For most of the first quarter, “uneventful” was the best description for bilateral relations between Russia and China. This is especially true when contrasted with the high-profile events in 2009 when bilateral trade declined 31 percent from $56.8 billion to $38.8 billion, Russia sank a Chinese cargo ship in February, the energy “deal of the century” was concluded in April, Moscow’s Cherkizov Market was abruptly closed in June, the 60^th anniversary of diplomatic relations was celebrated in October, and the China-Central Asian gas line and Russia’s Eastern Siberia-Pacific Ocean oil pipeline were opened in December. Only in late March, with the five-day visit by Chinese Vice President Xi Jinping to Russia, was there a return from mutual “hibernation” and an “obsession” with the Obama administration’s policies, though for different reasons. Prime Minister Vladimir Putin’s invitation was also seen as a “back-to-the-future” effort to size up Xi, who is poised to assume the leadership spot in China by 2012. For Putin, 2012 is also the time to retake the Russian presidency, if he desires to do so.

After a decade of rising regionalist aspirations and a flurry of community-building initiatives, the past year and a half has seen a slight shift in the momentum and direction of Asian regionalism.   While the signing of regional free trade agreements continues apace and discussions on regional cooperative mechanisms proceed unabated, the perceptions and political goals of many in the region have been recalibrated in the face of new challenges and new opportunities. By far, the biggest challenge was the global economic crisis, which had a mixed impact on Asian regionalism.  On one hand, it spurred calls for regional action, much in the way of the financial crisis that hit Asia hard in 1997-98.  Moreover, the relatively swift recovery of Asian economies seemed to highlight the fact that world economic power is shifting to East Asia.   On the other hand, crisis revealed the extent to which East Asia remains deeply integrated with the global economy, in both trade and finance, and it called into question the relevance of regional solutions for dealing with global challenges.

New opportunities arose with the election of new political leaders in Australia, Japan, and the US, each of whom placed regional initiatives high on their political agenda. Australia’s Kevin Rudd and Japan’s Hatoyama Yukio laid out competing grand visions for regional architecture that engaged Asian diplomats and policy analysts in lofty and abstract debates about institutional design and the proper membership and pacing for community-building. The change in the US had an even greater impact on regional dynamics.  After years of Bush administration policies that were perceived, fairly or not, as showing a lack of US interest in regional engagement, the Obama team took every opportunity to deliver the message that “the US is back” in Asia.  Its outreach to ASEAN has been particularly aggressive, raising the hopes and expectations of those who would like to see greater US involvement in regional community-building.

On the ground, however, progress on achieving tangible cooperation in regional frameworks, both trans-Pacific and East Asian, has been meager at best.  The global economic crisis gave rise to the G20 that, while elevating the symbolic weight of Asian economies in global governance, has also created institutional competition for regional frameworks.  Regional economic integration faces emerging and unresolved challenges, as the noodle bowl of bilateral free trade agreements (FTAs) grows more tangled and the impact of Chinese economic competition deepens.  Meanwhile, effective frameworks for multilateral security cooperation remain elusive.

The US is back in Asia! This was the central theme of President Obama’s major Asia policy speech, delivered in Tokyo on the first leg of a four-country swing through Asia this past quarter. North Korean “Dear Leader” Kim Jong-il also hinted that Pyongyang might come back to the Six-Party Talks after a visit to the North Korean capital by Special Envoy Stephen Bosworth. Kim did not meet Bosworth but he did meet with Chinese Premier Wen Jiabao at the beginning of the quarter, signaling that he too was back from the death bed many had placed him in. Washington’s commitment to multilateral cooperation was renewed at the Asia Pacific Economic Cooperation (APEC) leaders meeting. Obama also followed through on the Bush administration’s earlier unrealized plan to convene the first-ever full ASEAN-US summit. Historic rivalries within Southeast Asia returned to the front-burner as Thailand and Cambodia turned up the heat in a very un-ASEAN way. Asia’s economies also appear to be returning from the dead while Australian Prime Minister Kevin Rudd’s proposal for a new Asia-Pacific Community refuses to die, despite an apparent lack of enthusiasm within and beyond ASEAN.

In the last quarter of 2009, the US-Japan alliance entered one of the greatest periods of uncertainty in recent memory.  Many of the populist policy proposals of the Democratic Party of Japan (DPJ) fell by the wayside as the party settled into power after trouncing the Liberal Democratic Party (LDP) in August elections.  Fiscal and political realities forced Prime Minister Hatoyama Yukio to shelve several key domestic pledges.  On the foreign policy front, the new government announced Japan would terminate a naval refueling mission supporting coalition operations in Afghanistan, as it had pledged during the campaign, but unveiled a $5 billion aid package focused on infrastructure and vocational training.  President Obama and Prime Minister Hatoyama met in Tokyo in November to discuss Afghanistan and several other issues including North Korea, nonproliferation, and climate change.  However, the summitry did little to conceal Washington’s frustration with Tokyo’s conflicting messages about the US-Japan alliance.  Obama came away from the summit believing that Hatoyama had promised to implement the current bilateral agreement on realigning bases in Okinawa; instead, Hatoyama announced that he would make a decision on how to proceed in the late spring after exploring other options that the Obama administration and Hatoyama’s own ministers of foreign affairs and defense had already dismissed as unrealistic.  The Obama administration was also chagrined to see Hatoyama pledge to other Asian leaders that Japan would move forward with an ill-defined “East Asia Community” in order to reduce Tokyo’s “dependence” on the United States.  Public opinion polls in Japan revealed dissatisfaction with Hatoyama’s approach to the Okinawa issue and his leadership skills overall, while opinions toward the US hit their highest mark ever. Nevertheless, the difficulties managing the alliance cast a shadow over bilateral discussions on how to mark the 50^th anniversary of the bilateral security treaty in 2010.

