Monitor guidance east asia

In May 2009, Democratic Party (DP) candidate Tsakhiagiin Elbegdorj defeated incumbant Nambariin Enkhbayar of the Mongolian People's Revolutionary Party (MPRP) in a close Presidential race. Elbegdorj took office in June. Despite there being two main political parties, Mongolia’s politicans have been known to switch between parties, and both parties form a coalition government, meaning political transition is more about personality than policy. While there has been occassional bouts of violence related to Mongolian elections, protests and demonstrations don’t normally last long. 

Mongolian economics is dominated by the mining sector.The Democratic party has suggested it may try to better distribute mining profits; in other words try to soak the foreign mining interests. Watch for negotiations or adjustments, and any new potential investment from different countries. 

One other trend in Mongolia since it became un-Communist is a back and forth of nationalization and privatization, often spurred by over-paid foreign consultants. Watch things like the power sector. 
Security:

Internal security is relatively stable, though there are politically-motivated protests and the like occassionally (and some have resulted in deaths). Mongolia’s biggest concerns are its neighbors, China and Russia. Mongolia is afraid to grow too dependent upon either one, and tries to draw in a third power to balance the two neighbors. The obvious choice is the USA, but Washington remains reticent (largely because you cant get to Mongolia without going through Russia or China). Japan has slowly sought to insiunuate itself into Mongolia as a possible substitute, but not with force yet.

Largely the same as the security section and a bit of the econ section - look at how Mongolia deals with its neighbors and with different mining partners. Also watch for Japanese or South Korean expansion of political or economic influence. 

Politics in North Korea are dominated by Kim Jong Il and his family at the core, with the main support group being the National Defense Commission, recently expanded to 12 plus Kim (for a lucky 13). In addition, there is the Worker’s Party of Korea (WPK or sometimes KWP) and the Korean People’s Army (KPA) that have their own elements of power (but are both represented on and managed through hte NDC). The Supreme People’s Assembly (SPA) is another, lesser source of power, more often a reflection of existing influence than a place from which it emerges. 

In North Korea, the current center of political debate (well, not exactly debate, perhaps interest) is the succession program. Kim Jong Il has suggested he will step down in 2012, handing power to his youngest son (Kim Jong Un) who will be backed by a collective leadership group comprising the NDC (with Kim Jong Il at the head of the NDC to manage power as his son learns). There are still two other sons, Kim Jong Nam (AKA Fat Bear, who got caught going to Tokyo Disney and spends most of his time in Macau and Hong Kong - recently talking quite a lot to the media) and Kim Jong Chul, the middle son and a one-time contender for succession (but allegedly too “effeminate” for his dad’s taste). Kim Jong Il’s brother-in-law, Jang Song Thaek, has recently been appointed to the NDC as well.

Other politics revolves around how to deal with South Korea, how to deal with the United States, relations with China, Japan and Russia, and economic policy. Changes in govenrment positions are always important, as are overseas trips of top officials. The ongoing rumors of family and succession struggles are itneresting, but not necessarily vital, as it appears there is a renewed drive by Japan and some others to spread rumors in an attempt to reshape foreign perceptiuon and throw the regime off balance.  

There are none.

Just kidding.

North Korea has a centralized economic system, but has been experimenting with economic reforms, local markets and even private ownership of houses and land. There is a realization that the current economic system doesnt work well, that the country needs change, but there is a fear that economic openess leads too quickly to challenges to the political order. 

North Korea has a history of involvement in illicit activities, from drug running to counterfeiting, as well as less savory activities like missile sales abroad for hard currency. 

Reports of North Korea’s economic condition are often skewed, particularly reports about famine. In North Korea, the northern provinces along the Chiense and Russian borders were usually places whjere the less desirable were sent, and are geographically the places where agriculture flourishes the least. Thus reports of food problems from people in this area to interested parties outside is usually misleading. There is a strong motive to make things look worse, the situation in the north is usally worse than the rest of the country, but observers apply northern conditions to the whole country. 

