Lowy Institute

The US presidential campaign continued to dominate news this week, with Senator Bernie Sanders and Donald Trump winning the Democratic and Republican primaries in New Hampshire. The Interpreter carried several articles on the results, but Emma Connors concentrated on the question of whether Michael Bloomberg would run: 

How would a Bloomberg run affect the race? If you look at the polling available, you'd have to say the results are inconclusive. A Bloomberg Politics Des Moines Register poll of Iowa voters a few weeks ago found half of Republican caucus-goers didn't like him, or in pollster speak, had an unfavourable view. That fell to 26% among Democrat caucus goers  but only  17% indicated they liked the man. A nationwide poll conducted by well known pollster Frank Luntz, however, concluded 29% of Americans would support Bloomberg in a theoretical three-way race between the former mayor, Donald Trump, and Democratic front-runner Hillary Clinton.

Turning to another topic to do with America, Stephen Grenville reviewed a recent book by Robert Gordon, The Rise and Fall of American Growth:

Let's not be too glum. Maybe it is time for those of us in the mature economies to accept that we are already producing enough things and switch focus onto correcting income distribution (one of Gordon's 'headwinds'), making sure everyone gets a good education (another 'headwind') and putting less strain on nature and the climate. But the adaptation to diminished expectations will not be easy, especially at the political level. There are some big implications for foreign relations as well.

Michael Fullilove has written a two-part series on his trip to Cuba:

By chance, I was staying in the room next to his. The advantage of this situation was a nice view eastwards towards Plaza de Armas (the best place in town to buy revolutionary kitsch) and Morro Castle, the Spanish-era fort that guards the entrance to Havana harbour. This is the same view Hemingway enjoyed while he wrote several of his novels. The disadvantage was the crowd of foreign tourists always to be found lingering outside my door waiting for a tour of Hemingway's room. They always seemed disappointed when I emerged into the corridor, rather than Papa.

A stunning response to a Washington Post editorial from Aaron Connelly:

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The Post's objection to the inclusion of leaders from undemocratic countries in the region overlooks ASEAN's importance, and by extension, the importance of institutions in American diplomacy. Beijing may see the region's future as merely a contest of economic and military power. Washington, for whom the institutions of the liberal international order are of critical importance, should not. It is not enough to trade, invest, and send military assistance to Southeast Asian countries. It is essential that we also support the institutions that bolster their autonomy, and thus the liberal order.

Peter Layton wrote on air superiority in Asia and the RAAF's aging classic F-18 Hornets:

[fold]

Meanwhile in 2020, two-thirds of the RAAF's fighters will still be the 1980s classic Hornets. This was not as originally intended. The last of these should have left service last year but with the F-35 delayed, this now looksmore like 2022. Well done, then, former Defence Minster Brendan Nelson in disregarding RAAF advice and acquiring 24 Super Hornets when difficulties with the F-35 program first became apparent. This purchase has allowed some semblance of regional technological air superiority capability to be maintained. 

Sarah Frankel has written a series of posts explaining the UN Secretary-General election process and outlining the candidates so far: 

Led by an alliance of NGOs known as 1 for 7 billion, SG reform advocates have been lobbying for various changes including: a formal nomination process with clear deadlines and job qualifications; a single, non-renewable, seven-year term; engagement with the candidates; and for the Security Council to nominate more than one candidate. Bowing to the calls for reform, the presidents of the Security Council and the General Assembly issued a joint letter in December 2015 soliciting candidates and offering opportunities for informal dialogues and meetings. This was the first time the UN has officially kicked off the selection process. Critics say it's a small improvement in a largely broken system.

What would happen to the UK's economy if it were to exit the EU? Michael Martins:

Nobody knows whether this will occur either in the run-up to the referendum or after the vote – whichever way it goes. However, like all good central banks, the Bank of England is taking no chances. Figures released this week revealed it had increased its foreign currency holdings by one-third to $98 billion in the last twelve months. Incidentally, the Bank's entire holdings are worth less than the amount the Chinese central bank, People's Bank of China (PBOC), sold off in January alone (although the PBOC took that action mainly to maintain an effective peg against the US dollar, not to guard against a currency run).

Jiyoung Song wrote on the 'duelling forces' in Australia's migration policy:

In Australia, the projected population by 2050 is 38 million. The Migration Council Australia finds that migration will have added 15.7% to the workforce participation rate, 21.9% to after tax real wages for low-skilled workers, and 5.9% in GDP per capita growth.

Modern Australia is built by migrants. We’re all migrants or children of migrants. If relied solely on the current fertility rate, Australia would not be able to sustain its current global rankings. We shouldn't talk about our future prosperity and success solely in terms of GDP growth. It is also about resilience, diversity and adaptability, all of which are needed to maintain comparative advantage in a rapidly changing world, and all of which migration brings.

What shape is Taiwan in militarily after the recent election? Wu Shang-Su:

However, promises of economic development and social welfare made by Taiwan's newly elected president Tsai Ing-wen, especially when combined with the government's detoriating financial capacity, will not leave much room for increased military spending. Furthermore, most of the DPP's new legislators appear to have little interest in defence, which suggests it will be a low priority for the new administration. While the DPP Administration could begin some projects, such as the indigenous submarine and combat aircraft, these investments will take years to come to fruition. For the foreseeable future, it seems the mainstay of Taiwan's defence will remain its aging arsenal.

Raffaello Pantucci on China's Central Asian silk road:

The longer term problem for China is the responsibility that will eventually fall to it. While Beijing may see itself as a provider of goods and opener of markets, it is in reality reconnecting the continent in order to place itself at the heart of a new latticework of infrastructure and trade routes emanating from Urumqi. Not only is China going to be bound to these markets, it will also increasingly find itself in an awkward place when trying to sidestep involvement in local issues.

Robert E. Kelly thinks that the South Korea-Japan comfort women agreement is on shaky ground:

In such dire circumstances, it is easy to see the left reaching for the highly resonant comfort women issue in a bid to prevent catastrophe. Hotly disputing the comfort women deal — painting it as a deal of the pro-Japanese right, and not the Korean people — would be an obvious, evocative wedge issue. As long Korean opposition to the deal can be relegated to the leftist newspapers and nationalist NGOs, Park might be able to swing public opinion. But if this takes over the National Assembly campaign in the spring, I think the deal will collapse.

Finally, Casper Wuite on a possible Western-led intervention in Libya: 

First, while Western countries focus on how, why and under what conditions they should participate in military interventions, far too little attention is paid to how such an intervention would end. It is true that a light military footprint can prevent some of the pitfalls of large-scale interventions such as Iraq and Afghanistan, but nevertheless, such interventions achieve little in the absence of a political settlement, risking the type of mission creep Western countries are trying to avoid.

Photo courtesy of Flickr user Azi Paybarah.

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Jakarta's governor this week vowed to shut down one of the city's biggest red-light districts and was met with threats of resistance by local gangs. Meanwhile,  a former minister under Yudhoyono was jailed for embezzlement, and public attention remained glued to a mysterious death allegedly by poisoned coffee in a Jakarta mall.

Governor Ahok on Wednesday pledged to shut down the red-light district of Kalijodo after a drunk driver was reported to have killed four people on his way home from the night-spot on Monday night. The district on the banks of the Ciliwung River has been a target of Ahok's since he was vice governor to Jokowi for its illegal activities and because the area is supposed to be part of a green corridor to help prevent floods.

Monday's accident prompted Ahok to renew his pledge to flatten the strip. Local gang members and sex workers warned there would be riots if Ahok tried to evict them, and said he would have to use a tank to get them to leave. Ahok quickly responded that he would borrow a tank from the army if that's what it took. 

