but they criticize how it is fought and are disgusted by the corruption and incompetence that have claimed the lives of soldiers.

Those who can work politically and, if necessary, forcefully, giving Prigozhin a sense of common resonance, share this anti-elite but” nationalistic” sentiment.

The” heroes” of the so-called Russian Spring, the men who participated in the insurgency in Donbas starting in 2014, stand out among these figures. The widespread belief in the west is that this uprising was solely a Kremlin plot.

However, my conversations with field officers and officials like Igor Strelkov( real name Girkin ) suggested then. Many of these officers were driven by personal views; they dreamed of creating a brand-new” Novorossiya” in eastern Ukraine that idealized Russia, as opposed to the crony capitalism that defines Putin’s Russia.

I was certain that they were sincere in their ideas and willing to sacrifice both their own and other women’s lives for a greater cause. I’ve come to believe that this group does play a part in any dire situations, and it might soon happen.

The Russian state, which at first was unsure of how to handle these strongly pro-Russia but disorderly individuals, came to understand that they could pose a threat. Since 2017, they have begun to get repressed.

Rightwing Russian nationalism’s primary website academic tool, Sputnik-i-Pogrom, was blocked, and its director Yegor Prosvirnin passed away in dubious circumstances in 2021. Those who did survive were kept in the dark about politics and the media, so they focused their efforts on” milblogging.”

Men who enjoy fighting

These are men who adore conflict and everything associated with it, including the tools, strategies, traditional battles, wargaming, attire, and thrills of combat. They are present in all societies, but in Russia, the action in Ukraine gave them the opportunity to rise to social fame.

These” online warriors” emerged from the shadows and entered politics. Big audiences are drawn to their resources on the well-known software Telegram.

More people in Russia have subscribed to channels like Rybar( 1.13 million subscribers ), WarGonzo( 1.3 million ), and Igor Strelkov, the former” minister of defense” of the self-declared Donetsk People’s Republic( 790.000 ), who started the initial uprising in 2014.

In a film released earlier this year, Yevgeny Prigozhin, the leader of the Wagner group, can be seen speaking in Bakhmut. Photo: @ concordgroup_ official / Telegram channel

They identify as voenkory, or war correspondents, and engage with their people by posting articles and videos. Viewers value their frank assessments of the reality on the front lines, their knowledgeable sources, engaging news, and engaging guests.

Social feelings are important, and the” soldiers” have developed a popular sub-culture. It has its own legends, including Vladlen Tatarsky( Maxim Fomin ), who stole money, served time, escaped from jail after being shelled by a tank, participated in the Donbas uprising, wrote three memoir books, and served as the channel’s host. In a recent targeted burst, he was killed. Even if it was a brief experience, war was an experience worth having for Tatarsky and those like him.

Tatarsky was involved in the YouTube channel” Reverse Side of the Medal ,” which promotes military garb and insignia like the Wagner group’s red skull and two mortar shells, which have gained popularity as a badge of honor.

clash of cultures

Thus, two very different military cultures collide: a rigid and top-heavy ministry of defense establishment that is supported by the state, and the guerrilla tactics of volunteers and private military companies( PMCs ) that rely on initiative and improvization.

These two teams are afraid of one another. The defense ministry has been reticent to give Wagner a lot of weapons. Prigozhin criticizes them for the defense failure in the meantime. Putin, meanwhile, observes and seems to like the generals’ opposition.

The state may have to rely on this” warrior” district both on the front lines and to help keep a pro-war momentum in society, so it cannot afford to placate them. However, the Kremlin is even aware of the dangers involved because” warriors” like Prigozhin can be difficult to handle and may grow ambitious.

Individual enmities and divergent perspectives on the future of Russia exist, and their camp is not consistent. However, signs of a social force that could affect Russia’s post-Putin results are starting to take shape.

This district will be the one most willing to take action if an internal turmoil— such as Putin’s sudden death, for instance— opens a window of opportunity and the ruling elite loses power. They will have access to organizational, economical, and advertising resources thanks to people like Prigozhin.

Prigozhin may rise to the position of functionary, even if he is not a monarch. Therefore, we must look beyond merely observing the Kremlin’s hands in all directions to identify autonomous actors who have the potential to move and shake the new order.

At King’s College London, Anna Matveeva is a visiting senior research fellow.

Under a Creative Commons license, this post has been republished from The Conversation. Read the article in its entirety.

