Lowy Institute
  • A proposal to end the exaggeration of what counts as foreign aid.
  • How do countries and other donors compare in their Ebola assistance? The Ebola Response Tracker by ONE is a great interactive.
  • With the Lima Climate COP just around the corner,  how ambitious are China's climate targets? Good fact sheet from The Climate Institute.
  • In Berlin last week countries pledged US$9.3 billion for Green Climate Fund for developing countries to deal with climate change.
  • News that China will build a US$12 billion railway in Nigeria, connecting Lagos to Calabar.
  • 'The less the government controls, the more authoritarian it becomes.' The future looks dismal in war-torn South Sudan.
  • The Djioubti Minister for Foreign Affairs urges a reconfiguration  on the debate  African nations face in forging 'eastern' or 'western' partnerships.
  • Last week marked the 25th anniversary of the adoption of the Convention of the Rights of the Child, the world's most widely ratified human rights treaty. See UNICEF's anniversary interactive.

Bringing together the best longer Interpreter articles you were too busy to read this week.

This week the Lowy Institute hosted both the Prime Minister of Italy, Matteo Renzi, and the Chancellor of Germany, Angela Merkel. Both these visits followed the conclusion of the G20 Brisbane Summit and major speeches in Australia by President Barack Obama, President Xi Jinping and Prime Minister Narendra Modi, among others. It has been busy. Here Lowy Institute Fellow Sam Roggeveen reflected on the 2014 Lowy Lecture by Chancellor Merkel:

I think that what we tend to look for in political leaders is not so much intelligence but wisdom, and Merkel's was on display in the Q&A, where she cautioned patience on Europe's response to the crisis in Ukraine. As someone who saw Germans give up hope of their country ever being reunified, she said we ought not to be too pessimistic about future change in Russia's attitude. But it might take some time for Europe's most powerful tool, its economic might, to take effect. The only danger for Europe is that it becomes divided in the meantime.

Sam also pointed to the global goodwill that Merkel has personally developed, and what this could mean for Germany:

It seems to me that, were Merkel to embrace this opportunity, it could raise her country's standing in world affairs to something unprecedented in the post-war era. For instance, is it really so far-fetched to imagine Merkel taking the leading role in international climate-change negotiations? Her country has diplomatic heft and green-energy credentials. And, if I'm right, Merkel herself has the personal profile to give such an initiative real stature.

Chinese President Xi Jinping's speech before the Australian parliament on Monday, along with the announcement of the China-Australia Free Trade Agreement, has provoked considerable debate. Kerry Brown provided a first take on Xi's speech:

But Xi has made it clear that there needs to  be more diversification, and one of the routes to diversification is finance and services. Xi's recognition of Australia as a place where this sort of business can be done for Chinese today is a big deal. Now it is up to us to re-imagine our relationship with China along lines that are broader than just exporting resources and foodstuffs. If we go this way, we are pushing on an open door.

Lowy Institute Nonresident Fellow Malcolm Cook talked about how the FTA busted several myths about Australia-China relations:

The second strategic myth is that closer relations with the US, to which the Liberals are seen as being more prone than Labor, are detrimental to Australia's key relationships in Asia. Australia's Asian engagement policy would benefit from a more 'autonomous' and 'independent' relationship with the US and its ally Japan, it is argued.

The most sustained and inaccurate criticism of the Abbott Government's foreign policy is that closer relations with Japan and the US will undercut relations with China, with Beijing likely to impose costs on the bilateral economicrelationship. The exact opposite now seems to have occurred, with the signing of the historic Japan-Australia FTA earlier this year clearly an important late-term stimulus to the decade-long China-Australia trade talks.

Hugh White responded:

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As Malcolm Cook says, this week's events show that Tony Abbott's strategic policies in Asia have not got in the way of his economic agenda. Mr Abbott has won his free trade agreement with China despite his enthusiastic alignment with Japan and America to resist China's regional ambitions. So those, like me, who thought it might be otherwise have been proven wrong.

Hugh White layed out three possible explanations for why President Xi Jinping has 'been so warm and generous' to Prime Minister Abbott, when 'Mr Abbott has so deliberately opposed himself to China's interests and ambitions'.  Malcolm Cook provided a fourth option

Rather I think Option 4 — China's primary motivation for signing the trade deal with Australia is its global (not regional) trade diplomacy strategy aimed at domestic structural reform – is the most compelling. In this case, China is telling the truth when it says its foreign policy is primarily driven by the domestic concerns of a developing, previously centrally planned, economy in rapid transition.

Newly appointed Director of the International Economy Program at the Lowy Institute, Leon Berkelmans, made a compelling argument for treating the new FTA with some scepticism(part 2 of his post is here):

In any case, suppose we take the report at face value. The modelling suggests the agreement will boost GDP growth by 0.04% per year for 10 years. Trend GDP growth is around 3% per year, so 0.04% really does not look like much. In fact, at trend growth, that is how much the economy grows in 5 days. Let me emphasise this point: it is not that the FTA is worth 5 days' worth of output. It is worth the difference between GDP today and GDP in 5 days' time. We should all just calm down a little bit.

President Obama's speech at the University of Queensland on Saturday covered a wide range of topics, including climate change, human rights, the Asia Pacific rebalance and China's economic development. Rory Medcalf with a first impression on the strategic aspects of the speech:

Which brings us to China. Sensibly, Obama's speech today did not directly challenge the legitimacy of the Chinese political system, in the way that his strong words in Canberra did just three years ago ('prosperity without freedom is just another kind of poverty'). 

Still, he did not resile from upholding values of democracy, freedom and human rights – linking them with themes of opportunity, innovation and youth - and pointedly included a reference to Hong Kong alongside Asia's democracies.

In these times when a rules-based liberal global order is under challenge from forces variously of destabilization, disorder, authoritarianism and sheer barbarism, Obama's Brisbane speech may not prove historic, but it has at least held the line. With clarity and conviction about the staying power of democracies, British Prime Minister David Cameron did at least as much in addressing the Australian Parliament yesterday.

Hugh White argued that the speech was tough on China:

However, that matters much less than how the Administration sees Asia and China. Obama spoke more positively than he has done before about China's economic achievement and its significance for the welfare of the people of China, and of course he referred to the deal with Beijing on carbon emission targets. But he more than matched that with a distinctly adversarial tone in describing America's differences with China.

