A Trade War Truce?

Japan's plans for the Izumo; Uyghurs and Central Asia; Japan-Russia talks

The Big One.

Who told who what in Buenos Aires?

So, there’s a truce in the U.S.-China trade war. Maybe?

U.S. President Donald J. Trump and Chinese President Xi Jinping met over dinner in Buenos Aires, on the sidelines of the Group of 20 leaders’ summit, and both sides walked away claiming that they had reached a deal. Reporters on the site of the dinner reported hearing applause at the conclusion of the meal, suggesting at least a mutual satisfaction. The problem in the days since that dinner is that it’s not clear if both sides share the same perception of what was agreed.

I reflected quickly on Saturday evening, right after the dinner, about what the arrangement—largely as announced by the White House—might mean. It certainly looked like a truce and neither side, in my estimation, had really given away the farm. Xi didn’t cave; no one quite expected him to. At the same time, the Trump administration managed to hold fast and use the credible threat of raising the existing 10 percent tariffs on $200 billion in Chinese goods to 25 percent to extract what appeared to be some commitments.

But from there, it appeared that China had entirely another understanding of what had transpired.

Peter Martin@PeterMartin_PCMConfused about what exactly Xi and Trump promised each other yesterday? Here's a side-by-side comparison of the readouts from both sides. The U.S. on the left, China on the right https://t.co/5N7aISEdew @LucilleLiu @JDMayger @Jeffrey_Black

Readouts do normally vary between sides after a diplomatic encounter, of course, but Beijing made no acknowledgement of the very concessions that the Trump administration touted as being evidence of a decent deal—one that respected core American concerns. Critically, the 90-day period that the White House cited as an opportunity for the two sides to work toward a more comprehensive agreement, saw no mention in Chinese readouts. Meanwhile, the South China Morning Post reported that China had started censoring the U.S. embassy’s WeChat posts touting the trade agreement at Buenos Aires using the White House readout language.

All of this leaves the G20 agreement in an uncertain place. Markets, perhaps acknowledging this uncertainty, reacted initially with a fairly lukewarm positive turn before a precipitous fall on Tuesday U.S. time, as this newsletter was being written. (Something about Trump declaring himself a “tariff man” on Twitter perhaps didn’t sit right with investors?) The broader point stands with the trade war: the fundamental differences between the two sides are no closer to being ironed out.

Bottom Line: There’s considerable uncertainty around the commitments the United States and China gave each other in Buenos Aires. If the trade war is in a truce, we’ll find out when January 2019 comes around.

East Asia.

I hinted at this in the previous issue, but the issue of renewed Russo-Japanese talks over their mutual territorial dispute over the Kuril Islands merits a deeper look. In September, Russian President Vladimir Putin drew headlines for apparently shocking Japanese Prime Minister Shinzo Abe—an overstatement, perhaps—by proposing that the two sides finally resolve that decades-long dispute by entering talks toward a peace treaty “without any preconditions.” In short, the two sides have long been quagmired over this issue, relating primarily to the issue of sovereignty and the 1956 Joint Declaration between the Soviet Union and Japan. Japan wants to see the sovereignty of the disputed islands, which are currently administered by Russia, addressed, and Russia has refused to do that. At the East Asia Summit in November this year, Putin met Abe and the two hashed it out again, but there wasn’t any real progress apart from both leaders agreeing to “accelerate talks.” (Nick Trickett took a look at Putin’s EAS for The Diplomat.)

Since the EAS encounter, there has been some progress. This week, Abe anointed his foreign minister, Taro Kono, with the lead on the negotiations with Russia going into 2019. The goal remains a peace treaty. (A side note on Kono: it was his grandfather, Ichiro Kono, who signed the 1956 agreement with Nikita Khrushchev.) On the Russian side, Foreign Minister Sergei Lavrov will lead the charge.

The appointments and partitioning of portfolios, however, shouldn’t suggest that this time things will be different. What is different this time compared to previous attempts is that Russia’s attempts to economically galvanize its Far East with Japanese investment have come a long way and Japan has reciprocated. Cementing a peace treaty would probably unlock greater opportunities for both sides, but there’s a long list of issues to work through before getting there. Incidentally, I just returned from a trip to Vladivostok in the Russian Far East in late-November and a couple Russians who work on international affairs out of the country’s Far East saw similar benefits to resolving this issue with Japan.

