This has been a quiet but constructive quarter in cross-Strait relations.  Taipei and Beijing were focused on ratifying and beginning implementation of the Economic Cooperation Framework Agreement (ECFA). With Beijing’s agreement, Singapore and Taipei announced that they would consider negotiating a WTO-consistent economic cooperation agreement. This important flexibility by Beijing allows President Ma to show that ECFA has opened the door at least slightly to Taiwan’s involvement in regional trade liberalization.  Despite Washington’s approval of small commercial arms sales, Beijing indicated a willingness to resume military exchanges with Washington. Nevertheless, arms sales to Taiwan remain a threat to US-China relations.

The past quarter in inter-Korean relations might be called the morning after the night before. Tensions over the sunken ROK corvette Cheonan by no means disappeared; the less so since North Korea still denied responsibility, while the South smarted at its failure to convince key powers – China and Russia above all – of Pyongyang’s culpability. The Cheonan incident remains a crime and an obstacle.  Yet hopeful signs are emerging that both sides realize they will have to get past this eventually and that they might as well start now. Among various small initiatives, including flood aid, the quarter ended on a hopeful note with an agreement to hold a fresh round of reunions of separated families in late October.

China reaffirmed its traditional friendship with a revamped leadership in Pyongyang that emerged from the historic Workers’ Party of Korea (WPK) conference that re-elected Kim Jong-il as party and state leader.  Kim Jong-il visited Northeast China, holding his second summit with President Hu Jintao this year. Immediately after Pyongyang’s party conference, Secretary of the WPK Central Committee Choe Tae-bok led a senior party delegation to Beijing to brief President Hu and other officials. Meanwhile, China-ROK relations remain strained following the March 26 Cheonan incident, marking the lowest point in bilateral relations since diplomatic normalization in 1992.  The third China-ROK high-level strategic dialogue was held in Beijing. China and South Korea also held their first preliminary round of free trade agreement talks. Beijing promoted resumption of the Six-Party Talks, sending Special Representative for Korean Peninsula Affairs Wu Dawei to meet counterparts in Pyongyang and Seoul.

The quarter started well. The Kan government, emphasizing efforts to strengthen economic ties with China, appointed Niwa Uchiro, former president of the trading giant Itochu Corp., as Japan’s new ambassador to China. Talks to implement the June 2008 agreement on joint development of the East China Sea began in Tokyo in late July.  Prime Minister Kan and all Cabinet members refrained from visiting Yasukuni Shrine on Aug. 15.  In early September, Japan began the destruction of chemical weapons left behind in China by the Imperial Army at the end of the war. The quarter, however, ended in controversy.  Sparked by the Sept. 7 incident in which a Chinese fishing boat operating near the Senkaku Islands collided with two Japanese Coast Guard ships, relations quickly spiraled downward.  The Japanese Coast Guard detained the captain and crew setting off a diplomatic row that led to the Japanese ambassador being called in for a midnight demarche as well as the personal involvement of Premier Wen Jiabao before Japanese prosecutors released the ship’s captain on Sept. 24.  China’s call for compensation and an apology went unanswered as of the end of the quarter.

The two highlights in Japan-Korea relations during this quarter are Prime Minister Kan Naoto’s apology to South Korea for Japan’s colonial rule, and the appointment of Kim Jong-un, as vice chairman of the Workers’ Party Central Military Commission and military general in the Korean People’s Army. While these developments hold the promise to potentially change the security landscape of Northeast Asia, Prime Minister Kan’s first full quarter in office reveals that Japan’s North Korea policy is likely to continue along the lines of previous Japanese administrations, at least for now: an unfavorable attitude coupled with hostility and inaction. Pyongyang’s attitude toward Tokyo, too, changed little and remained more or less predictable – it denounced Prime Minister Kan for apologizing only to South Korea, criticized Japan for “shamelessly” wanting a permanent seat at the UN Security Council, and demanded compensation for all of Japan’s past wrongdoings. Japan-South Korea relations appear to be moving closer, although whether Kan’s apology will truly change anything remains to be seen.

For much of the third quarter, Russia and China were besieged by disasters of various kinds. Leaders sent each other messages to express their sympathy and support while relief materials were delivered.  Bilateral relations began to gather momentum at the end of August when Prime Minister Putin attended the opening of the Russian-Chinese oil pipeline. In September, the Shanghai Cooperation Organization kicked off its Peace Mission 2010 exercise in Kazakhstan. This was followed by President Medvedev’s state visit to China in the name of “comprehensively deepening Russian-Chinese strategic partnership relations.” All of this occurred against the backdrop of heightened tension on the Korean Peninsula after the sinking of the South Korea Navy ship in March and the rapid deterioration of China-Japan relations after Japan’s seizure of a Chinese fishing boat in early September.