Ahok's hard-headed approach to leadership has attracted him his fair share of enemies but also plenty of supporters from very different sides of politics. Hardline Islamist group Front Pembela Islam, previously one of Ahok's biggest critics on the grounds of him being a Chinese-Indonesian Christian leading a Muslim-majority city, have welcomed the Governor's initiative to clear out Kalijodo. Separately, a group called Teman Ahok (Friends of Ahok) is working to support the Governor to run as an independent in next year's election, hoping that he can continue to steer clear of the influence of party politics. The group has already collected more than the required 600,000 declarations of support from voters, and is aiming for a new target of one million. However, Ahok surprised the group on Thursday by floating the idea of joining Jokowi's party, the PDI-P, prompting speculation that he may be looking further ahead than the gubernatorial election in 2017 and on to his chances of running for president or vice president in 2019, for which he'll need party membership.

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Jokowi's current Vice President, Jusuf Kalla, attracted criticism this week for testifying in support of former minister Jero Wacik, who was found guilty of embezzlement on Tuesday. As tourism minister and then energy minister under President Yudhoyono — and for part of that time under Jusuf Kalla as Vice President — Wacik was found to have embezzled billions of rupiah from state funds, and received billions more in kickbacks from energy companies.

Reports say he spent much of the money on concert tickets and holidays for his family, luxury handbags for his wife and daughters and weekly trips to massage parlours. Yet Kalla defended Wacik in the trial, saying that it was not easy for a minister to draw the line between personal and professional expenses. Judges added that considerations were made for Wacik's current expenses, such as his wife's medical bills and his daughter's university tuition. Far below the prosecutors' demands of nine years, Wacik was sentenced to only four years in prison, and ordered to pay several billion rupiah in fines and restitution for state losses. Upon receiving the reduced sentence, he thanked Yudhoyono and Kalla for their defence.

While this high-profile corruption trial was unfolding, local media was distracted by the mysterious case of a young woman who died of cyanide poisoning after drinking a coffee with friends at a Jakarta mall. In a convoluted story that has played out like a sinetron soap opera in local headlines for weeks, the main suspect has been identified as one of the three friends at the cafe, and the only one who didn't take a sip of the allegedly poisoned coffee.

Even the Australian Federal Police have been drawn into investigations since questions were raised about the nature of the relationship between the victim and the suspect when they studied together in Australia. The suspect, Jessica Kumala Wongso, is now an Australian resident, and could receive the death penalty if found guilty of murdering her friend, Wayan Mirna Salihin. Details are still unfolding. 

Photo courtesy of Flickr user Matthew Kenwrick.

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The new video above from Vox gives a simple, but quick and easy, breakdown of Iran's government and upcoming parliamentary elections that will be held on 26 February. Often Western media portrays Iran as just another top-down dictatorship with 'no politics to speak of', but there is real ideological 'tussle' within the Islamic Republic and its complex institutions. Iran has also been the subject of that question in the West:  are Islam and democracy 'compatible'?

The accompanying Vox article by Johnny Harris and Max Fisher is very optimistic about the election and its chances to change the direction of politics in Iran. That may be so, but the moderate faction is fighting from a significant disadvantage. As Rodger Shanahan pointed to late last month, several important reformist candidates have been disqualified from running in both the parliamentary election and for the Assembly of Experts, the body that selects the Supreme Leader. This is because the Supreme Leader exerts a great amount of influence over the Council of Guardians, the group that approves electoral candidates.

Whatever the case, the election should be an interesting one.

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Last week Pentagon officials revealed that the number of ISIS fighters in Libya has grown to between 5000 and 6500 – more than double the number estimated last year.

In a previous post ('Why Libya peace talks are crucial in the fight against ISIS') I talked about the rise of ISIS in Libya and the need for a political settlement that could pave the way for cooperation between pragmatic military factions fighting ISIS. Such a deal was reached in Morocco last month, but so far a government of national unity proposed under the UN-backed plan has been rejected by Libya's rival parliaments over allocation of ministries and the transfer of power over military appointments.

If a viable unity government does not materialise in coming weeks, it is likely that an ad hoc coalition made up of the US, France, Italy and the UK will decide to intervene militarily. Last week, President Obama instructed his National Security Council to counter efforts by ISIS to expand to Libya, including by military action. Such action — likely to be more limited in scale than the 2011 intervention — would likely consist of an aerial campaign complemented by Special Forces, and intelligence liaison with Libyan armed groups on the ground.

While there are compelling reasons to prevent the metastasising of ISIS beyond its primary base in Iraq and Syria, earlier Western interventions offer three lessons that would suggest a military operation in Libya, however limited, is fraught with risk.

First, while Western countries focus on how, why and under what conditions they should participate in military interventions, far too little attention is paid to how such an intervention would end. It is true that a light military footprint can prevent some of the pitfalls of large-scale interventions such as Iraq and Afghanistan, but nevertheless, such interventions achieve little in the absence of a political settlement, risking the type of mission creep Western countries are trying to avoid.

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Secondly, limited interventions of the kind currently being considered by the international community in Libya will, according to one voice from the field, 'work indirectly through partners and thus are most effective when security institutions exist or a patchwork of local armed actors shares enough common ground that it can be leveraged to promote stability.' 

There is no such common ground in the region of Sirte, an ISIS stronghold and the likely target of Western military action. Both rival Libyan governments have rejected the presence of ISIS in the region, but their military factions have been fighting each other in and around Sirte. US Special Forces have been deployed to Libya in recent months to liaise with these factions, assess capabilities, and identify local factions to support in an anti-ISIS surge.

Yet analysts have pointed out that singling out factions to work against ISIS will be challenging due to 'overlapping alliances, tribal connections, and shared interests among them.' For example, the Libyan Petroleum Facilities Guard, which is fighting Wilayat Tarablus (ISIS) in the Sirte region, is commanded by Ibrahim Al-Jadran, who is the brother of an ISIS commander and who has been accused by the head of Libya's National Oil Corporation, Mustafa Sanalla, of siphoning oil to ISIS.

The 'city-state' of Misrata, crucial to ISIS's expansion plans, has also deployed its powerful militias to Sirte to fight ISIS, and has repeatedly asked for military assistance from the US. It would provide Misrata with the international legitimacy it seeks to emerge as a powerbroker in a future political settlement. More importantly, its local interests could pave the way for an anti-ISIS alliance with General Haftar — who leads forces aligned with Libya’s internationally recognised government in Tobruk — pending the supply of weapons to his forces. However, it would further fragment the Dawn camp — a coalition of Islamist militias supporting Libya’s Tripoli government — to which the Misrata factions are allied, and inflame intra-Islamist conflict in Western Libya. Crucially, a rift between Misrata and the Ansar al-Sharia-aligned Islamist factions which dominate General National Congress (Dawn’s political body), would jeopardise UN efforts to establish a unity government.

Thirdly, as we have seen in Afghanistan, Syria and Iraq, a strategic rapprochement between key regional players is crucial to the success of a Western intervention. In Libya, both Algeria and Egypt support (to various degrees) the internationally recognised government and share similar cross-border security concerns. However, they diverge on the means to improve stability and security. Egypt has supplied Haftar’s forces with weapons and has twice conducted air strikes on targets in Tripoli and Derna, while Algeria, in line with its doctrine of military non-intervention, has advocated a political solution and firmly backed the efforts of UN Special Representative Martin Kobler.

A Western intervention would embolden Egypt to ramp up its military support for Operation Dignity — Haftar’s anti-Islamist military offensive in East Libya — and alienate Algeria, an indispensable broker of stability in the Sahel region and an influential power over major tribes in the western regions of Libya, which have long been marginalised due to their loyalty to Gadaffi, but whose role will be decisive in the formation of a national unity government.

Photo by: Godong/UIG via Getty Images

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As discussed in part 1 of this series, this year’s UN Secretary-General (SG) race is well underway with a public nomination process for the first time ever, the Eastern European Group claiming it is next in line for the post, and civil society strengthening its calls for the first female SG.  Now we’ll take closer look at the contenders themselves, many of whom boast strong diplomatic credentials, including several with deep UN expertise and multilateral leadership experience.  The field is likely to be fairly crowded, dynamic, and hotly contested. 