Obama's remarks on climate change have provoked a rare rebuke from Foreign Minister Julie Bishop. Historian James Curran wrote an interesting piece on past breakdowns in the alliance:

The last occasion when there was a serious public rupture in the alliance came with Bill Clinton's refusal to provide American ground troops in East Timor in 1999. Notwithstanding the fact that US logistical, intelligence and diplomatic muscle were crucial ingredients in the success of that mission, both John Howard and Alexander Downer made the point to American leaders at the time that, given Australia's support for the US in various wars over the previous half-century, Canberra could have reasonably expected the participation of a few Marines. Downer's remarks at the time on CNN invited a personal phone call of complaint from then Secretary of State Madeleine Albright.

Mike Callaghan has given his 'tick of approval' to the Brisbane G20 Summit, saying that it produced outcomes that were necessary for the event to be called a success. There was just one hiccup:

If Australia had adopted a more positive approach well in advance of the summit, rather than conveying an impression that it was doing everything possible to avoid the mention of climate change in Brisbane, it could have latched onto the US-China deal on emissions and presented the Brisbane G20 Summit as an important step in building momentum for next year's UNFCC negotiations.

So for all the good work Australia did as G20 chair in 2014 and the substantial outcomes from the Summit, it missed an opportunity for Brisbane to be presented as a major success across all fronts, rather than being overshadowed by the US-China agreement.

It's a pity, because in every other way Australia had a successful G20 year.

In a personal reflection on the feeling in Brisbane during the G20, Hugh Jorgensen provided some colour:

Otherwise, the only really noticeable human activity going on within the vicinity of the Summit site are 6000 sweaty police, a handful of Falun Gong protesters, and a lone monk bearing a placard asking G20 leaders to give peace a chance. I have heard there are a few hundred protesters across the river near City Hall, but as today's mercury moves up to a sweltering 35 degrees, I sympathise with anyone who can think of somewhere better to be that is not in Brisbane's willpower-draining sun.

Danielle Rajendram wrote on Prime Minister Modi's important visit to Australia:

Closer relations with Australia also tie into Modi's broader vision for India's role in East and Southeast Asia. The Modi Government has devoted considerable effort to deepening its partnerships in the region as part of its recently enhanced 'Act East Policy'. Focusing on key partners such as ASEAN, Japan, Vietnam and Australia, the Modi Government has signalled its intention to play a greater role in the region, potentially acting as a counterweight to Chinese influence in the Indo-Pacific. If it is able to carefully manage Chinese sensitivities (no mean feat), cautious Indian engagement has the potential to act as a stabilising force in the region.

Vanessa Newby recalls her friendship with Peter Kassig, the humanitarian worker held hostage and recently beheaded on camera by ISIS:

Peter was never idle. Usually when I saw him he was on the run from A to B delivering medical supplies to whoever needed them. He never had any money of his own; he spent all his resources assisting others. On the odd evening when he did take a break he was to be found in deep conversation with someone about his work or an issue he felt strongly about. He lived out his beliefs with an authenticity that is unusual. Peter was charming, eloquent, intelligent and highly passionate. It was the last trait that got him into trouble.

Finally, Anthony Bubalo wrote a two-part post on the Iranian nuclear negotiation, which is set to reach its deadline on 24 November (part 2 here):

But the thing that clouds judgments about what constitutes a good or a bad deal, the thing that makes this complex technical negotiation even more complicated and makes the atmosphere around the negotiation highly charged, is that for each of the protagonists — the Rouhani Government, its domestic opponents, the Obama Administration and key regional players such as Israel and Saudi Arabia — the talks are a proxy for their broader objectives.


Part 1 of this two-part series here.

I would argue that, for the Obama Administration, a nuclear deal with Iran is central to its recalibration of America's policy and posture in the Middle East. Of course it is not explicitly articulated that way, and for obvious reasons cannot be, but it's not difficult to make the case.

Iranian President Hassan Rouhani, World Economic Forum, 23 January 2014.

Obama's approach to the Middle East can be crudely summed up as 'get out of the wars America is fighting in the region and don't get into any new ones'. By withdrawing American forces from Iraq and Afghanistan, Obama has fulfilled the first part of this policy. The second is evident in the way his Administration has either been extremely limited or exceedingly reluctant in its use of military force in Libya, Syria and now Iraq (although in many ways the rise of Islamic State in Iraq is the most serious challenge to his policy).

This second aspect of the policy has also been articulated quite explicitly by Obama, most notably in his West Point speech, where he set out the kinds of things that the US will do in the Middle East, but also the things it won't.

I think Obama also understands that if the US is going to stop fighting wars in the Middle East, it has to come to terms diplomatically with its most difficult adversary, Iran, on the most challenging issue, the nuclear question. There are two key dimensions to this.

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First, a nuclear deal is the key to ending 35 years of enmity between Iran and the US that has on many occasions flared into serious clashes and military conflict. Of course, a deal won't on its own end that enmity or resolve all the difficulties in the relationship. But in the same way as the Rouhani Government wants to remove the nuclear issue as an obstacle to ending Iran's political and economic isolation (see part 1 of my series), I think Obama wants to remove the nuclear issue as an obstacle to gradually normalising relations with Iran.

But there is another dimension. Both enhanced sanctions, and now the nuclear negotiations, are not just designed to stop Iran from getting the bomb, they are also designed to stop some of America's allies in the region taking unilateral military action against Iran. In particular, what I think Obama fears is that any military strike by Israel will risk drawing America into any subsequent conflict between the two. To a lesser degree, by diminishing the nuclear threat, Obama also reduces the reliance of regional Gulf allies, in particular Saudi Arabia, on US security guarantees. This again helps him recalibrate American policy and posture in the region.

The problem, however, is that a comprehensive nuclear deal (even one that places very strong limits on Iran's ability to build a nuclear weapon) will leave Iran a stronger regional player. Ending Iran's political and economic isolation will allow it to better pursue its regional ambitions and to realise its economic potential. As I said in Part I, this is what the Rouhani Government hopes for. 

