Will Russia Buckle, Sell China Control of Its Oil Fields?

On Friday, Russian Deputy Prime Minister Arkady Dvorkovich signaled that the Kremlin would be willing to give Chinese companies majority stakes in Russian oil and gas fields. “There used to be a psychological barrier,” he said, speaking from Krasnoyarsk, a city in energy-rich Siberia. “Now it doesn’t exist anymore. We are interested in maximum investments in new industries. China is an obvious investor for us.”

At present, Russia caps foreign ownership at 50 percent for oil fields where reserves exceed 70 million tons and gas fields containing more than 50 billion cubic meters in reserves. Yet that could change if the Chinese want bigger stakes. As Dvorkovich said, “If there is a request, we will consider it.”

Re-monopolizing China's Industry

The recent completion of two government-directed mergers in China’s energy and manufacturing sectors and other mergers now in the making suggest Beijing is reversing two decades of reform intended to make Chinese industry more efficient and competitive in local and global markets. The ongoing effort is certain to fail in the long term.

Hong Kong Protests Traders from China

On Sunday, more than a hundred protesters—most of them young—mobbed New Town Plaza, a mall in the Sha Tin District of Hong Kong. There, they clashed with shoppers and hounded tourists from mainland China.

Police tussled with the demonstrators, wielded batons, used pepper spray, and made arrests during the second consecutive Sunday of demonstrations against “parallel traders,” individuals buying goods in Hong Kong and lugging them across the border to China. On February 8th, there were similar protests in Tuen Mun, an area also close to the China border.

For years, residents of Guangdong Province—from quick-buck artists to concerned parents—have entered Hong Kong, a special administrative region of China, and bought foodstuffs and household items to bring back to the mainland.

Will Japan Flex Its Naval Power in South China Sea?

In a startling interview with Reuters, Admiral Robert Thomas, commander of the US Seventh Fleet, said that America would welcome Japan patrolling the South China Sea, south of the Japanese islands and far beyond the country’s current area of operations. Tokyo has no current plans to send planes and ships into that body of water, but Beijing, which aggressively patrols there, is already upset.

“I think that JSDF operations in the South China Sea make sense in the future,” Thomas said, using the acronym for the Japan Self-Defense Forces. The admiral’s comment signaled Japan would soon take on responsibilities beyond its vicinity because Washington and Tokyo are now in discussions to revise bilateral security guidelines.

An Ominous Chinese Military Parade

Everyone loves a parade.

And, evidently, no one more so than General Secretary Xi Jinping. The Chinese ruler has scheduled a grand military procession through the heart of Beijing in early September. The news of the parade, carried in state and Communist Party media but still not officially confirmed, was unexpected and suggests China will continue to move in dangerous directions.

There have been 14 military parades in the history of the People’s Republic of China.

Eleven occurred between 1949 and 1959, during the era of founder and tyrant Mao Zedong. His first three successors—Deng Xiaoping, Jiang Zemin, and Hu Jintao—each presided over one military parade, all of them on October 1st, National Day.

The last such parade was in 2009, marking the 60th anniversary of the founding of New China, as the party calls the country. The one before that was in 1999. Most everyone, therefore, assumed the next military parade would be held on October 1, 2019.

Improving India-US Relations Unnerves Beijing

Chinese state media both denigrated President Obama’s historic trip to New Delhi this week and excoriated American policy in what appears to be a concerted effort to undermine US-Indian ties. 

On Monday, an American leader attended Republic Day celebrations in the Indian capital for the first time ever, and Obama became the first US president to visit India twice while in office. 

Shifting Relations in North Asia

Discussions this week in Singapore between North Korean officials, led by chief nuclear negotiator Ri Yong Ho, and former special envoy Stephen Bosworth and other American figures ended in calls for the resumption of formal nuclear talks, which have been on hold since 2008. The two-day “Track Two” consultations did not result in any breakthroughs, but the lack of progress in the informal consultations comes amid a flurry of unusual diplomatic activity involving the peninsula.

There was hope in recent days that the Track Two participants might come up with a new blueprint to restart the six-party talks to “denuclearize” North Korea. Instead, Ri used the occasion to lambast Washington and Seoul for their annual joint military exercises, which he termed the “root cause” of problems on the peninsula.

Sri Lankans Boot Pro-China Government

Friday, Sri Lankan voters decisively turned out President Mahinda Rajapaksa, Asia’s longest-server leader. By the end of the day, his former ally and health minister, Maithripala Sirisena, had taken the oath of office. Sirisena, 63, had defected from the government camp only in November, just as the election was called.