Candidates require nomination by a member state or regional group; typically it comes from their own government, but it isn’t required.  In this year’s race, competing interest from several citizens of the same country and recent Eastern European and Australian government changeovers have created some confusion over nominations and a more contentious field than usual.  There’s nothing restricting a member state from nominating more than one candidate, but most prefer to coalesce around one, sparking domestic battles for support in several Eastern European countries that some commentators have described as SG primaries.

While NGOs and bloggers continue to post lengthy lists of leaders they consider to be qualified candidates, it’s important to filter those lists for those who are actually interested and have a chance at garnering support from the UN Security Council’s permanent five (P5) members.  German Chancellor Angela Merkel and Chilean President Michelle Bachelet, for example, do not seem inclined to leave their day jobs, and the Council is unlikely to support an influential former head of state. 

The President of the General Assembly has announced five official candidates so far:

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  • Srgjan Kerim, a former Macedonian diplomat and UN General Assembly President, was first to be officially nominated through the new process and already has his website up and running.
  • Croatian Foreign Minister Vesna Pusic received an official nomination from the outgoing Croatian prime minister despite uncertainty over the incoming government’s position on her candidacy.
  • Montenegrin former Prime Minister and current Deputy Prime Minister and Minister of Foreign Affairs Igor Luksic has maintained a low profile so far.  At age 39, he is likely to be the youngest candidate in the field and would be the youngest-ever SG if selected.
  • Former Slovenian President Danilo Turk, who has also served as UN Assistant SG for Political Affairs, secured the support of his current government, almost two years after the previous one endorsed his candidacy.
  • Bulgaria earlier this week formally nominated UNESCO chief Irina Bokova after Vice President of the European Commission Kristalina Georgieva withdrew her name from consideration.  Bokova had received support from two different Bulgarian administrations, and some commentators consider her a frontrunner.

There are several other potential candidates from the Eastern European Group:

  • Slovakia also has two potential candidates who are jockeying for support; Foreign Minister Miroslav Lajcak and Jan Kubis, the UN’s Iraq envoy and former SG of the OSCE.
  • Former Serbian Foreign Minister and UN General Assembly President Vuk Jeremic has long coveted the SG post, but some question whether he will receive the support of his government, and his divisive leadership style and nationalistic agenda at the UN has rankled Western countries on several occasions.

And there are some other potential contenders from outside Eastern Europe:

  • The Portuguese government released a statement last month endorsing Antonio Guterres, a well-respected former prime minister who just wrapped up a decade as UN High Commissioner for Refugees.
  • UNDP chief and former New Zealand Prime Minister Helen Clark continues to remain discreet about her interest, although her government has publicly stated it would support Clark if she ran. 
  • Speculation continues to swirl about former Australian Prime Minister Kevin Rudd, and he may very well be testing the waters, in part through an ambitious travel agenda. In the latest twist, an exchange of letters obtained by The Australian reveals that Tony Abbott pledged Australian support for Clark while he was prime minister, unbeknownst to the Malcolm Turnbull administration.  New Zealand Prime Minister John Key has since told Turnbull that he won’t hold Australia to the agreement. Regardless, as a Western male with close ties to Washington, Rudd most likely would face an uphill battle for P5 support (for more on this, see 'Kevin '17 and the race to be the next UN Secretary-General' and 'Why Kevin Rudd won't be the next UN Secretary General').
  • The names of several Latin American women have also been floated, including Mexican senior UN official Alicia Barcena, Costa Rican economist and former UN official Rebeca Grynspan, Colombian Foreign Minister Maria Angela Holguin, and Argentine Foreign Relations Minister Susana Malcorra, who previously served as a senior UN official.

This list is likely to change, and new names may emerge in the coming months or even toward the end of the process.  While bets are already being taken (Bokova leads with 4-1 odds on one gambling site), it’s hard to predict closely held P5 positions and how geopolitics in the next six months might affect their views.  Eastern Europeans and female candidates may have an advantage at least initially, but in this 'G-zero' world of competing visions, the field may need to be broadened. 

Continue to watch The Interpreter as the race unfolds to see whether an early front-runner secures early P5 support, a candidate consolidates support with financial and diplomatic promises, or a dark horse emerges only after a P5 deadlock. 

Photo Courtesy of Flickr user United Nations

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Labor shadow foreign minister Tanya Plibersek has committed a future Labor government to negotiations with the Timor Leste government to reach a permanent maritime border between our two countries, and undertaken to hand the issue over to UNCLOS arbitration if an agreement cannot be reached.

This might seem a sensible way to go. The East Timorese have certainly been victims of some awful history. They are poor and we are rich. An equidistant border seems intuitively fair. Our bumbling Inspector Cousteau spying efforts are an ongoing national disgrace.

But there is a fair bit of misunderstanding about the relevant geography

Popular commentary sees the central issue as an equidistant border. Typical is Tom Allard, who writes about this often in the Sydney Morning Herald:

If the boundary was drawn midway between East Timor and Australia — as is standard under international law — most of the oil and gas reserves would lie within Timor's territory.

As a geographical fact about known petroleum resources, this is wrong. Look at the map showing the location of the main oil resource — Greater Sunrise — with estimated revenues of $40 billion. Some 80% of this undeveloped field is to the east of the Joint Petroleum Development Area (JPDA). Shifting the boundary to equidistant still leaves 80% of Sunrise in Australian territory. True, Timor would then have 100% of the JPDA revenue from resources that lie north of an equidistant border, but at the moment they receive 90% of the revenue from resources currently being exploited, and under the existing agreement would receive 50% of the overall Sunrise revenue (not just the part of Sunrise which lies in the JPDA).

For Timor to get a larger share of Sunrise, the border on the east side of the JPDA would have to be shifted eastward. Of course that would have to involve Indonesia: the eastern edge of the JPDA is based on equidistance between Timor and the Indonesian islands to the east of Timor. But why would Indonesia agree to such a shift? Sunrise is closer to Indonesia than it is to Timor.

If this issue goes to UNCLOS and the East Timor/Australia border is shifted to equidistant, Indonesia will probably demand that its border be shifted to equidistant. The same arguments apply in this case: that border was decided at a time when Indonesia was weak and Australia was strong. At that time, a border based on the continental shelf was normal, but now the fashion has changed so the UNCLOS arbitrators, unable to decide in the more common case where the continental shelf is not well defined, take the easy way out and settle for equidistant. That would put 80% of Sunrise  in Indonesian territory and it seems unlikely that Indonesia would give Timor any share of the revenue.

Is this such a bad outcome? After all, Indonesia has many more poor people than Timor has. But it may not be what the Labor Party has in mind.

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On 3 February, the Australian High Court ruled the offshore detention centres to be lawful institutions, in line with a country’s sovereign right to determine how to treat asylum seekers on its territory. The High Court’s decision is significant as it is will influence the Australian Government's actions towards asylum seekers and refugees in future, including the 12,000 Syrian refugees Australia has promised to receive.

Migration is a complex human phenomenon with generational impact on both sending, transiting and receiving countries. When making decisions related to migration, a state needs to consider various factors including national security, demographic challenges, transport and social services, economic growth and ethnic diversity, as well as public opinion.

But before elaborating on this complexity, let’s get the terminology right. Many discussions of migration demonstrate some serious misconceptions and confusion. This lack of understanding can have serious consequences. It can mislead public opinion and result in short sighted decisions in an area of policy that is vital for for Australia’s long-term economic and social future.

First, not all migrants are immigrants. Migrants tend to move and keep moving. Immigrants, on the other hand, have temporary or permanent residence. The majority of immigrants who apply for residence do so for economic reasons. Others cite family or humanitarian grounds. Refugees have temporary residence on humanitarian grounds and are a subset of a much larger group.

Secondly, not all asylum seekers are granted refugee status. Asylum seekers fear persecution in the country they've left and desire temporary shelter and protection. If their applications are successful, they become refugees with temporary residency status. In 2013-4, 72,162 persons applied for Australia’s humanitarian visas. Around 13,750 individuals and their families were granted this status. States who are party to the 1951 Refugee Convention must comply with the principle of non-refoulement (no return to the country where refugees fear persecution), and provide humanitarian assistance to asylum seekers. Australia has been a party to the 1951 Refugee Convention and its Protocol since 1954 and 1973, respectively.