For Tokyo, however, the primary issue will be a satisfactory resolution of the dispute, namely with the transfer of sovereignty of the four disputed islets to Japan. Getting there will mean swallowing tall Russian asks, which may include the exclusion of the islands from the U.S.-Japan Mutual Defense Treaty and the removal of sanctions that Tokyo agreed to impose on Russia in 2014 for its annexation of Crimea.

Bottom Line: Russia and Japan are back to talking about the Kuril Islands in a more serious way than they have in recent years, but there’s little reason to believe that this time will really be different.

South Asia.

December will be a big month for two of India’s neighborhood relationships. The newly elected president of the Maldives, Ibrahim “Ibu” Mohammed Solih, and the newly elected prime minister of Bhutan, Lotay Tshering, are both expected in New Delhi. With the Maldives, the Indian government will seek to capitalize on what turned out to be an unexpected opportunity. Where many had expected the country’s former, autocratic-leaning president, Abdulla Yameen, to manipulate state institutions and eke out victory in the September elections, Solih rose to the top on the back of unprecedented democratic turnout and enthusiasm. In his inaugural address in November, Solih pledged to improve and restore relations with India. (Indian Prime Minister Narendra Modi made his first trip to the Maldives to attend Solih’s inauguration.) The rapprochement between New Delhi and Male will be in full swing with Solih’s visit to India.

With Bhutan, matters are a little more nuanced. Last year, India and China found themselves mired in a standoff on a piece of territory on the Doklam plateau claimed by Bhutan and China; India, Bhutan’s close partner and security guarantor, stepped in to prevent Chinese construction activity in the disputed territory. While that standoff was resolved more than a year ago, the situation on the Doklam plateau remains tense, with the Chinese People’s Liberation Army having considerably upped its presence. For India and Bhutan, part of managing the relationship over the recent decade or so has been the issue of Thimphu’s outstanding territorial dispute with China. (India and Bhutan are the only countries among China’s land neighbors that have yet to finalize their borders with Beijing.) With Lotay Tshering, New Delhi will want to ensure that the relationship is properly calibrated under a new government and that Bhutan won’t be prone to make any territorial concessions to China that might harm India’s interests. (If you missed it, The Diplomat’s Sudha Ramachandran had a deeper dive on this very issue.)

Bottom Line: India’s neighborhood policy will be in the spotlight in December as the leaders of Bhutan and the Maldives head to New Delhi.

China's Insecurities on Show at APEC 2018

Pence in Asia; North Korea's weapons test; Kazakh gas exports

The Big One.

Pence’s big Asia tour wraps up with an unexpected moment.

U.S. President Donald J. Trump doesn’t travel long distances well and that’s left the vice president, Mike Pence, as the new point-man on Asia. Pence has returned from a regional tour across Asia, with the headline events of his trip including the usual round of Association of Southeast Asian Nations (ASEAN) summitry, including the East Asia Summit, held this year in Singapore. Pence ended his trip in Papua New Guinea, host of this year’s Asia Pacific Economic Cooperation (APEC) summit.

At both the EAS and APEC, Pence brought a classic Trumpian tone and defended the administration’s approach to the region.

Some of the choice lines from Pence’s EAS speech:

  • Let me be clear: China’s militarization and territorial expansion in the South China Sea is illegal and dangerous. It threatens the sovereignty of many nations and endangers the prosperity of the world.

  • The United States seeks a relationship with China that is based on fairness, reciprocity, and respect for sovereignty. We have documented the difficulties that the United States and other nations face with China, and China knows where we stand.

  • This year, we’ve devoted more than half a billion dollars to security assistance in the Indo-Pacific, including nearly $400 million in foreign military financing – more than the previous 3 years combined.

  • Now is the time to maintain the pressure campaign [on North Korea] and enforce all U.N. sanctions. We must work together to stop North Korea’s evasion of sanctions, including the illegal ship-to-ship transfer of oil and coal. All countries must also expel North Korean labor.

And Pence at APEC:

  • [S]ome are offering infrastructure loans to governments across the Indo-Pacific and the wider world. Yet the terms of those loans are often opaque at best.  Projects they support are often unsustainable and of poor quality. And too often, they come with strings attached and lead to staggering debt.