In 2010, Australia saw a first-term-elected prime minister deposed by his own party and then a federal election that produced a hung Parliament. The Labor Parliamentary caucus removal of Prime Minister Kevin Rudd on June 24 ushered in Australia’s first female prime minister, Julia Gillard, who waited only three weeks after replacing Rudd before calling a national election, seeking her own mandate from the voters. Instead, the election on Aug. 21 returned the first hung Parliament since World War II. The new Labor government will live on the permanent brink of defeat – fearing an MP’s heart attack, a defection, a by-election.  Gillard has won the right to negotiate for her policy preferences, not to impose them. Running a minority government will demand an almost unremitting domestic focus from Gillard. She has promised a more consultative, inclusive style of politics. The Australian Financial Review summed up the difference between the two leaders with this quote from a senior ministerial adviser: “Kevin governed from a two-man tent. Julia will need a marquee.” Style changes between the Rudd and Gillard governments will be marked. But policy continuity will often be the norm, especially in foreign policy.

Gillard fulfilled her promise to give Rudd a senior post in her government by appointing him foreign minister. The challenge for Rudd will be whether he can put aside his deep personal hurt – and the political habits that brought him down – to serve the woman who deposed him. To put the Canberra question in a Washington frame: Can Kevin do a Hillary? Can Rudd be a loyal and effective foreign minister following the example set by Hillary Clinton as secretary of State?

Hopes for a resumption of Six-Party Talks this past quarter were torpedoed when an international investigation team concluded that the ROK Navy ship Cheonan was deliberately attacked by a North Korean submarine. The Chinese, while scuttling plans for UNSC censure of Pyongyang, fired a warning shot of their own, denying Defense Secretary Gates’ request for a China visit after the Shangri-La Dialogue in June in a sign of continued displeasure over US arms sales to Taiwan. Also once again torpedoed, this time by an oil spill, was President Obama’s twice-delayed “homecoming” visit to Indonesia.

ASEAN defense officials gathered in Singapore in June for the Shangri-La Dialogue but not until after convening their fourth ASEAN Defense Ministers Meeting (ADMM) in Hanoi in May where they finalized plans for a broader multilateral ADMM Plus Eight confab to improve regional defense cooperation. If successful, the ADMM+ could render the Shangri-La Dialogue obsolete. Other regional multilateral activity included the third China-Japan-South Korea Trilateral Summit and the 10^th Shanghai Cooperation Organization (SCO) Summit, while globally the G8 and G20 met for the first time back-to-back in Canada, with the G20 beginning to outshine its older more exclusive cousin.

The Obama administration published its overdue National Security Strategy and Nuclear Posture Review reports this quarter, outlining its overall strategic priorities and the (diminished) role of nuclear weapons as, together with Moscow, Washington made a New START toward its declared goal of a nuclear weapons-free world. Nuclear safety and security were very much on the president’s mind as he convened the first ever Nuclear Security Summit involving leaders and other senior officials from 49 countries in Washington and applauded the success of the 2010 Nuclear Nonproliferation Treaty Review Conference in New York.

Finally, it’s been a rough quarter politically in East Asia, especially in Thailand where “red shirt” protests and government reactions both turned violent. In Japan, Prime Minister Hatoyama chose to walk the plank (and took ruling party Secretary General Ozawa with him) in hopes of salvaging his party’s chances in the upcoming Upper House elections while Prime Minister Rudd was also a victim of a surprise attack, in this case coming from his own party. A peaceful transfer of power did take place in the Philippines, however, and Hong Kong took another baby step toward promised universal suffrage.

The relocation of Marine Corps Air Station Futenma on Okinawa remained the predominant issue in the US-Japan relationship and the two governments issued a joint statement in late May reaffirming a commitment to realize a plan adopted in 2006 with some modifications to be explored.  Prime Minister Hatoyama then resigned as polls revealed frustration with his handling of the Futenma issue and weak leadership overall.  Finance Minister Kan Naoto succeeded Hatoyama as premier and outlined his own policy priorities just weeks before an important parliamentary election.  Kan stressed the centrality of the US-Japan alliance to Japanese diplomacy and reiterated the theme in his first meeting with President Obama at the G8 Summit in late June.  The two leaders’ first meeting was business-like and lacking for drama – exactly as both governments had hoped.  New public opinion polls suggested political turmoil at home has not had a significant impact on Japan’s standing globally or in the US, but some observers continued to suggest the US should lower expectations of Japan as an ally in the debate about the future of the alliance.

Presidents Barack Obama and Hu Jintao met twice this quarter, first on the sidelines of the Nuclear Security Summit in Washington in April and again on the margins of the G20 Summit in Toronto in June.  Nevertheless, tensions lingered over US arms sale to Taiwan and the military relationship remained suspended. The Chinese rejected a request from Secretary of Defense Robert Gates to visit China.  The second round of the Strategic and Economic Dialogue was held in Beijing in late May, yielding agreements on energy, trade environment, and healthcare.  Many hours were spent during the quarter in discussions between the two countries on an appropriate response to the sinking of the South Korean warship, but the gap was not narrowed.  In June, China finally announced the long-awaited decision to allow its currency to be more flexible, though it remains unclear how fast and to what extent it will permit the yuan to appreciate.