President Obama’s first-ever trip to China was the main attraction of the fourth quarter. In addition to meeting Chinese leaders, Obama held a town hall-style assembly with Chinese students in Shanghai. The two sides signed a joint statement, the first in 12 years, which highlighted the depth and breadth of the relationship and promised greater cooperation. Nevertheless, the US media mostly faulted the president for not making sufficiently concrete progress on a number of problems. The Copenhagen climate talks garnered much attention in December. As the two largest emitters of CO2, negotiations between China and the US not only occupied the meeting’s spotlight, but also ultimately decided its outcome. Trade friction continued to intensify with both countries launching new investigations and imposing duties on several products. The bilateral military relationship took a step forward with the visit to the US by Xu Caihou, vice chairman of China’s powerful Central Military Commission.

The final quarter of 2009 included a number of significant developments in US-Korea ties. President Barack Obama made his first trip to Seoul in November, and Special Envoy for North Korea Policy Stephen Bosworth traveled to Pyongyang in December.  The summit between Presidents Obama and Lee Myung-bak marked the continuation of an historical high in relations between the two countries.  On issues affecting the alliance, Obama and Lee found common ground on North Korea, while they inched forward with the Korea-US free trade agreement.  Meanwhile, Bosworth’s three days of talks with North Korean officials brought the most encouraging signs of a return to the six-party process since talks broke down at the end of 2008.  The Obama administration is faring well on the Korean Peninsula, even as relations with other major powers of the region become more complicated.  Those accompanying Obama on his trip to Asia informally acknowledged that Korea was the “best stop” on the trip and sensed a personal connection between the two leaders.

The last quarter of 2009 proved to be a quiet one for US-Russia relations.  Although there were no major bilateral rifts, several issues continue to fester, including the impasse over the Iranian nuclear program.  The biggest disappointment, however, may have been the failure to reach an agreement on the replacement for the Strategic Arms Reduction Treaty (START) that expired on Dec. 5.  Negotiations are set to resume in January, but end-of-year remarks by Prime Minister Vladimir Putin about the dangers of the US ballistic missile defense system threaten to throw a wrench into the discussions.  Meanwhile, the long-awaited East Siberian oil pipeline destined for Asian markets has finally come on line.

High-level US efforts to convince Burma’s military government to open its political system to the democratic opposition and release political prisoners prior to scheduled 2010 elections accelerated this quarter.  President Obama, Secretary of State Clinton, and Assistant Secretary of State Campbell all weighed in during meetings in Burma and at the first ASEAN-US summit in Singapore after the annual APEC leaders meeting.  The ASEAN states welcomed the first US summit with all 10 members. Secretary General Surin Pitsuwan noted that President Obama’s praise for ASEAN’s key role in Asian international organizations debunked claims by some that ASEAN is no longer the centerpiece of the region’s architecture.  Singapore’s prime minister insisted that the US continues to be Asia’s “indispensable” player despite the rise of China and India.  In the Philippines, the Visiting Forces Agreement continues to be a political football in domestic Philippine politics as President Arroyo’s political opponents claim that the US military violates the Philippine constitution by engaging in combat – an allegation denied by both the US embassy and the Philippine government.  On a tip from the US, Thai authorities detained a cargo aircraft coming from North Korea with a load of sophisticated weapons in violation of a UN Security Council Resolution.

The last quarter of 2009 featured high-level Chinese leadership diplomacy with individual Southeast Asian countries, ASEAN, and Asian regional multilateral groups. Salient meetings involved the ASEAN Plus 1 and Asian leadership summits in Thailand in October, a presidential visit to Malaysia and Singapore, including the APEC leaders meeting in Singapore in November, and high-level visits to Australia in late October, and Myanmar and Cambodia in December. Chinese official media commentary showed some concern over recently heightened US and Japanese diplomatic activism in the region. The South China Sea disputes and military tensions along the China-Myanmar border were much less prominent than earlier in the year.

Taipei and Beijing resumed progress on economic issues by completing the Memorandums of Understanding (MOUs) on cooperation in regulating the financial sector and signing three technical agreements at the fourth round of SEF-ARATS talks.   Informal talks concerning an Economic Cooperation Framework Agreement (ECFA) continued but no date for starting formal negotiation has been announced.  While the pace of progress is now slow largely because reaching compromises on substantive economic issues has proven to be time-consuming, these agreements further integrate the two economies.  Taipei has continued to resist pressure from Beijing to address political issues about which opinion in Taiwan remains deeply divided.  Cross-Strait trade has recovered quickly from the precipitous drop a year ago and should surpass its pre-recession peak in December.   Slow progress is likely to continue in the coming months.