  • Know that the United States offers a better option.  We don’t drown our partners in a sea of debt. We don’t coerce or compromise your independence.  The United States deals openly, fairly. We do not offer a constricting belt or a one-way road. When you partner with us, we partner with you, and we all prosper.

The trip was Pence’s big moment to take the new and overt U.S. competitive tone toward China—the same one Pence introduced in an October speech at the Hudson Institute—to Asia. And, it actually appears to have turned out fairly well, but not necessarily due to Pence’s doing.

The APEC summit ended without a joint communiqué and it wasn’t the United States that was the troublemaker like at last year’s G7 meeting. It was China that was unable to accept the language prepared for the statement, embarrassing and frustrating host Papua New Guinea. According to the Wall Street Journal, the troublesome line was the following: “We agreed to fight protectionism including all unfair trade practices.”

That China couldn’t accept that language is telling. President Xi Jinping has been on the defensive lately. As early as the Boao Forum for Asia earlier this year on Chinese soil, Xi began emphasizing that China has no geopolitical grand designs behind the Belt and Road Initiative. He made a similar plea at APEC, remarking that his signature Belt and Road Initiative was “not designed to serve any hidden political agendas.”

Xi’s attempt to pitch himself as the defender of globalization—a project that began with his trip to Davos earlier this year—is running into roadblocks. For the United States, this presents an opportunity to corner China and capitalize on growing regional skepticism of Beijing’s intentions.

Bottom Line: The unfortunate impasse at the end of this year’s APEC summit shows that Chinese insecurities may provide the United States with an important geoeconomic opening.

East Asia.

Are the North Koreans back at it again? Last week, North Korean state media announced in a vague article that Kim Jong Un had supervised the test of a new type of "ultramodern" and "tactical" weapon. The article was accompanied by a single image that didn't show the weapon off, but did show Kim giving guidance to uniformed members of the Korean People's Army gathered at what appeared to be a coastal test site. There was a message being sent with this supposed test, which appeared to be carefully calibrated to not be too provocative. Kim was letting U.S. President Donald J. Trump know that if he wanted to continue enjoying the benefits of the ongoing pause in ballistic missile testing, he'd better move toward the "corresponding measures" the North Koreans have been looking for. Importantly, announcement of Kim's inspection came after the United States and South Korea resumed a modest, small-scale marine exercise, suggesting that North Korea wouldn't tolerate any allied military exercises as long as diplomatic talks were on. For now, this move appears to be a shot across the bows of the United States and South Korea. Momentum toward a second Trump-Kim summit, in the meantime, continues.

Bottom Line: North Korea is getting impatient and is particularly irked with resumed U.S.-South Korea military drills.

Bonus: Keep your eyes on Russia and Japan. Two months after Russian President Vladimir Putin proposed suddenly to resolve their outstanding territorial dispute over the Kuril Islands “without any preconditions,” Tokyo appears to have thought things over and has made an important opening. Abe wants to put an end to the dispute and open a new era in Russia-Japan ties, which have been expanding quickly in recent years despite the outstanding dispute and tensions between Moscow and the West.

South Asia.

In the Indian Ocean, there are two stories playing out. One's a happy one, that reached its climax with the inauguration of Ibrahim 'Ibu' Mohamed Solih as the new president of the Maldives, putting an end—for now—to former President Abdulla Yameen's authoritarian designs. Solih vowed to balance the country's foreign relations in an inaugural speech, which was attended by Indian Prime Minister Narendra Modi. For New Delhi, Solih's rise in the Maldives presents an opportunity to restore equilibrium to a once close neighborhood relationship that had gone off the rails as Yameen pursued closer ties with China. “Large-scale embezzlement and corruption have dwindled the coffers of the state by billions of rufiyaa. This money belongs to the Maldivian people, money that should have been spent for the common good of the people,” Solih noted in his inaugural speech, hinting at the corruption of the previous government. In a veiled reference to China-backed projects in the country that were initiated under Yameen, Solih noted that “reckless mega development projects [were] undertaken purely for political gains.”