Thirdly, asylum seekers and refugees are not criminals detained in state sanctioned institutions. They seek help on humanitarian, as opposed to legal grounds. In contrast, people smuggling is a criminal act, defined in the UN Convention against Transnational Organised Crime and its Protocol on people smuggling to which Australia is also a party.

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When refugee smuggling takes place, as is the case with most boat arrivals in Australia, two principles of international law compete against each other: on the one hand, protecting refugees on international humanitarian grounds, and on the other, defending national borders as the sovereign right of the state. In the High Court’s decision, border protection interests came out ahead of humanitarian concerns. This was, however, just one round in a long running saga where the influence of the various considerations wax and wane.

Both the Department of Immigration and Border Protection and the Department of Social Services acknowledge Australia's humanitarian obligations, saying 'As a member of the international community, Australia shares responsibility for protecting these refugees and resolving refugee situations'. So do church leaders and human rights groups. However,  human rights can be traded off against other national interests. Even in Article 13 of the 1948 Universal Declaration of Human Rights, the right to mobility only exists for part of the migration process. It only defines rights to leave and return to one’s country of origin. There is no human right to reside in a country not your own. That is a sovereign right of the hosting country. Humanitarian and human rights principles often come out second best when they come up against national security, sovereignty and territorial integrity.

Those making the case for asylum seekers to reside in Australian territory, and not in offshore detention centres, need to make a rational, as opposed to a simply moral, case. This requires an understanding of the complexity of migration and its uncertainty and unpredictability, as well as its often overlooked potential to contribute to Australia’s economy and society.

Migration has multiple causes and consequences. It can be both positive and negative for the hosting society. The media tends to focus on the negative, with coverage that dwells on the potential threats migrants pose to national security, economic advancement, and cultural identity. The Boston, Bangkok and Jakarta bombings exacerbated this trend. Stories about migrants bringing in radical ideas and networks, taking local jobs, raising housing prices, increasing crime rates, and spreading diseases are standard fare in today’s media.

What is not often highlighted, and what should be, is that most migrants, especially refugees, are more likely than not to be healthy and educated individuals of working age. In evolutionary biological terms, they’re the fittest survivors, who have outlived wars, violence and poverty. They have immense potential for a country’s economy. This 2014 OECD report found migrants accounted for 47% of the increase in the workforce in the US and 70% in Europe over the past ten years. They fill important niches in both fast-growing and declining sectors of the economy. The report also concluded that migrants contribute more in taxes and social contributions than they receive in benefits, boost the working-age population, and contribute to human capital development of receiving countries.

In Australia, the projected population by 2050 is 38 million. The Migration Council Australia finds that migration will have added 15.7% to the workforce participation rate, 21.9% to after tax real wages for low-skilled workers, and 5.9% in GDP per capita growth.

Modern Australia is built by migrants. We’re all migrants or children of migrants. If relied solely on the current fertility rate, Australia would not be able to sustain its current global rankings. We shouldn't talk about our future prosperity and success solely in terms of GDP growth. It is also about resilience, diversity and adaptability, all of which are needed to maintain comparative advantage in a rapidly changing world, and all of which migration brings.

Photo courtesy of Flickr user Takver

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The first part of this series outlines how the race is run, who is agitating, and what their interests are. Part 2 will handicap the field of early secretary-general contenders, from a 39 year-old Montenegrin wunderkind to Australia's own Kevin Rudd.

Eurasia Group's Ian Bremmer recently warned about the absence of global leadership, claiming that we've reached a 'G-zero world' in which global caucus members don't share political or economic values or a common vision for the future. It's against this backdrop that world leaders will this year select the next UN Secretary-General (SG) to replace Ban Ki-moon when his second term ends on 31 December.

This year's SG race features record levels of public engagement with the candidates, intense lobbying from civil society groups, and the potential for geopolitical clashes. Below are the key issues to follow as the process unfolds throughout 2016.

There is an unprecedented push for reform underway…

The SG selection process has long been considered secretive and undemocratic, and reform advocates calling for more openness and inclusion are gaining momentum this time. The UN Charter stipulates only that the SG 'shall be appointed by the General Assembly upon the recommendation of the Security Council,' leaving the rest of the process to be decided by custom and informal agreements. In practice, the Council — most importantly the permanent five (P5) members who hold veto power — almost always recommends a candidate, and the General Assembly serves as a rubber stamp. The SG race tends to play out differently each time, reflecting both evolving UN practices and occasions when SGs have resigned or died while in office, and it looks like this will be the case again this year (for more information, see Security Council Report's special research report and the Center on International Cooperation's online magazine guide).

Led by an alliance of NGOs known as 1 for 7 billion, SG reform advocates have been lobbying for various changes including: a formal nomination process with clear deadlines and job qualifications; a single, non-renewable, seven-year term; engagement with the candidates; and for the Security Council to nominate more than one candidate. Bowing to the calls for reform, the presidents of the Security Council and the General Assembly issued a joint letter in December 2015 soliciting candidates and offering opportunities for informal dialogues and meetings. This was the first time the UN has officially kicked off the selection process. Critics say it's a small improvement in a largely broken system.

…but transparency can be a double-edged sword.

While transparency is generally presented as a good thing, it's worth considering the risks. Former senior UN official Alvaro de Soto argues that the process has evolved from one where the Security Council sought out potential SGs — former SG Dag Hammarskjold famously didn't know he was being considered — to one in which candidates seek the job. In exchange for support, candidates are now expected to make promises and horse-trade favours, undermining their independence even before they assume the role.

Additional exposure of candidates also risks hampering the Council's decision-making process as it seeks to find not only the best candidate, but one who is acceptable to each of the veto-wielding P5 members. For example, questioning candidates publicly on controversial issues, such as the conflict in Ukraine, could push them to make statements that would render them toxic to one P5 member or another.

De Soto also warns that thrusting SG nominees into the limelight can call attention to the wrong attributes of a candidate. He writes:

Public grillings of candidates may bring out the skills of a successful politician or communicator or CEO. But they won't tell us whether the candidate has the temperamental profile, the empathetic skills, the coolness of mind and the experience of performing diplomacy of that rarefied kind: the third party role in solving conflict.

Regional rotation is not a fixed rule but nationality matters.

UN member states continue to debate the value of geographic diversity and the much-touted concept of a regional rotation for the SG post. Neither is mentioned in the UN Charter, and the actual timeline of SG terms doesn't establish a clear pattern of rotation. Furthermore, the history of candidates considered from various regions during most races suggests that regional rotation is not as entrenched as political commentators might make it seem.

On the other hand, UN General Assembly resolutions have referenced geographical balance, and the perception of an informal regional rotation continues to resonate with many UN member states. Regional groups, sometimes with the support of P5 members, have succeeded in establishing a sense of inevitability around their candidates in the past. The Eastern European Group, the only UN regional group that hasn't held the SG post, has Russia's support and has made remarkable progress in building consensus around the idea that it's Eastern Europe's turn this time around. Read More



Some rotation advocates have suggested that the Western European and Others Group (that includes Australia and New Zealand), which hasn't had an SG for 35 years, would be next in line if the Council fails to agree on an Eastern European. However, the Latin American and Caribbean Group also has a case to make for under-representation at the helm of the UN, as it has only held the post for two terms while the others have had at least three. A Latin American candidate may have a better chance of making it past the P5, given ongoing tensions between Russia and the West.

Female candidates are in high demand

After 70 years of male SGs, many UN observers, including civil society groups like WomanSG and Equality Now, are calling for a female UN chief. More than 40 UN member states have signed a document promoting the selection of a woman, and the UN's recent joint letter encouraged member states to consider presenting women, as well as men, as candidates. Some member states are calling for the most qualified candidate regardless of gender or nationality, while others argue that it's high time for a woman, not only to demonstrate the UN's commitment to gender equality and to empowering women, but also to bring a more diverse perspective to its leadership.