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China to boost quantum research in space

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Three Chinese astronauts will have the opportunity to study” novel quantum phenomena ,” according to state media, when China announced the successful docking of its Shenzhou-16 spacecraft and Tiangong-3 space station on Tuesday.

There were no more specifics after that trailer. The news sparked annoyance because classical is the subject that some true experts in China’s space program are most serious about. & nbsp,

Fortunately, there is enough open-source data available to allow for the creation of a progress report. This report begins by noting that, in contrast to four years ago, China now conducts its primary particle research using specific satellites as opposed to space stations. & nbsp,

Since it was launched & nbsp, into small orbit( 500 meters above sea level) in August 2016, the nation’s existing Micius dish, a quantum laboratory, has already been recognized for its scientific accomplishments.

Micius will then carry out international tests with nations like Russia, Italy, Sweden, and South Africa.

Last July, China safely launched Jinan-1, a low-orbit particle dish. In the upcoming ages, it intends to establish a channel – to high Earth orbit and satellite as well as several smaller and low orbit ones. & nbsp,

If all of these tests are successful, China will be able to use quantum key distribution( QKD ), an encryption technology, to transmit unhackable data and offer pertinent services to banks and government customers.

Pan Jianwei, a teacher of physics at the University of Science and Technology of China, stated in an opening speech on May 10 that” we are currently developing the first method – to higher circle classical satellite, which is planned to launch around 2026.”

The classical satellite does offer a new system for classical precision measurement( or quantum time ), Pan said, in addition to testing QKD. With this, it is possible to realize quantum entanglement transmission over a distance of more than 10,000 kilometers.

Classical interaction is a phenomenon that explains how, despite being very much apart, two photons may be linked to one another and maintain the same polarization state. One of them & nbsp’s states will change, and the other will follow suit. Such a trend can be used to transmit files using encryption.

Because it is based on the principles of quantum technicians, this kind of crypto cannot be cracked. Standard public key cryptography relies on mathematical operations that can be decrypted by supercomputers or quantum computers and is used by banks and governments to safeguard data communications.

In simple terms:

  • Two photons are sent to two locations while maintaining their position as part of the quantum entanglement distribution.
  • To ensure that no hackers is taking place, QKD is sending a beam along one data transfer network while keeping another. & nbsp,
  • Information about the state of a beam is sent via classical levitation.

from concept to application

Erwin Schrödinger, an Austrian scientist who won the 1933 Nobel Prize in Physics, first proposed the theory of quantum entanglement. The second QKD process, known as BB84, was created in 1984 by technicians Charles Bennett and Gilles Brassard. It uses a 1, 550 nm laser source to emit polarized visual pulses.

The concept of classical teleportation, which is crucial to some quantum information protocols and a significant potential mechanism for creating gates inside quantum computers, was pioneered in 1998 by Hungarian physicist Anton Zeilinger. & nbsp,

Zeilinger won the Nobel Prize for Physics last month along with French mathematician Alain Aspect, British physicsist John Clauser, and others. He served as Pan’s scientific advisor and nbsp, who earned his doctorate in 1999 from the University of Vienna in Austria.

Pan went back to China in 2001. His staff set a record for classical teleportation in 2009 by traveling over 16 km, which was unprecedented at the time. Pan oversaw the launch of the Micius dish in 2016 as part of China’s Quantum Science Experimental Satellite job. The satellite carried out a number of quantum experiments in 2017 while using the BB84 laser and & nbsp to send signals to the ground. & nbsp,

Pan Jianwei, a renowned Chinese classical professor. CGTN image

” Overcoming the current challenges faced by quantum satellites is necessary in order to realize global quantum communication ,” Pan said. ” The entire world may be covered by a single low-orbit dish.” Additionally, recent satellites may only transmit signals in clear skies at night.

He claimed that the issues could be resolved by placing more satellites in low orbit to cover a larger area on the ground, and connecting them with larger satellite in medium – to great range.

Elon Musk’s Starlink satellites, in contrast, are currently flying in small circle, 550 km above water level. A level of 20, 000 km above ocean level is referred to as a medium range, where GPS and China’s Beidou satellites are in operation. Standard satellites that transmit communications and broadcast signals are suitable for large orbit or geostationary orbit, which is located about 36, 000 km above sea level.

Tiangong’s demise – 2

When China’s Tiangong – 2 storage place was launched into small – range in September 2016, Pan put his plan of setting up a QKD satellite system into action. Between 2018 and 2019, the space station collaborated with the Micius dish and sent QKD impulses to the floor.