The second story in the Indian Ocean concerns Sri Lanka, which led the previous edition for this newsletter. The bad news continues in Colombo, with the ongoing constitutional crisis appearing to only deepen without any sign of reversal. Sri Lankan lawmakers were able to arrive at a no-confidence motion in a parliamentary voice vote that Rajapaksa's supporters rejected as legitimate. All this eventually led to a November 18 meeting between the three men at the center of the ongoing crisis: President Maithripala Sirisena, former President and newly appointed Prime Minister Mahinda Rajapaksa, and, finally, the ousted Prime Minister Ranil Wickremsinghe. Direct talks between the three men failed to deliver any way out of the crisis, with Wickremsinghe claiming that the no-confidence motion proved that he still enjoyed legislative support.

Bottom Line: In the Indian Ocean, the Maldives drifts away from democratic decline toward what will hopefully be a period of recalibration and reconstruction. Meanwhile, Sri Lanka's crisis deepens.

Southeast Asia.

A Constitutional Crisis in Sri Lanka

Inter-Korean military progress; India's nuclear sub milestone; Lion Air crash

The Big One.

A game of thrones in the Indian Ocean.

In the final week of October, Sri Lanka found itself thrust suddenly into a political crisis—or a soft coup, depending on who you ask. The crisis has swirled largely around the ambitions of three men: Maithripala Sirisena, the president; Ranil Wickremsinghe, the prime minister of the country since 2015; and Mahinda Rajapaksa, the former decade-long ruling president and newly appointed prime minister. Sirisena, who had unexpectedly risen to defeat Rajapaksa in the January 2015 presidential elections, appointed his one-time former rival to the prime ministership. Meanwhile, Wickremsinghe, who was once Sirisena’s unity government partner, refused to vacate the prime minister’s residence, arguing that he could prove that he continued to enjoy the support of parliament. In the days since, a power struggle has played out as two prime ministers seek to wrangle support from the legislature. Meanwhile, Sirisena prorogued parliament and dissolved and reconstituted his cabinet. At least one person has been killed in political violence resulting from the crisis and there are serious concerns that further violence might emerge.

The geopolitical contours of the crisis are apparent. China has acknowledged Rajapaksa’s ascent to the prime ministership while India and the United States have been more circumspect. Under Rajapaksa’s ten-year rule, Sri Lanka took on massive amounts of Chinese debt. Beijing also sees the former Sri Lankan president as a reliable partner.

Things are still in flux, but it’s expected now that Sirisena will reconstitute parliament sooner than expected, allowing a potential confidence vote to take place, reviewing Rajapaksa’s appointment. “Really, Rajapaksa or Wickremesinghe should have to prove that they have majority support in the legislative body right now. Chaos and delay favor coup supporters,” writes Taylor Dibbert in The Diplomat.

Bottom Line: A constitutional crisis in Sri Lanka with geopolitical stakes threatens to thrust the island nation toward prolonged instability and even political violence.

Bonus: Catch the latest Asia Geopolitics podcast where Prashanth Parameswaran and I discussed Sri Lanka’s constitutional crisis and its regional implications.

Northeast Asia. 

North and South Korea have been remarkably successful so far at seeing through the implementation of the Comprehensive Military Agreement (CMA) they announced during the third inter-Korean summit this year in Pyongyang. The two sides have, among other things, jointly de-mined and demilitarized the Joint Security Area (JSA) along the Military Demarcation Line (MDL) that separates them, instituted land-, sea-, and air-based exclusion zones for military exercises and live-fire drills, instituted a no-fly zone, removed guard posts, and started talks on turning the Han River Estuary into a “joint utilization zone.” The details are interesting, but the broader picture is that South Korean President Moon Jae-in and North Korean leader Kim Jong Un have produced a stark change in the security environment on the Peninsula at breakneck speed. So far, while there continue to be roadbumps on the side of economic cooperation due to the unswerving international sanctions regime against North Korea, there have been no significant obstacles in the implementation of the CMA. The reason this is particularly important and valuable is because it raises the threshold for a crisis to break out. A replay of the 2010 shelling of Yeonpyeong Island or the sinking of the ROKS Cheonan becomes far less likely in this context.

Bottom Line: Inter-Korean military tension reduction is an incredible bright spot right now on the Korean Peninsula.

In Case You Missed It: Japan-China ties are on the mend. Japanese Prime Minister Shinzo Abe’s summit with Chinese President Xi Jinping in Beijing was an important moment in the bilateral relationship and a product of both sides seeing hedging value in the other amid an increasingly unpredictable U.S. foreign policy under President Donald J. Trump.

