Multilateralism was the order of the day in the Asia-Pacific this quarter. Two sessions of the Six-Party Talks and a number of associated bilateral and multilateral working group sessions were held, culminating in a “breakthrough” at quarter’s end, at least in terms of the disablement of North Korea’s nuclear facilities at Yongbyon. The ASEAN Regional Forum (ARF) and associated 10+X ministerial meetings took place amid reports of steady progress on the development of ASEAN’s first Charter. The annual Asia Pacific Economic Cooperation (APEC) Leaders Meeting resulted in rhetorical commitments to combat global warming and move the Doha round of trade talks forward, while President George W. Bush met for the third time in a summit with assembled ASEAN leaders along the APEC sidelines. The failure of Secretary of State Condeleezza Rice to attend the ARF meeting (her second miss in three attempts) and the cancellation of Bush’s follow-on visit to Singapore (for what would have been his first full summit meeting with ASEAN leaders) renewed concerns about the U.S. commitment to the region, despite the deepening of the U.S.-ASEAN Enhanced Partnership. Multilateral military cooperation included major exercises in the Indian Ocean and Central Asia by what some portray (inaccurately?) as emerging rival blocs. Democracy watchers continued to keep a close eye on Bangkok’s slow return to democracy and election dynamics in Seoul and Taipei, even while expressing revulsion over the latest giant step backward taken by the military junta in Rangoon.

The Liberal Democratic Party (LDP) was defeated in the July 29 Upper House election and lost its majority to a coalition led by the Democratic Party of Japan (DPJ).  Abe Shinzo vowed to stay on as prime minister despite calls for his resignation, reshuffling his Cabinet in late August and then continuing diplomatic initiatives in meetings with President George W. Bush and others at the APEC summit in Sydney.  However, presented with news from his doctors that his ulcer-related health problems were now chronic and facing intractable opposition from DPJ leader Ozawa Ichiro to an extension of the government’s counterterrorism law in support of Operation Enduring Freedom, Abe suddenly resigned a week after the Sydney summit.  The quarter came to a close with Fukuda Yasuo succeeding Abe and vowing to forge ahead with economic reforms and strong support in the war against terror.  But Fukuda only has three months to win back public support as the Diet could deadlock during contentious budget negotiations early next year, forcing an election for the more powerful Lower House by the spring.  Such a showdown seems likely, given Ozawa’s pledge of a no-holds-barred fight to destroy the LDP.

Continued recalls of Chinese-made products prompted actions by both the U.S. and China to shore up consumer confidence and enhance bilateral cooperation on food and product safety. Presidents George Bush and Hu Jintao discussed a broad range of economic and security issues on the sidelines of the APEC leaders meeting in Sydney.  Treasury Secretary Henry Paulson traveled to China at the end of July to prepare for the third round of the Strategic Economic Dialogue (SED) scheduled for December amid attempts by Congress to pass legislation that would punish China if it does not revalue its currency.  U.S. Chief of Naval Operations and Chairman of the Joint Chiefs of Staff- designate Adm. Mike Mullen made a six-day visit to China during which he was given unprecedented access to China’s navy.

In an historic breakthrough at the Six-Party Talks, North Korea committed to disabling its Yongbyon nuclear facilities and declaring all its nuclear programs by Dec. 31, 2007. It also pledged not to transfer nuclear materials, technology, or know-how.  In exchange, the U.S. agreed to move toward normalizing relations with Pyongyang by fulfilling its commitment to take North Korea off the list of state sponsors of terrorism and end the application of the U.S. Trading with the Enemy Act as Pyongyang fulfills its denuclearization commitments.

North Korea’s agreement in the nuclear negotiations created a positive atmosphere for a successful North-South summit, held Oct. 3-4 in Pyongyang.  In their summit declaration, signed by President Roh Moo-hyun and Chairman Kim Jong-il, the two Koreas pledged to work together on security, economic and humanitarian issues while making only passing reference to smoothly implementing the Six-Party Talks agreement. Significantly, the declaration also explicitly acknowledged that “the South and the North both recognize the need to end the current armistice regime and build a permanent peace regime.” According to U.S. Ambassador to South Korea Alexander Vershbow, Washington and Seoul “have already begun consultations…in order to develop a common approach” to this issue.

As the ratification process for the Korea-U.S. Free Trade Agreement (FTA) moved ahead, Seoul resumed imports and inspections of U.S. beef.  South Korea seemed to take seriously the warning of U.S. Secretary of Agriculture Mike Johanns that the Congress would not ratify the FTA as long as restrictions on U.S. beef remain in effect.  In early September, the South Korean government submitted the FTA to the National Assembly for ratification.

Finally, in a change long sought by South Korea, President Bush signed into law in early August a measure that will allow South Koreans to visit the U.S. without a visa, for a period of up to 90 days.  The change is set to go into effect in July 2008, at the time the Korean government is expected to issue biometric “e-passports” to its citizens.

Despite the progress made on several fronts, there was also an undercurrent of tension that marked the relationship between both Koreas and the U.S. throughout the quarter. Nevertheless, each time the tension bubbled to the surface both sides seemed intent on smoothing over the differences and moving on with the issue at hand.

