‘Phase One’ Trade Deal Ahoy?

China’s Fourth Plenum; a nuclear power plant cyber attack; Asian summitry

The Big One.

A delay for the ‘phase one’ trade deal?

Dictator Augusto Pinochet’s unresolved legacies are the real cause of the raging anger in Chile

The cancellation of the upcoming Asia-Pacific Economic Cooperation (APEC) summit in Chile appeared to have caught the White House, eager to finally cinch a trade agreement with China, off-guard. Trump’s negotiators have been laying the groundwork for the U.S. president to meet Xi Jinping, his Chinese counterpart, to sign what has been described as a “phase one” agreement—or an interim agreement—to address differences between the two sides in the ongoing trade war. The APEC summit meeting in Chile was meant to provide the backdrop for that deal, but Chilean President Sebastian Piñera announced that Santiago would no longer host the APEC summit and the 2019 United Nations Climate Change Conference, also known as COP25.

Both the U.S. and China have been supportive of Chile’s decision. The immediate impact of the move appears to be a delay in the timing of when Trump and Xi might meet. Washington and Beijing are reportedly seeking an alternate venue to bring the two leaders together for this hotly anticipated agreement (which, of course, could fall apart in the upcoming weeks due to the usual bouts of unpredictability that have colored the trade war so far).

The broader tensions between the two sides, however, are here to stay, as The Diplomat’s Shannon Tiezzi observes. “In case reports of a potential ‘Phase 1’ trade deal had anyone thinking U.S.-China frictions were nearing an end, a fiery speech from the U.S. secretary of state made it clear that confrontation is the new normal,” she writes. Right now, it seems that U.S.-China ties are running on two tracks.

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The Communist Party of China’s Central Committee, the apex organ of the party, just wrapped up the Fourth Plenum of the 19th Party Congress in the final week of October. There were two major themes in the lead-up:

  • Uphold and improve the system of socialism with Chinese characteristics

  • Advance the modernization of China's system and capacity for governance

In the end, the Plenum appears to have been more about further consolidating Xi Jinping’s leadership and position. David Bandurski, writing for the China Media Project, has a nice distillation of the plenum’s official bulletin and the focus on reform—well, with Chinese characteristics:

That’s right, the Fourth Plenum is about reform. But now, this is not about political reform as liberalization. This is about political reform as the continued and renewed consolidation of Party control of all aspects of Chinese society around the central authority of Xi Jinping.

The lead-up to this plenum was unusually fraught with speculation about a delay, given the 20 month gap since the Third Plenum (the longest such gap since the Deng Xiaoping era). There were also rumors that a president-in-waiting would be tapped for the Politburo Standing Committee, dashing Xi’s ambitions of serving more than two terms. Rather than checking Xi’s power, though, the Fourth Plenum did the opposite. Broadly speaking, the Fourth Plenum continues to build up the cult of Xi Jinping, taking the party back from the apparently short-lived era of collective leadership to concentration under one man (something Deng had been particularly concerned with).

Xinhua has the Fourth Plenum communiqué here. A shorter version, with a little more levity, from Reuters’ Keith Zhai:

Go Deeper: A few more Fourth Plenum reads from Radio Free Asia, Bill Bishop (Sinocism), and a pre-Plenum view from Jude Blanchette on Xi’s position.

U.S. and Asia.

It’s November and you know what that means—Asian summitry season. Thailand is gearing up to host a range of summits for the Association of Southeast Asian Nations in its capacity as chair, along with the East Asia Summit. Regional leaders will converge on Bangkok soon.

For the United States, the importance of these summits has decidedly been on the slide—despite the Trump administration’s own Indo-Pacific Strategy Report calling this region the United States’ “priority theater.”

Barack Obama, who also made a “pivot” to Asia a strategic priority, attended all East Asia Summits with the exception of the 2013 iteration, when a government shutdown in Washington, D.C., demanded his attention. Trump, by contrast, has yet to fully sit through a complete summit. He went in 2017, his first year in office, but left the Philippines, that year’s host country, before the plenary session, taking with him planned policy remarks that would have addressed, among other things, the South China Sea.

This year, the U.S. will send a downgraded delegation to Bangkok; the most senior official in Bangkok will be U.S. Secretary of Commerce Wilbur Ross. Moreover, according to the White House, Robert C. O’Brien, the new assistant to the president for national security affairs, will attend the summits as a presidential special envoy. Ross and O’Brien will attend the U.S.-ASEAN summit and the East Asia Summit.