But this is precisely what regional adversaries such as Israel and Saudi Arabia (as well as their supporters in the US Congress) fear. This is not to say that they do not fear a nuclear-armed Iran. They do, but they also recognise that the utility of nuclear weapons is limited and that a nuclear-armed Iran would be isolated and sanctioned, and would bring even stronger regional security guarantees from the US. 

The Israeli and Saudi preference, therefore, is to see Iran sanctioned and contained. As I argued in part 1, even if a nuclear deal leaves Iran less isolated and more influential in the region and internationally, I think over time, the end of its economic isolation will pose a more direct threat to the regime and to the interests of hardliners than the current sanctions regime. But for those regional countries like Israel and Saudi Arabia with justified fears about what a more powerful Iran means for their interests and the security of their citizens, this is unlikely to prove reassuring.

What this means is that if we do get a nuclear deal next Monday, or more likely, an extension of the current negotiations, there is going to need to be an effort to address these broader concerns as well. The Rouhani Government and the Obama Administration are right that the nuclear issue needs to be addressed first. But it should only be seen as a first step in building a more stable and less conflict-prone region.

Photo courtesy of Flickr user World Economic Forum.


Thanks to Hugh White for responding to my post on the China-Australia free trade agreement (FTA). Hugh lays out three options for interpreting China's decision to go ahead with the FTA despite the Abbott Government's pro-Japan and pro-US stances. I am not an Option 1 believer ('Beijing doesn't really care much about these strategic/political issues, and their importance is outweighed by the economic value to China of the FTA and the diplomatic value of a warmer relationship with Australia'), as Hugh suggests.

Rather I think Option 4 — China's primary motivation for signing the trade deal with Australia is its global (not regional) trade diplomacy strategy aimed at domestic structural reform – is the most compelling. In this case, China is telling the truth when it says its foreign policy is primarily driven by the domestic concerns of a developing, previously centrally planned, economy in rapid transition.

Australia is the fourth developed economy to sign a preferential trade deal with China in 2014, following after Iceland, Switzerland and South Korea. More are on the way. These four were preceded by deals with Singapore, New Zealand, Hong Kong and Taiwan. Not only is China under Xi Jinping increasing the number of trade deals with advanced economies, the scope of these deals, as we can see with the Australian and Korean FTAs, is increasing.

For me, the China-Australia deal is motivated more by China's global trade diplomacy aimed at domestic economic goals than it is by the regional strategic order in East Asia and Australia's perceived position in this order in relation to China and the US. I imagine the same is true for Australia as well.

If Option 4 is the best explanation, this is a good sign for the regional security order and a strong caution against over-interpreting the scope and effect of regional strategic competition. If the Abbott Government is an Option 4 follower, then the China-Australia trade deal is even more of a coup than advertised, and is the sign of a mature, not adolescent, Australia in Asia.

Photo by Flickr user gp1974.


Why would a prime minister with a two-thirds majority in the lower house of parliament go to the polls two years early? While Abe's Liberal Democratic Party (LDP) is experiencing a slump in the polls at present, it is two years away from having to front the electorate if the normal electoral cycle is followed. If we scratch the surface it is not difficult to find reasons why Abe has taken this extraordinary step. But what really needs explaining is why Abe is risking so much in the process.

Abe's justification for the snap election is to seek a mandate to delay a planned increase in the consumption tax from 8% to 10%, originally scheduled for October 2015. This is a flimsy excuse indeed, given the LDP's overwhelming majority in both houses of parliament. The Government can revisit the consumption tax legislation and get it through whenever it pleases.

The real incentive for Abe here is to placate the party's rank and file, for whom the April 2015 round of local elections across the country loom large. Japan has just officially gone into recession, voters in the regions have not seen the benefits of the quantitative-easing aspect of Abenomics, and their wages are not keeping pace with inflation. When asked if they want to delay the planned tax increase, most voters will yelp 'YES' in response.

There is self-interest at play also. Abe is scheduled to face his own party in September 2015 in the election for the presidency of the ruling LDP. With an electoral slump in April, Abe could easily be blamed for diminishing the LDP's fortunes through the failure of Abenomics, the policy that bears his name. Abe could be tossed out as prime minister if he is not returned to the presidency of the party.

From this perspective then, the December election starts to look like a self-serving attempt to provide a democratic sheen to what is essentially a spot of internal party trouble.

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We can also see that, by interrupting the electoral cycle, the LDP will avoid confronting a hostile electorate in both houses of parliament in the same year (2016), thus limiting the fallout should the economy remain flat.

Cynics will point to the fact that the LDP under Abe is clever to time this election for December, because it is difficult to recall a time when the opposition parties have been in greater disarray than they are at present. But this where the spectre of political risk enters the picture.

With several small opposition parties locked in self-defeating hostilities against each other, the LDP is literally the only political force capable of winning power in its own right. But there is another political entity that needs to be taken into account – the non-aligned voter. The LDP is sitting on only 41% approval ratings; 38% of the country supports no party.

So the real contest in December is not between the LDP and the rest but between the LDP and no-one. Voters can express their democratic dismay at the lack of a viable choice by simply staying away from the polling booth. If less than 50% of the electorate turns out to vote, Abe's resort to the fig leaf of democracy will be exposed.

Moreover, he may lose his precious two-thirds majority in the lower house, now that the electorate is really able to react to the policy agenda that has only been revealed after the last poll in 2012. The post-electoral moves by the Abe cabinet to reinterpret the pacifist clause of the constitution to allow for collective self-defence, and his determination to re-start Japan's nuclear power generators, will now receive the electoral scrutiny they deserve.

Abe wants to claim a mandate for Abenomics before economic policy failures become too entrenched by asking voters to answer an easy question: do you want to delay a tax increase? But voters may flex their democratic muscles in quite another way, slicing the LDP's majority and undermining the very notion of a mandate, by staying at home on election day. This is the political risk Abe has chosen to face off against in December. And it is a huge risk, given that this is an election Japan simply did not have to have.


Next Monday, 24 November, we will know whether months of talks over Iran's nuclear program will end in a comprehensive deal, a comprehensive failure or an agreement to keep negotiating. 