Any casual observer of the U.S. and Russia recognizes the deterioration of relations since the beginning of the war in Iraq in 2003.  Until recently, this entailed diplomatic lectures, energy nationalism, spying, Great Game politics in Central Asia, and a worsening opinion of one another among the general publics of both nations.  This past quarter saw the re-emergence of something not seen since the days of the Cold War: military posturing.  This has taken the form of military exercises, increased military expenditures, a re-emphasis on arms exports, a race to claim territory, and actual “meetings” of armed personnel in the skies and in the sea lanes around the Eurasian periphery.  The primary points of contention that have existed since 2003 continue to harm relations (Iraq, Iran, the former Yugoslavia, and missile defense, among others), but now Moscow has taken the next step in reasserting itself as a global power: bolstering its long-beleaguered defense establishment.

Asia’s largest multilateral naval exercise in decades took place in the eastern Indian Ocean Sept. 4-9, involving ships and aircraft from the U.S., India, Japan, Australia, and Singapore.  Extensive combat, antiterrorism, and humanitarian assistance scenarios were included. President Bush condemned the Burmese junta for its brutal suppression of anti-regime demonstrations. Secretary of State Condoleezza Rice bypassed the annual ASEAN Regional Forum gathering for the second time in three years while President Bush postponed the U.S.-ASEAN summit originally scheduled for September and left the Sydney APEC summit a day early, demonstrating that Asia’s importance continues to take second place to Washington’s Middle East tribulations. Antiterrorist support dominated U.S.-Philippine relations this quarter. The Indochinese states were featured in several U.S. statements on trade and human rights in Vietnam, Hmong refugees from Laos, and counterterrorism training for Cambodia. Washington continued to press for the restoration of democracy in Thailand, looking forward to elections in December.

Chinese President and Communist Party General Secretary Hu Jintao toured Australian cities, engaged in summitry, and presided over the Chinese delegation at the Sydney APEC meeting. The events elicited positive publicity that underlined a good Chinese image and redounded to the benefit of Hu and the party leadership as they stressed stability and harmony at home and abroad in the lead up to the 17^th Chinese Communist Party Congress in Beijing in October. Regional harmony and China’s international image were seriously challenged in late September when the military junta in Myanmar, which regards China as its major foreign supporter, cracked down violently on swelling anti-government demonstrations led by thousands of Buddhist monks. China has long worked to block UN and other international pressure against the military regime, but faced strong pressure led by U.S. President George W. Bush to support UN and other international efforts to stop the crackdown.

Beijing is preparing for the 17^th Party Congress, projecting an image of orderly authoritarian politics.  In Taiwan, the volatile and unpredictable democratic politics of the presidential campaign are raising issues and prompting expressions of serious concern in Beijing and Washington.  The focal points have been President Chen Shui-bian’s quixotic appeals to join the UN as “Taiwan,” the Democratic Progressive Party’s (DPP) promotion of a referendum on UN membership under that name and DPP Chairman Yu Shyi-kun’s proposal for a new DPP resolution on making Taiwan a “normal country.”   The strong international reaction to these maneuvers has not deterred Chen or the DPP from the referendum on UN membership that is driven by their domestic political calculations.  However, the U.S. position did provoke debate and contributed to a DPP decision to reject the most provocative aspects of Yu’s proposals on the “Normal Country Resolution.”  What the Taiwan voters will do remains to be seen.  Against this background, it is hardly surprising that the few authorized cross-Strait contacts that have occurred have produced no results.

The main event between the two Koreas in the third quarter of 2007 was, obviously, President Roh Moo-hyun’s visit to Pyongyang. This was the first North-South summit meeting in seven years, and only the second in the 59 years since two rival states were declared in 1948 under respective U.S. and Soviet patronage, each claiming – as they do still, even after a decade of “Sunshine” – to be the sole legitimate government on the peninsula. Originally scheduled for late August, the summit was postponed until early October after North Korea was hit – yet again, and worse than ever – by crippling floods. Strictly, then, it fell outside the third quarter. But it would be perverse to exclude so key an event, especially since anticipation of how it would go dominated August and September.

Moreover, the fact that the summit coincided, almost to the day, with further progress at the Six-Party Talks (SPT) added an extra twist to what, however one evaluates it, was a crucial moment in the tangled history of inter-Korean relations. Time will tell, and we shall have a clearer idea by the year’s end; or maybe not till early 2008, when a new and almost certainly more conservative leader in Seoul – Roh’s successor will be elected Dec. 19, taking office Feb. 25 – must decide how far to accept and implement the eight-point agreement that Roh signed with Kim Jong-il.

To this writer, skeptical like many, this looks a better deal than feared. Despite regrettable if predictable brevity on the nuclear issue, and a deafening silence on human rights, the new agreement, if implemented – always a big proviso with the DPRK – presages the start of serious, large-scale, and wide-ranging inter-Korean economic cooperation. If some critics still find this one-sided – no prizes for guessing who will write the checks – at least now the focus is on solid infrastructure and joint business; it’s not simply aid (much less cash) that Kim Jong-il can use as he pleases, as was too often the case hitherto.

