Secretary of State Hillary Clinton’s choice of Japan, Indonesia, South Korea, and China for her first official trip overseas helped shine a spotlight on Asia as a high priority region this quarter, as did North Korean Dear Leader Kim Jong-il’s announcement that he intended to conduct a satellite launch in early April. The drama surrounding the anticipated launch provided an unfortunate back drop for otherwise very positive pronouncements about intended Obama administration policies in East Asia, even if the quarter closed with only a handful of those eventually to be tasked with implementing these policies at their desks. ASEAN leaders finally held their postponed summit and celebrated the entry into force of their much-maligned Charter.  Meanwhile, Australian Prime Minister Kevin Rudd visited Washington to underscore that the U.S. and Australia are still “mates,” even as his reluctance to send more combat forces to Afghanistan foreshadowed the difficulty President Obama faces in getting allies to sign up for his “surge” there. Finally, economic forecasts kept being adjusted downward as Asian leaders prepared for the G20 summit in London in hopes that this would bring a turnaround.

A new calendar year did little to change the tenor of Japanese domestic politics as the public became increasingly frustrated with parliamentary gridlock and the leadership of Prime Minister Aso Taro, whose approval rating plummeted amid a deepening recession.  Opposition leader Ozawa Ichiro continued pressure tactics against the government and became the favorite to succeed Aso until the arrest of a close aide damaged his reputation and stunted momentum for a snap election.  Aso demonstrated the art of political survival, touting the urgency of economic stimulus over a poll he could easily lose and which need not take place until the fall.  In an effort to prevent political turmoil from weakening Japan’s global leadership role, the government dispatched two Maritime Self-Defense Force (MSDF) destroyers to participate in antipiracy operations in the Gulf of Aden.

The Obama administration wasted little time in establishing a positive trajectory for the U.S.-Japan alliance, first sending Secretary of State Hillary Clinton to Tokyo in mid-February and receiving Prime Minister Aso at the White House shortly thereafter.  The core agenda items for both visits – the economic crisis, North Korea, Afghanistan, and climate change – reflected both regional and global challenges. Bilateral issues also featured prominently on the agenda in the form of an agreement on the relocation of U.S. forces from Okinawa to Guam.  In a fitting end to a quarter of close bilateral coordination, Washington and Tokyo were poised to monitor an anticipated missile test by North Korea and orchestrate a cohesive response that could determine the fate of the Six-Party Talks.

The U.S.-China relationship got off to a good start under the Obama administration, putting to rest Chinese worries that a prolonged period would be required to educate the new U.S. president about China’s importance.  “Positive” and “cooperative” were the two watchwords used repeatedly by Secretary of State Hillary Clinton in her discussions with Chinese leaders, which focused on the need to deepen and broaden the U.S.-China relationship, and to elevate cooperation to address urgent global problems, especially the financial crisis and global warming. In late February, U.S.-China military-to-military ties, which had been suspended by Beijing after the U.S. sold a large weapons package to Taiwan last October, partially resumed with the visit of U.S. Deputy Assistant Secretary of Defense David Sedney to Beijing.  A naval confrontation between U.S. and Chinese ships took place near Hainan Island, which was quickly defused, although the underlying causes remain.  Chinese Foreign Minister Yang Jiechi visited Washington D.C. in March to prepare for the first meeting between the two countries’ presidents, which took place on the margins of the G20 meeting in London on April 1.

The quarter ended with the question of whether President Obama’s first late-night crisis phone call – the metric for leadership bandied about during the campaign – would be over a ballistic missile test by North Korea.  The suspenseful end to the quarter contrasted with its quiet start where the focus of U.S.-ROK bilateral relations was on initial contacts between the Lee and Obama administration teams and policy coordination over the global financial crisis, while the North Korea missile launch issue slowly but steadily moved from a simmer to a slow boil.   However events unfold, the launch itself gives the new administration its first taste of North Korean bad behavior and confronts it with the problem of finding the right balance between under- and over-reaction that is needed to move denuclearization negotiations forward.