Bonus: Read Diplomat editor-in-chief Shannon Tiezzi’s take on Chinese President Xi Jinping’s speech to the China International Import Expo (CIIE) in Shanghai:

There were clear echoes here of Xi’s speech at the 2017 Davos meeting, where he tried to position China as the new defender of free trade and globalization. That branding exercise has become both a harder sell and a more crucial one for China to make as the United States and European countries step up their criticisms of Beijing for placing restrictions on foreign firms.

South Asia.

Pakistan’s blasphemy laws continue to stoke the flames of popular extremism in the country. On October 31, 2018, the Pakistani Supreme Court—the apex institution in the country charged with ensuring that the rule of law, well, rules—acquitted Asia Bibi, a Christian woman charged with blasphemy, citing poor witness statements against her and a shaky case by the prosecution. The Diplomat’s Umair Jamal had written in anticipation of the verdict that the case would be a “test case” for Pakistan, to see how well it could cope with an institutionally sanctioned acquittal of a defendant in a blasphemy case.

Blasphemy is no joke in Pakistan. A few years ago, Pakistani authorities hanged Mumtaz Qadri, who was bodyguard—and eventually assassin—to Salman Taseer, the former governor of Punjab province. Qadri killed Taseer after the latter criticized Pakistan’s blasphemy laws and called openly for Bibi, who had been held in custody since 2009, to be released. Qadri’s hanging spurred mass protests across the country.

That episode foreshadowed the ongoing fallout in Pakistan from Bibi’s Supreme Court verdict. Political parties like Tehreek-e-Labbaik Pakistan have seized on the moment to spur mass protests, in an attempt to force the Pakistani government to override the writ of the Supreme Court and thus rule of law itself. These protesters seek to prove that God’s law is greater than that of the state itself, as Jamal notes. Critically, the still-new government led by Prime Minister Imran Khan is unwilling to stake out too radical a position. “The government is not willing to target protesting individuals, let alone target the narrative of religious intolerance that has brought out thousands of people in streets,” Jamal observes.

It’s still unclear how the latest episode will resolve itself. Asia Bibi is being held in the custody of the Pakistani military while her life is under threat. Her lawyer has left Pakistan in the meantime, fearing for his life.

Bottom Line: Extremist outcry over Pakistan’s blasphemy laws continues to be a serious political force in the country.

Southeast Asia.

Indonesia remains gripped by the tragedy of Lion Air Flight JT610. The Boeing 737 MAX 8 passenger jet crashed off the coast off Jakarta in the Java Sea, claiming the lives of all 189 passengers and crew on board. The accident was the first to involve this kind of Boeing aircraft and is the deadliest to date involving an aircraft of the 737 class. The question of just how preventable the accident was has gripped Indonesians in the past week. The 737 MAX 8 that crashed as flight JT610 had previously encountered mechanical errors during a previous flight.

Image result for lion air crash

As Asmiati Malik explained in The Diplomat, one passenger on that flight noted that the plane was “flying at a lower altitude than usual” and another noted that “the airplane’s engine made unusual noises.” But the bigger problem may have to do with a failure to adequately regulate low-cost carriers, which are fast-growing all over Asia. Lion Air, especially, has grown famous for its low fares, which have come at a cost to customer service, labor standards, and, apparently, safety too. Malik cautions:

US INF Treaty Withdrawal and China

Mirziyoyev in France; U.S.-ROK exercises canceled; Japan-China thaw.

The Big One.

China Eyes the US Withdrawal From the INF Treaty.

The Trump administration has made its intention to withdraw from the 1987 Intermediate-Range Nuclear Forces Treaty, the last surviving Cold War-era arms control agreement, clear. “We’re going to terminate the agreement and we’re going to pull out,” President Donald J. Trump said this weekend, adding that the U.S. would develop new weapons. The Treaty prohibited both the United States and the Soviet Union—now Russia—from deploying, possessing, or testing ground-launched cruise of ballistic missiles with ranges between 500 km and 5,500 km. Since 2014, the United States has alleged that Russia has developed, and more recently, deployed a system known as the 9M729 that violates the Treaty-proscribed ranges.