Iranian Foreign Minister Zarif Stand. Baroness Catherine Ashton and US Secretary of State John Kerry, 20 November 2014.

The talks have generated great heat in Iran, in the Middle East and in key international capitals, mainly because Tehran and Washington have never been closer to an agreement (strictly speaking it's a negotiation between Iran and the five permanent members of the Security Council plus Germany, but who are we kidding?). 

If there is one thing that both proponents and opponents of a deal would agree upon privately, it is that the negotiation is not really about Iran's ability to produce nuclear weapons.

Don't get me wrong. At the core of the talks is a highly technical negotiation designed to do three things: (1) prevent Iran from using its nuclear knowledge and technology to build a weapon, primarily by placing limits on its ability to produce fissile material; (2) put in place an intrusive inspection regime to ensure that if Iran does try to make a bomb, the international community would quickly know about it; and (3) establish a sanctions mechanism that both rewards compliance but also has the capacity to quickly punish Iran if it is found to be cheating.

But the thing that clouds judgments about what constitutes a good or a bad deal, the thing that makes this complex technical negotiation even more complicated and makes the atmosphere around the negotiation highly charged, is that for each of the protagonists — the Rouhani Government, its domestic opponents, the Obama Administration and key regional players such as Israel and Saudi Arabia — the talks are a proxy for their broader objectives.

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It is these broader objectives that make the protagonists variously more or less willing to compromise on the nuclear issue. And it is these broader objectives that lead opponents of a deal to charge that the proponents are willing to trade anything to get an agreement, and in turn for proponents to argue that there is no deal that would satisfy opponents.

So what are these broader objectives? Let's start with the Rouhani Government and its opposition within Iran. Rouhani is neither a moderate nor a reformist. His goal is not to change the Iranian regime but to strengthen it. What distinguishes him from his internal opponents is his belief that the best way to do that is by striking a nuclear deal. 

I was in Tehran a few weeks ago attending a workshop organised by the European Council on Foreign Relations and the Institute for Political and International Studies (the think tank of the Iranian Foreign Ministry). The workshop included a long session with the Iranian Foreign Minister, Mohammed Javad Zarif. Two things were evident.

On the one hand, Iran is confident about its position in the region. In particular, it feels that has the upper hand in their long running power struggle with Saudi Arabia. The Saudis have failed in their efforts to dislodge Tehran's key ally Bashar al-Assad in Syria. Meanwhile in Saudi Arabia's backyard, Yemen, Houthi rebels, seen by many as aligned with Iran, have seized the capital. Even the rise of Islamic State in Iraq, while presenting some immediate challenges for Tehran, has played into Iranian hands. Suddenly the international focus is less on the brutality of the Syrian regime and more on Islamic State. Meanwhile, Iran can portray itself as a bulwark against jihadist extremism in Iraq.

On the other hand, there was a strong sense of frustration that despite its strategic ascendancy, Iran remained politically isolated and economically vulnerable. At the workshop it was noted with strong disdain the way that Iran had been left out of the Geneva talks on Syria last year and the Paris talks on the rise of Islamic State in Iraq this year. This is not just a practical matter for Iranians, it is also a question of pride – a sense that Iran is not being accorded its due deference in the region. 

Likewise, Iran's strategic ascendancy obscures a great economic vulnerability. The limited sanctions relief that has already occurred as a part of the interim agreement, combined with better economic management by the Rouhani Government, has improved the economic situation in Iran, particularly with respect to inflation. But this improvement, and the renewed economic confidence that has come with it, is fragile and susceptible to a breakdown in the nuclear negotiation. You sense that for the Rouhani Government, the nuclear talks are not just about staving off future socioeconomic causes of unrest, it's about realising Iran's full potential – something that won't happen while Iran remains economically isolated.

I have no doubt that the Rouhani Government is bargaining very hard to protect Iran's nuclear program. But it also sees the nuclear issue as a stick that has been used to beat Iran down and keep it isolated. In its view, taking that stick out of the hands of its adversaries is key to both Iran's future and the regime's longevity.

I think for this reason Rouhani has been able to convince Supreme Leader Khamenei to give him the leeway to negotiate. Convincing him to sign off on a deal will be more difficult, however, given that the Leader is more naturally predisposed to the views of those opposing an agreement.

The Iranian domestic opponents of a deal do not form a coherent group, nor do they have a single motive. I am sure there are some within the regime who want to preserve and even enhance Iran's ability to produce a nuclear weapon should the regime take the decision to do so (and most analysts assume it has not, so far).

But there are two other groups, sometimes overlapping, that are also opposed to a deal for different reasons. First, there are those within the regime who are ideologically opposed to a deal. They tap into a deep vein of distrust of the outside world in Iran (and not just in the regime) that is sceptical of any promise to deliver real sanctions relief in return for deep Iranian concessions on its nuclear program. There are also those who believe that the regime cannot ultimately survive without preserving its ideological enmity to the US in particular, and the West in general. In this view, ending that enmity would remove a key reason for the regime's unity and existence.

In recent years this ideological enmity has, however, overlapped with a more practical opposition to any deal with the US. Parts of the regime have made enormous amounts of money as a result of sanctions. They have done this by either running sanctions-busting schemes or by filling the economic vacuum left by international companies unable to do business in Iran. The expanded role of Revolutionary Guard commercial entities in the economy is one example.

So for ideological and economic opponents, a nuclear deal represents a threat to the regime and in some cases to their personal economic interest. As a matter of fact I think the hardliners are right. In an isolated Iran, the regime and regime hardliners hold all the security cards and increasingly the economic ones as well. A less isolated Iran will empower new economic interest and actors outside the regime. 

In Part II of this post I will look at the broader factors driving external proponents and opponents of a deal.

Photo courtesy of Flickr user U.S. Department of State.


It's been a long time since an Australian foreign minister publicly pushed back against a US president. Julie Bishop did just that in her interview from New York last night on the ABC.

The last occasion when there was a serious public rupture in the alliance came with Bill Clinton's refusal to provide American ground troops in East Timor in 1999. Notwithstanding the fact that US logistical, intelligence and diplomatic muscle were crucial ingredients in the success of that mission, both John Howard and Alexander Downer made the point to American leaders at the time that, given Australia's support for the US in various wars over the previous half-century, Canberra could have reasonably expected the participation of a few Marines. Downer's remarks at the time on CNN invited a personal phone call of complaint from then Secretary of State Madeleine Albright.

