Top Geopolitical Risks in Asia This Year

AGAMI BRIEF

Agami Briefs are AAA’s outlook reports. Agami (आगामी) which means upcoming in Hindi, are concise memos on important forthcoming events. Agamis aim to inform Members of what to keep an eye out for and when. In this first brief, we look at the key elections happening in Asia for 2020.

Tensions in the South China Sea

SCS disputes have gone on for at least 5 decades since China and South Vietnam fought a brief battle over the Paracel Islands in 1974, resulting in PRC control over the islands till this day. Numerous clashes between the navies and fishermen of China and other claimant states in Southeast and East Asia over the succeeding years have been a repeated source of resentment for the latter.

With China’s rise as a middle-income country and regional military power, these clashes have now seen a greater resolve from Beijing to assert its claims as an increasingly “core” issue.

Since Beijing’s rejection of a 2016 Hague ruling voiding China’s claims in the SCS based on its nine-dash line, Beijing has sought to enforce its claims through physical means. This strategy has weakened Beijing’s already halting efforts to establish a Code of Conduct (CoC) in the SCS and has also revealed the lack of options that other claimant states have to effect their sovereign claims to portions of the SCS.

This year, there is a possibility that Malaysia may file a UNCLOS legal suit to clarify the limits of its continental shelf, and Indonesia could follow a similar path in response to what it says are recent Chinese incursions into its exclusive economic zone north of the Natunas Islands.

As this year’s ASEAN chair, Vietnam is also likely to prioritize ASEAN unity against Chinese encroachments in the SCS and will not be satisfied with a watered down CoC.

If these developments take place, it is not implausible that Beijing will double down and seek to assert its claims over the SCS in a more forceful manner as they have done before. When that occurs, ASEAN will face its greatest test in recent years.

Hong Kong Protests

Hong Kong’s protest movement is seeing a transformation into a permanent political movement with its mass weekly demonstrations seeing dwindling attendance since the new year.

A large number of district councils are now filled with pro-democracy individuals who are supportive of the protest movement. These district councils are expected to expand their mandate from a narrow administration of their constituencies to wider political interests, and should be seen as new staging grounds for future mass mobilisation.

Although Chief Executive Carrie Lam has managed to retain Beijing’s confidence, she will be reporting to a new Director at the Liaison Office of the Central People’s Government of Hong Kong, Luo Huining. What steps he takes to assert Beijing’s authority or to manage the relationships between the now energized pro-democracy bloc in Hong Kong remain to be seen. But what is certain is that he will be eager to avoid any new protests from escalating as they did in 2019.

If Lam does not act to solve some of Hong Kong’s major woes in housing affordability and economic inequality, or makes a misstep in dealing with the outstanding legal cases involving protesters, we could see mass protests break out once more. If such protests last as long as they did in 2019, investors that held out last year may well pack up for good.

US Presidential Elections

Very little can be predicted about the outcome of the US Presidential Election in November. If Donald Trump achieves reelection it will spell 4 more years of continued US withdrawal from Asia. By then, much of Asia would have recalibrated their strategic bets making any future US reengagement beyond 2024 an especially difficult task.

Even if the Democratic nominee triumphs, there is no guarantee that US presence in Asia will be strengthened nor that its Asian partners will throw caution to the wind and welcome the Americans back unconditionally.

The rise of nationalist movements in Japan and Southeast Asia that began well before Trump’s inauguration already presents a hurdle to building trust with any new US administration, though what other choices remain for countries facing a relentless China is anyone’s guess.

It is not clear how Trump or a new US president will deal with the on-and-off issue of North Korea. As it has been for decades, the North has never been a serious existential threat against the US – even while it claims to be so. The real impacts have always been viscerally felt in South Korea and Japan, and how the US president acts towards its East Asian allies – whether reassuring or extracting – will be a better marker of how the wider North Korean issue will be dealt with after the 2020 elections.

By Staff Writers