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Weekend catch-up: Iran nuclear deal, MH17, China's stock market, ANZUS and more

Weekend catch-up: Iran nuclear deal, MH17, China's stock market, ANZUS and more
Published 18 Jul 2015   Follow @BrendanTN_

Earlier this week, an 'historic' agreement was concluded between the P5-1 and Iran over the latter's nuclear program. The specifics of the deal, and whether it was a good one for the West, Iran or the Middle East has generated heated debate. Anthony Bubalo said the deal will form the basis of Iran's cost-benefit analysis:

...the purpose of the deal is not so much to prevent Iran from having the capability to produce a nuclear weapon. That jinn is already out of the bottle. Instead, the goal is to create a framework of incentives and disincentives that ensure Iran never makes the decision to produce a nuclear weapon. 

In other words, the agreement is an attempt to convince Iran to be more like a nuclear Japan than a nuclear Pakistan. This relies on the assumption that all governments — democratic, autocratic or even theocratic — make more or less rational cost-benefit analyses of decisions. In this particular case, it relies on Tehran calculating that the costs of producing a nuclear weapon, even covertly, outweigh the benefits.

What about US security commitment to its allies in the region? Rodger Shanahan:

To reassure the Gulf states, Washington has also had to reluctantly adopted some policy positions. Washington has provided military support to the Saudi-led air campaign in Yemen, an operation increasingly seen as lacking any coherent campaign plan. In June the US also announced a resumption of arms sales to Bahrain, even though the State Department acknowledged that the human rights situation there remains inadequate. Although Human Rights Watch criticised the move, it too needs to be seen as part of the price Washington is prepared to pay to reassure some seriously upset regional allies.

Here's Marie McAuliffe on Grece's other crisis, refugee migration, and how it could push the Greek Government's resources to the limit:

With pressures on so many fronts in Greece, something has to give.

The migrant smugglers clearly know this. Just as we have seen the rapid rise of smuggling from an increasingly insecure Libya, the fragility and uncertainty in Greece has seen smugglers target the country. This is one of the more insidious aspects of migrant smuggling, and perhaps one of the least understood. More research and analysis on migrant smuggling dynamics and operations is urgently required.

Matthew Dal Santo on the first anniversary of the downing of MH17 in Ukraine: [fold]

Earlier this week, the Netherlands, Belgium, Malaysia, Ukraine and Australia tabled a proposal for the UN Security Council to support the creation of an international tribunal to try the perpetrators. According to Australian Foreign Minister Julie Bishop, such a tribunal 'would send a clear message that the international community will not tolerate acts that threaten international peace and security by endangering civil aviation.' As a permanent member of the Security Council, however, Russia seems likely to block it.

Though the plane's destruction did nothing to change the underlying causes of the conflict, news of MH17 had an almost immediate and ultimately far-reaching impact on how the conflict was perceived. The shift was particularly sharp in Germany, where Chancellor Angela Merkel had privately been ahead of public opinion for months in assessing the threat to peace posed by Russia and the rebels who received its support.

Catriona Croft-Cusworth with a piece on infrastructure in Indonesia:

The poor state of infrastructure can be deadly for mudik travelers. A reported 152 people have died on the roads since last Friday, including in a collision on a new toll road in West Java that was just opened by President Jokowi on Saturday. In an attempt to reduce casualties, the Transportation Ministry has offered free rides to motorcyclists, as those are in greatest danger on the roads. The navy has reportedly also offered free transportation, even after the tragedy involving civilians on an air force Hercules earlier this month. Meanwhile, the National Police has launched its annual Operation Ketupat, named after the woven palm pouches of rice cakes eaten to celebrate the holiday, to secure the congested roads and empty cities.

Leon Berkelmans asks: why is the Chinese Government intervening so heavily in its stock market?:

The stock market does not look to be of systemic importance to the Chinese economy. It is relatively small, it is not a major source of finance for firms, and stocks are not widely held. The stock-market falls will likely see some effect on GDP numbers because there will be lower financial-services demanded in the economy, but I don't anticipate the recent ructions precipitating any sort of crisis. Some estimates I've seen suggest something like a 0.2 percentage point subtraction from growth in the third quarter. Small beer.

There is, nonetheless, something disconcerting about recent events in the Chinese stock market. The Chinese authorities have moved to aggressively support equity prices, even though stocks still appear over-valued. This is a far cry from the rhetoric that came out of the Third Plenum in 2013, where market forces were championed. If the stock market is not a systemically important part of the Chinese economy, why intervene like this? It has me a little confused.