But Bishop's language on ABC 7:30 was careful, moderate, and symptomatic of the approach the Abbott Government is taking in reaction to the President's speech in Brisbane. There's been no public retort from the Prime Minister. No fire-breathing fulmination from government ministers, though Joe Hockey and Jamie Briggs certainly let off some steam earlier in the week. And Bishop was quick to repudiate any link between the President's speech and the Government's decision not to increase its contribution in the Middle East. The optics of this were potentially awkward.

Bishop's cautious reminder of what state and federal governments have been doing to protect and preserve the Barrier Reef is probably as much as we will hear from the Government on how it really feels about Obama's remarks on climate change in Brisbane. The rest will no doubt be made clear behind closed doors.

For over a century, Australian governments of both political persuasions have mostly chosen not to air in public the dirty laundry of their differences with the great powers.

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Nothing is to be gained from an open slanging match. Billy McMahon tried that in 1971 after President Nixon failed to consult him about his dramatic change on China policy. McMahon, enraged at being ignored by Washington and hopelessly flatfooted on account of Whitlam's successful visit to Beijing as opposition leader, resorted to ridiculing Nixon in a speech to an American-Australian Association Dinner in July that year. So shocking were the PM's public words about the President on that occasion that many in the audience thought McMahon was drunk.

Obama's words in Brisbane were certainly provocative. It is doubtful that either the State Department or the US Embassy in Canberra would have cleared them. This was a White House effort. It showed dramatically the difference between the US and Australian positions on climate change.

There are of course potential flaws in the US-China climate deal. A badly weakened president at home, Obama will struggle to gain congressional approval for his Green Climate Fund. And there is certainly no guarantee that next year's summit in Paris – the city of light, no less! – will produce a global deal that is either binding or enforceable. It is entirely conceivable that the Chinese will scupper that deal as they did Copenhagen. And in Australia, the domestic politics of climate change remain treacherous terrain for Labor. It would be utter folly for Opposition Leader Bill Shorten to think that momentum is now swinging back Labor's way on this issue.

It is difficult, however, to think of a precedent where an American president has intervened in Australian domestic politics quite like this.

LBJ certainly made life uncomfortable for Labor Opposition leader Arthur Calwell during his visit here in October 1966, but Calwell had publicly provoked Johnson at the parliamentary welcome by reminding the President of those Democrats back in Washington – Morse, Mansfield and Bobby Kennedy – who opposed the Vietnam war. It didn't matter that Calwell finished his speech by reciting verbatim the Gettysburg address. Johnson duly poured a bucket of rhetorical grief all over Calwell. Recall too that George W Bush publicly referred to the 'disaster' of a possible Latham victory at the 2004 election, and that Howard believed Obama's win in 2008 would be a victory for the terrorists.

Imagine if Ronald Reagan had visited Australia in the mid 1980s and given a major speech on why US allies should support his SDI (or 'Star Wars') missile defence program, or indeed the testing of the MX Missile. On both issues the Hawke Government ultimately decided not to lend its support to Washington – though in the case of the MX Missile a rancorous Labor Left forced Hawke into backing down on his previous commitment to allow the use of Australian airfields by US aircraft to monitor the weapon's splashdown. But if Reagan had visited Australia and given such a speech, Hawke would have been justifiably furious, especially given that his political opponents, Andrew Peacock and John Howard, were strongly backing the US over its MX testing.

In private, however, American rebukes to Australia have been much sharper – and a good deal more significant – than Obama's comments last weekend.

The remarks in Brisbane were certainly not as embarrassing for Australia as when President Eisenhower took a different stance to Australia over the Suez crisis in 1956. Nor as ruthless as those by John F Kennedy to the Australian foreign minister in October 1963, when Kennedy told Garfield Barwick that the American people had 'forgotten ANZUS' and that US support for any Australian military action against the Indonesians in Borneo would be negligible.

Nor were they as infuriating to Australia as Nixon's decisions not to warn the governments of John Gorton and Billy McMahon about troop withdrawals from Vietnam and the enunciation of the Nixon doctrine in 1969. Or as stinging as Nixon and Kissinger's telephone conversation in late December 1972, when they dismissed Whitlam as a 'peacenik'.

But Obama's speech reminds us that, in an unprecedented era of bipartisan consensus on the alliance, the two countries cannot expect to see eye to eye on all issues. That is unrealistic. And, clearly, Australia's loyalty as an ally does not mean it will necessarily receive special treatment. That, perhaps, is the more salient lesson from this week. The President's speech in Brisbane shows that the alliance, strong as it is, will from time to time inevitably face the dilemmas of divergence. The test is how each side responds in these moments. The history shows that both countries have been able to manage those differences within the alliance.

Photo courtesy of Flickr user G20 Australia 2014.

  • The big news this week was Modi's visit to Australia, the first of any Indian prime minister in 28 years. The Age has an editorial on the new maturity in Australia-India ties, Pradeep Taneja looks at what the visit means for the broader bilateral relationship and P Vaidyanathan Iyer argues that the Australia-India Security Framework reveals a lot about Canberra's strategic choices in the face of a rising China.
  • How Modi's trip to Myanmar for the India-ASEAN and East Asia summits presented an opportunity to rebuild historic connections.
  • Why is India doing better than most emerging markets?
  • The 2014 Global Slavery Index was released this week, revealing India has the highest number of slaves in the world, though it ranks fifth in terms of a percentage per capita.
  • Rajiv Kumar looks at what Modi must do at home to meet the global expectations for his Government.
  • What happened when Jokowi and Modi met in Myanmar?
  • Abhijit Singh looks at the emerging Australia-India maritime relationship.
  • On the 86th anniversary of Mickey and Minnie Mouse's TV debut, Disney has sent Mickey on an auto-rickshaw journey across India:


Last week's summitry in Myanmar was full of media soundbites and photo ops but the policy scorecard was won by Beijing.

During a period of US weakness (with Obama suffering at the midterms and many in the region doubting his Administration's ability to fulfill the great Asia Pivot promise), China asserted itself in Myanmar. 

