Tag Archives: Trump

Pyongyang’s SLBM launch signifies progress in missile development, use of pressure tactics in talks – Korean Peninsula Analysis

 

Executive Summary:

  • North Korea’s October 2 test of a Submarine-Launched Ballistic Missile (SLBM) indicates considerable progress in its solid-fuel weapons program.
  • The launch may be viewed as part of a strategy to intensify pressure on the US in order to gain maximum concessions in view of Pyongyang’s perceived advantageous position.
  • Denuclearization talks are unlikely to yield concrete results over the coming months given the US and North Korea’s differing expectations from the process.
  • This is given that Washington appears to be pushing for a cessation of nuclear weapons development and Pyongyang is effectively attempting to secure a deal wherein it is allowed to maintain the requisite deterrence capabilities.
  • Japan is likely to increasingly step up its role in negotiations relating to the Korean Peninsula. This follows PM Abe’s efforts to secure support for constitutional revisions towards increased militarization by citing the purported threat posed by North Korea.
  • Travel to Seoul may continue at this time, while adhering to standard security protocols regarding protests, crime and the lingering risk of conflict with North Korea. 
  • We advise against nonessential travel to Pyongyang and North Korea given the risk of detainment of foreign travelers.

Current Situation:

  • On October 2, North Korea tested the two-stage, solid-fuel Pukguksong-3 SLBM off its east coast near Wonsan. The missile traveled an approximate distance of 451-km in an easterly direction at a maximum altitude of 909-km. It is believed to have been launched from a submersible barge instead of an actual submarine. North Korea first test-launched a Pukguksong-1 missile, or an earlier variant of the latest device, from an underwater platform in 2016.
  • The development, which represents the 11th missile test by Pyongyang since May, came hours after it agreed to hold working-level talks with the US on October 5.
  • North Korea’s chief negotiator Kim Myong-gil claimed that denuclearization talks on October 5 failed after his US counterpart, Stephen Biegun, refused to offer a new negotiating strategy. He also expressed doubt on whether the US will be able to amend its negotiation terms before the next meeting between the two sides in the coming weeks, while reiterating that Pyongyang is unwilling to negotiate with Washington if it does not amend its “hostile policies”.
  • A US spokesperson refuted Kim’s claims, stating that the official’s comments did not reflect the spirit of the discussion. The spokesperson further described the talks as positive. In April, North Korean leader Kim Jong-un demanded that Washington alter its current “maximum-pressure” sanctions strategy against Pyongyang by the end of the year.
  • At present, the US administration is believed to be prepared to offer North Korea a three-year suspension of UN sanctions on textile and coal exports in exchange for the dismantlement of the Yongbyon nuclear facility and a halt on the production of enriched uranium.
  • According to reports from October 3, Washington “unofficially” promised Pyongyang low-level sanctions relief including a partial resumption of tourism at Mount Geumgang in North Korea.

Assessments & Forecast:

SLBM launch indicative of significant progress in solid-fuel missile development

  1. The October 2 test is extremely notable for a number of reasons. Firstly, the Pukguksong-3 is the longest-range solid-fuel missile tested by Pyongyang to date. This fact gains further significance as the missile was launched at a lofted trajectory instead of a standard path that would have helped it to cover a larger distance. This may have been intentionally done so as to avoid threatening US territory such as Guam, which could have precipitated a much stronger response from Washington.
  2. Overall, the development is indicative of significant leaps in North Korean solid-fuel missile development over the past months, considering that this represents another step in its quest to perfect a solid-fuel Intercontinental Ballistic Missile (ICBM) capable of striking targets in the US. This is given that solid-fuel systems have an advantage vis a vis liquid-fuel systems in being more stable. Moreover, the generally compact nature of solid-fuel missiles allows them to be launched from mobile launchers. This makes it hard to counteract a potential strike given that these launchers can be moved immediately after engaging a target and can be quickly deployed from hidden structures such as tunnels.
  3. In addition, the potential deployment of an SLBM from a submarine is hard to detect, making these target packages immune to the first strike by enemy elements. In this context, and given that the Pukguksong-3 is a medium-range missile capable of hitting Japan and South Korea, the test represents a notable escalation in the paradigm of ongoing processes aimed at eventual peninsular denuclearization. In terms of signaling, a test in the eastward direction serves to deliver the message that Japanese territory is still accessible to North Korean warheads despite Tokyo’s acquisition of the Aegis Ashore ballistic missile defense systems. This is indicated by the missile’s landing in Japan’s Exclusive Economic Zone (EEZ). The test is also a more carefully-calibrated message to Washington, given that it is reflective of North Korean capabilities to target the US’ western seaboard from locations in the Pacific Ocean.

Weapons testing in quick succession likely part of ongoing effort to maximize leverage in relation to talks with US

  1. The spate of missile testing by Pyongyang from May-October appears to be aimed at pressuring the US to adhere to North Korean leader Kim Jong-un’s year-end ultimatum regarding sanctions. Moreover, this may be an effort to persuade the US to forego perceived hostile actions such as joint military exercises with South Korea, with the last such drills concluding on August 20. The SLBM test, in particular, can be viewed as part of Pyongyang’s planned strategy to head into the October 5 talks from a position of strength, especially when considering the test occurred just hours after it agreed to meet with Washington.
  2. At the same time, the fact that a high-profile test was conducted immediately prior to scheduled talks speaks to a degree of confidence in Pyongyang with regard to its perceived upper hand in negotiations as well as its broader understanding of Washington’s reaction and escalation patterns. FORECAST: As the year-end deadline approaches, similar attempts to pressurize Washington can be expected in the form of missile tests and escalated rhetoric.  The timing of the launch amid growing calls for US President Donald Trump’s impeachment could potentially also suggest that Pyongyang will view such domestic diversions in the US as opportunities to push its testing program in the future.
  3. North Korea’s decision to participate in working-level talks was likely primarily motivated by the removal of US National Security Advisor John Bolton in the month prior, as this likely created expectations among North Korean officials that his departure will prompt the US to pursue a fresh and more lenient negotiating strategy, given his hawkish stance on the issue of peninsular denuclearization. The subsequent failure of talks may be attributed to the absence of a new strategy employed by Washington, and the resultant gulf in expectations regarding potential meeting outcomes. Conflicting claims by US officials regarding the outcome of talks, as well as their reported agreement to meet again in Sweden in the coming weeks for additional negotiations, further lend credence to the prevailing divergence in perceptions over negotiations between Washington and Pyongyang. FORECAST: This suggests that the current stalemate will prolong into the near future, although channels of communication at multiple levels will likely remain open in the absence of a defining change to the status quo by either side.
  4. US President Trump’s decision to move forward with the October 5 meeting in spite of the SLBM test suggests that further testing is unlikely to jeopardize denuclearization talks, at least for the time being. His relative restraint is likely tied to a desire to rehabilitate his political image through a major foreign policy victory ahead of the US presidential elections in November 2020. FORECAST: It is important to note, however, that domestic pressure on President Trump is liable to increase as a consequence of the most recent test. This is due to Pyongyang’s launch of an SLBM, as this particular type of weapon, if perfected, will ultimately extend North Korea’s maritime reach and increase the threat level towards Washington. Over the long term, sustained pressure in this regard may prompt President Trump’s administration to take an incrementally hardline approach, raising the potential for backlash by Pyongyang and further scuttling the prospects of a larger de-escalation. This may comprise a potential backtracking on proposed initiatives such as the aforementioned low-level sanctions relief package with eased restrictions on tourism.

Japan to escalate calls for tougher stance on Pyongyang, seek more active role in regional talks

  1. Pyongyang has repeatedly condemned South Korea’s efforts to boost its deterrence capabilities, which most recently included Seoul’s purchase of F-35 stealth fighter jets from a US-based company. In this light, South Korea’s display of the newly-acquired aircraft during a patrol over the East Sea on October 1 may have factored into the North’s latest test. Precedent for this was established in the string of short-range tests by North Korea that began in July to rebuke the aforementioned US-South Korea military drills in August. Nevertheless, Seoul’s failure to condemn the short-range tests likely signaled to Pyongyang that its weapons development efforts will continue to be viewed as not posing an imminent existential threat. South Korea’s August decision to not renew the General Security of Military Information Agreement (GSOMIA) intelligence-sharing pact with Japan, which was forged on the basis of both countries’ shared threat perception of North Korea in 2016, likely reinforced notions that Seoul places the current threat from Pyongyang on a lower scale.
  2. Japan expectedly condemned the SLBM test; however, October 4 reports indicate that Japanese Prime Minister Shinzo Abe reiterated his desire to meet with Kim Jong-un to discuss the longstanding issue of Japanese nationals purportedly abducted by North Korean agents. PM Abe’s request for a one-on-one meeting may have to do with the fact that Tokyo and its interests have been sidelined in the format of the current negotiations, even as Washington has largely refused to strongly condemn the North Korean threat or advocate on Japan’s behalf. The call for a meeting is likely also an attempt to increase nationalistic sentiments among his electorate by drawing attention to the alleged threat posed by Pyongyang. FORECAST: This will work favorably for PM Abe as he pursues initiatives to boost Japanese military capabilities through constitutional revisions in the coming months. Further, Tokyo will likely capitalize on the SLBM test to potentially restore security coordination with Seoul, as evidenced by its offer to renew the GSOMIA pact on October 3.