The bilateral dialogue in the first quarter of the year was cordial, if somewhat distant.  The administration of President Barack Obama sent clear and positive signals to the Kremlin.  At times President Dmitry Medvedev and Prime Minister Vladimir Putin reciprocated with positive language; at times Moscow’s negative rhetoric reappeared.  Clearly the Russian leadership has been making a cautious assessment of the new U.S. leader.   Optimism was again evident at the London meeting between Obama and Medvedev on the eve of the G20 summit on global economic issues.  In London, the two leaders pledged cooperation on a variety of issues, centering on arms control.  There has been nothing positive in the bilateral relationship to report since last April when then-President George W. Bush visited then-President Putin at Sochi.  Since that time, the relationship has plunged to depths unseen since the Cold War.  Although many observers wish to see progress (and have come to forecast it), there is clearly much work to be done to repair the rift that has developed over the past six years.

Secretary of State Hillary Clinton’s visit to Indonesia, part of her initial overseas journey to Asia, was enthusiastically received in the world’s most populous Muslim country.  The secretary praised Indonesia’s thriving democracy as evidence of the compatibility of Islam and political pluralism. Noting Southeast Asia’s importance to the U.S., Clinton announced that the State Department would begin consideration of a process to sign ASEAN’s Treaty of Amity and Cooperation, a prerequisite for membership in the East Asia Summit.  She also acknowledged that Washington’s harsh sanctions against Burma’s military junta had not changed that regime’s draconian rule but also pointed out that ASEAN’s engagement strategy was equally impotent. Nevertheless, she stated that the U.S. would consult with ASEAN in the process of reviewing its Burma policy.  Meanwhile, ASEAN held its 14th summit in Thailand at the end of February. While the global economic crisis dominated the agenda, the future of a human rights commission mandated by ASEAN’s new Charter proved the most contentious, with the more authoritarian ASEAN members insisting that noninterference in domestic affairs should remain the underlying principle of any human rights body.

Southeast Asian and broader international attention focused in March on the confrontation between five Chinese government ships and the U.S. surveyor ship USNS Impeccable in the South China Sea near Hainan Island. U.S. and Chinese protests and related media commentary highlighted for Southeast Asian audiences a pattern of U.S. surveillance to learn more about China’s growing military presence and activities in the area, and a pattern of China’s unwillingness to tolerate such actions in areas where it claims rights that are disputed by the U.S. and other naval powers. The protests and commentary provided a vivid backdrop for China’s continued efforts to claim and defend territory in the South China Sea that is also claimed by Southeast Asian nations. Meanwhile, there was little good news on the economic front as China’s international trade and economic interchange with Southeast Asia continued to fall rapidly. Chinese diplomatic and political attention to the region remained low during the quarter.

Looking back, it was a hostage to fortune to title our last quarterly review: “Things can only get better?” Even with that equivocating final question mark, this was too optimistic a take on relations between the two Koreas – which, as it turned out, not only failed to improve but deteriorated further in the first months of 2009. Nor was that an isolated trend. This was a quarter when a single event – or more exactly, the expectation of an event – dominated the Korean Peninsula and Northeast Asia more widely. Suspected since January, announced in February and awaited throughout March, despite all efforts to dissuade it North Korea’s long-anticipated Taepodong launched on April 5. This too evoked a broader context, and a seeming shift in Pyongyang. Even by the DPRK’s unfathomable logic, firing a big rocket – satellite or no – seemed a rude and perverse way to greet a new U.S. president avowedly committed to engagement with Washington’s foes. Yet, no fewer than four separate senior private U.S. delegations, visiting Pyongyang in unusually swift succession during the past quarter, heard the same uncompromising message. Even veteran visitors who fancied they had good contacts found the usual access denied and their hosts tough-minded: apparently just not interested in an opportunity for a fresh start offered by a radically different incumbent of the White House.

Beijing and Taipei have been making preparations for the third round of ARATS-SEF talks to be held in May or June at which time additional agreements on finance, flights, and crime are expected.  The global recession has precipitated a dramatic decline in cross-Strait trade and that, in turn, has contributed to accelerated plans to negotiate a comprehensive cross-Strait economic agreement.  However, the planning for such an agreement has produced a storm of opposition protest in Taiwan, which represents the most serious challenge yet to President Ma’s cross-Strait policies. Officials on both sides are speaking optimistically about finding a formula under which Taipei could be an observer at the World Health Assembly (WHA) in May.  Although defense reports from both sides acknowledge reduced tensions, there is as yet no sign that Beijing will reduce the military threat directed at Taiwan.