A new report argues ANZUS needs to shift its priorities back towards Asia. Alex Oliver wonders if Australian popular opinion will come with it:

The Asia 'refocus' recommendation is controversial because, reading more closely, it involves some tough prioritising for Australia. The argument made in the report is that Australia's military involvement in the Middle East (which is more palatable to the Australian public) has distracted us and diverted funds from the 'needed geopolitical focus on challenges in the Asia-Pacific' (less palatable to the Australian public). The corollary is that while Australia needs to refocus, the US needs to reconsider its demands on us, because Australia cannot afford significant military commitments in both the Middle East and Asia Pacific. It has to choose.

This all makes perfect sense from a strategic point of view. The soon-to-be released Defence White Paper may well recommend similar policy shifts. But if these are up for serious consideration by Government, it needs to be with the full realisation that they will require persuasive selling to win over a nervous Australian public.

The refugee crisis in Syria may only get worse as the Assad regime falls, and the international community doesn't have a plan. Bob Bowker:

Unless the international community gears up contingency plans, and places a great deal of pressure on Turkey, the Saudis and others to address such a contingency through their clients, the humanitarian and regional consequences of regime collapse will be dire, especially for refugees and for Lebanon. Unfortunately, there is little evidence of effective leadership, either internationally or within the region, to address the need to avoid a further mass refugee migration. Nor is planning under way to deal with the likelihood of even greater humanitarian fall-out from the conflict.

There is reason to hold fast on new legislation under consideration in the Australian Parliament regarding the stripping of citizenship, writes David Wells:

However, the legislation states that the individuals who engage in terrorism-related conduct 'automatically' lose their Australian citizenship. If this is the case, when do the intelligence agencies inform the minister that they have detected such conduct? Do you 'double-dip' if the court doesn't deliver the desired result? Alternatively, why bother with the criminal justice system at all? Surely it's common sense to go straight to the minister if you have reliable intelligence indicating that your target has met the requirement for automatically losing their citizenship? 

How this process works will evolve as internal policy is developed. And in doing so, the intelligence agencies may develop an appetite to use the powers against the full range of permitted targets, not just those highlighted by government rhetoric.

Rodger Shanahan followed up his piece last week on the naming of jihadi groups:

The fundamental Western misunderstanding of Islamist groups is ideological. Secular and liberal states consign religion to the private sphere. Islamist groups believe they are empowered to institute God's will (or their version of it) on earth. They are not variations of the European model of Christian Democratic parties, where religious beliefs inform social welfare or social justice policies only. Islamist parties by their nature are exclusionary, and this is an essential reason why such groups fail to gain traction in the secular, liberal West.

Samir Saran took a look at what the latest BRICS summit meant for each member:

BRICS is also the last hand India has to play with Russia, given the dwindling interdependence between the two states. India fears continental encirclement, owing to increased Russian engagement with Pakistan (visible in the diluted treatment of counter-terrorism in the BRICS outcomes statement) and what it believes is a Russian slide into China's orbit. Consequently, it will be through the normative processes as well as the economics of the BRICS grouping that India can maintain a serious balancing play with Moscow.

The Lowy Institute's Thawley Scholar, Jacob Berah, wrote on the Afghan peace process:

Taliban engagement this year is a cause for optimism. The most recent informal meeting hosted by Pugwash in Qatar produced a statement indicating the Taliban may be willing to consider compromising on its traditional red-line issues of women's rights and education, modifications to the Afghan constitution, and the departure of foreign troops. Its willingness to meet publicly on so many occasions is itself a positive change.

Finally, Sam Roggeveen noticed that the ALP may be shifting its stance on Japan:

These are straws in the wind, but we can't rule out the possibility that we are seeing a clear difference emerging in the foreign policy priorities of the two major parties. The Abbott Government, after all, has been very pro-Japan. The Prime Minister's rhetoric towards Japan has been warm from the beginning, and he is thought to enjoy a close relationship with Prime Minister Abe. Australia and Japan have inked a free-trade deal, deepened defence ties (Japanese forces are taking part in Exercise Talisman Sabre as we speak), and there's an excellent chance Australia's next generation of submarines will be Japanese-built or at the very least have a lot of Japanese input.

Photo courtesy of Flickr user U.S. Department of State.

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