The P5 remains the ultimate decision-maker

Despite the steps taken to make the SG selection process more open, and the calls for further reforms, the candidates' chances are still largely determined by the P5. This race provides an opportunity for Russian obstructionism, as Moscow's views will be particularly critical in the consideration of Eastern European candidates. Russia's outspoken UN Ambassador claims that Moscow supports an Eastern European woman, although he had previously stated that the candidate should be chosen based on merit alone.

The race also represents a chance for the Obama administration to leave its mark on the organisation before leaving office, just as the Bush administration did in 2006 — former US Ambassador to the UN John Bolton claims in his book that then US Secretary of State Condoleezza Rice told him, 'I'm not sure we want a strong secretary general'. France in the past has insisted on the SG speaking French, although Ban's struggles with the language suggest that Paris has backed down from strictly enforcing its own informal tradition.

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Until the North Korean nuclear test grabbed everyone's attention, the most important recent news to come out of Korea was the late 2015 deal between South Korea and Japan regarding the comfort women. Indeed, in so far as North Korea's nuclear test is more of the same (it was not a thermonuclear device), the comfort women deal is arguably more important. The deal is hugely controversial and, I increasingly believe, unlikely to hold.

Lowy's previous treatment of this topic has focused on the agreement's fairness (or lack of), and there seems to be an emerging consensus that the comfort women got a poor deal (here, here and here). The comfort women themselves appear strongly opposed. The largest comfort women group, the Korean Council for the Women Drafted for Sexual Slavery by Japan, strongly opposes it and has started a fund drive to replace the monies Japan has agreed to provide. Rather than debate the deal's merits yet again, I want to look at the political questions surrounding it.

Why this deal now?

The external pressure on both sides was enormous and worsening.

The initial response, especially in Korea, was surprise. The deal seemed to fall out of the sky. The Park Geun-Hye Administration gave little indication that a deal was coming, and initial reporting called it 'hasty' and 'thrown-together.' President Park painted herself into a corner by insisting that the comfort women issue be dealt with in 2015, the 50th anniversary of Japan-Korea normalisation. It increasingly looks like Japanese Prime Minister Abe Shinzo played for time and got the better of negotiations. That likely explains the very late 2015 timing.

But there were huge structural pressures in the background: extraordinary and growing American pressure on Tokyo and Seoul to finally put this issue to rest. Every Western analyst, journalist, academic, government or military figure I know with some involvement in this issue thought a resolution was critical. There has been constant diplomatic pressure at track 1, 1.5 and 2 levels on both parties to resolve it. There has been a torrent of articles, think-tank reports, policy briefs, books and so on regarding this issue. Even President Obama got involved. Everyone could see that the real winners of Japan-Korea estrangement are North Korea and China. As China continues its ascent and North Korea's nuclear program expands, the unrelenting drumbeat of Westerners at every level saying, 'fix this', must have been exhausting.

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Will South Koreans accept this deal?

It will be far more contentious in Korea than Japan.

As the links above suggest, there is a growing consensus that Japan got a lot out of the deal. In fact, I am rather surprised the Koreans accepted it., and the backlash here has begun. Comfort women groups have hit the streets; the nationalist NGOs are opposed it; the weekly rallies at the comfort woman statue in front of the Japanese embassy in Seoul have continued unabated; Korean intellectuals have taken to social media to push back.

The reaction of civil society groups and the media commentariat in the coming months, especially in the run up to parliamentary elections in April, will be crucial. The leftist groups and papers will come out against it, of course. Whether the Park Government can move larger public opinion, to get the deal to 'stick,' is questionable at best. Park herself may have to give a major address in which she openly pleas for Koreans to accept that this was the best they could get.

I am sceptical Koreans will accept that, especially from Park given her father's past. Park Chung-Hee worked for the Japanese colonial administration in Korea, and later ruled as a dictator, accepting normalisation terms from Japan which many Koreans considered a raw deal back then as well. The criticism that the current Park is 'pro-Japanese' and not willing to take a tougher stand can already be heard. If only Nixon could go to China, it may take a leftist nationalist president in South Korea to finally reconcile the left to a deal with Japan on this issue. I do not believe Park, or the secretive manner in which she handled the negotiations, can do it.

But more important than Park's mixed effort are the larger background issues of Korea's interpretation of Japan. As I have argued in The Interpreter before (here, here; much longer version here), the comfort women and the historical issues with Japan are central narratives in the construction of modern South Korean political identity. As a divided nation, South Korea must constantly demonstrate its 'stateness' and legitimacy against its mendacious and highly nationalistic northern competitor. To win the inter-Korean legitimacy contest, South Korea defines itself against Japan and its imperial history. For example, South Koreans get far more incensed by Japan's behavior 75 years ago than North Korea's far worse human rights behavior since then, and comparisons of the comfort women tragedy to the far-worse Holocaust are commonplace. With so many groups vested in these issues, and so much of Korea's 'ontological security' wrapped up in demanding recognition and contrition from Japan, are Koreans ready to move on? I am hugely sceptical because Park has made no effort to lay this groundwork.

Will the South Korean left politicise the deal?

The fragmenting, flailing left will be sorely tempted to use this as a wedge issue.

The deal tries to lay this issue to rest by insisting that it may not be re-visited in the future. Elites all around — Seoul, Tokyo, Washington — want this, but there will be a substantial bloc of rejectionists in South Korea. Hence reviving and politicising this issue will be a tremendous temptation for the South Korean left, particularly given its disarray and inability to find an issue that will work against Park Geun-Hye. The left has been (surprisingly) unable to reap political gains from the many scandals of Park's tenure: staffing controversies, the sinking of the Sewol ferry, the outbreak of Middle East Respiratory Syndrome. Worse, the left, always more fragmented than the right anyway, is breaking into two rival blocks, with polling suggesting the right may take 60% of the April parliamentary vote.

In such dire circumstances, it is easy to see the left reaching for the highly resonant comfort women issue in a bid to prevent catastrophe. Hotly disputing the comfort women deal — painting it as a deal of the pro-Japanese right, and not the Korean people — would be an obvious, evocative wedge issue. As long Korean opposition to the deal can be relegated to the leftist newspapers and nationalist NGOs, Park might be able to swing public opinion. But if this takes over the National Assembly campaign in the spring, I think the deal will collapse.

If all this was not enough, the deal also intimates that the South Korean Government will eventually move the statue from in front of the Japanese embassy. Tokyo claims, with some reason, that it violates the Vienna Convention on diplomacy prohibiting undue harassment of embassies. Moving it will be another huge controversy. This deal is the not the final statement Tokyo wants it to be.

Photo by Chung Sung-Jun/Getty Images

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US presidential race 2016

Avowed 'democratic' socialist Bernie Sanders and unashamed arch-capitalist Donald Trump were the big winners in today's New Hampshire presidential primary. The Sanders win will lead to a huge, albeit probably temporary, loss of confidence for the Hillary Clinton campaign while there is now even less certainty about who, if anyone, can challenge Trump for the Republican nomination later this year.

What mattered most in the Democratic contest was the winning margin, with Sanders besting Clinton by more than 20 percentage points, according to latest indications, and gaining a resulting preponderance of delegates. He has proved himself a formidable opponent for the former secretary of state who was long thought to have the nomination sewn up.

In the Republican field, the identity of the second place-getter was of the most interest. Here, unheralded moderate John Kasich's return of about 16% of the vote was not unexpected in the somewhat atypical and nationally unrepresentative New Hampshire electorate. However, the strong showing by Kasich is still a big setback for other GOP candidates who sought a confidence and momentum boosting surprise as Trump consolidates. This is particularly the case for Marco Rubio, who came in fifth with barely 10% of the vote.

In fact, save for the worse-than-predicted Rubio performance — possibly a result of his cringeworthy showing in the last debate before the vote — the results on both sides of the political divide largely belied the reputation of New Hampshire as a graveyard of pollsters.

In comparing the two results, it's clear that Clinton is being punished for several years of what seemed like ineluctable electability. She must often look wistfully at the still massive and divided Republican field that dilutes opposition to Trump.