The 69-year-old Rajapaksa had called the poll two years before the end of his second term, and it looked like a smart move because, even in the days before the balloting, many expected him to win. He had, after all, ended the civil war by crushing the Tamils and in recent years presided over a period of fast growth.

East Asia's Population 'Death Spiral'

In 2014, Japan experienced the lowest birthrate ever, the fourth-straight year of record low births. There were 9,000 fewer Japanese born last year than in 2013, according to Health Ministry statistics.

Japan is shrinking as it sets one unenviable demographic record after another. Last year, the population fell by a biggest-ever 268,000. “2014’s population decrease was a ‘record’ but it’s a record that is going to be broken annually for the foreseeable future,” writes Forbes’s Mark Adomanis. “By this point it’s essentially inevitable: every January for at least the next 20 or 30 years there will be newspaper headlines stating that Japan’s population just suffered a new ‘record’ loss.”

India Blocks China’s Attempt to Take Over South Asian Group

In late November, New Delhi blocked Beijing’s attempt to gain membership in the South Asian Association for Regional Cooperation. Pakistan, Bangladesh, Nepal, Sri Lanka, Bhutan, Maldives, and Afghanistan are the seven other full members of what some call a club of poor nations.

At the group’s 18th summit, held in the Nepalese capital of Kathmandu, Beijing allies Nepal, Pakistan, and Sri Lanka pushed for China’s upgrading from observer status to full membership. India sought to defeat the initiative because SAARC, as the organization is known, operates on consensus and New Delhi feared that China would block its initiatives in the future.

Is a ‘Proportional Response’ to North Korea a Good Idea?

Last Monday, North Korea lost all Internet connectivity for about nine and a half hours. Tuesday, service was interrupted again, for a half hour. The outages were apparently the results of low-tech denial-of-service attacks. The North's network then went out over the weekend.

So far, a few hackers have claimed responsibility, but some believe the incidents to be the handiwork of US Cyber Command. Yet whether or not the American military was behind the extraordinary events—Obama administration officials are issuing both denials and non-denials—the unusual takedown of the North’s Internet has raised the issue as to what constitutes a “proportional” response.

India’s ‘Annihilator of Enemies’ Takes to the Sea

On Monday, Indian Defense Minister Manohar Parrikar approved sea trials of the INS Arihant, his country’s first indigenously built nuclear-powered submarine. The boat, which first slipped into harbor water in July 2009, is designed to launch ballistic missiles carrying nuclear warheads. “Arihant” means “annihilator of enemies.”

The Indian Navy already operates a nuclear-powered sub. INS Chakra, however, is a Russian Akula-2, leased for 10 years from Moscow and commissioned in April 2012. This “attack” boat, designed primarily to kill other submarines, carries only conventional weapons, most notably torpedoes and cruise missiles.

Obama Cites Dangers in Xi’s Consolidation of Power

At the beginning of the month, President Obama, in comments to the Business Roundtable in Washington, displayed his command of Chinese Communist Party politics. “He has consolidated power faster and more comprehensively than probably anybody since Deng Xiaoping,” he said of his Chinese counterpart, Xi Jinping. “And everybody’s been impressed by his … clout inside of China after only a year and a half or two years.”

“There are dangers in that,” Obama then remarked.

Yes, there are, and it was important for the president to have said so, even if it was unusual for the leader of the free world to comment on the political standing of an authoritarian supremo.

Taiwan Voters Reject China-Centric Policies

Taiwan President Ma Ying-jeou bowed for 10 seconds Wednesday as he confirmed his resignation as chairman of the ruling Kuomintang, taking responsibility for the party’s worst drubbing since 1949, when Chiang Kai-shek fled to the island after defeat in the Chinese civil war. On Saturday, voters thoroughly rejected the KMT, as the organization is known, in elections for 11,130 local posts across the island.

Voters turned down KMT candidates in seats that had been safely “blue” for decades. It was not so much that the electorate had gone “green”—the color adopted by the opposition Democratic Progressive Party and its allies—as much as they had rejected Ma, who was nearing the end of his second and last term.

As the president said while announcing his resignation, “The results of the election tell us our reforms were not made fast enough and have yet to meet the expectations of the people, which is why the KMT failed to win the support of most voters.”

Criminal States Protecting Their Proxies at UN

On November 18, the United Nations Third Committee adopted a resolution recommending the referral of the Democratic People’s Republic of Korea to the International Criminal Court, alleging crimes against humanity. This was the first time a U.N. resolution recommended sending North Korea to The Hague.

The General Assembly is expected to accept the committee’s report next month and formally pass the matter to the Security Council.

 China and Russia, among the 19 voting against the Third Committee resolution, will undoubtedly use their Security Council vetoes to make sure the ICC does not get an opportunity to hear the case.


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