The move won’t reassure the region of the professed “priority theater” status of the Indo-Pacific region, especially as several other heads of state will be in attendance. Last year, Trump sent Vice President Mike Pence in his stead. The takeaway after this third Trump-era EAS can only be that the United States is happy to profess a focus on Asia in strategic documents, but will often fail to show up when showing up is called for.

Bottom Line: The upcoming ASEAN summits and East Asia Summit in Bangkok will feel a downgraded U.S. presence.

Personnel Watch: Stephen E. Biegun is about to make negotiating with North Korea a part-time job. Trump’s special envoy on North Korea is slated to become Mike Pompeo’s number two at the State Department.

South Asia.

India’s largest nuclear power station, the Kudankulam Nuclear Power Plant, pushed back on unconfirmed reports that it had suffered a cyber attack. The plant, located in the southern Indian state of Tamil Nadu, issued a statement that said reports of a cyber attack were “false information … being propogated (sic) on the social media platform, electronic, and print media.” The denial was followed by claims that the plant was invincible to cyber attack because of a so-called “air-gap” between the critical systems and the outside world. 

As I wrote in The Diplomat, this is misleading. 

The official denial of any cyber attack rests on the notion that a physically separated power plant system is invulnerable to cyber attack. While this may be true for remote attacks, it does not protect against physical intrusion—either by nefarious human actors intending to tamper with the systems themselves, or who may seek to install malware from the inside. 

Earlier this year, a story published by Yahoo News revealed the account of how the well-known Stuxnet worm, which disabled Iran’s Natanz uranium enrichment facility, penetrated its target:

Engineers at Natanz programmed the control systems with code loaded onto USB flash drives, so the mole either directly installed the code himself by inserting a USB into the control systems or he infected the system of an engineer, who then unwittingly delivered Stuxnet when he programmed the control systems using a USB stick.

Since the initial denials by Indian officials, more details have emerged. The Nuclear Power Corporation of India Limited (NPCIL), for instance, acknowledged that malware that has been attributed by other countries to North Korean cyber actors was found at Kudankulam. The North Korea angle is intriguing, but India has yet to do its own attribution. Attributing cyber attacks is particularly difficult and North Korean code signatures have been used in the past by other actors to attempt to throw attribution investigators off the trail. In any case, this will be a story worth watching closely.

Bottom Line: A cyber attack on an Indian nuclear power plant underscores nuclear security risks.

Don’t Miss It: I had Aman Thakker, a South Asia contributor for The Diplomat and fellow at the Center for Strategic and International Studies, on the Asia Geopolitics podcast to discuss Indian politics in Modi’s second term and the effects of India’s actions since August in Kashmir on the U.S.-India relationship. Listen to our discussion here.

Asia Defense.

Japan’s F-15J upgrade: The U.S. Department of State approved a possible sale of a modernization package for 98 F-15J fighter aircraft valued at an estimated $4.5 billion. The U.S. Defense Security Cooperation Agency notified U.S. lawmakers of the possible sale.

Upgraded SSBN in Russia: The nuclear-powered ballistic missile submarine (SSBN) Knyaz Vladimir (Prince Vladimir), the Russian Navy’s first upgraded Project 955A Borei II-class (“North Wind”) or Dolgorukiy-class boomer, has for the first time fired a RSM-56 Bulava (NATO reporting name: SS-N-32) submarine-launched ballistic missile (SLBM) as part of its final certification tests, the Russian Ministry of Defense (MoD) said in an October 30 statement. Read more from Franz-Stefan Gady.

Type 002 nears commissioning: The People’s Liberation Army Navy’s first domestically designed aircraft carrier is nearing its commissioning ceremony.


Don’t miss issue 60 of The Diplomat’s magazine, which is hot off the (virtual) presses. This month we trace Japan-South Korea tensions from their much-discussed historical roots to the more critical politics of the present. 

We also examine how Democratic hopefuls for the U.S. presidency in 2020 think about Asian security; pick apart the details of Vietnam’s latest standoff with China in the South China Sea; and dive deep into Indonesia’s decision to relocate its capital. And, of course, we offer a range of reporting, analysis, and opinion from across the region.

This newsletter is written by Ankit Panda, senior editor for The Diplomat, and director of research at Diplomat Risk Intelligence. Please do feel free to reach out with comments, tips, and feedback at ankit@thediplomat.com and follow me on Twitter at @nktpnd and The Diplomat at @Diplomat_APAC.