Thus far, the watchword for 2016 is ‘be prepared for anything.’ The first week of the new year has been volatile to say the very least. From the Arabian Peninsula to East Asia, diplomatic, nuclear and economic crises have come to life and the aftershocks of these events have been felt around the world. It remains to be seen whether this pattern turns out to be an aberration or something more consistent. What is certain is the fact that 2016 has started with a bang and the world is warily waiting for what might happen next.
In the Middle East, the execution of Sheik Nimr al-Nimr has touched off a wave of protests and diplomatic maneuvering. Rioters in Tehran stormed and set fire to the Saudi Arabian embassy. The Saudis responded by severing diplomatic ties with Iran and within 24 hours, the Gulf States and Sudan had followed suit to varying degrees. As if this were not bad enough, on 7 January, 2016 Iran accused Saudi Arabia of intentionally striking its embassy in Yemen with warplanes. The Saudis rejected the claim and as of yet the Iranians have not provided any proof to support its accusation. The events that are playing out at the moment are part of a much bigger drama between Iran and Saudi Arabia in the region. Tensions will continue to rise this year and the possibility of open conflict between the two nations and their allies will also increase.
Then there are the happenings in East Asia. Earlier this week, Pyongyang claimed that North Korea had successful tested a thermonuclear device. Within hours, scientific experts were disputing the claim. Without delving into detailed explanations, it is safe to assume that North Korea did not test a thermonuclear (hydrogen) bomb. No one is disputing that a nuclear weapon was tested, though. From all indications there was indeed an underground test. This morning, three days after the test, North Korea has released video of a supposedly new SLBM (Submarine Launched Ballistic Missile) test. South Korean media outlets have pointed out that the footage of the ‘new’ test appear very similar to a North Korean missile test from 2014.
In response to the test, the US has warned China that its efforts to keep North Korea on a leash have failed. It is apparent that the ‘Soft Approach’ to North Korea is not working and a new approach has to be considered. As far back as the 1990s, the US and then China opted for a softer approach for contending with North Korea’s nuclear ambitions and its overall animosity. These efforts have resulted in nothing substantial. The North has nuclear weapons, it is continuing nuclear testing, and expanding its ballistic missile capabilities as well. The failure of incentives and tolerance by China and the US is the primary reason that Pyongyang is a nuclear power.
Finally, there is China. This past week saw China’s stock market and currency go off the rails for the second time in six months. The circuit breaker mechanisms put in place to limit market sell-offs halted trading twice this week and actually intensified sell-offs. The situation was so damaging that the government has decided to do away with the circuit breaker. The Chinese drop was felt around the world as global indexes reacted negatively to the reality that China’s economy is faltering. The situation appears to 2008 when the US economic slump led to consequences far beyond its borders.
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