Recommendations:

  1. Travel to Seoul may continue at this time, while adhering to standard security protocols regarding protests, crime and the lingering risk of conflict with North Korea.
  2. We advise against nonessential travel to Pyongyang and North Korea given the risk of detainment of foreign travelers.
  3. During periods of armed escalation between North and South Korea, we advise against all nonessential travel to the vicinity of the Demilitarized Zone (DMZ) and the Yeonpyeong-do Islands.

El Paso Shooting – Domestic far-right shooters become primary militant threat as online communities act as hubs for radicalization, catalyzing attacks – USA Analysis

Written and Edited by Saad Lambe and Ollie Wiltshire

Executive Summary

Far-right online communities have increasingly shifted towards planning and calling for militant attacks, demonstrating the increased threat from such forums.

Calls for attacks against traditional far-right targets, including Jewish and Muslim communities, have seen a significant increase.

Corporations aligning with perceived left-wing political views are frequently discussed in a violent context.

Attendees at left-wing rallies, particularly those with right-wing counter-protests, face an increased threat of being identified online and targeted.

Far-right attacks from lone wolves will take place in the coming months as a result of the uptick in online activity.

Increase awareness of threats on social media through the use of threat monitoring services.

Current Situation

On August 3, a man entered a large supermarket in El Paso, Texas and opened fire on shoppers, killing 20 and wounding 26. The shooter posted a manifesto on 8chan, which described his opposition to the ‘Latino takeover’ of Texas. While he disavowed both the Democratic and Republican party, the manifesto included terms such as ‘fake news’ popularized during President Donald Trump’s campaign. Additionally, he stated that he was inspired by the Christchurch, NZ shooter and echoed talking points of the conspiracy theory ‘the great replacement’, naming it as the reason he targeted Hispanic and Latino people.

Following the shooting, 8chan’s hosting provider, Cloudflare, dropped the website as a client due to it being a convergence point for militants, which is expected to disrupt access to the website. With the presence of multiple competitors in the market, reports state that this incident is unlikely to have a long-term impact on the website.

A far-right militant entered a festival in Gilroy, CA on July 29 with a semi-automatic weapon and opened fire on attendees leading to the death of two people. The shooter was killed in a confrontation with the police having asked his social media followers to read a far-right extremist book before committing the attack.

Federal Bureau of Investigation (FBI) director Christopher Wray stated on July 23 in a Senate Judiciary Committee hearing that a significant percentage of domestic militant suspects arrested had been linked to white supremacy, additionally stating that over 100 domestic militant arrests had taken place from October 2018 to July 2019.

Portland, Oregon witnessed clashes on June 29 between members of the anti-fascist Antifa group and the far-right Proud Boys group, leading to several injuries. A member of the Proud Boys threatened to kill Portland Mayor Ted Wheeler and a number of people on far-right forums rallied against what they perceived as ‘state-sanctioned violence’, calling for violence against people they identified as Antifa members.

On April 27, 2019, a gunman entered the Chabad of Poway synagogue in Poway, California and killed one person with a semi-automatic rifle and injured three others.  He attempted to live stream a video of the shooting to Facebook but failed. He yelled anti-semitic slurs while entering and posted an anti-semitic manifesto on the far-right online forum 8chan before carrying out the attack. He had previously committed arson at a mosque and was allegedly inspired by the Christchurch shooter.

A Coast Guard Lieutenant, Christopher Paul Hasson, was arrested in Maryland on February 15, 2019, in the USA with a large stockpile of weapons, intending to commit an attack on a scale he claimed was ‘rarely seen in this country’. He identified as a white nationalist and had been collecting weapons since 2017. He planned to attack members of the Democratic Party, including House Speaker Nancy Pelosi, along with television anchors from several high-profile networks perceived as ‘liberal’ and being biased against the right-wing community.

Notable far right incidents in 2019

Background

Far-right attacks in North America have increasingly involved a single perpetrator (lone-wolf), self-radicalized through online propaganda, involving ‘memes’ depicting migrants and people-of-color as invaders, posing a threat to the ‘white race’.

Individuals committing attacks and associated with far-right communities follow a path involving joking about attacks against certain target groups, which is usually applauded and reinforced by other members. They then begin stockpiling weapons, settling on a target, and researching the premises before executing the attack.

A large number of far-right militants were inspired by ideas espoused in Anders Behring Breivik’s manifesto used to justify his 2011 attacks in Norway and have released similar documents before attacks. This was highlighted by the Christchurch attacker, who posted his manifesto online on 8chan.

Far-right online communities have been instrumental in the dissemination of propaganda intended to establish the white race as ‘inherently superior’, as well as to push propaganda such as the ‘Great Replacement Theory’, which portrays Muslims attempting to convert a ‘Christian West’ into an Islamic homeland by sustained high-levels of migration.

Several far-right communities engage in ‘doxxing’, a term used to describe identifying an anonymous user or person’s personal details, in an attempt to intimidate, harass, and threaten the victim. While previously restricted to users online, members have begun posting images of left-wing activists at counter-protests in an attempt to identify and potentially harass and attack them.

Glossary of Terms

Assessments & Forecast

Increased calls for militant attacks likely to heighten security threat against traditional far-right targets

There has been a notable increase in calls for attacks on traditional far-right targets, including Jewish and Muslim communities, on websites such as 8chan and Gab with a dominant far-right userbase, which have been used to post militant manifestos due to their relaxed content rules.

On far-right forums, calls for attacks are largely indirect and usually in response to events perceived as ‘anti right-wing’. Recruitment for potential militants begins by appealing to traditionally conservative issues including anti-immigrant sentiments and orthodox conceptions of the family, which later devolves into calls for forum users to join ‘state militias’ which have often been described as possessing a far-right leaning.

While Gab has occasionally enforced rules over direct threats, 8chan allows this content to be posted regardless of its nature. In this regard, 8chan is likely to grow as one of the primary modes of propaganda dissemination and calls to action for far-right extremists online. Such content will come in the form of ‘memes’ and short-form media, including images and gifs, allowing the ideology to easily embed itself within more palatable internet culture.

Posts from 8chan calling for violence

A common theme of conversation includes corporations perceived as aligning with left-wing issues, such as civil rights and diversity, along with social media and news corporations accused of bias against right-wing groups. These discussions largely take place in a violent setting, with accusations of being funded by secretive ‘anti-white’ groups. In this regard, this behavior demonstrates the increased threat faced by these companies from far-right individuals over their political views.

Calls against Jewish targets rely on a variety of anti-semitic tropes, attempting to instigate readers into stopping Jewish ‘influence’ in politics and socio-economic issues on the world stage. Certain key personalities, including George Soros, are frequently mentioned, implying a stronger focus towards committing violence against Jewish people in political, corporate, and community positions.

Muslim communities in the West are largely painted as ‘invaders’, using the great replacement theory which was mentioned by the Christchurch shooter. As such, calls for attacks specifically mention mosques and Muslim community centers in Western countries, designating them as potential targets.

In the Gilroy, CA shooting on July 29, the shooter posted on social media asking followers to read a far-right book, common in white-supremacist groups before committing the attack. This highlights an ongoing trend among militants, attempting to clarify their intentions for the attack, likely brought on by multiple ‘white-power’ movements with differing goals.

As seen in the Christchurch shooter’s manifesto, many online calls will include references to ‘internet culture’ known as dog-whistle tactics, in which content is used to mean different things to the general public and the far-right audience. Given that a large number of ‘memes’ and culture-specific images have been created to evoke racist imagery within these communities, it is often used to subtly encourage violence towards groups. This is often termed as ‘redpilling’, a phrase used by online far-right communities to indicate the ‘conversion’ of a casual user into one who fits the profile of a traditional far-right user.

The recent wave of shootings served to highlight the trend of far-right incidents trickling down from casual hate-speech online to real-life violence. While the majority may not act based on hate-speech, the inherent nature of such closed-off communities attracts psychologically unstable individuals who are increasingly susceptible to these forms of propaganda.

Post about "red pilling" from far-right group on 8chan and Gab

Attempts to identify (dox) protesters and call for violence at left-wing rallies likely to grow, including dissemination of false information

With both left-wing and right-wing events predominantly being promoted and discussed online, there will likely continue to be an increase in discussions centered around what takes place at these rallies.

Far-right communities have included inflammatory content, especially false warnings about Antifa and other left-wing groups planning to commit attacks at right-wing rallies and calling for attendees to carry weapons to protect themselves which is likely to lead to further clashes at right-wing rallies going forward.

Some users on the social media website Reddit’s now restricted ‘The_Donald’ forum attempted to create a document containing personal details of individuals believed to be ‘anti-Trump’. This document featured generic information, including age and vague location, but in some cases, it featured details including ethnicity, sexual orientation, and home and business addresses. The details imply that members of the LGBT community and other minority groups are priority targets for these radical factions.

Most recently echoed in a Portland, OR rally by a far-right group called the Proud Boys, comments made on Gab included screenshots of individuals’ social media profiles who were perceived as left-wing activists, descriptions of their workplace, as well as photos of a rope meant to call for lynchings. Some allegedly left-wing members identified were unlikely t be members of Antifa, instead, such false-positives were likely targeting unaffiliated counter-protesters. This behavior reinforces the danger presented to civilians unconnected to both Antifa and other left-wing groups who may be misidentified through these actions and targeted for attacks.