Clinton's enduring popularity with non-white voters in much of the rest of the country is still expected to carry her through to November's election, but her cosiness with Wall Street is hurting her campaign. There is also the continuing saga of her use of private email while secretary of state. The Sanders campaign has refused to exploit this as an election issue, but it may not have to with the FBI on the case. Regardless, Clinton is still given a quite incredible 80% chance of winning the Democratic nomination according to collated betting odds.

Turning, as all things inevitably must, to Trump, the New Hampshire result has seen his chance of winning the GOP nomination reach 42%, according to those same betting odds. This must come close to confirming the worst nightmares of many mainstream Republicans and others outside the camp.

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Yet still many pundits nurse a statistics-defying belief that some sense of normalcy will eventually return. This would take the form of an establishment candidate — likely Rubio, a somehow resurgent Jeb Bush, or even the hyper-conservative Ted Cruz, who is at least an experienced politician — seeing off the other challengers and mounting a sustained challenge against the frustratingly popular and id-driven New York billionaire.

So, as the Nevada caucus and the South Carolina primary beckon for the Democrats and Republicans respectively, it is essentially still all to play for. Nonetheless, there are two potential major developments on the horizon that could shake up both contests in the near future.

The first is the possibility that former New York City mayor and businessman Michael Bloomberg will run for president as an independent, seeking to capitalise on the loss of faith many voters have expressed in both mainstream political machines. As well as sitting outside the process altogether, the centrist Bloomberg (who confirmed this week he is considering a run) combines what are considered to be the more appealing elements of the various existing candidates, including the self-funded campaigning ability and business bona fides of Trump, and the socially progressive leanings of Clinton and Sanders. The increasing momentum for this campaign could  prove destabilising for red and blue voting blocs alike.

The second potential disruption is the growing chaos in global financial markets and the looming threat of a worldwide recession. This recalls the closing stages of the 2008 presidential campaign between Barack Obama and John McCain. With the global financial crisis still unfolding, Obama, already in the ascendancy, was able to effectively portray the Republican party as culpable through policies that had favoured deregulation of financial markets.

Should the instability continue to mount and exact a heavy toll on Americans — there are already signs of a jobs slowdown — there is a chance it could have a dramatic impact on the narrative of the primaries, and likely the election. As compared to 2008, however, the culprits will not so easily be identified. Sanders could make a case against Clinton's Wall Street ties while the Clinton camp could warn about the risk of dallying with socialism in uncertain times. On the Republican side, Trump will no doubt continue to champion his job-creating credentials while the likes of Rubio and Cruz could double down on conservative ideology.

So, just as the waters seem to be clearing, there is a potential for plenty of muddying yet.

Photo by Alex Wong/Getty Images

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US presidential race 2016

Marco Rubio should drop out of the White House race and become Donald Trump’s vice presidential nominee.

Rubio devotees; hear me out. First, some facts:

  1. Every Republican candidate who has been the frontrunner for as long as Trump has gone on to win the nomination.
  2. Never has a Republican candidate who has lost both Iowa and New Hampshire become the nominee.
  3. Trump won New Hampshire convincingly. New Hampshire has a 2-1 lead over Iowa when it comes to predicting the Republican nominee.
  4. Trump came second in Iowa, yet won more votes than any previous winner of that caucus.

The last point is worth delving into a little. Trump's popularity is lowest among voters who consider 'values' to be the most important issue (as opposed to 'jobs', 'economy' or 'national security'). In Iowa, a majority of Republican caucus-goers identify as ‘evangelical Christian’, and 40% consider themselves ‘very conservative’. Given Trump’s relatively weak religious and/or conservative credentials, and his oft maligned lack of ‘ground game’ in Iowa, where retail politics is at a premium, gaining the second highest vote count in Iowa caucus history is not a terrible result.

In the days after the Iowa caucus, pundits and media piled on Trump to talk down his chances of winning the nomination. This was partly Trump’s own doing. The candidate failed to frame his real chances of winning Iowa, and lost some momentum when the result did not reflect the inflated expectation. The reverse was true for Rubio, even though he came in third.

Yet that criticism was largely catharsis masquerading as analysis. It was the yearning of failed pundits for vindication and an emotional purge by those desperate to see Trump falter. In other words, the importance of the Iowa result was massively overstated. The predictions of Trump’s imminent demise did not reflect reality.

Enter Rubio: a young, articulate, first-term Senator from a minority background who shows great promise. He has a compelling personal story of overcoming adversity to reach public office. He looks, sounds, and behaves like someone who might have succeeded as president after eight years of George W. Bush.

That’s why he won’t win the nomination. Rubio is the Republican Obama, at a time when GOP voters can’t think of anything worse. He’s clearly a tremendous political talent and the future of the Republican party. But the future is not the present.

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Now is not Rubio’s time, and timing is everything. Despite the media hysteria after Iowa, Rubio had a very poor period between Iowa and New Hampshire. At the GOP debate, Chris Christie had Rubio totally on the ropes, reducing him to repetitive robotics. Earlier on, Rick Santorum could not think of a single accomplishment of the candidate he was endorsing. Rubio's opponents used that footage to devastating effect.

Exit polls are showing a thumping victory in New Hampshire for Trump. If they are reflected in the final count, Trump will sweep up half of all the delegates. This is because in New Hampshire any delegates awarded to candidates who gain less than 10% of the primary vote are redistributed proportionally to the remaining candidates (and yes, at the time of writing a vote for Jeb Bush looks like a vote for Trump).

Trump is now a winner again and heading into primary states that favour him and Ted Cruz. Rubio is unlikely to be competitive in many of these early southern bastions, and he will be a long way behind in the delegate count before any chance of clawing back ground presents itself. Even if other establishment candidates drop out, Rubio has little chance of staging a serious comeback.

Yet, if Rubio cuts a deal now, he might have a chance to become Trump’s vice presidential nominee. If the opportunity presented, Trump would surely jump at it; the nomination would be sewn up against Cruz, and a Trump–Rubio ticket would be well positioned for the election.

To state the obvious, Trump and Rubio are everything the other is not. The two could gain a great deal from other, both in terms of campaigning and in being able to govern effectively.

Most importantly for Rubio, after four or eight years serving as the US vice president, never again would the accusation be levelled that he doesn’t have the experience to be president.

Rubio’s political career has not yet peaked. This is an opportunity for him to occupy the second-highest office in the most powerful nation on Earth; and there is every possibility he could one day take the step up.

The alternative for Rubio is a grinding, expensive war of attrition and probable defeat; at which point Trump (and certainly Cruz) would have no reason to want him on the ticket. .

It's possible there may already be an understanding. Trump and Rubio have gone out of their way to avoid criticising one another during the campaign; each picking their fights with others in the race. After the last debate journalists lined up to give Trump a free kick at Rubio which Trump pointedly refused to take. While that might just be realpolitik campaigning at work, it could be Trump has already made his vice-presidential pick.

Photo: Scott Olson/Getty Images

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By Alastair Davis, an intern in the Lowy Institute's Melanesia Program

  • The lobbying underway in Vanuatu to form a new coalition government is reported to be reaching a conclusion, with the proposed prime minister and ministers expected to be announced soon. The Pacific Institute of Public Policy has  posted a visual representation of Vanuatu's political history that puts the recent election in context.
  • The political uncertainty in Vanuatu  has slowed repairs to Port Vila's Bauerfield Airport. The tourism industry, already weakened by last year's cyclone, is feeling the strain with flights suspended from Australia and New Zealand.
  • In Fiji, the SODELPA opposition party is protesting the suspension of NFP opposition members from parliament and the state of Fiji's democracy by wearing black armbands to parliament.
  • The Lowy Institute's Euan Graham discussed the projection of Russian influence into the Pacific and its ramifications for Australia on the ABC's Pacific Beat. Russian soldiers have recently arrived in Fiji to provide weapons training.
  • Denise Fisher examines stresses and strains in New Caledonia as the planned referendum on independence in 2018 comes into view.
  • This piece from Transform Aqorau on DevPolicy argues that the instability and unintended federalism of Pacific Islands' politics distracts from the business of governing.
  • The Seasonal Worker Programme for Pacific states has been expanded to include the broader agricultural sector. The changes have been welcomed by the Australian cattle industry.
  • ANU has released two pieces with a legal bent. One discusses the case against jailed MPs in Vanuatu, and the other explores the extraordinary experiences of John Logan who sat on the Supreme and National Courts of Papua New Guinea in 2011.
  • Australia and New Zealand are considering how best to assist Pacific states in combating the Zika virus. The Cook Islands, Samoa and Tonga are all concerned about outbreaks.
  • Rosie Delmah, a 14-year-old Solomon Islander, is receiving huge international attention and nearing 15 million views on YouTube for her cover of  the Adele song Hello:

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Ulugh Beg Madrasah, an important centre for astronomical study in the 15th century. (Photo by the author.)