The decision has driven American Asia hands, Europe hands, and arms control analysts into a frenzied debate about the merits. In the Asia analyst community, INF withdrawal has long been favored as a means by which to balance China. According to former Pacific Command chief Adm. Harry Harris, 95 percent of China’s missile inventory is in the INF-proscribed range, which has allowed Beijing to operationalize a robust anti-access/area denial capability in East Asia. The United States has been able to compete using sea- and air-based platforms, which, while generally costlier than land-based deployments, are not limited by INF.

There are some problems that spring to mind with the decision to frame INF withdrawal around concerns about China.

First, the fundamental case to be made is that the costs to U.S. and allied security in Europe of INF withdrawal will be outmatched by the deterrence benefits in East Asia against China. I remain unconvinced that this is the case. Second, while Russia will be free to continue to deploy the system it has already developed to violate INF, the United States simply does not possess any existing systems that it could deploy. This means that the prospect of deploying a new conventional, ground-launched cruise missile (GLCM) in Asia may take years. Third—and most significantly—allied geography in East Asia and political realities will make GLCM deployments to deter China challenging. Proponents of the idea have cited basing locations including Okinawa, the Philippines, and Australia. Unless the nature of the China threat changes so considerably that domestic politics in the latter two transforms considerably, it’s almost unimaginable that either would be lining up to host U.S. missiles that would turn them into targets. With Okinawa—and other parts of Japan—it’s easy to imagine just how much more toxic local politics regarding the U.S. military presence could get.

China, in the meantime, hasn’t reckoned with the U.S. debate about its own missile forces. The Chinese Foreign Ministry criticized the U.S. decision to leave the Treaty, noting on Monday:

The US side should prudently handle the issues related to the treaty. It is even more wrong to make an issue out of China on withdrawing from the treaty. We hope that the US side can shoulder its responsibility and think twice before its pullout.

If the above discussion interests you, watch out for a new podcast soon with The Diplomat’s Robert Farley on the benefits and costs of INF withdrawal for the United States in Asia.

Northeast Asia. 

There’s a serious bout of a thaw underway between Japan and China. Of course, this isn’t particularly new; Tokyo has been carefully working to repair its bilateral relationship with Beijing as the United States has grown ever more unpredictable. The move doesn’t signal a Japanese embrace of China; rather, it’s an acknowledgement that it is better at the current moment for Tokyo to find areas of common interest with China and work to reduce bilateral tensions. This is particularly true as the U.S.-China relationship reaches a low we haven’t seen in some time.

To underline the thaw, we have two recent data points. First, the defense chiefs of both countries met for the first time in three years recently and have resolved to start regular exchanges. This will include regular fleet visits between warships of the Maritime Self-Defense Force (MSDF) and the People’s Liberation Army Navy (PLAN)—a serious step that takes cooperation back to an activity that we haven’t seen since 2011. All this bodes well for the implementation of the recently finalized East China Sea crisis management mechanism between the two sides, which took effect this summer.

For now, Tokyo is making a serious effort to repair its strategic and economic relationship with Beijing. The real proof will come with an expected leaders-level summit meeting between Chinese President Xi Jinping and Japanese Prime Minister Shinzo Abe in China. The two leaders recently had a cordial encounter in Vladivostok, Russia, on the sidelines of the Eastern Economic Forum. For China, the outreach by Japan is well in its own interests. Beijing needs all the external support it can find amid the ongoing trade war with the United States. While Tokyo has staked out its clear positions in support of a high-standards, rule-based, multilateral trading architecture in Asia—best captured by the new Comprehensive and Progressive Trans-Pacific Partnership—Beijing sees Japan as a more than willing economic partner.

Abe will be in China from October 25 to 27.

Bottom Line: There’s a serious strategic thaw underway with Japan and China that is expected to deepen with a summit between Xi and Abe.

Bonus: Shannon Tiezzi, The Diplomat’s editor-in-chief and resident China hand, joined me for a discussion on Taiwan’s navigation of U.S.-China tensions on the Asia Geopolitics podcast. You can listen here.

South Asia.

