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Volume 40/No. 2/Summer 1998
The strategic implications of Asia’s economic crisis will be severe. Regional cohesion has been undermined. The Association of South-east Asian Nations (ASEAN) has lost status, and regional institutions, such as the Asia-Pacific Economic Cooperation and the ASEAN Regional Forum, have been found wanting. Japan has proved to be an unhelpful power and resentment of the International Monetary Fund and the US is growing. China, by comparison, stands to gain in influence. The West’s interests are to ensure that key countries—such as Indonesia and South Korea—are not permanently weakened.
In summer 1997, the high-performing East and South-east Asian economies faced a financial crisis of unprecedented proportions. In a matter of weeks, once-vibrant economies and their strong currencies witnessed a meltdown, forcing them to turn to that lender of last resort, the International Monetary Fund (IMF), for assistance. A careful examination of the long-term as well as the immediate causes of the crisis refutes the widely held view that no one predicted the crisis. The crisis could have been avoided if the over-exuberant Asian governments had heeded the IMF’s early warning. The IMF’s policy prescriptions are not only working, but those states in the region that follow them will do best.
It is time that India was taken more seriously in international affairs. Its economic reforms since 1991 have been cautious and limited, but they hold considerable promise for making India a more formidable partner and market. The reforms are also politically sustainable because they are gradual. India possesses a wealth of skilled political operatives who can sustain democratic processes amid economic reform and social tension. The net effect of its unparalleled social heterogeneity is to prevent conflict from becoming dangerously polarised. The pragmatism which is evident in the reforms has also begun to reshape India’s approach to the wider world. Many painful dilemmas remain to be faced, but the outlook is encouraging.
The Clinton administration has sought recently to improve relations with India on a range of foreign-policy and trade issues—despite continuing disagreement on the issue of nuclear proliferation. Nationalist nuclear rhetoric from the new Indian government underscores that this disagreement will not go away; a roll-back of India’s nuclear programme cannot be expected. Yet differences even on such sensitive issues as nuclear proliferation can be lessened through an approach based on engagement and increased cooperation. In particular, economic ties should be strengthened in the area of high technology. US export-control legislation that constrains such cooperation will not be repealed, but can be interpreted more broadly. Special exports of high-technology to India may help to increase the stake Indians have in good relations with the US, and eventually contribute to nuclear restraint from New Dehli.
Despite the restoration of the democratic process in Pakistan, the military continues to be the most formidable actor in the political process. Top military leaders may not be interested in assuming power, but they have a significant input into decision-making on foreign policy, security affairs and key domestic issues. Their disposition towards the civilian government is shaped primarily by their professional and corporate interests. They are prepared to work with a government as long as it can cope with the problems of governance in an effective and transparent manner and does not threaten their interests. The civilian government enjoys sufficient freedom for political and economic management, but it has to give due consideration to the military’s sensibilities.
Since the end of the Cold War, the war in Afghanistan has been transformed from an ideological struggle into a brutal ethno-nationalist conflict. This transformation has largely been fuelled by Afghanistan’s neighbours, most importantly Pakistan, which have pursued competing policies of cross-border ethnic clientelism. In the search for a solution to the crisis, the US must take the lead, enlisting international support to pressure Pakistan and the Taleban, as well as their opponents, into a compromise solution based on a loose federal system. A failure to do so could not only inflict more devastating consequences on the Afghan people, but also seriously imperil international security and stability.
To ensure its longevity and usefulness, the US–Japanese alliance must become as close and as balanced, and principle-based, as the US–UK special relationship. This requires the Japanese Self-Defense Forces to expand their military missions beyond national defence and deterrence to operations inspired by liberal principles. These missions include the maintenance of navigational freedom, humanitarian relief, hostage rescue, non-combatant evacuation operations, peacekeeping, counter-piracy and counter-terrorism efforts, and the prevention of humanitarian tragedies. In turn, the US should welcome greater cooperation with Japan in crisis decision-making. Tokyo and Washington should also work, as a long-term goal, towards a multilateral collective-security arrangement for the Asia-Pacific region that includes China.
While the Allies remain committed to collective defence, they have increasingly endowed NATO with new roles as an instrument of collective security in the Euro-Atlantic region. Elements of Partnership for Peace (PFP), the May 1997 NATO–Russian Founding Act, the stabilisation commitment in post-war Bosnia and other activities have raised new challenges for NATO’s cohesion and effectiveness: how to give practical content to its vision of a peaceful political order in Europe; how to handle the hypothetical issue of eventual Russian membership in the Alliance; what meaning to attribute to vague ‘security is indivisible’ declarations and the Article 4-like security-consultation commitments offered to PFP members; and how to maintain collective defence in good order while assuming collective-security duties.
Refugees and displaced persons from conflicts across the world continue to be killed in large numbers. Ad hoc efforts to protect them—in Rwanda, the ‘safe areas’ in Bosnia and elsewhere—have been largely ineffectual. The international community should pursue a strategy of protection through demilitarising and, in particular, disarming the areas to which displaced persons have fled. Such Demilitarised Protected Areas would, in general, require major-power interventions and should be neutral and explicitly humanitarian, rather than political, in intent.