Journalists have increasingly been targeted in recent years, especially those deemed as left-wing. Far-right users, in particular, believe in a larger conspiracy against right-wing groups among “mainstream” media. This was demonstrated in the case of the coast guard arrest, who planned to attack several left-wing commentators due to their perceived bias. Therefore, journalists are likely to continue being the target of online harassment, with the increased possibility of threats online devolving into physical violence.

Based on previous attacks, instances of violence directed towards ‘doxxed’ individuals may include pipe bombs, possibly containing TATP often employed by Islamic State (IS) members, with the wide availability of manufacturing instructions online.

Gab post attempting to Dox

Recommendations

Public, private, and third sector organizations are advised to increase their awareness of threats on social media through the use of threat monitoring services. Increased awareness of an organization’s political footprint and perceptions from fringe online groups can help uncover potential violent actors and plots before they occur.

Prolonged trade conflict with US likely amid disagreements on core issues, domestic political compulsions for both parties – China Analysis

Written by Tarun Nair 

Executive Summary:

On June 29, the US and China arrived at a truce in the trade conflict on the sidelines of the G-20 summit in Osaka, Japan. The agreement halted the next round of US tariffs on Chinese goods worth 300 billion USD.

While no further escalatory actions by either party have materialized, reports from July 17 suggest that trade talks have once again reached a standstill over the lack of clarity in the White House on addressing Beijing’s demands to back off restrictions on a prominent Chinese telecommunications company.

A prolonged trade conflict is likely due to domestic compulsions on leaders of both sides. This will be compounded by continued disagreements on core issues related to the negotiations.

However, a low level of rapprochement is anticipated while fluctuations to global supply chains, as well as impacts on business sentiment and investor confidence, are likely in the medium to long term.

Travel to China may continue at this time while avoiding nonessential travel to outlying areas in China, notably Xinjiang Province in the west. When traveling anywhere in China, we advise using caution when discussing sensitive political issues.

Current Situation:

China and the US agreed to a 90-day truce in the ongoing trade conflict on December 1, 2018, following weeks of heightened rhetoric. Subsequently, three-day talks were held in Beijing in January 2019. Two rounds of trade talks were also held in Beijing and Washington in the months of February and April, with US Treasury Secretary Steve Mnuchin calling the discussions “positive”.

However, on May 13, China announced tariff hikes on US products after the US increased tariffs from 10 percent to 25 percent on 200 billion USD worth of Chinese goods on May 10.

Washington placed a prominent Chinese telecommunications company on its “entity list” on May 16, which effectively bans US companies from selling to the firm without authorities’ approval. The company, which is the world’s largest telecom equipment supplier, has been the target of allegations that its technology facilitates espionage.

On May 31, Beijing announced that it will form its own “unreliable entities” list comprising foreign enterprises and individuals that are suspected of disregarding market rules, violating contracts, and influencing supply for non-commercial reasons.

Beijing increased tariffs on goods worth 60 billion USD from the US on June 1, while opening an official investigation into a US-based shipping company for purportedly diverting China-bound packages to the US.

On June 29, reports indicated that both sides arrived at a fresh truce in their trade dispute through an agreement that halted the next round of US tariffs on Chinese goods worth 300 billion USD, apart from reopening the door for negotiations. The development came about on the sidelines of the G-20 summit in Osaka, Japan.

On July 5, Chinese President Xi Jinping spoke at a meeting of military leaders, politicians, and bureaucrats where he stated that the ongoing political reform process has systematically enhanced the Chinese Communist Party (CCP)’s leadership. He attended yet another meeting on July 9 to emphasize the importance of the party.

Reports from July 17 suggest that trade talks have once again reached a standstill over the lack of clarity in the White House on addressing Beijing’s demands to roll back restrictions on the aforementioned telecommunications company. This comes amid indications that US Trade Representative Robert Lighthizer will travel to Beijing in the near future with Trade Secretary Mnuchin for further trade deliberations.

Assessments & Forecast:

Domestic compulsions on leaders from both sides to sustain friction in medium to long term

Primarily, domestic compulsions on both sides will make it more challenging for either party to adopt a concessionary attitude with respect to tariff de-escalation. In China, President Xi Jinping has increasingly moved towards strengthening the powers of the CCP since the third plenary session of the CCP Central Committee in March 2018, where it was decided that reforms are needed to bolster the party’s leadership and control over state institutions. While this reversal of the previously limited separation of powers between the party and state is not new, he has doubled down on evaluating the progress of the 2018 plenum’s goals in recent times, as indicated by the consecutive meetings in early July. This speaks to a desire to expedite the expansion of CCP leadership.

This is relevant in the context of the trade conflict given that dissident factions in the party will increasingly hold him accountable with respect to avoiding prospective concessions to the US. These compulsions may be compounded by criticism from individuals with close links to trade negotiations, such as a comment by the former vice-minister for foreign trade in November 2018, wherein he stated that action on agricultural products by China was ill-thought out. This is especially likely when considering pressure on Beijing following the ongoing anti-extradition protests in Hong Kong and the recently-approved US arms deal with Taiwan, which could be used by opponents to show President Xi’s lack of control on Chinese regional interests. In this light, China likely to adopt a tougher stance on trade negotiations in the coming months, a preliminary indication of which was seen in the hardliner Chinese Minister of Commerce Zhong Shan’s addition to the trade talks. Further, President Xi may also seek to avoid making moves until the results of the presidential election in the US are announced, in order to gauge the degree of amenability a new government may have to some of Beijing’s terms.

In the US, President Donald Trump is unlikely to accede given that the trade conflict has been a major pillar of his “America First” platform, more so against the backdrop of the upcoming presidential elections in 2020. Another consideration informing this position will be the growing domestic consensus on cracking down on the Chinese telecommunications firm. A broader unilateral de-escalation seems increasingly improbable at this point. Increased rhetoric can be expected from authorities in Washington, as illustrated by President Trump’s statement days after the truce, in which he implied that he was open to place tariffs on additional goods worth 325 billion USD.

Zhong-Shan-Quote

Prolonged tensions further likely due to core disagreements regarding Chinese firm, Beijing’s projected capacity to absorb economic shocks 

While one of the key outcomes of the G-20 truce involved the US lifting some of the curbs on the Chinese telecommunications company, authorities later stated on July 9 that licenses for sales to the firm will be contingent on the protection of national security. The sweeping nature of national security considerations indicates that dealings with the Chinese firm in question will remain complicated, with the concession at the G-20 meeting likely only being symbolic. Broadly, this points to the continued disagreements on the regulation of the firm, which has emerged as a core concern behind the trade dispute. This is also backed by the reported stalling of talks in recent weeks due to a lack of clarity on dealing with the firm’s alleged violation of intellectual property laws. It also remains unclear if the firm will be given access to US parts for its product development.
FORECAST: Given this lack of clarity and the fact that security concerns remain unaddressed, the issue will remain a sticking point to a trade deal, further speaking to a state of flux in the coming term. The inclusion of five additional Chinese firms in the US’ entity list on June 21 will further exacerbate tensions on the issue.

FORECAST: Another factor pointing to prolonged tensions is China’s projected capacity to absorb economic shocks through measures like interest trade cuts, trade diversification, and additional domestic tax cuts. According to July 15 reports, China’s growth rate slumped to a 27-year low of 6.2 percent in the quarter that ended in June, down from 6.4 percent in the previous quarter. US President Donald Trump cited the sluggish growth to be a product of pressure from tariffs. Despite the ongoing slowdown of the Chinese economy, it is pertinent to note Chinese authorities’ claim that the 6.2 percent figure is still within Beijing’s target range for the year. Thus, China’s current aggressive approach in light of its estimated robust domestic economy may indicate its willingness to sustain a trade conflict for extended periods of time. Its perceived upper hand will likely serve as justification to avoid making concessions to the US, thus exacerbating trade tensions in the medium term.

Low-level rapprochement may materialize in absence of concrete deal, security situation to remain unchanged 

FORECAST: Regardless of the impediments to a concrete deal, low-level rapprochement by both sides may occur over the coming weeks and months. This may include additional meetings such as principal-level calls between trade representatives where minor concessions on certain tariff structures may be discussed. Certain countries like Indonesia and Vietnam will likely see heightened labor productivity through relocation of investments and facilities away from China, although trade reliance will serve to affect these gains on a case-to-case basis. Regional powerhouses like Singapore, which have seen troubling economic conditions in recent times including a potential recession, will continue to feel the blowback with respect to manufacturing. In China, the tech sector will face a disproportionate effect of the ongoing tariffs regime, due to revenue changes as a result of slower exports to the US and restrictions on the proliferation of technological inputs.

FORECAST: In terms of the on-ground security situation, we assess that the latent threat of arbitrary arrests and harassment of US nationals remains largely unchanged. Beijing will be keen to avoid direct escalations that could translate to pressure through other avenues such as international courts. While a number of Western nationals have been targeted in anti-narcotics raids and on espionage charges, these events appear to be linked to their respective nations’ actions against Chinese citizens and interests rather than being directly linked to the trade dispute. Beijing’s projected reticence to use the trade conflict to take action against US nationals appears likely since it has largely sought to delink the issue of the telecommunications company from the trade dispute in an attempt to restrict patterns of escalation. That said, further arrests or detentions may nevertheless be perceived as retaliatory measures that are indirectly related to the trade conflict, thus sustaining peripheral tensions on the issues.