On October 20, Afghans across the country went to the polls to vote in delayed parliamentary elections, just shortly after a devastating Taliban attack killed the police chief and intelligence of Kandahar, and even injured a U.S. brigadier general. The conduct of the polling—at least in Kabul—did not offer reason for confidence in the robustness of Afghan democracy, even though the turnout by ordinary voters—especially at locations in the city that had recently been targeted by Taliban and Islamic State militants—gave cause for hope. Franz J. Marty was on location in Kabul for The Diplomat in Afghanistan. As Marty notes, the Taliban did manage to make a dent in the conduct of the elections with their attacks on the day of the voting:

The Taliban claimed to have conducted an array of attacks across Afghanistan on October 20 (a summary statement indicated 407 alleged attacks), blocking roads and allegedly preventing the elections in countless districts, if not nearly whole provinces. While such Taliban propaganda is usually vastly exaggerated and sometimes even made up, some of the incidents – as well as the fact that they severely hampered the elections – have been confirmed.

Meanwhile, technical polling problems, including reports of closed polling sites and sites opening late, leave the result open to allegations of fraud and tampering. Additionally, due to the security situation across the country, various polling sites were simply unable to operate. (This included Kandahar, and also Ghazni, which saw a dramatic takeover attempt by the Taliban in August and, earlier in the summer, had grown mired in separate constituency delimitation issues.)

In case you missed it, Michelle Tolson looked at the role that female candidates played in this year’s parliamentary elections. Female political participation is up considerably in Afghanistan.

Bottom Line:

In Case You Missed It: A few issues ago, I enthusiastically discussed the Maldives’ remarkable election outcome. That result, sadly, has come under assault by the outgoing authoritarian-leaning president, who asked the apex court in the country to annul the result. The latest is that the court has rejected Yameen’s request, but there remain several weeks until the scheduled leadership transition date of November 17.

Pakistan Turns to the IMF

Maha Vajiralongkorn's consolidation; S-400 power plays; U.S.-China "competition"

The Big One.

It’s on: Imran Khan’s government heads to the IMF for its bailout.

Pakistan’s new government has finally swallowed the bitter, but necessary, pill of formally approaching the International Monetary Fund with regard to an $8 billion dollar bailout package: its best chance at averting certain fiscal meltdown. “An IMF team will visit Islamabad in the coming weeks to initiate discussions for a possible IMF-supported economic programme,” IMF Managing Director Christine Lagarde said, after meeting Pakistani Finance Minister Asad Umar in Bali, Indonesia, on the sidelines of the IMF’s annual meeting there. The sum Pakistan seeks is its largest ask yet of the IMF, which has previously put together a dozen bailouts for the country.

Some questions for Pakistan going forward will include the conditionalities on this latest, record-breaking IMF bailout; this extends to limitations of potential repayments of Chinese creditors (something the United States has publicly mentioned). U.S. Secretary of State Mike Pompeo has reportedly swung around on the issue. First, he noted in July that “there’s no rationale for IMF tax dollars, and associated with that American dollars that are part of the IMF funding, for those to go to bail out Chinese bondholders or China itself.” However, in September, Pompeo reportedly told his Pakistani interlocutors in Islamabad that “if Pakistan opted to go to IMF for any financial help, the USA will not oppose it.” 

Going to the IMF doesn’t magically get the country’s economic problems out of the woods; the Pakistani rupee went into freefall ahead of the IMF encounter, underlining the uncertainties that lie ahead. The political fallout of this latest bailout can also be expected to be severe. Imran Khan’s prime ministership is built on a razor-thin coalition edge with seven parties and, given the onerous austerity terms the IMF is likely to impose on Pakistan, these coalition partners will see an opportunity to extract concessions from the government on a range of issues.

Northeast Asia. 

U.S.-China ties continue their nosedive. The big highlight in early October was a speech on the relationship by U.S. Vice President Mike Pence. The speech was easily the most important high-level U.S. statement on the relationship with China in a long time and sets up the keyword that’ll define the bilateral for the rest of the Trump presidency: “competition.” Pence took pains to discuss recent comments by Trump in September that China was seeking to interfere in U.S. politics. As The Diplomat’s editor-in-chief Shannon Tiezzi astutely observes:

But Pence’s specific examples, while concerning, don’t amount to a covert influence campaign similar to Russia’s actions during the 2016 campaign. On the contrary, most of the cases he brought up had been widely reported before. Most notably, Pence’s main example of China seeking to influence the upcoming U.S. midterm elections is the tariffs China implemented in response to the Trump administration’s own tariffs. These tariffs are targeting “industries and states that would play an important role” in the midterms – and specifically targeting Trump supporters, Pence said. But using economic tools to shape a foreign government’s policymaking decisions is par for the course in statecraft.