Once the heart of the Timurid Empire, the city of Samarkand now sits in the middle of Uzbekistan, relegated to a splendid tourist attraction. Sitting atop the city with a clear view in every direction is the great astronomer Ulugh Beg's observatory, from where he mapped the stars while his grandfather's empire ebbed away.

Samarkand was at the heart of the ancient silk trading routes, which went cleanly around Russia, crossing Central Asia, Afghanistan and Iran to reach Turkey and Europe's shores. Track forwards to today, and this straightforward route across the continent is being replicated by China. The first freight train left from Yiwu in China's Zhejiang province en route to Tehran in the wake of President Xi Jinping's recent visit to Iran.

Beijing, it seems, has the ancient silk routes in mind.

My recent visit to Uzbekistan was part of a longer trip that included stops in Islamabad, Beijing and finally Tashkent. With conferences and workshops at each stop, the goal was to understand China's Silk Road Economic Belt strategy from the ground up. This particular trip was aimed at trying to understand some of the recent shifts around the vision, now that President Xi has so clearly thrown his institutional weight behind it.

While no such trip is every wholly conclusive, I walked away with two clear impressions. First, in Pakistan, China is uncertain about how it is going to mitigate the complicated local political dynamics it is getting dragged into as local authorities quibble over where different strands of the China Pakistan Economic Corridor (CPEC) should go. Second, in Tashkent, Uzbekistan is hesitant to completely fall into China's embrace, but prefers it to Russia's entreaties.

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The lesson from Tashkent was hammered home at Ulugh Beg's monumental observatory. Built in the 1400s, it was a testament to Timurid ambition. Inheriting a weak tribe, the great Timur the Lame turned their fortunes around and built an empire that spanned the ancient Silk Road from Beijing to Turkey's Asian shores. As our guide pointed out, this meant that he was able to levy taxes along the entire route. He left a mighty inheritance to his sons which meant his grandson, Ulugh Beg, could build his monument to the stars. The ancient routes brought prosperity, scientific advance and grandeur that lived through the ages.

Nowadays, Beijing's long-term ambitious are less clear, though the short-term direction is obvious. Having decided that China's west needs to be reconnected to the world, Beijing has poured massive investment into Xinjiang and across the border into Pakistan and Central Asia. While the exact route of the CPEC through Pakistan is not certain (hence the bickering in Islamabad), the general path, linking Kashgar to the seas, is clear. Similarly, in Uzbekistan, the plan to develop train lines from Tashkent through Ferghana to Kyrgyzstan points to a project that will help develop faster train links across Central Asia to China. And sending a train down the route from Yiwu to Tehran shows that these routes through the region exist already.

The loser in all of this Eurasian connectivity is Russia. A historical player in the region (and one which Timur attempted to dominate a number of times), Moscow has chosen to express itself through the establishment of the Eurasian Economic Union, an attempt to re-create the Soviet economic space whereby fiscal rules and customs tariffs in the heart of Eurasia are determined by the Kremlin. But the EEU is largely seen as a paper tiger; policy-makers I spoke to in Beijing are uncertain it will survive. they point to tensions between powers in the Union (eg. blocked trade between Kazakhstan, Belarus and Russia), and they say it seems unlikely the already faltering Kyrgyz or Armenian economies will welcome higher tariffs on their external trade while their domestic markets are opened up to Russian monopolies. Anyway, seen from Beijing, the single customs and trade bloc is actually a convenient trading and transit partner, offering one clear market from China's western borders to Europe's eastern flank.

Even if Moscow chooses to frustrate China's silk route strategy, the opening of Iran shows its increased viability. The ramifications are hard to predict. In ancient times, eventual overreach and imperial intrigue weakened the Timurids and they lost control of the Silk Road. Samarkand today is testament to their faded glories. For China, it may be too early to predict over-reach, but certainly the slowdown at home is having ramifications abroad.

Already, softening domestic gas needs have led to the suspension of the Line D gas line bringing hydrocarbons from Turkmenistan to China through Uzbekistan. In Pakistan, security concerns persist, but more intriguing is the possibility of China exploring opportunities in Chabahar, Iran, a port not far from Pakistan's Gwadar and in a far less sensitive part of the country, thereby suggesting a more convenient and cheap route to the seas.

While Chinese state planners declare there is room for all of these projects under President Xi's 'Belt and Road' vision, in truth it means China has options and has constructed a vision which can go in any direction it chooses. This keeps Beijing in the driving seat, careful not to over-promise to any one country while maintaining opportunities with all. It also provides Beijing with the perfect vehicle to keep its domestic capacity moving, with new markets and opportunities found over every hill and in every valley across its western borders.

The longer term problem for China is the responsibility that will eventually fall to it. While Beijing may see itself as a provider of goods and opener of markets, it is in reality reconnecting the continent in order to place itself at the heart of a new latticework of infrastructure and trade routes emanating from Urumqi. Not only is China going to be bound to these markets, it will also increasingly find itself in an awkward place when trying to sidestep involvement in local issues.

Already visible in Pakistan in complaints around routes planned by the CPEC, this haranguing is something which is going to become increasingly common as Chinese planners and builders find themselves marching into difficult places with no clear understanding of local dynamics. And while such complications can be sidestepped in distant Africa, in neighbouring Eurasia it has ramifications with direct links home. 

In tracing the ancient Silk Road, China needs to find a way to navigate through the many cultures and civilisations that live along it. As China displaces Timur to become the guarantor of the ancient silk roads, the logic of non-interference can no longer hold.

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Taiwan's incoming Democratic Progressive Party (DPP) administration is about to come face to face with unprecedented vulnerabilities in national security, thanks to a variety of factors which the new government is likely to find difficult to alter in the near future.

For more than 30 years from 1949, the modernisation of Taipei's armed forces, particularly its air force and navy investments, followed the lead of Beijing, as Taiwan sought to keep pace with its primary security threat. Then, following the democratisation movement of the 1990s, the Kuomintang gave way to the DPP. However, the Chen Shui-bian Administration (in power from 2000 to 2008), lacked a congressional majority, and opposing parties repeatedly rejected budget measures, including new submarines and other major military projects. The subsequent Ma Ying-Jeou Administration, which had a policy of cross-Strait integration, did proceed with a narrow range of military build-ups but with a defence budget that never tracked above 3% of GDP. The major programs of recent years, such as new P-3C anti-submarine aircraft and Apache helicopters, were largely planned before 2008 (with the exception of upgrades for Taiwan's F-16A/Bs and the Navy's two Perry class frigates).

Taiwan's indigenous defence industry has provided some local designs such as the Tuo Chiang-class stealth corvette and the CM-32 armoured vehicle, but limited budgets and domestic technological capacity have constrained the internal supply of arms.

All three of Taiwan armed services need modernisation. Taiwan's air force receives the most investment but still there is no plan to upgrade or replace its fleet of Mirage 2000-5 and F-5E/F fighters, which are due to be phased out of service over the next four years. The upgrades to Taiwan's F-16s and the Indigenous Defence Fighter notwithstanding, the loss of Mirages and F-5s would put Taiwan's air power in an even worse position against China's air force, with its J-10s, J-11Bs, J-16s and other advanced fighters.