However, the tests came to an end in July 2019 when Tiangong-2 made a controlled return to Earth and burned up over the South Pacific Ocean. In 2022, China had originally intended to incorporate Tiangong – 2 and – 3.

Information about the classical research carried out by Tiangong – 2 wasn’t made public until past August.

In an interview that was published last August, CAS Academician Wang Jianyu stated that” The Micius satellite is only a starting point.” To cover all of the world’s atomic communication networks, we should construct a network of satellites in small, medium, and large orbits.

We have advanced by at least five years compared to other international and nbsp players at the moment. We may lead the world by at least 10 years if we can successfully establish a channel – to high particle satellite, according to Wang.

According to Liao & nbsp, Sheng-Kai, a professor at the University of Science and Technology of China( USTC ), the Micius satellite weighs 640 kg with an 80 kg QKD emitter, while Jinan-1’s total weight is 98 kg. He claimed that the size lowering is significantly lower research costs.

While China is investing more in quantum technology, northern companies prefer to remain on the ground because they believe that if QKD can eventually be transmitted via materials, satellite transmission will be relatively impractical and China may lose its business bet.

An encryption startup in the UK called Arqit & nbsp, Quantum Inc. announced the launch of two QKD satellites in 2023. However, a Wall Street Journal article from April of last year claimed that the & nbsp, company may have exaggerated its prospects.

As it would depend on its QuantumCloud to offer customers encryption solutions, Arqit announced in December that it was abandoning its plan to launch classical satellites and nbsp.

Bob and Alice

From Alice to Bob, two fictional characters who stand in for the sender and the receiver in classical communication, QKD is typically carried out on the ground using visual materials. However, transmission reduction significantly reduces the transmission range. & nbsp,

In a report released by the regular scientific journal Physical Review Letters on May 25, Pan and some Chinese scientists reported that they had found optical fibers that were 1, 002 km long-distance QKD.

The QKD distribution range of 833 kilometres was surpassed by experts from Toshiba’s Cambridge Research Laboratory in October 2021 by a group led by Chinese professor Guo Guangcan in January of last year.

A 2, 000 km-long classical fiber community connecting Beijing, Jinan, Hefei, and Shanghai was already built in China in September 2017. According to researchers, as a result of the rising demand for crypto companies from banks and government clients, Western nations, Japan, and the United States have built and are expanding their personal QKD sites.

Read: China is leading the race for classical technology.

At & nbsp, @ jeffpao3 is Jeff Pao’s Twitter account.

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New cryptocurrency licensing rules kick in for Hong Kong’s retail investors

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Hong Kong Monetary Authority chief Eddie Yue said the city wants to give the industry flexibility to develop, innovate and create an ecosystem.

However, that does not mean a light-touch regulation.

In fact, Prof Aris said he believes the new rules allow Hong Kong to fill a void left behind by a series of meltdowns in the west.

“At the point of lowest confidence, is when you can instil more confidence in investors by showing them that it is safe to trade these assets in Hong Kong, because they are well regulated,” he said.

“There is room for Hong Kong to step in and become an international hub in the trading of virtual assets.”

ATTRACTING GLOBAL INVESTORS

Overseas investors such as Mr Chen Zhuling, who runs a Singapore-based blockchain company, is also eyeing a slice of the pie.

His firm is looking at potentially offering staking services in the city, as its crypto space grows. Staking is a way for crypto holders to earn rewards on digital assets.

“Hong Kong is never short of sophisticated funds and investors. So that’s going to have a great inflow into the crypto space,” said Mr Chen, the chief executive officer of RockX.

“After the crackdown of Signature Bank and Silvergate Bank, there are no efficient on-ramp, off-ramp services globally. (This is) where after the licensing, banks will be more comfortable to serve that need.”

More than 80 companies, including major crypto exchanges OKX and Huobi, had expressed interest to operate in the city even before the new laws kicked in.

Prof Aris said he believes these movements signal a growth trajectory, one that the Hong Kong is preparing to meet as it steps up recruitment of fintech professionals.

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Counting the costs of Cambodia’s Belt and Road

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China is Cambodia’s largest bilateral donor, lender, investor and trading partner. About a quarter of Cambodia’s total trade, a third of aid and two-fifths of foreign direct investment (FDI) and external debt involves China. Although Sino-Cambodian diplomatic and economic relations date back centuries, they have grown sharply over recent decades.

Economic relations have been strengthened by Cambodia’s active participation in the Belt and Road Initiative (BRI). Cambodia has been a vocal and enthusiastic proponent of the BRI since its inception in 2013. 