The Diplomat’s Dingding Chen offers his perspective on the three main categories of reactions to Pence’s speech over in China, separating them into the pessimists, the concerned realists, and the calmer optimists. Pence’s speech raises the fundamental question too of how far the Trump administration goes beyond “competition” with China; that alone is not a strategy.

Either way, the current trajectory is set to continue at least until the Trump-Xi encounter at the G20 summit in late-November. (The Diplomatic & Strategic Dialogue scheduled for October has been called off.)

Bottom Line: Get ready for a new era of U.S.-China “competition.” The downsliding in bilateral relations is here to stay.

Bonus: A farewell tweet from the Financial Times’s Victor Mallet, the first journalist to be denied a visa in Hong Kong for arbitrary reasons related to his moderation of a panel on Hong Kong independence.

Victor Mallet@VJMallet

Mallet’s departure comes as another harbinger of the effective death of ‘One Country, Two Systems.’

South Asia.

India and Russia have clinched a $5.5 billion major deal that will see Moscow’s advanced S-400 surface-to-air missile system transferred to New Delhi by the early 2020s; the agreement was concluded during Russian President Vladimir Putin’s visit to New Delhi last week. The system, which can target aircraft, cruise, and ballistic missiles, will give India an important capability against both Pakistan and China (Beijing also recently took delivery of its S-400s). The sale has raised concern of India eventually facing U.S. sanctions.

File:S-400 SAM during the Victory parade 2010.jpg

When asked on October 10 if India would face the brunt of U.S. sanctions under the Countering America’s Adversaries Through Sanctions Act (CAATSA), Trump noted ominously that “India will find out” soon. “You'll see. Sooner than you think,” the U.S. president added. CAATSA includes a waiver for U.S. partners and allies, but New Delhi remains concerned that the administration could move ahead with sanctions anyway; the issue has come up in recent U.S.-India high-level interactions, including reportedly the high-level ‘two-plus-two’ meeting in August.

Sanctions on India would be a departure from the serious nurturing of the U.S.-India relationship that has gone on under this administration, representing continuity from the Obama years. It would also hinder the United States’ efforts to build a coalition of like-minded partners in the Indo-Pacific, with India being the most important non-allied node.

Bottom Line: The issue of CAATSA sanctions on New Delhi appears to still have the potential to go either way.

Southeast Asia.

The Thai monarchy is undergoing interesting changes under the still relatively new king, Maha Vajiralongkorn (Rama X). As Pavin Chachavalpongpun notes at The Diplomat, “king’s decision to evict old members of the Privy Council close to his late father, King Bhumibol Adulyadej, the stripping of the power from its president, General Prem Tinsulanonda, as well as the appointment of his close confidants as new Privy Councilors, suggests that, more than just a process, this is part of the growing aggrandizement of political power of Thailand’s new King Maha Vajiralongkorn, or King Rama X.” Changes are also taking place on the side of royal security, with a massive planned expansion to the royal police security unit, charged with the King’s personal security. Torsak Sukvimol, the newly-appointed head of the King’s Special Service Division, noted a planned expansion from a personnel level of 400 to 1,617, suggesting a quadrupling of the capability afforded to the king. Prashanth Parameswaran explored some of the implications:

The focus on the security forces around Vajiralongkorn ought not to be understated – the monarchy remains a powerful institution in Thailand, and Vajiralongkorn himself is no stranger to power politics, having himself served in the King’s Guard when he was Crown Prince. That said, it is still early days in his reign, and the real impact of efforts such as a boost for its security force will likely only be felt as we see Thai politics evolve and concretize.

Bottom Line: Thai King Maha Vajiralongkorn is consolidating power around the monarchy.

Catch Up: The September 28 earthquake and tsunami that struck the northwestern portion of the Indonesian island of Sulawesi has claimed more than 2,000 lives, with another 10,000-plus injured. The natural disaster is among the worst to strike Indonesia in recent years and poses a major setback to the region. The devastation has initially proven too much for Indonesia’s domestic capacity, prompting significant overseas humanitarian assistance and disaster relief aid.

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