Recommendations:

Travel to China may continue at this time while adhering to standard security protocols given the latent threat of militancy and crime. We advise against non-essential travel to outlying areas in China, particularly Xinjiang Province in the west.

When traveling anywhere in China, we advise using caution when discussing sensitive political issues in China, including Xinjiang, the graft purge, Tibet, Taiwan or Tiananmen Square protests of 1989. Refrain from photographing sensitive sites, including government buildings and security forces.

Remain cognizant of developments in the ongoing trade dispute involving China and closely monitor the rhetoric of the Chinese government in order to identify early escalation warning signs.

Companies with ongoing disputes with Chinese authorities are advised to consider the risks involved in sending high-level executives to the country.

Employees should avoid posting any material on social networks that may be deemed as critical of the Chinese government, as this may invite temporary detention or even prosecution.

Implications of recent escalation in US-Iran tensions on Iranian domestic, foreign policy – Iran Analysis

Executive Summary

Over the months of April and May, the US took multiple measures as part of its “maximum pressure” campaign vis-a-vis Iran, including the revocation of sanction waivers to importers of Iranian oil and deployment of US military assets to the Middle East.

As a response to the perceived provocations, on May 8, Iran announced its decision to partially halt its commitments to the Joint Comprehensive Plan of Action (JCPOA) and set a 60-day deadline for European states to renegotiate the financial terms of the agreement, marking a highly significant development since the ratification of the nuclear deal in 2015.

The purported involvement of Iran and its affiliates in the recent uptick in attacks against US allies, particularly the May 12 attack against four naval vessels, including two Saudi oil tankers, off the coast of the UAE, has further fueled tensions in the region.

Iran has resisted direct negotiations with the US thus far, which indicates the high level of influence wielded by hardliners on the country’s foreign policy. Tensions are liable to remain high as both Iran and the US are likely to continue their strategic posturing in the region over the short term, in order to eventually coerce each other onto the negotiating table.

Western nationals operating or residing in Iran are advised to regularly review emergency and contingency protocols as a basic security precaution due to the risk of limited hostilities between Iran, the US, and its Gulf allies. Those operating in Lebanon, Iraq, and Syria are advised to maintain a low profile due to threat of attacks by Iranian-linked elements.

Current Situation

On May 8, Iran’s SCNS released a statement announcing Tehran’s decision to partially halt its commitments to the JCPOA and setting a 60-day deadline for European states to take steps to counteract the negative effects of US sanctions.

The US President Donald Trump subsequently issued an executive order to impose sanctions on Iran’s metal industry.

On May 11, the US sent Patriot air defense systems to US CENTCOM based in Qatar’s al-Udeid Air Base.

On May 12, the US Embassy in Baghdad issued a security alert advising “all US citizens of heightened tensions in Iraq” and the “requirement to remain vigilant.”

On May 12, Saudi Arabia’s official news agency stated that two out of the four civilian commercial cargo ships that were subject to a “sabotage attempt” near UAE territorial waters in the Gulf of Oman, off the eastern coast near Fujairah, were Saudi oil tankers.

On May 14, the Yemeni Houthis claimed unmanned aerial vehicle (UAV) attack against an oil pipeline belonging to the official Saudi Arabian Oil Company in Riyadh Province’s towns of al-Duwadimi and Afif.

On May 15, the US ordered the departure of all non-emergency US government employees stationed at the US Embassy in Baghdad and the US Consulate in Erbil from Iraq.

On May 18, the Federal Aviation Authority (FAA) issued an advisory warning of risks to civil aviation over the Persian Gulf and the Gulf of Oman.

On May 19, a rocket landed in the vicinity of Baghdad’s Green Zone, less than two kilometers away from the US Embassy.

On May 20, the Spokesperson of the Atomic Energy Organization of Iran (AEOI), Behrouz Kamalvandi stated that Iran’s 3.67 percent production capacity of enriched uranium had increased by four-fold.

On May 20, two ballistic missiles were reportedly intercepted over Mecca Province’s Taif and Jeddah. Yemeni Houthis denied involvement in the attack.

On May 24, the US announced additional deployment of 1,500 military personnel to the Middle East.

Background

In May 2018, the US President Donald Trump unilaterally withdrew from the JCPOA, also known as the Iran nuclear deal, which was negotiated between Iran and P5 +1 (US, UK, France, Russia, China and Germany) countries in 2015. Subsequently, the US re-imposed sanctions related to Iran’s export of oil in November 2018, but granted sanction waivers to eight countries including India, China, South Korea, Taiwan, Japan, Italy, and Turkey for a period of 180 days. On April 8, 2019, the US designated the Iranian Revolutionary Guard Corps (IRGC) as a Foreign Terrorist Organisation (FTO). This was followed by the US’s decision to end sanction waivers to importers of Iranian oil starting on May 2, 2019. Out of the seven sanctions related to Iran’s uranium enrichment and civilian nuclear energy cooperation, the US revoked two sanction waivers related to Iran’s uranium enrichment process under the JCPOA – one that allowed Iran to store excess heavy water produced in the uranium enrichment process in Oman and one that allowed Iran to swap enriched uranium for raw yellowcake with Russia. On May 5, US officials announced their decision to deploy an aircraft carrier and bomber task force to the Middle East citing indications of Iranian threat, but provided no further details. This prompted Tehran’s decision to partially halt its commitments to the JCPOA on May 8, 2019.

Assessments & Forecast

Impact of IRGC’s designation as an FTO:

The designation of the IRGC in its entirety, including its extraterritorial wing, the Quds Force, as a “terrorist entity” marks a highly significant development, as it constitutes the first ever instance wherein the US has labelled a country’s military organization as an FTO. Such a designation comes amid the US’s continued policy to apply “maximum pressure” on the Iranian government to end its alleged role in destabilization activities across the regional as well as the international stage. It forms part of the US’s efforts to depict the Iranian administration as “rogue” or an “outlaw”, and is aimed at further isolating Iran on the international stage.

The move is largely symbolic, given the fact that US sanctions already target the IRGC and its leaders, affiliates, and subsidiaries such the Basij Resistance and the Quds Force and the US had already designated the IRGC as a “Specially Designated Global Terrorist” in 2017. However, the latest step will likely augment the existing pressure on Iran. Any individual or entity knowingly providing material support to the IRGC will now face the possibility of a 20-year US prison sentence. It will also impose immigration restrictions on members of the IRGC who attempt to travel to the US simply by virtue of their membership or affiliation to the organization. FORECAST: Given that the IRGC has significant stake in the Iranian economy, through this measure, the US likely intends to make it further difficult for foreign entities to conduct business with Iran, which, in turn, would have a negative impact upon the Islamic Republic’s economy. However, the fact that a large extent of the IRGC’s business dealings are known to be carried out through illicit channels, such dealings are unlikely to be significantly affected by the recent designation.

FORECAST: Moreover, such a move is also unlikely to alter Iran’s policies on the regional setting, like its involvement in supporting proxies such as the Lebanese Hezbollah, the Yemeni Houthis, and Shiite militias in Iraq such as the Harakat al-Nujaba (HNA). Rather, given the increased restraints faced by the IRGC, the recent move is liable to increase Iran’s motivation to expand its regional footprint through the above-mentioned proxies as well as other sponsored militias. To this effect, the Iranian government will continue to divert large funds, at the expense of its domestic population, in order to sustain its influence in neighboring countries. This, in turn, is likely to inflame already existing local grievances, which may result in further instances of widespread civil unrest in the country. However, on a broad basis, given Iran’s history of strategic culture and great power rhetoric, a majority of the Iranian populace views the US sanctions as the source of their economic hardship, as compared to the Iranian government’s policies. While this is partly aided by the intensive propaganda campaigns in the country, it nevertheless galvanizes unity in the face of a “foreign aggression”. Thus, it is likely that the Iranian administration will attempt to placate the inherent domestic concerns related to the government’s regional activities and support for its proxies amidst an economic crisis, by attempting to project strength vis-a-vis the US. This may take place through the continued portrayal of strength through military exercises, display of new defense equipment, such as the unveiling of the new domestically produced “Khordad 15” air defense system on June 9. Moreover, the Islamic Republic will seek to counteract the US’s measures by maintaining a relatively belligerent posture, given the influence wielded by hardliners on the country’s foreign policy.”

FORECAST: By continuing, or rather increasing support for its proxies, the IRGC may be able to effectively target its adversaries, namely the US, Israel, and Saudi Arabia-aligned countries in the Gulf over the coming months. In this regard, given that much of the recent attacks in the region, such as the May 19 rocket landing in Baghdad’s Green Zone near the US Embassy, the June 1 rocket attack into Israel’s Mount Hermon from Syria, or the spate of attacks against Saudi targets have consistently targeted Iran’s adversaries, it is likely that they were encouraged by Tehran in an effort to destabilize the region. Moreover, the fact that some of the attacks were carried out against energy-related targets, such as the May 12 targeting of Saudi oil tankers off the coast of UAE’s Fujairah in the Gulf of Oman and the May 14 Houthi-claimed UAV attack on the oil pipeline in Riyadh Province, suggests that Iran may be attempting to weaken the economies of Saudi-aligned countries, given their significant dependence on oil revenues. This would align with Tehran’s strategy of preventing its rival, Saudi Arabia, from expanding its influence in the region and subsequently positioning itself as the dominant regional power in the Middle East. This, in turn, would allow Iran to prevent the regional balance of power from significantly shifting away from itself, particularly in light of the reimposition of US sanctions.