In Cambodia, the BRI focuses mainly on loans to develop physical transport infrastructure, although it has also been indirectly associated with the development and transformation of the port city of Sihanoukville. 

There are also investments in agriculture, energy and light manufacturing.

Participation in the BRI has costs and benefits. As a Least Developed Country aspiring to achieve upper middle-income status by 2030, Cambodia has embraced the BRI as an important instrument for addressing infrastructure deficits and reducing trade and transport costs. 

The BRI has also supported the development of the power sector and agricultural diversification. This has raised productivity and led to trade expansion and high economic growth without compromising debt sustainability.

Rapid economic growth has increased wealth inequality but also raised overall living standards and produced sharp reductions in poverty. Between 2009 and 2019, poverty incidence (US$1 per day) almost halved from about 34% to 18%. These achievements derive from multiple factors but the BRI’s contribution cannot be denied.

The government has not undertaken a quantitative cost–benefit analysis of the BRI in Cambodia. The presence of BRI projects alongside massive socioeconomic gains suggests that the country has derived net benefit from the BRI. 

There are also no concerns relating to “debt trap diplomacy” as debt levels remain below 40% of GDP. Still, there are risks associated with increasing reliance on just one country for economic and non-economic needs.

The BRI provided the transport and related infrastructure that facilitated the transformation of Sihanoukville from a sleepy, beachside resort town to a bustling entertainment center focused on gambling. The spill-over benefits of this rapid development to the local communities appear limited, while there is growing evidence of a rise in the cost of living, crime, corruption and various forms of inequality. 

A Chinese casino lit up by night in Cambodia's Sihanoukville. Photo: Facebook
A Chinese casino lit up by night in Cambodia’s Sihanoukville. Photo: Facebook

While the BRI was not directly involved in transforming Sihanoukville in this way, it did enable the conditions for its development. The real and perceived costs of these rapid transformations have caused dislocation and displacement among local communities.

Experts have concerns about the environmental and resettlement effects of BRI projects. The second BRI Forum in 2019 committed to mitigating problems through greater community consultation and stakeholder participation. It is still too early to tell if this consultation is really happening.

The forum also resolved to multilateralize the BRI by expanding the participation of regional, albeit still China-based, institutions. In Cambodia, this is occurring through a gradual shift in the financing of projects from Chinese state-owned banks and corporations — whose operations are sometimes opaque — to the Asian Infrastructure Investment Bank (AIIB), a multilateral development institution. 

The AIIB’s role is set to increase rapidly and raise overall transparency, including contractual obligations.

But the extent to which AIIB’s involvement will also raise environmental standards and other safeguards remains unclear. This is because the AIIB adopts national environmental and other standards and policies — which may fall short of global benchmarks. 

AIIB oversight of the implementation of environmental standards or resettlement policies may also involve national authorities rather than an independent party, which could be problematic.

How can Cambodia ensure that future projects are net positive?

The Committee for the Development of Cambodia reviews FDI proposals as part of the process of obtaining Qualified Investment Project (QIP) status and securing fiscal incentives. While some of the criteria used in determining QIP status involve assessing potential benefits to the local economy, the analysis lacks a comprehensive cost-benefit framework. 

This is also true of the new Law on Investment adopted in 2021, which is mainly designed to facilitate FDI. Both the QIP and the Law on Investment ignore macroeconomic issues such as debt or investment sustainability and do not attempt to measure broader spill-over effects on the economy.

A view of the Morodok Techo National Stadium, funded by China’s grant aid under its Belt and Road Initiative, in Phnom Penh. Photo: AFP / Tang Chhimn Sothy / POOL

Cambodia needs a formal framework to assess the potential costs and benefits of all project proposals as part of a conventional approval process.

Cambodia could consider setting up a new Projects Review Board, which could operate as a non-statutory body with inter-ministerial and multi-stakeholder representation, to assess individual proposals in a purely advisory capacity to the government. 

Technically competent staff who are capable of undertaking comprehensive cost-benefit analysis should support this project. A properly functioning Projects Review Board could help avoid the kinds of BRI projects that have left neighboring Laos in severe debt distress.

A transitional economy like Cambodia should be selective and strategic in its choice of projects if it is to grow in a sustainable and inclusive manner. It has done well so far but needs an independent assessment mechanism to ensure its success continues.

Jayant Menon is Senior Fellow at the ISEAS-Yusof Ishak Institute.

This article was originally published by East Asia Forum and is republished under a Creative Commons license.

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