Beijing came offering some $20 billion in development loans for Southeast Asian states. It also proposed a friendship treaty with ASEAN as well as continuing its favoured bilateral approach in signing $7.8 billion in deals with Myanmar and, in the days leading to the summit, between $500-700 million annually in development loans to Cambodia

As China doled out the cash, Obama was left wanting. It seemed to fall to his personal charisma and popularity in the region to carry America's load. 'I have a very close association with Indonesia having spent a good deal of my childhood there', he reminded his counterparts during a meeting with Joko Widodo. His mantle as America's most Asia-focused president is often recalled in the region. But harder policy (a US-ASEAN Summit Fact Sheet is here) on this trip went missing. Read More

Obama wooed an admiring audience of young Southeast Asian leaders in a town hall meeting in Myanmar. After strong support of her struggle for the presidency, Obama shared an affectionate if awkward hug with Aung San Suu Kyi during their press conference. In that conference, she noted that the country's reform process is going through a 'bumpy patch' but that it could be overcome. Post summit, that 'bump' came for her with the speaker of the lower house this week categorically stating that there would be no changes to the constitution, thus barring Aung San Suu Kyi from contesting the presidency. The US may be caught backing a scratched horse in next year's election and souring other relationships.

On the economic front, while China's Asia Infrastructure Investment Bank and other development loans have made headlines, few others have made progress.

As RSIS's Yang Razali Kassim wrote last week, China has recently out-manoeuvered the US for the mantle of Asia Pacific economic leadership. The APEC Summit showed as much, as did Southeast Asian support for the AIIB. Obama left the long week of summitry in the region (including the G20 and APEC) without the desired progress on the TPP. Only a handful of ASEAN states are involved in TPP negotiations due largely to the high threshold of trade liberalisation required.

Despite some trademark Obama charm diplomacy in Myanmar, the fact remains that his promises have been long in materialising. While his ambitions of an Asian-focused presidency are still well received, they lack the bite they once had. And for Southeast Asian states, relations with the US are easier to mend than with China. After all, Obama is an outgoing president with a couple of years left; Xi's tenure will hold long into next decade.

The rounds of summitry in Myanmar seemed to reflect this reality. Indeed, as Thein Sein noted in his Chairman's statement, Southeast Asia is undergoing a period of 'rapidly changing regional and international dynamics'. Last week signaled that China is steering this change.

Photo by REUTERS/Soe Zayan Tun.


As you can see above, the video of the 2014 Lowy Lecture, delivered on Monday by Angela Merkel, is now available, and I encourage you to take a look, particularly since her tough remarks on Russia are making news back in Europe.

But I want to emphasise one moment in the video to expand on a point I made in my summary of Merkel's speech on Monday afternoon — that Merkel seems to be on the cusp of a rare type of global political celebrity but is reluctant to grasp it. Of course, she is the Chancellor of Germany and she regularly appears in various power lists, so its no surprise that she is a prominent figure. But my sense (and that's all it is; no science here) is that she has developed a personal popularity which she has chosen not to encourage or exploit.

It seems to me that, were Merkel to embrace this opportunity, it could raise her country's standing in world affairs to something unprecedented in the post-war era. For instance, is it really so far-fetched to imagine Merkel taking the leading role in international climate-change negotiations? Her country has diplomatic heft and green-energy credentials. And, if I'm right, Merkel herself has the personal profile to give such an initiative real stature.

But at the very end of the video (1:04:02) there is a moment which encapsulates Merkel's reluctance to take on the global stateswoman role. Lowy Institute Executive Director Michael Fullilove closes proceedings by remarking that 'Henry Kissinger once asked "If I want to call Europe, who do I call?" After today's lecture, I would say the answer is Angela Merkel'.

Now, you can't see it in the video because it goes to a wide shot at that moment, but I was sitting in the front row facing Merkel, and I thought I saw her draw back slightly when she heard that.

Just to reinforce this point, here's a Twitter exchange between Michael Fullilove and one of Europe's leading strategic thinkers, Francois Heisbourg:

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Of course there are good reasons why it is difficult for Merkel to embrace the global stateswoman role, even if she wanted to. The French, for instance, would resist it because it would, by implication, demote France's standing in world affairs. And such open German leadership would also erode the sense of collective decision-making that other European states value, and which Merkel herself promoted in her speech.

But this raises a historical irony. As we have discussed on The Interpreter recently, and as Merkel herself said in the Lowy Lecture, the post-war European integration project is predicated on the 'never again' philosophy: never again would Europe descend into great-power rivalry, militarism and German aggression. A united Europe represented a clean break from European history.

Yet if I am right about Merkel's global stature and the possibility that her leadership and activism on key global issues could elevate Germany's standing as a responsible and constructive global power, then we have to say that the weight of history is actually still holding Germany down. For it is the European project that prevents Germany from embracing that global role.


By Anna Kirk, an intern in the Lowy Institute's Melanesia program.


Thirty years ago to the week, New Caledonia was torn apart by violent protests. The pro-independence FLNKS boycotted an election and town halls were burned throughout the country. It provoked a four-year long civil war euphemistically known as 'the events'.

At first, Australia supported the Kanak independence movement diplomatically. But Foreign Minister Hayden warned on 19 November 1984 that violent tactics would cost the Kanaks Australia's 'immense sympathy'. This sympathy dissipated when the FLNKS began to train its militants in Gaddafi's Libya.

Thirty years later, New Caledonia is an almost invisible blip on Australia's strategic radar. Aside from the thorough coverage of local politics by several experts, our policy towards this fragile neighbour appears to be one of 'benevolent disregard', as Denise Fisher brilliantly put it.

This is not good news for local peace and security. Tensions are flaring on this island of past grievances and hot tempers. A Kanak leader earlier this week told his militants that 'we are going to organise ourselves, and fight.' At a time when the country has seen the most serious political violence in decades, it is anyone's guess whether this fighting talk will remain rhetorical.

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There are serious reasons to worry that the country could once again descend into violence, a development Australia cannot neglect.

In a country as polarised and heavily armed as New Caledonia, any outside diplomatic interventions ought to follow the 'Do No Harm' principle. This may be why Canberra has been so cautious in not siding with either party. This is an excellent starting point for our policy towards New Caledonia.