China and South Korea commemorated the 15^th anniversary of diplomatic normalization Aug. 24.  In contrast to the unbridled optimism and buoyant lure of mutual economic opportunity that characterized the 10^th anniversary of normalization, this one was greeted with more realism and mixed feelings about the future of the relationship.  China’s relationship with North Korea, in contrast, remained estranged as ever despite an important meeting between Foreign Minister Yang Jiechi and National Defense Commission Chairman Kim Jong-il in Pyongyang. This was the first Chinese high-level contact with Kim Jong-il since Tang Jiaxuan went to Pyongyang as a special envoy immediately following North Korea’s nuclear test in October of 2006.

Changes in the Sino-South Korean economic relationship, driven by China’s rising international competitiveness, changes in Chinese investment regulations safety, and concerns attached to Chinese consumer products, were reinforced by the sudden death due to medical error of South Korea’s number two diplomat in Beijing. South Korean caution regarding Chinese policies toward North Korea remained a central focus of concern, as China’s economic growth and influence continued to expand in both parts of the Korean Peninsula.

As the second half of 2007 began, Japan focused on the Upper House election held July 29. Beset by political scandals and dogged by questions of competency, the Liberal Democratic Party (LDP) suffered a historic defeat. Following the election, Prime Minister Abe Shinzo was preoccupied with a Cabinet reshuffle that resulted in the appointment of Machimura Nobutaka as foreign minister and Komura Masahiko as minister of defense.  At the same time, the government was preoccupied with preparations for the Japan-North Korea Working Group meetings as the Six-Party Talks appeared to gather momentum. Meanwhile, Beijing worked to accentuate the positive, the approaching anniversary of the normalization of Japan-China relations (1972) and to downplay history, the July anniversary of the Marco Polo Bridge Incident (1937).

The tempo in the bilateral relationship began to pick up with the late August visit to Japan of China’s minister of defense and the early September meetings between Prime Minister Abe and President Hu Jintao on the sidelines of the APEC meeting in Sydney.  On Sept. 12, Abe announced his resignation. Beijing’s reaction was to make clear the importance China places on the development of a stable bilateral relationship.  On Sept. 25 Beijing congratulated Prime Minister Fukuda Yasuo on his accession to office and expressed hope that the reciprocal strategic relationship would continue to develop in a healthy and stable manner.

If the previous quarter was marked with little movement in the stalemate between Tokyo and Pyongyang, this quarter appears to be transitional. North Korea shut down the Yongbyon nuclear reactor and announced its intention to disable other nuclear facilities by the year’s end. In Japan – Abe Shinzo who gained national popularity for his hardline approach to North Korea – stepped down in September, and Japan’s new Prime Minister Fukuda Yasuo has hinted at softening Japan’s stance toward the North. Arguably, the quarter’s developments signaled that the pendulum of Japanese foreign policy may swing back closer toward dialogue with Pyongyang.

Abe’s decision not to visit Yasukuni Shrine on Aug. 15 was welcomed by Seoul, keeping bilateral relations relatively cool compared to the wars of words that had occurred under Koizumi. History issues continued to linger between Japan and South Korea, as Seoul made noises about Japan’s “lack of repentance” on its 62^nd Liberation Day and the two countries continued to clash over the naming of the Sea of Japan/East Sea and over Japan’s 2007 Defense White Paper’s inclusion of the Dokdo/Takeshima islets as part of Japanese territory. But the quarter also witnessed important efforts aimed at strengthening bilateral cooperation. Tokyo and Seoul agreed to conduct joint surveys on the level of radiation in waters near the Dokdo/Takeshima islets and on daylight savings time policies. South Korea seemed reasonably happy with Fukuda as Japan’s new prime minister, as he said early on that he would seek more friendly relations with China and South Korea and not visit Yasukuni Shrine. Tokyo expressed concerns over the timing of the inter-Korean summit, watchful of its possible impact on the December presidential election in South Korea, and of one-sided payoffs from Seoul to Pyongyang.

By any standard, the third quarter appeared to be the finest moment for the Shanghai Cooperation Organization (SCO):  the seventh summit in Bishkek, Kyrgyzstan was the largest summit ever held by the regional organization; the SCO heads of state signed its first multilateral treaty (Treaty among the Member States of Good Neighborliness, Friendship and Cooperation, or “The Friendly Treaty”) and it was the first time all member countries participated in a joint antiterrorism military exercise in Russia.

A closer look at the chemistry between Russia and China, however, reveals a far more complex interactive mode of cooperation, competition, and compromise. While security cooperation moved forward culminating in the Peace-Mission 2007 military exercise, the game of petropolitik was heating up in Central Asia with Beijing gaining the upper hand, at least for the time being. The quarter ended, however, with significant progress in energy cooperation as the long-awaited Eastern Siberia-Pacific Ocean (ESPO) oil pipeline was about to extend a branch line to China’s energy-thirsty northeast region. Thus, in his eight years as Russian president, Putin seems to have set a solid record in dealing with Russia’s southern neighbor: pure geostrategy has outweighed market fundamentals and friendly partnership with Beijing.