Potential Ramifications of the imposition of various sanctions on Iran:

A) Oil-related sanctions:

The US’s refusal to extend the 180-day sanctions exemptions for importers of Iranian oil (China, India, South Korea, Turkey and Japan) from May 2 constitutes a core segment of the US’s “maximum pressure” campaign, as it aims to completely diminish Iran’s oil revenue. Although India and China, the two top importers of Iranian oil, were envisaged to face significant setbacks to its energy security policy due to the US move, it appears that both countries have planned for this eventuality and are effectively looking at alternate sources to fulfill their energy requirements. In this scenario, while neither of the two countries have officially announced their position on the future of Iranian crude imports, it is likely that imports from other key energy players such as Iraq, Saudi Arabia, and the UAE will feature on a higher side, specifically in the case of India. This will put further strain on Iran’s revenues from its oil sector, which, in turn, will have a significant adverse impact upon its national economy.

FORECAST: Given that the move has been anticipated since the reinstatement of US sanctions on Iran in November 2018, early indications suggests that apart from the initial shock, the decision has not drastically impacted the global oil market, despite fears of an oil price surge and supply disruptions. This is primarily due to a boost in Saudi Arabia’s oil production in May to fill the gap of Iranian crude, along with similar boosts in production by Iraq and Libya. However, Iran may resort to illegal trade of its oil in the black market, particularly in countries such as Yemen, where the Houthis have been reportedly deriving a majority of its income by selling Iranian oil. Furthermore, Iran may also attempt to export its oil through the use of “switch-off-the-transponder” tactics, which makes tracking ships increasingly difficult.

B) Uranium enrichment-related sanctions:

The May 8 statement released by the SNSC, which was reiterated by Iranian President Rouhani in a televised address, represents a pronounced effort by the Islamic Republic to project strength in response to perceived US provocations in recent years. The decision to halt its partial commitments under the JCPOA regarding enriched uranium and heavy water reserves follows the US’s May 4 revocation of the two sanction waivers, which practically forces Iran to completely overhaul its production of heavy water and uranium enrichment or continue production and find itself in breach of the JCPOA. Moreover, the five sanction waivers that were extended were also reduced from 180 days to 90 days, in which the remaining adherents of the JCPOA are allowed to cooperate with Iran on the sites of Bushehr, Arak, and Fordow without facing US sanctions.

This was followed by the May 20 announcement from the Spokesperson of the Atomic Energy Organization of Iran (AEOI), Behrouz Kamalvandi according to which, Iran’s 3.67 percent production capacity of uranium had increased by four-fold. However, Iranian officials reportedly stressed that the uranium would be enriched only to the 3.67 percent limit set under the JCPOA. Thus, although Tehran still remains party to the JCPOA, its increased capacity to produce enriched uranium suggests that Iran is likely to soon exceed the 300 kg uranium stockpile limitation set by the accord. FORECAST: However, as indicated in Rouhani’s speech, Tehran will likely retain its enriched uranium (upto 300 kg) and heavy water (upto 130 tons) rather than selling them to other nations while remaining within the limits prescribed in the nuclear deal over the short term, at least until July 8. This would allow Iran to project its adherence to the terms set under the JCPOA.

FORECAST: However, as per the joint statement released by France, Germany, and the UK on May 9, while the European states expressed “regret” over the reinstatement of US sanctions and continued to pledge their willingness to support alternate trade mechanisms such as the Instrument in Support of Trade Exchanges (INSTEX), they also categorically rejected Tehran’s 60-day ultimatum for negotiations. While this highlights their unwillingness to publicly be strong armed onto the negotiation table, it is also indicative of their reluctance to oppose US policies. Furthermore, the reimposition of the US sanctions has increased the risk of conducting business with Tehran for foreign companies, several of whom have already ceased their operations in the Islamic Republic. This is likely to have a significant adverse impact upon Iran’s economy over the coming months.

C) Metal industry-related sanctions:

The US President Donald Trump’s May 8 decision to impose new sanctions on Iran’s metal industry are aimed at undermining Iran’s revenue from the export of industrial metals, the country’s largest non-oil sector, which reportedly accounts for approximately ten percent of its export economy. While Iran’s mining industry was already facing severe setbacks due to shipping and payment restrictions, the recent move is liable to inherently impact employment provided by the metal as well as the automotive industry, which reportedly constitutes almost six percent of Iran’s total labor force. This is liable to significantly exacerbate domestic workers’ grievances, which have manifested in the form of persistent localized demonstrations across Iran over the recent months.

FORECAST: In this context, public protests surrounding employment, pensions, inflation, increase in the prices of basic commodities and other economic-related issues are liable to continue in a significant manner over the coming weeks and months. Such demonstrations will likely take place across Iran, including in major cities such as Tehran, as well as in outlying provinces such as Khuzestan and Kordestan, where the locals comprising of an Arab-majority or Kurdish population perceive themselves as marginalized by the Shiite Iranian government’s policies. This will not only increase the threat of civil unrest in the country as a whole, but also exacerbate sectarian tensions between the countries minority communities and the Shiite-led government.

Lack of direct engagement, continued strategic posturing liable to prolong tensions in the region:

The Iranian administration’s current position to resist direct negotiations with the US, albeit agreeing to mediation talks with Japan, highlights the high degree of influence wielded by hardliners on the country’s foreign policy at this juncture. Such elements continue to criticize the Rouhani administration’s moderate approach towards dealing with the US and aspire to correct the perceived weakness with which the terms of the JCPOA were negotiated in 2015. FORECAST: This, combined with the relative lack of tangible economic benefits from JCPOA, is liable to further embolden segments of hardliners and conservative elements within Iran’s political sphere. This may result in further appointments of such elements in key leadership posts, which is liable to significantly hinder the popularity of more moderate officials, consisting of figures such as President Hassan Rouhani and Foreign Minister Javad Zarif. This is underscored by the appointment of General Hossein Salami, a prominent hardliner within Iran’s military establishment as the IRGC’s Commander-in-Chief on April 21. Such appointments are not only liable to increase the anti-US rhetoric emanating from the Islamic Republic but also significantly hamper the potential for backchannel negotiations with the US, which are generally conducted by more moderate officials.

FORECAST: On a regional level, tensions are liable to remain high due to the strategic posturing of the two countries, in order to eventually coerce each other onto the negotiating table. The deployment of US warships, including an aircraft carrier and a bomber task force on May 5, the sending of Patriot missile systems on May 11, as well as the decision to deploy an additional 1500 US military personnel to the region, is likely to significantly increase tensions in the Persian Gulf waters and the Strait of Hormuz over the coming weeks and months. This is particularly in light of Tehran’s persistent effort to assert its authority as the legitimate custodian of security across its territorial waters. These tensions may manifest in the form of limited confrontation between the naval forces of the two sides, which constitutes a general risk to shipping through the critical energy choke point.

FORECAST: Tensions are also likely to increase between Saudi-aligned countries and Israel on one side and Iran on the other. Iran may encourage its backed elements, particularly the Yemeni Houthis, to increase their attacks against targets in Saudi Arabia and the UAE. This would also align with the Houthis’ aim of weakening the economies of countries that are part of the Saudi-led Coalition in Yemen in order to reduce their ability to engage in the ongoing civil war in the country. Iran may also use its proxies and backed elements in Syria and Lebanon, such as the Lebanese Hezbollah, to put pressure on the US by using them as leverage against Israel, the US’s closest ally in the Middle East. This may manifest in the form of attacks against Israel by Iranian-backed elements in Syria, as witnessed on June 1, when a rocket was launched from Syria towards Israel’s Mount Hermon. However, such attacks are likely to remain limited and constrained to areas within close proximity to the Syria-Israel border. This is because an attack deep inside Israeli territory would trigger a large-scale conflict between Israel on one side and Syria and Lebanon on the other, and Syria is currently not interested in such a scenario given its preoccupation in hostilities with rebel forces.

FORECAST: Overall, as tensions between the US and Iran get prolonged, the risk of a military confrontation between the two countries will increase. Such a military confrontation is likely to be limited at least in the short term, with Iran attempting to use its proxies as a means to put pressure on the US and its Gulf allies and the US retaliating with a further increase in military presence in the Persian Gulf. While Iran is currently not interested in a broad conflict with the US given that its economy is unlikely to be able to sustain such a cost, as previously assessed, the influence of hardliners on the country’s foreign policy reduces the possibility of backchannel negotiations. This combined with the fact that the US is unlikely to agree to any terms that do not significantly diminish Iran’s nuclear and military capabilities, further reduces the possibility of successful negotiations. Therefore, as these tensions persist over a long period of time, the risk of a full scale conflict between the US and Iran cannot be ruled out.