French President François Hollande, who met Prime Minister Abbott on Tuesday, visited New Caledonia after the G20. Although some hardliners (on both sides) hoped his Government would pick a side, Hollande was crystal clear that France's role would be one of strict impartiality. He vowed to maintain law and order and to support the will of New Caledonia's population, as expressed at future self-determination referendums (by 2018 at the latest). 

Canberra should follow in those footsteps by adopting an impartial standpoint. That said, I would advocate Australia adopting a more assertive impartiality.

As Nic Maclellan has argued, the 'belief in Canberra that New Caledonia's Nouméa Accord process will run smoothly to its conclusion needs to be tested, rather than just assumed as the basis for policy-making.' Canberra should ask some hard questions about this assumption.

Firstly, what can Australia do to prevent armed violence in New Caledonia? Some Kanak independence leaders are already contesting the legitimacy of future referendums due to issues relating to the electoral roll, and are expressing the intention to negotiate their independence bilaterally with the French Government if (as is expected) they lose at the ballot box. The local pro-French majority will not lie down and accept this, so it could could spell a return to the nasty and violent days of November 1984. 

Australian diplomats and policy-makers ought to begin thinking right now about how to prevent such a scenario. How, while remaining strictly impartial, can Australia help to prevent violence in our neighbouring country?

The second question is the toughest: what is Australia's Plan B? It would be better that locals sort this conflict out peacefully rather than requiring a billion-dollar peace enforcement mission which would drag Australia into a dangerous conflict (not that France would want such an intervention). Still, it's worth pondering a back-up plan if Plan A fails.

Finally, what are Australia's strategic interests in New Caledonia? One Australian miner I spoke to warned me that he thought instability was on the cards and that international capital flight would ensue. I hope he's wrong. But this does raise the question of how Australia can guarantee its mining interests in New Caledonia if the local political climate deteriorates. Australia's strategic policy should be guided by the commitment – as in Fiji – to see a peaceful and democratic transition of power, and to avoid the recourse to force or coups, which could destabilise the South Pacific region.

I don't have any answers at this stage, only questions which are worth pondering in Canberra.

The single policy recommendation I would make is that the Australian Consulate-General in Noumea could play a greater public diplomacy role by reaffirming Australia's commitment to supporting a peaceful and democratic power transition in New Caledonia. This should not offend the French, since Hollande is on the same wavelength as Australian policy. But it could contribute to strengthening the hands of peace-makers locally, and ensuring that no Plan B is ever necessary.

Photo courtesy of Flickr user sebastien panouille.


As Malcolm Cook says, this week's events show that Tony Abbott's strategic policies in Asia have not got in the way of his economic agenda. Mr Abbott has won his free trade agreement with China despite his enthusiastic alignment with Japan and America to resist China's regional ambitions.

So those, like me, who thought it might be otherwise have been proven wrong. When that happens it is a good idea to ask oneself why. Why has President Xi been so warm and generous to Mr Abbott when Mr Abbott has so deliberately opposed himself to China's interests and ambitions? There seem to be three possible explanations:

  1. Beijing doesn't really care much about these strategic/political issues, and their importance is outweighed by the economic value to China of the FTA and the diplomatic value of a warmer relationship with Australia.
  2. Beijing does care deeply about the strategic/political questions, but doesn't think Australia's views matter, so it is willing to ignore what Mr Abbott says on these subjects.
  3. Beijing does care deeply about these issues and does think Australia's views matter, but it decided carrots will work better than sticks. China's leaders may have calculated that the best way to change Mr Abbott's mind and bring Australia closer to China's views would be to offer soothing words and lavish gifts.

Which of these best explains what has happened this week? The Government probably believes it is option 1, and many others will agree. The consensus in Canberra remains that China is not really serious about challenging the US-led order in Asia, because for Beijing the economy always comes first. Hence Xi has been willing to overlook Abbott's strategic policies in pursuit of an economic win for China.

The problem with this explanation is that everything China has said and done in recent years shows that it is very serious about building a new strategic order in Asia. China's ambitions were absolutely clear from Xi's speech to parliament on Monday. It was equally clear from President Obama's speech in Brisbane that he takes China's challenge to the regional order very seriously indeed. That is exactly what his speech aimed to warn us about, in unusually stark terms.

Others too think the same. Mr Cameron's speech to parliament last week, and Mr Modi's yesterday, made plain their concerns about the strength of China's ambitions, and so did Mr Abe's address back in May. Only in Canberra does a consensus still prevail that China is not strongly committed to driving major change to the Asian order. The weight of evidence is strongly the other way, and that makes option 1 look implausible, especially as the economic benefits to China of the FTA are hardly transformational.

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What about option 2? For all the recent boasting about Australia coming out as a big regional player, it is possible that some people, even in the Government, still half-believe that what we say on these big issues doesn't really matter to the main players. A reflection perhaps of the 'adolescence' in our approach to foreign policy that Peter Hartcher has recently described.

But on this issue, at least, we should be in no doubt: Australia seems to have acquired quite a prominent place in regional power politics, as shown by the way Obama, Xi, Modi and Abe have all come here to deliver big geopolitical speeches. It would be unwise to believe that the Chinese do not care about Australia's position on Asia's great strategic questions.

That leaves option 3 as the most credible explanation for what has happened. If that is right, Mr Xi and his colleagues are very serious about their strategic ambitions, and do care what Australia thinks. But they concluded that it would be easy to bring us around to their point of view by offering an FTA and some reassuring words.

If that is what they thought then they seem to have been proved right – at least for now. To judge from what Mr Abbott said this week, and from the response of many of our leading commentators, Australia has taken a long step away from the policies he and they have articulated until now, and towards accepting and endorsing Mr Xi's vision of Asia's future under Chinese leadership. This is just what Mr Obama seems to have feared would happen.

But do the Chinese imagine that Mr Abbott's new-found enthusiasm for their vision of Asia will last for long? If so, they will be disappointed. He already took a step away from it in his exchanges with Mr Modi yesterday. What will he say next time he goes to Washington or Tokyo?