Top-level diplomacy between Beijing and Pyongyang intensified this quarter in honor of China-DPRK Friendship Year and the 60^th anniversary of diplomatic relations.  Prior to the Lunar New Year holiday in mid-January, Kim Jong-il held his first public meeting since his reported illness with Chinese Communist Party International Liaison Department Head Wang Jiarui. In March, DPRK Prime Minister Kim Yong-il paid a return visit to Beijing.   The Chinese have accompanied these commemorative meetings with active diplomatic interaction with the U.S., South Korea, and Japan focused on how to respond to North Korea’s launch of a multi-stage rocket.  Thus, China finds itself under pressure to dissuade Pyongyang from destabilizing activity and ease regional tensions while retaining its 60-year friendship with the North.  Meanwhile, South Korean concerns about China’s rise are no longer confined to issues of economic competitiveness; the Korea Institute for Defense Analysis has produced its first public assessment of the implications of China’s rising economic capabilities for South Korea’s long-term security policies.  The response to North Korea’s rocket launch also highlights differences in the respective near-term positions of Seoul and Beijing.  Following years of expanding bilateral trade and investment ties, the global financial crisis provides new challenges for Sino-ROK economic relations: how to manage the fallout from a potential decline in bilateral trade and the possibility that domestic burdens will spill over and create new strains in the relationship.

The year 2008 ended with reports that China would begin construction of two conventionally powered aircraft carriers, while February brought news that China was planning to construct two nuclear-powered carriers.  January marked the first anniversary of the contaminated gyoza controversy and despite concerted efforts to find the source of the contamination and the interrogation of several suspects, Chinese officials reported that the investigation was back at square one.  Meanwhile, efforts to implement the June 2008 Japan-China joint agreement on the development of natural gas fields in the East China Sea made little progress and the long-standing territorial dispute over the Senkaku Islands found its way into the headlines following Prime Minister Aso’s February visit to Washington.  In mid-March, China’s defense minister confirmed to his Japanese counterpart Beijing’s decision to initiate aircraft carrier construction.

The first three months of 2009 saw Japan-North Korea relations go from stalemate to hostility, as North Korea’s “satellite” launch on April 5 heightened tensions throughout Northeast Asia. As Pyongyang tried to goad its partners in the Six-Party Talks (the new Obama administration in particular) to induce more favorable terms, Tokyo took steps that may have more far-reaching implications for regional security than merely a plan to deal with the current North Korean missile crisis. Meanwhile, Tokyo and Seoul continued to focus on a practical partnership for economic cooperation and stayed on good terms. The highlight of the quarter was Prime Minister Aso’s successful two-day visit to South Korea in mid-January for a summit with President Lee Myung-bak. Although historical issues lingered as a potential factor that might challenge and disrupt this mood of détente, Japan-South Korea relations improved due in no small part to the Lee administration’s tough policy toward Pyongyang.

The year of 2009, which marks the 60^th anniversary of diplomatic ties between China and Russia, unfolded with a series of high-profile interactions. The “Year of Russian Language” in China was launched, which is to be reciprocated by Russia’s “Year of Chinese language” in 2010. An oil pipeline is finally to be built from Skovorodino to northeast China 15 years after its initial conception. The two militaries were engaged in the first round of talks for joint exercises to be held in July-August. The Shanghai Cooperation Organization held its first special session on Afghanistan as it officially reached out to NATO. Meanwhile, top leaders and senior diplomats were busy coordinating policies regarding the financial crisis and growing tensions on the Korean Peninsula. All of this, however, could hardly conceal a sense of uneasiness, particularly from the Chinese side, about the sinking in mid-February of a Chinese cargo ship by the Russian Coast Guard near Vladivostok. While Beijing requested a thorough and timely investigation, Moscow seemed more interested in a weapons smuggling case allegedly involving top Russian naval officers.