Recommendations

Travelers are advised to regularly review their emergency and contingency procedures as a basic security precaution, as the current tensions between Iran on one side and the US and its Gulf allies on the other may manifest in some form of cold war or even a limited or full military confrontation.

Western nationals operating or residing in Iran are advised to remain cognizant to prevailing negative sentiment toward the United States and other North American and Western European countries.

US citizens and other Western nationals operating or residing in other countries in the Middle East with sizeable Iranian-backed elements are advised to keep a low profile and maintain heightened vigilance, given the potential for attacks by such groups.

Those operating vital infrastructure, particularly in the oil sector, in Saudi Arabia are advised to review security protocols in light of the threat posed by Yemeni Houthi-perpetrated attacks, particularly through the use of UAVs.

Those planning to operate commercial aircraft over the Persian Gulf and the Gulf of Oman are advised to exercise heightened caution and remain apprised of further FAA notices regarding the increased threat to aviation in this region.

US measures against PA likely attempt to force concessions in negotiations with Israel – Israel & Palestinian Territories Analysis

Executive Summary

In recent months, the Trump administration took several economic and diplomatic measures against the Palestinian Authority (PA), including cutting funding for the United Nations Relief and Works Agency for Palestine (UNRWA), as well as closing the Palestine Liberation Organization (PLO) mission in Washington, D.C.

These are likely driven by the Trump administration’s desire to act in accordance with perceived US national interests only, as well as to challenge the status quo, thus forcing the PA to return to negotiations and adopt more flexible positions vis-a-vis Israel.

While the measures have exacerbated heightened tensions between the US and the PA, as well as domestic tensions, in the near-term, they are unlikely to lead to broad hostilities between Israel and Gaza, or large scale unrest in the West Bank.

Nonetheless, the measures will likely contribute to an uptick in “lone-wolf” attacks by Palestinians targeting Israeli civilians and security personnel in the West Bank and Jerusalem, as well as fuel the ongoing civil unrest along the Israel-Gaza border.

Travel to Israel may continue at this time while adhering to security precautions regarding militant attacks, while avoiding the immediate vicinity of the Syrian, Lebanese, and Egyptian borders, due to the persistent risk for cross-border violence.

Current Situation

On August 31, the US State Department announced that the US Government will end all financial contributions to the United Nations Relief and Works Agency (UNRWA), which officially provides Palestinians with healthcare, education, and social services. The statement described the agency as an “irredeemably flawed operation”, further citing its unwillingness “to shoulder the very disproportionate share of the burden of UNRWA’s costs”.

The US regards UNRWA’s business model as “simply unsustainable” due to its “endlessly and exponentially expanding community of entitled beneficiaries”, namely the bestowing of refugee status to descendants of Palestinian refugees following the Arab-Israeli conflict of 1948-49.

The measure was denounced by the Palestinian Authority (PA) President Mahmoud Abbas whose spokesperson referred to the Trump administration’s move as “promoting terrorism” and a “flagrant assault against the Palestinian people and defiance of UN resolutions.”

Meanwhile, on September 10, the US State Department announced that it will close the Palestine Liberation Organization (PLO) mission in Washington, citing the PLO’s “refusal to engage with the US government with respect to peace efforts”.

Background

The Trump administration’s decision to halt all funding to UNRWA comes amidst a series of policy changes vis-a-vis the Palestinians over the last year. On December 6, 2017, President Donald Trump officially recognized Jerusalem as the capital of Israel, followed by the relocating of the US Embassy from Tel Aviv to Jerusalem on May 14. In January, the Trump administration withheld 65 million USD of a planned 120 million USD contribution to UNRWA.

More recently, on August 24, the US State Department announced that it will cut a further 200 million USD in aid to the Palestinians, followed by the September 8 announcement of cuts amounting to 25 million USD earmarked for Palestinians in East Jerusalem hospitals.

The UN agency is funded almost exclusively by voluntary contributions from UN Member States. The cuts in the US’s contribution amount to approximately 300 million USD in planned funding for UNRWA. The US had previously contributed almost 30 percent of UNRWA’s 1.1 billion USD 2017 budget.

The PA has not engaged with a US-brokered diplomatic process since the latter’s recognition of Jerusalem as the capital of Israel in December 2017.

Assessments & Forecast: US measures in accordance with national interests, constitute effort to force Palestinian engagement

The Trump administration’s series of diplomatic and economic measures are likely motivated by two reasons. First, the decision is consistent with President Trump’s broader “America First” doctrine, which emphasizes a foreign policy that prioritizes perceived US national interests. This has manifested in the desire to demand that other governments increase their share of the budgetary burden for numerous international organizations. Thus, President Trump seeks to reduce UNRWA’s reliance on the US, as the latter had been paying almost 30 percent of UNRWA’s budget prior to the cuts and the Trump administration does not believe that UNRWA serves its national priorities.

Given the administration’s attempts to challenge previously held international consensus on issues such as the status of Jerusalem and Palestinian refugees, the UNRWA cuts are likely driven by the US’s goal of encouraging the Palestinians to return to the negotiating table and make concessions. By challenging the status quo, the US likely seeks to exert pressure on the PA to adopt more flexible positions on areas of policy that have long been considered non-negotiable by the Palestinian leadership. President Trump’s reported remarks on September 6 that the US “is not paying” (with reference to US aid to the Palestinians) if the Palestinians “don’t make a deal”, strengthens this assessment.

Furthermore, the US measures should be understood within the broader geopolitical context pertaining to the widely anticipated US-sponsored peace plan. Alongside the US’s attempts to force the Palestinians to make concessions, Egyptian authorities have sought to encourage both a Hamas-Fatah reconciliation process and, simultaneously, an Israel-Hamas long-term ceasefire, much to the chagrin of PA President Mahmoud Abbas, whose Fatah Party was reportedly excluded from the ceasefire talks. As the PA strives to return to control the Gaza Strip, such an exclusion may have been interrupted by Abbas as sign that he is considered irrelevant to the Gaza negotiations. Meanwhile, the US reportedly seeks to leverage a reported warming of ties between Israel and the Gulf countries, in addition to Egypt and Jordan, to promote its diplomatic plan and help to harness this growing relationship to exert pressure on the Palestinian leadership to yield to the US’s demands. Overall, the developments represent a weakening of the Abbas-led PA, which the US is likely seeking to take advantage of to promote their own interests.

However, the US measures are unlikely to succeed. Rather, they will likely exacerbate already heightened US-PA tensions. Given that the right of return of Palestinian refugees is considered by all Palestinian factions to be a prerequisite for the conclusion of the conflict, any international decisions pertaining to the refugee question are highly sensitive. In this context, the US’s decision to cease its funding of UNRWA, represents a perceived “flagrant assault against the Palestinian people” for the Palestinian leadership because it likely views such a decision as undermining the “right of return”. Therefore, the US’s efforts are prone to reduce the PA’s willingness to engage in a US-brokered diplomatic process.

If PA President Abbas was perceived as agreeing to US demands on the right of return and the status of Jerusalem, this would significantly undermine him in Palestinian public opinion due to the sensitivities surrounding these issues. Furthermore, it would present an opportunity for more extreme Palestinian factions, such as Hamas, to undermine the PA and sabotage any diplomatic process.
FORECAST: Given precedent, and the failure of previous measures to bring the Palestinians back to the negotiating table, the strategy is more likely to strengthen the Palestinian leadership’s refusal to engage and will therefore undermine the US-sponsored peace initiative due to this refusal.

Assessments & Forecast: Potential ramification on security environment due to economic initiatives

Overall, we do not assess that the US measures will lead to a broader violent uprising in the Palestinian Territories. On the contrary, the Israeli security apparatus continues to deter sophisticated acts of militancy exceptionally well, despite constant attempts to destabilize the security environment. For instance, in June, Israel Security Agency (Shin Bet) Director Nadav Argaman revealed that 250 acts of militancy, including suicide bombings, kidnappings and shootings, had been foiled by security forces in the first half of 2018. Furthermore, despite the lack of diplomatic engagement, the security collaboration between Israel and the PA remains stable and adds to the overall excellent security environment. Indeed, this cooperation is the only remaining Palestinian institution that the US continues to fund, in the form of the office of the United States Security Coordinator (USSC), which provides direct financial assistance and support to the PA Security Forces (PASF).
FORECAST: Taken as a whole, over the short-term, we do not anticipate that there will be an uptick in sophisticated, large-scale acts of militancy in the West Bank.

However, alongside the tangible, adverse economic effects of the cuts to UNRWA and additional aid, the broader series of economic and diplomatic measures is liable to exacerbate existing frustration and the Palestinians’ sense of marginalization. As a result, this perception may lead to an uptick in small-scale acts of militancy, motivated by these grievances. For instance, in the aftermath of the Trump administration’s recognition of Jerusalem, a slight temporary uptick in “lone-wolf” attacks was recorded, representing the increased sense of marginalization amongst the Palestinian populace. The question of the right of return of refugees is a similarly emotive and sensitive issue for Palestinians and any attempt to undermine this perceived right is liable to ignite Palestinian violence.
FORECAST: As a consequence, over the coming weeks and months, this anger could manifest in an increase in the volume of “lone-wolf” attacks such as throwing of Molotov cocktails, stabbings, shootings, and vehicle-ramming attacks on security forces and civilians, primarily in the West Bank and Jerusalem.