So where do we go from here? On the basis of this week's performance, Malcolm and others seem to think Mr Abbott has created a clear and sustainable basis for Australia's relations with China and our position in the power politics of Asia. I'm not so sure.


The Indo-Pacific is a strategic system encompassing the Indian and Pacific oceans, reflecting the expanding interests and reach of China and India as well as the enduring role of the US. The Lowy Institute's International Security program presents a weekly selection of links illuminating the changing security picture in this increasingly connected super-region.

  • Despite initial hopes, the atmospherics of the recent APEC meeting between Japanese Prime Minister Shinzo Abe and Chinese President Xi Jinping have left some with little optimism for the future.
  • Indian Prime Minister Narendra Modi's visit to Australia resulted in a successful public reception and the conclusion of a new India-Australia framework for security cooperation.
  • Elsewhere, Rory Medcalf argues that the G20 summit and speeches by the leaders of the region's most consequential states marks Australia's coming-of-age as a 'core Indo-Pacific power.'
  • On the sidelines of the G20, the US, Australia and Japan have agreed to deepen cooperation on maritime security and commitment to the peaceful resolution of territorial disputes.
  • Greg Sheridan has argued that US President Barack Obama deliberately sought to politically damage Prime Minister Tony Abbott through his remarks on climate change.
  • The influential US House Armed Services Committee has selected its newest chairman, Republican Representative Mac Thornberry. The move follows the overwhelming Republican victory at the 2014 midterm election earlier this month.
  • A meeting between Chinese Premier Li Keqiang and Russian Defence Minister Sergei Shoigu in Bejing resulted in an announcement that the two countries will strengthen their military cooperation in the Asia Pacific.
  • North Korea has threatened to conduct more nuclear weapons tests in response to a recent UN resolution that recommends its leaders face prosecution for crimes against humanity. 

The Lowy Institute International Security Program's work on Indo-Pacific security is supported by two grants from the John D and Catherine T MacArthur Foundation.


Japan goes to the polls on 14 December on a very odd pretext. Prime Minister Abe, in calling an election yesterday, justified dissolving the lower house only half way into his four-year term on the grounds that he needed a mandate to defer raising the consumption tax from 8% to 10% in October 2015. The scheduled tax rise was legislated by the former DPJ-led government of Yoshihiko Noda. Abe again stated last night on NHK's much watched 9pm news service that the DPJ Government had failed badly because it had not included the consumption tax plan in the manifesto it was elected on.

In essence, Abe is arguing that he needs an election mandate to defer a tax rise that did not have a public mandate in the first place.

Even more strangely, all the main political actors, including the DPJ, agree with deferring the consumption tax rise. Opposition to deferral emanated primarily from fiscal conservatives within the LDP itself, such as party secretary-general Sadakazu Tanigaki, and from some academic advisers. The LDP holds a majority in both houses of the Diet and can enact legislative change without taking the issue issue to an election. Moreover, when the DPJ legislated for a timetable of consumption tax rises, it incorporated provisions in an annex to the bill that foreshadowed deferral of the rise if economic circumstances were unfavourable.

As indeed they are now. The LDP's snap election strategy, much leaked and publicly discussed over the last week, has been sideswiped by unexpectedly bad economic data. Abe found himself on Tuesday night calling an election just a day after new statistics had Japan officially in recession. The July-September quarterly data, contrary to market expectations of around a 2% rise, came in at a dismal annualised minus 1.6%.

So why an election now?

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Two ministerial resignations soon after Abe's August ministerial reshuffle, which was supposed to offer a fresh line up to carry his government for at least another year, is apparently a factor. The LDP also has precedents for successful early elections, including Yasuhiro Nakasone's strong victory in June 1986 and Junichiro Koizumi in August 2005. Moreover, former PM Taro Aso, now deputy leader and finance minister, is widely thought to have waited too long in going to the polls in 2009, compounding the scale of the LDP's defeat. In short, things can only get worse. According to one well-placed insider, LDP leaders expect to lose about 20 seats on 14 December.

Oppositional politics is fragmented. The DPJ has reasonable leadership under Banri Kaeda but remains severely weakened by the scale of its November 2012 defeat and the earlier divisions that saw the departure of Ichiro Ozawa and his 50-odd supporters. The main threat to Abe's LDP would come from effective coordination on electoral strategy between the DPJ and Your Party (Minna no Tou). Yet the latter is hampered by leadership divisions, as the popular Yoshimi Watanabe stepped down from the leadership in April during an investigation of a personal loan received from the chairman of a cosmetics company to cover personal debts.

The various opposition parties offer numerous but divided voices critical of the Government. Each will struggle for attention as the campaign develops. The LDP meanwhile benefits from support from Keidanren, a peak business organisation which has renewed political donations to the party and is supportive of Abenomics, and from effective media management and grassroots organisation.

Yet Abe might find he is fighting the election on rather more issues than he hopes.

Many Japanese have not forgotten the policy decisions he pushed through, such as constitutional reinterpretation of Article 9 to allow collective security, and a new national secrecy law. These were major policy developments that ran against the grain of postwar political culture and which he did not articulate clearly to the electorate in the November 2012 campaign, nor in the upper house election in July 2013.

It is no surprise then that opposition politicians and critics are declaring this to be a diet dissolution without a pretext, and mocking Abe's tangled logic on needing a mandate to reschedule a consumption tax rise, a policy move that has broad political support anyway.

The most optimistic explanation for Abe's snap election move is that he wants a full four-year term to pursue seriously the so-called 'third arrow' of Abenomics: radical economic reform. There are tentative signs that he is prepared to push major changes upon traditional LDP-supporting sectors such as agriculture (the powerful agricultural cooperatives will lose their exemption from anti-monopolies law, although Abe has retreated from a more radical plan to break them up). With President Obama facing a Republican-controlled Congress, he and a re-elected Abe might be able to lead TPP negotiations to a clean agreement.

These are some of the hopes and fears that will animate electoral politics in Japan between now and 14 December. The money is obviously on the LDP, due to its fund-raising ability and capacity to get out the vote in a country when many are too alienated from politics to bother to vote. Yet Abe may yet find his margin of dominance shaved closer than LDP strategists imagined when they decided to dash to an early election.

Photo by Flickr user James Hadfield.