As for Taiwan's navy, China's anti-access and area denial (A2/AD) capability, which deny the US and others militaries a maritime military presence in the western Pacific, have forced Taiwan to focus its  strategy on sea denial, most recently evidenced in launches of its stealth missile boats and corvettes. However, without any new submarines, Taiwan's small fleet, which includes two submarines that are more than 70 years old, Taiwan's sea denial capability is incomplete. Meanwhile, the the air/missile defence capability of the Navy's major surface combatants, unless improved, may not be adequate to match China's A2/AD capability.

Taiwan's army is most in need of modernisation. In addition to a range of World War II artillery pieces, its armoured vehicles, including tanks, lack modern protection such as reactive or layered armour, and would be vulnerable against most modern anti-tank weapons.

However, promises of economic development and social welfare made by Taiwan's newly elected president Tsai Ing-wen, especially when combined with the government's detoriating financial capacity, will not leave much room for increased military spending. Furthermore, most of the DPP's new legislators appear to have little interest in defence, which suggests it will be a low priority for the new administration. While the DPP Administration could begin some projects, such as the indigenous submarine and combat aircraft, these investments will take years to come to fruition. For the foreseeable future, it seems the mainstay of Taiwan's defence will remain its aging arsenal.

Taiwan is also exposed to the threat of irregular warfare. Through cross-Strait integration, the number of Chinese tourists, students and business travelers to Taiwan is growing. Chinese intelligence agencies can deploy agents under such covers. Chinese companies' extensive investments and business operations in Taiwan also provide opportunities to collect information and influence the local economy. Taipei has little capacity to respond to such threats, which would complicate a cross-Strait conflict. For example, Taiwan's air defence relies heavily on surface-to-air missiles (SAMs) to compensate for quantitative weaknesses. But those SAM systems could be easily paralysed by sabotage or attacks from light weapons, especially during their movement to tactical positions. If Beijing deployed its special forces in advance of a conflict, Taipei's air defence capability could be considerably degraded, making it easier for China to conduct an air campaign or secure air superiority.

Taiwan's armed forces also have a human resources problem. Unlike most countries shifting from conscription to a volunteer force, Taiwan is under threat from the second-strongest military power in the world, with firepower that covers the entire island. It is arguably unrealistic to expect an all-volunteer force made up of just a small portion of the population to shoulder the island's defence. Despite repeated failures to recruit sufficient soldiers, however, the official policy of transforming to a volunteer force is still unchanged.

Of course, any discussion of a military confrontation between Taiwan and China has to consider the US, which has has been a key player in the Taiwan Strait since 1950. Its regional military presence ameliorates China's strategic pressure on Taiwan. However, as the cost of military intervention into the Taiwan Strait increases, America's willingness to take action may become uncertain, and military response times could become longer as Chinese military capability improves.

So while Taipei's own defence capability is more critical than ever before, there are significant obstacles in the way of much needed improvements.

Photo by Alberto Buzzola/LightRocket via Getty Images

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In a year that will be dominated by the will they/won't they issue of the UK's referendum on whether it should stay in the European Union, there should be plenty of scope for some detailed analysis of the state Britain will be in when it heads to the polls. However, amid all the bluster over runners and riders and analysis of what reforms Britain may be able to achieve, one particular area has received little attention; what the UK's status as a 'double deficit' economy means in the context of an EU membership referendum.

'Double deficit' nations are those with both a budget deficit and a current account deficit. The budget aspect refers to the difference between how much a government spends and how much it collects. Running a deficit requires a government to borrow money to plug the gap. The 'current account' bit takes into account all the money arriving in a country less what it sends abroad. That's the UK's earnings from exports, foreign investments and other one-way transfers minus the money spent on imports, payments to foreign investors, and anything else, like aid payments, sent abroad. On both accounts, Britain is in the red.

In the years following the financial crisis, the UK began to run a large budget deficit. As the economy stumbled and tax revenues shrank, the government carried on spending to try to prop up the economy.  The debt pile accrued over this period now stands at around 80% of Britain's GDP. The Chancellor of the Exchequer, George Osborne, has emphasised the importance of the UK 'living within its means'. This has principally meant eradicating the budget deficit in a bid to begin paying off Britain's debt. There is a growing sense of urgency about attacking the high level of debt. This is due both to the £46 billion the government is spending on interest payments every year — more than its entire defence budget — and the prospect of interest rates going up or quantitative easing (QE) ending in the next few years. QE is  important because the Bank of England owns £375 billion of UK Government bonds, or 'gilts', the interest on which is transferred back into the Treasury;  monetary policy is effectively subsidising fiscal policy, at least for the time being.

The high level of government indebtedness also weakens the UK's current account standing. When the UK government pays interest to foreign investors, it does so in the currency of the creditors' choosing. This reduces the Bank of England's foreign reserve stocks, and increases the current account deficit, which currently stands at 3.7% of GDP. This would usually not be too much of a problem unless markets begin to question the UK's ability to pay back its debt. Such questioning happens in times of uncertainty, for instance, in the run-up to a referendum. As with all currency runs, the cycle can become vicious as investors call in debts and the central bank uses up reserves, which further undermines confidence.

Nobody knows whether this will occur either in the run-up to the referendum or after the vote – whichever way it goes. However, like all good central banks, the Bank of England is taking no chances. Figures released this week revealed it had increased its foreign currency holdings by one-third to $98 billion in the last twelve months. Incidentally, the Bank's entire holdings are worth less than the amount the Chinese central bank, People's Bank of China (PBOC), sold off in January alone (although the PBOC took that action mainly to maintain an effective peg against the US dollar, not to guard against a currency run).

What is a particular worry for the current account as we gear up to the referendum is the UK's primary income balance.  Read More

This measures how much UK companies and assets pay out to foreign investors minus the amount the UK collects from foreign investments. This is largely out of the control of either the government or the Bank of England since it is a function of basic market economics; if more money wants to flock to the UK, then it runs a surplus, otherwise, it runs a deficit. Until recently, the primary income balance had been falling due to the strength of the UK economy, particularly compared to that of other EU member states. In a sense, the UK has been a victim of its own success. More people want to invest in the UK than other places, while British investors have themselves been shy about looking too far afield. This means, basically, that returns on UK investments have performed stronger than the returns on foreign assets. This belies the strength of  the UK economy, but does mean that money pours out from the UK to investors beyond its shores.

At the moment, a run on the current account doesn't look likely to be an immediate problem, thanks mainly to a gloomy global economy. Investors looking for both stability and decent returns are faced with a difficult task. Across Europe, government bonds are negative, including in Germany. In the US, an election later this year is adding a dose of uncertainty into the mix, and the Fed's recent rate hike does not look like it will be followed by another any time soon. Canada, too, has cut interest rates as their economy slows in the face of a plummeting oil price, while Australia has also suffered at the hands of a commodity bust.

In less advanced markets, the foundations appear even shakier. Chinese growth has slowed to below 7% a year, even as measured by official government statistics. Recent steps to liberalise the currency have rippled through financial stability in Asia as fears grow of a string of competitive devaluations in the region. In other emerging markets, countries such as Nigeria and Turkey, which both absorbed much investment during the era of low returns in advanced economies, face a range of problems. These include a low oil price, which accounts for 70% of government revenues in Nigeria, demographic upheaval caused by massive population movements in Turkey, and the threat of terrorist activity in both.

In one sense, the UK's current account looks very British. It will likely muddle through, contingent on exactly how much uncertainty markets perceive in the run-up to the referendum. What happens after the vote is anybody's guess, really. Markets and analysts are already crunching the numbers about both the likelihood of the result and what each would mean for the British economy. Sushil Wadhwani, a former member of the Bank of England's rate-setting Monetary Policy Committee, however, once said that 'current account deficits appear not to matter until, well, they suddenly do.' Nobody knows if the referendum — or any other unforeseen event — will result in a run. Should it occur, however, the UK may start to look very similar to an emerging market facing a balance of payments crisis.

Photo courtesy of Flickr user Jon Mould

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