With respect to the Gaza Strip, UNRWA services, in part, play an important role in stabilizing the Palestinian security environment. UNRWA officially provides vital employment opportunities, medical services, and educational institutions. For instance, in Gaza, 240,000 students study at 252 UNRWA-run schools, illustrating the importance of such aid in helping to alleviate economic challenges.
FORECAST: With this in mind, the cuts to UNRWA are liable to exacerbate the precarious economic crisis. Given precedent, as Hamas tends to divert Gazans’ attention away from such economic crises and rather than permit criticism of its governance, this will likely redirect Gazans’ grievances towards Israel. Hamas’ resistance to Israeli policy, at present, typically manifests through the enabling, or instigating, of unruly riots on the Israel-Gaza border, encouraging the hurling of Molotov cocktails and incendiary balloons and kites into Israel, as well as infiltration attempts. In the short-term, these acts of unrest are likely to continue but are unlikely to cause a significant escalation. However, over the medium- and long-term, as the impact of the UNRWA cuts aggravates the economic crisis, there will be an elevated risk that Hamas will be forced to resort to armed conflict out of desperation, manifesting in rocket attacks, sophisticated infiltration attempts utilizing Hamas’ tunnel network, and mass riots on Israel’s borders. Nevertheless, overall, over the coming months, a significant change to the travel security environment that would have an impact on business continuity in Israel is unlikely.

Recommendations

Israel:

Travel to Israel may continue at this time while adhering to security precautions regarding militant attacks, while avoiding the immediate vicinity of the Syrian, Lebanese, and Egyptian borders, due to the persistent risk for cross border violence.

Those traveling in the 40 km area surrounding the Gaza Strip should continue adhering to all safety precautions regarding early warning sirens for incoming rockets. In case you hear a siren, seek shelter in a protected area and remain inside for at least 10 minutes.

Palestinian Territories:

Business-essential travel to Ramallah can continue at this time, while maintaining heightened vigilance in Bethlehem. Adhere to basic security precautions regarding the threats of civil unrest and militancy. Consult with us for itinerary-based recommendations and ground support options.

Avoid nonessential travel to other Palestinian-controlled areas of the West Bank, including refugee camps, at this time given the persistent threat of civil unrest.

We advise against all travel to the Gaza Strip at this time due to continuous border crossing closures and the threat of militant activity.

If travel is essential, prior to entering Palestinian-controlled areas from Jerusalem-area checkpoints, confirm that crossings remain open and no unrest is taking place. Crossings near the cities of Jenin, Qalqilya, and Tul Karem remain less prone to violence.

Minimize night travel in major cities, as the majority of IDF and PA security operations occur at this time, particularly in the vicinities of Palestinian refugee camps.

Annual joint US-South Korea military exercises to begin on April 1; US, North Korea display commitment to upcoming bilateral talks – Korean Peninsula Analysis

Current Situation

On March 19, the US Department of Defense confirmed that the annual Foal Eagle and Key Resolve joint military exercises with South Korea will begin on April 1 and last approximately one month. A spokesperson said that the exercises will be on a scale similar to previous exercises, and involve 23,700 US and 300,000 South Korean troops. There have been no announcements regarding the involvement of  US aircraft carriers. Last year’s exercises lasted two months and involved the nuclear supercarrier USS Carl Vinson. According to recent reports, South Korea is considering procuring Apache heavy-attack helicopters and anti-artillery surface-to-surface missiles, to be used in the event of a ground war.

The US and South Korean presidents are preparing for individual summits with North Korean Supreme Leader Kim Jong-un. South Korean President Moon Jae-in is planning to meet with Kim in late April, and US President Donald Trump has tentatively agreed to meet with Kim in May, although no details of the latter meeting have been confirmed, including the location. A South Korean envoy reported that Kim said he understands that joint exercises must continue, but that he expected them to be readjusted in the future if bilateral developments remain positive.

Background

Kim delivered a speech on New Year’s Day suggesting a restart in bilateral negotiations with South Korea and offered to send a delegation to the 2018 Olympics in Pyeongchang. South Korea accepted, and the two sides held a series of meetings leading up to and following the Olympics, resulting in the North Korean offer of bilateral talks with both South Korea and the US.

No sitting US president has ever agreed to meet with North Korean leadership; President Bill Clinton and President Jimmy Carter traveled to Pyongyang after leaving office.

North Korea has not held a nuclear weapon or missile test since November 28, 2017.

Annual joint US-South Korea military exercises to begin on April 1; US, North Korea display commitment to upcoming bilateral talks - Korean Peninsula Analysis | MAX Security

Assessments

US, North Korea appear committed to talks, although deep distrust remains

The announcement of a U.S.-North Korea summit marks the first ever for a sitting US President, and is made more notable by Pyongyang’s stated willingness to discuss denuclearization. The main reason to doubt a North Korean commitment to denuclearization is the fact that it views its nuclear arsenal as the ultimate guarantee of regime survival. Other, more realistic objectives for the summit might be reaching an agreement on an indefinite ban of missile or nuclear testing in exchange for limits on US-South Korea exercises or a sanctions relief.

In the immediate term, a positive outcome is the North’s offer to temporarily suspend missile tests ahead of the talks, without presenting pre-conditions such as freezing military exercises or requesting sanctions relief. This suggests Kim’s willingness to begin negotiating in good faith, although similar strong starts have collapsed in the past.

The upcoming US-led exercises look to be an in-kind response to this good faith despite public claims to the contrary that the 2018 military exercises are on a similar scale to previous years. The decision to exclude aircraft carriers and halve the length of the drills demonstrates reciprocal flexibility following statements from Pyongyang showing increased tolerance for the exercises. Pyongyang’s stated tolerance and the drawdown of exercises by the US are signals that the desire for talks is, for the time being, sincere.

Despite this projected sincerity, the exercises are perceived as highly provocative by Pyongyang. By not delaying them entirely until talks, the US may be testing Pyongyang’s restraint, as the spring exercise season is normally notorious for North Korean weapons tests. The tenuous nature of the potential US-North Korean harmony is underscored by South Korea’s military tenders for equipment that has little use outside of war with the North.

Major areas of discussion include disarmament, sanctions, detentions

There is significant divergence in the expectations of such a process, as the US views denuclearization as the dismantling of North Korea’s nuclear weapons program, while North Korea views denuclearization as the complete withdrawal of US forces from the region. At present, neither side has shown willingness to satisfy the other’s demands on the issue. The US appears equally unwilling to ease sanctions in the short term, as the current belief in Washington is that economic pressure is one of the few things that brought North Korea to negotiations in the first place. Other areas may prove more easy to reconcile, including the transfer of foreign detainees out of North Korea prisons. The prisoners serve little strategic value for North Korea, and their release would constitute a strong showing of good faith ahead of more contentious issues.

The unprecedented meeting could have positive outcomes even if the primary goal of complete denuclearization of the peninsula is not achieved, including a more general de-escalation of tensions between Washington and Pyongyang. A more comprehensive solution is less likely, as it would be particularly difficult for an agreement to be reached based on a few days of talks, especially given the short preparation time for the Kim-Trump summit. It also remains possible that the lack of preparation, along with the remaining uncertainty over a neutral location for the meeting, might lead to abandoning or delaying the summit. Ultimately, whether or not agreements are made, just holding the summit at all would mark a significant breakthrough.

Recommendations

Travel to Seoul may continue at this time, while adhering to standard security protocols regarding protests, crime and the lingering risk of conflict with North Korea.

We advise against nonessential travel to Pyongyang and North Korea given the risk of detainment of foreign travelers.

During periods of armed escalation between North and South Korea, we advise against all nonessential travel to the vicinity of the Demilitarized Zone (DMZ) and the Yeonpyeongdo Islands.

US aid withdrawal unlikely to elicit security policy reversal from Islamabad; risk to US, Western nationals elevated during periods of tension between countries – Pakistan Analysis

Current Situation

On January 1, US President Donald Trump issued a statement on social-media threatening to cut financial aid to Pakistan for allegedly harboring anti-US militants within its territory and for lying to the US about its counter-militancy efforts.

Washington officially announced a suspension of financial aid worth 2 billion USD to Pakistan on January 4, pending “decisive action” against anti-US militant groups, such as the Afghan Taliban and the Haqqani network, which it alleged targets US personnel in Afghanistan.

On the same day, the US reportedly placed Pakistan on a watch list for “severe violations” of religious freedom, with Islamabad alleging that the move was “politically motivated”.

In response to the developments, Pakistani Defense Minister Khurram Dastgir Khan indicated on January 9 that Pakistan had suspended military and intelligence cooperation with the US in the wake of President Trump’s allegations and the subsequent US measures.

President Trump’s harsh rhetoric with respect to Pakistan’s “lies and deceit” have triggered a wave of anti-US sentiment in the country. Several political parties have also issued statements critical of Washington’s stance; most notable among them is opposition Pakistan Tehreek-e-Insaf (PTI) leader Imran Khan who has traditionally expressed his opposition to US drone strikes in Pakistan’s tribal areas.