Keep an eye on the movement of funds from north korean accounts aborad. Also for changes in focus domestically (heavy industry, energy, Kaesong).
Security:

North Korea’s core security concern is the preservation of the elite, with the Kim family at its core. This drives both domestic and itnernational security activities. While North Korea has a large army, with plenty of artillery aimed at Seoul (any details or discussion of the precise nature of this threat would be valuable), its biggest cocnern is the United States. Pyongyang has a strong fear of ending up like Iraq - a country attacked and ultimately invaded by the USA. The missile and nuclear programs serve as deterrents to this, as does North Korea effectively holding Seoul as a human shield. Anti-ship and asymmetric/unconventional capabilities are also where we may see meaningful shifts in DPRK military capability. Keep an eye on ways Pyongyang is attempting to hold its adversaries at risk.

Tests of North Korean nuclear devices and long and medium range missiles are important to monitor. So are reports of North Korea cooperation/activity with other programs abroad as well as sales of its weapons. 

North Korea has threatened possible military action in the West Sea/Yellow Sea, which may include naval clashes or even action against UN/South Korean controlled islands along teh so-called Northern Limit Line (the western extension of teh DMZ into the sea, which North Korea doesn’t recognize because it limits access to the deep water port of Haeju and to the rich crab fishing grounds around one of the islands.)

In addition to North Korea’s actions, watch the way other countries position themselves to deal with North Korea, especially dealing with anti-missile systems and surveillance.
International:

North Korea has the uncanny ability to draw global attention whether it is deserved or not. This is a critical part of Pyongyang’s survival strategy since the end of the Cold War lost it its sponsor - what we have affectionately dubbed the Crazy Fearsome Cripple Gamut. In short, the regime gives the impression it is crazy and unpredictable, then it adds a level of fearsomeness and danger from weapons, making people afraid North Korea might use them if provoked. That alone would not be enough, though, and would invide forceful disarmament. But DPRK added the cripple element, giving the impression the country is always on the verge of collapse. The bigger fear from the neighbors and otehrs is the fear of collapse and dealing with the aftermath, which would include refugees and the flow of arms and weapons all over the place. Thus the international community does what it can to keep North Korea from collapsing, giving North Korea the leverage it needs to survive. 

With additional punitive measures on North Korea for its latest round of nuke and missile tests, keep an eye out for movement of North Korean funds, for interception of North Korean ships, and the like.

TAIWAN
Politics:

The two major parties in Taiwan are the ruling Kuomintang (Nationalist Party, or KMT) and the opposition Democratic Progressive Party (DPP). The KMT retook the presidency a little over a year ago with Ma Ying-jeou’s victory, ending two terms of DPP leadership under then-President Chen Shui-bian. Internal politics are often dirty in Taiwan, and both sides engage in mud-slinging, street protests and corruption and other legal investigations. One of the biggest issues is always China policy, and the KMT has engaged in a policy of peaceful cooperation with Beijing in order to ease tensions and gain more “international space” for Taiwan, and the DPP is now facing an internal debate over how to respond to a Chinese offer to begin engaging DPP officials. It is important currently to watch the evolution of the debate in the DPP, and the potential for Beijing to use its offers to weaken the ostensibly pro-independence DPP. 

Like much of the region, Taiwan’s economy is heavily tied to exports. Over the past several years, there has been an increase in Taiwanese economnic integration with mainland China, and this has both helped the Taiwanese economy, and contributed to political cocnerns. The rural farmers traditionally supported the DPP, but Chinese openings to Taiwanese produce weakened that connection. It is hard to seperate economics from cross-straits politics at times, so watch for deals made via political parties as opposed to the govnerment. 

Taiwanese security revolves around the China-Taiwan-USA triangle. Washington tries to keep an uneasy balance in the region, backing Taiwan’s defense, but not granting Taiwan access to defense materials that would give Taipei more independence of U.S. security and political influence. Chinese missile numbers are always a major issue. Taiwan’s quest for more submarines, and any new ASW capabilities or activities are important to watch, as is Taiwan’s potential expansion of security ties with Japan.