On January 19, Pakistan’s Interior Ministry closed the Islamabad bureau of a US government-linked Pashto-language media outlet after Pakistan’s intelligence agency, the Inter-Services Intelligence, accused it of airing programs “against the interest of Pakistan” and of “portraying it as (a) hub of terrorism and (a) safe haven for militant groups”.

At least 43 people were killed in an overnight attack claimed by the Taliban group on a UK-based luxury hotel in Kabul on January 20, prompting the White House to call on Islamabad to conduct the immediate arrest or expulsion of Taliban leaders based in Pakistan.

According to Pakistani officials, two Haqqani network militants were killed in a suspected US drone strike in the Federally Administered Tribal Areas (FATA) in northwestern Pakistan on January 24.

US aid withdrawal unlikely to elicit security policy reversal from Islamabad; risk to US, Western nationals elevated during periods of tension between countries - Pakistan Analysis| MAX Security

Assessments & Forecast

US aid freeze unlikely to elicit desired policy reversal from Islamabad with respect to conflict in Afghanistan 

The aid freeze is notable as it is the first concrete, coercive measure adopted by the Trump administration towards Pakistan over its alleged implication in the conflict in Afghanistan. Occurring in the wake of President Trump’s unveiling of a visibly more aggressive Afghan strategy in August 2017, the measures appear aimed at securing enhanced counter-militancy cooperation from Islamabad against anti-US groups in Afghanistan ahead of an anticipated annual uptick in their operations during the annual spring offensive.

Such cooperation, as Washington expects, would largely encompass intelligence regarding the whereabouts of senior leaders of the Afghan Taliban and the Taliban-linked Haqqani network, that Pakistani intelligence allegedly harbors on its soil. Islamabad has maintained that the actual levels of involvement of the Haqqani network in the Afghan conflict are minimal. However,  US officials’ estimate that the Haqqani network has a membership of over 10,000 and are one of the most operationally-sophisticated militant groups in Afghanistan, highlighting their concerns about the group’s key role in the conflict.

Nevertheless, the latest measures from Washington are unlikely to achieve the intended response from Islamabad. Such punitive financial cuts are not entirely new in US-Pakistan relations, with one of the most recent examples occurring in the immediate aftermath the unilateral US raid in 2011 targeting the hideout of deceased al-Qaeda (AQ) leader Osama bin-Laden in Abbottabad, Pakistan. Washington’s frequent resort to the threat of aid withdrawals to shape desired policy behavior has enabled Islamabad to take appropriate measures to weather the negative impact of these measures.

More importantly, Islamabad’s long-term ties to the Afghan Taliban and its affiliated groups continue to remain a core component of its national security strategy. This is unlikely to shift significantly under external pressure or inducements from the US. Islamabad perceives close relations with such groups as securing itself vital strategic depth in Afghanistan and as a bulwark against the perceived growing influence of regional rival India in the country.

Policymakers in Islamabad also work under the assumption that the factors that sustain the insurgency in Afghanistan may not be completely quelled simply through militarily eliminating the Taliban, given the general inadequacy of the Afghan government’s security policy. As such, and in the event of a future US withdrawal from the region, Islamabad may perceive itself as being the most vulnerable in terms of long-term militant blowback from the region. Another factor shaping Islamabad’s reluctance to capitulate entirely to US demands could be concerns that any overt assistance to the US war effort in Afghanistan could have severe domestic repercussions, including widespread public backlash as well as a potential uptick in Islamist militant attacks within Pakistan’s territory.

Potential security costs of enforcing additional punitive measures may decrease prospect of escalation 

Given Islamabad’s apparent intransigence on the issue, Washington has a range of measures it can choose to initiate in order to escalate diplomatic pressure. These measures include the revocation of Pakistan’s non-NATO ally status, which could deny it preferential treatment on military hardware sale deals or influencing international financial institutions to suspend lending to Islamabad. Another angle that may be considered is to conduct, expand, and even regularize drone strike operations in and outside of Pakistan’s restive FATA, particularly in neighboring Balochistan Province where top leaders of the Afghan Taliban, known as the Quetta Shura, are believed to be residing.

However, such measures run the risk of triggering retaliatory measures from Islamabad that could damage the overall US effort in Afghanistan. Pakistan could enforce a closure of the US ground and aerial supply routes through the country that sustain US troops in landlocked Afghanistan. This may include closing off US access to military bases in Pakistan that have been used for logistical operations. Such a move would considerably increase operational costs for the US and hamper efforts to combat the currently resurgent Taliban. Washington would likely have no choice but to seek alternative routes, most of which run through Central Asian countries that are largely under the Russian sphere of influence. Current US tensions with Russia over a number of issues could dampen the appeal of such alternative supply routes.

Despite the elevated tensions, both countries remain appreciative of the mutual benefits of ties to the overall regional counter-militancy effort, as illustrated by continued low-key meetings between US and Pakistan administration officials. While Pakistan has largely benefited from friendly ties through the procurement of military hardware, Washington understands the role played by Pakistani intelligence in its efforts to dismantle AQ networks in the region. This explains both countries’ seeming unwillingness to resort to further escalation tactics, at least for the time being.

FORECAST: Tensions are unlikely to dissipate over the coming months, and any rhetoric from Washington over the issue is likely to trigger similarly sharp verbal responses from the administration in Islamabad. This is likely as authorities would seek to project strong leadership in the face of external pressure, particularly due to the upcoming general elections in Pakistan this year and the potential for opposition politicians to raise the issue.


US aid withdrawal unlikely to elicit security policy reversal from Islamabad; risk to US, Western nationals elevated during periods of tension between countries - Pakistan Analysis | MAX Security

Despite growing defense cooperation with Beijing, Islamabad likely to remain keen on retaining security ties with US

One of the factors that may have emboldened Islamabad to challenge the US is Beijing’s continued verbal assertions of support throughout the crisis. China proclaims itself as Pakistan’s “all-weather friend” and has continued to shield the Muslim country from international censure with respect to its perceived inadequate counter-militancy efforts. Additionally, a suspension of financial aid from the US may not be as impactful as Washington intends it to be, as Islamabad has a diverse list of countries, including China, Turkey, and several Western European countries, with which it has maintained defense relations. China’s attempts to establish a naval base in Jiwani in Pakistan’s Balochistan Province may also be perceived in Islamabad as early efforts to establish growing security cooperation between both countries over the long term.

Nonetheless, Islamabad will remain reluctant to completely detach itself from all military cooperation with Washington. Currently, much of US defense sales to Pakistan focus on the F-16 fighter jets, a key component of Pakistan’s aerial defense capabilities. Additionally, Washington-supplied attack helicopters, such as the AH-1Z Viper, considerably enhance Pakistan’s counter-militancy operations in the harsh mountainous terrain of the country’s northwestern tribal areas that are known to be militant safe havens. Thus, any potential suspension of US assistance with regards to maintenance of the fleet would negatively impact anti-militancy operations. This, coupled with Beijing’s current inability to match or surpass the performance criterion of far superior US-made aircraft, is likely to push Islamabad to maintain its defense ties to the US.

Anti-US sentiment in Pakistan may spur militant activity, political protests by parties seeking to boost respective election campaigns

FORECAST: Political groups in Pakistan are increasingly liable to utilize the issue to portray the Pakistan Muslim League-Nawaz (PML-N) government as ineffective in safeguarding Pakistani interests and seek to mobilize large numbers to boost their respective election campaigns. Apart from mainstream political groups, Islamist organizations such as Difa-e-Pakistan Council (Council for the Defense of Pakistan) led by Hafiz Saeed, and newer parties such as the Tehreek E Labbaik Pakistan (TLP) are likely to spearhead these protests, in order to increase their relevance during the election year. Given the existing hostility within the Islamic demographic against President Trump’s decision to recognize Jerusalem as the capital of Israel, these protests are liable to draw turnouts in the thousands. They may particularly target US diplomatic installations in major cities, and bear the risk of violent escalation due to the heightened sensitivities over the issue.

A considerable section of Pakistan’s Muslim community, especially those that subscribe to a hardline Islamist ideology, continues to harbor sympathetic views with the Afghan Taliban, which is seen as fighting a corrupt and inefficient Afghan government backed by the US.

FORECAST: Taliban-sympathetic militant groups in Pakistan are likely to continue to capitalize on public suspicions of the US’ motives and the West in general. This may take the form of attacks using local sympathizers on Western NGOs, particularly health workers involved in immunization campaigns that are considered a Western conspiracy to sterilize Muslim populations. During periods of particularly tense Pakistan-US relations in the immediate term, the risk to US nationals of Western interests by extension is elevated. The potential for attacks remains greater in major cities in the outlying provinces, such as Quetta in Balochistan and Peshawar in the Khyber Pakhtunkhwa Province, where groups like the Tehreek-e-Taliban Pakistan have a notably strong presence.

Recommendations

We advise against all nonessential travel to Pakistan given the heightened threat of militant attacks, criminality, kidnappings and sectarian tensions throughout the country.

US nationals operating or residing in Pakistan are advised to remain cognizant of the increased anti-US sentiment in the country at present and to avoid demonstrations and large gatherings over the issue, given the potential for unrest.

We further advise to US nationals in the country to maintain a low profile due to the potential for targeted attacks, while avoiding engaging in discussions with locals over the sensitive issue.