Aside from the ever-present China issue, Taiwan’s international relations focus now on gaining “international space” - a euphamism for more representation in multilateral international bodies, particularly various organizations under the United Nations. Two major ones Taipei is focusing on next, after the WHA victory, are the IMO and the ICAO. Also watch for the continued (but much quieter these days) dollar diplomacy as Taiwan tries to keep its few remaining diplomatic connections, and China counters. Any overseas travel by the president needs watched.

Indonesia is a product of the anti-colonialism movement following World War II. Founding President Sukarno harnessed the new nationalism to hold the vast archipelago together, balancing numerous political forces including the Muslims, non-Javanese and communists. It was his flirtation with the latter that gained his successor, Suharto, the opportunity to throw a US-encouraged coup, first putting down a “communist rebellion,” then ultimately seizing power. Suharto held teh island nation together through an invasive bureaucracy (in the form of Golkar - meaning “functional group” - to which everyone on government pay, from the military to school teachers, held membership), a strong military with a regional command system, transmigration policies to mix up the ethnicities (and to ensure continued Javanese dominance) and a strongly centralized economic power (centralized in the person of Suharto himself). 

Suharto’s downfall in the wake of the Asian economic crisis led to a period of political uncertainty as the elite jockeyed for position and tried to avoid massive infighting or loss of territorial integrity (though East Timor did break free during this period). Suharto was replaced in the interim with his VP, Habibi. Abdurrahman Wahid became the next President, representing one of the two largest Muslim organizations in the country (his being less fundamentalist than that of his rival Amien Rais). Wahid never finished his term, his “cabinet of national unity” a dismal failure, and his VP, Megawati Sukarnoputri, daughter of founder Sukarno, took over. Megawati was a relatively ineffective president, and lost in the next election to Susilo Bambang Yudhoyono, the current President. Yudhoyono had ties to numerous pillars of Indonesian elite - the military, the backing of the Muslims, the popular street (previously held by Megawati), Golkar and the economic community. 

Indonesia is heading for another Presidential election in July. Yudhoyono (Democrat Party) has teamed up Boediono, an economist and Bank of Indonesia governor, to take on his former VP Jusuf Kalla (Golkar) and his running mate General Wiranto (Hanura/People’s Conscience Party), and Megawati (Indonesian Democratic party of Struggle PDI-P) who teamed up with former General Prabowo Subiantoro.

Politics in Indonesia can be violent, and large demonstrations clashing are not unusual in election season. 

Political power is centered in Java, the most populous island, while the further away from Java one travels, the less influence a province has in the center. 

Once a major oil exporter, Indonesia is now a net importer.

Indonesia’s economy has done better in the current global slowdown than some of its neighbors, registering a GDP growth rate in 1Q09 of 4.4 percent. GDP in 2008 was just shy of $500 billion. 

Java is the power of Indonesia, but Java exploits resources in other islands, adding a bit of tension to the economic policies. The central government has experimented with greater autonomy in economic activity for provinces to alleviate some of this pressure. 

Look for new investments in energy and mining. Watch for developments regarding Japanese, Chinese, US and Australian investments, aid or trade. 
Security:

A heavy security focus is on the potential for domestic separatist activity. The two potential hot spots are Aceh (where the Free Aceh Movement - GAM - is now partially cooperating with Jakarta, though there are elements still hiding out in the mountains) and Papua (also called West Papua or Irian Jaya, where the Free Papua Movement - OPM - and others are often engaged in small-scale activities, as are rebel soldiers who get stir crazy being stuck out in the jungles of Papua for too long).

Due to its size and dispersion, Indonesia is a hard place to control militarily. Transport aircraft is vital, and the military has seen several crashes recently. Maintenance was delayed for years after the US cut off spare parts. Watch for expanded budgets for new aircraft. 

Indonesia has become more aware of the potential to lose many of its smaller outlying islands to others, and the Navy is trying to step up patrols and get more ships. Keep an eye on these developments, as well as potential clashes or verbal exchanges with its neighbors over counter-claims to maritime territory and resources.

Indonesia is a key player in ASEAN, and to a lesser extent NAM. It sits astride one of the most important maritime choke-points - the Strait of Malacca - and has an occasionally cooperative occasionally contentions relationship in dealing with maritime security with its neighbors Malaysia and Singapore.  

There is a slow and quiet game for influence over Indonesia among China, Japan and Australia. The United States is coming in a little late to the game. 

THAILAND
Thailand is the core of mainland Southeast Asia, a GDP around $250 billion, an ally of the US, and a popular tourism and travel hub. It was never colonized by a European power, and was one of the first Asian countries (following Japan’s lead) to modernize and westernize in the twentieth century. Thailand is mainly interesting for two reasons: (1) global economic significance as a regional finance center and export powerhouse (2) constant, cyclical domestic social and political disruptions that lead to mass protests and often (19 times since 1932) military coups.
ECONOMY:

Thailand is the second biggest economy in the sub-region (second to Indonesia) and a leader in the Association of Southeast Asian Nations (ASEAN). Bangkok is a vibrant export and finance hub for the region – crucial enough that the collapse of its currency triggered the Asian Financial Crisis of 1997-8. After recovering from that crisis, Bangkok has not shown itself to be the most stable economy in 2008-9 because it is still highly export dependent, and political impasse has eroded public finances. The Thai population was humiliated by the country’s borrowing from foreign institutions (like the IMF) to get out of the previous crisis, and the current Democrat Party-led government will incur similar criticism by reaching out to foreign lenders to help in the current recession (though this time, because Thailand’s reserves are deep, there is not a risk of debt default or anything so grave).

Recently the focus falls on Thailand because of its unstable domestic political and social situation. The first thing to know about politics in Thailand is that the country is (1) a highly religious kingdom, in which the monarchy is revered on a level with Buddha (2) that big business and free market capitalism has disrupted this old world order, over the past twenty years especially. Essentially the country is divided in half between the old status quo, which consists of members and sympathizers with the civil bureaucracy, military, palace, whose power is centered in Bangkok (where the palace and military are stationed) and in the Southern regions, and the new rich – the big business class that has infiltrated all levels of political power, and often draws its support from the poor rural people in the country’s north and northeast. The new rich is embodied in the form of former Prime Minister Thaksin Shinawatra, who is in exile after the military deposed him in 2006, but who continues to control proxy politicians in the country because of his popularity.

Thailand is a long-time American military ally, though the alliance has become far less relevant since the US withdrew from Vietnam in 1975 and China opened up to the world in the late 1970s (and Beijing helped stopped Vietnamese communists from funding Thai communist rebels). Because it is lodged in the center of Southeast Asia, Thailand is constantly struggling with its neighbors over borders (as it has for its whole history). Border disputes are important to watch.

Thailand is a member of ASEAN and other major international groups, and has good relationships with the US, Europe, China, Japan, South Korea and others. Thailand needs energy and raw materials from Myanmar, and generally agrees not to interfere with its internal politics (as with other ASEAN countries who generally try to avoid criticizing each other for their own domestic political issues). Bangkok is thought to not get along well with Singapore, and border disputes with Cambodia and tensions with Malaysia over the southern insurgency are always simmering.

POLITICS

Malaysia has a tight grip on the internal security situation due to the colonial era Internal Security Act, which has never been repealed and gives authorities sweeping powers, and also due to Mahathir’s heavy hand in managing internal situation during his 22 year premiership. However protests emerge from ethnic minorities and political groups frequently and sometimes turn violent. Malaysia has also had Muslim militants from all over the world seek to hide, plan or gather funds inside its borders, creating tensions with neighbors like Thailand and other interested players, such as the US after 9/11. Malaysia has played an active role in fighting piracy in one of the world’s most important maritime transit points (the Straits of Malacca on the southern tip of the Malay peninsula) and has been attempting to upgrade its naval capabilities to defend its maritime boundaries (and resources) in the South China Sea and Indian Ocean.

Malaysia is a member of ASEAN, a predominantly Muslim country with ties to the Middle East, an energy exporter with ties to energy consumers, and thorough links with other states in the East Asian manufacturing and supply chain. Kuala Lumpur, especially under Mahathir, has occasionally been a harsh critic of the west, after having successfully avoided the IMF’s strict fiscal prescriptions during the Asian Financial Crisis (and come out the better for it).