Fearless Forecast

Kim Jung-un, the North Korean leader, who is also the Chinese People’s Daily’s “sexiest man alive,” ended this year with a bang. He had ordered a successful rocket launch into space that put an object into an impressive 500-kilometer orbit. Warned by everybody not to do it as it would escalate tensions in the region, he did it anyway. Nobody was amused, not even his Chinese patrons. The fury of the US, Japan and South Korea, all proven to be within reach of the Hermit’s Kingdom’s rockets, knew no bounds.

But that consolidated Kim’s leadership. With his throne secure and the military under his thumb, he well may now start North Korea on a path of economic reform, a la Deng Xiaoping. Far-fetched? Anything is possible in the year of the water snake.

Even a dialogue of the Koreas is possible. The newly elected South Korean president, Park Geun-hye, daughter of the late strongman Park Chung-hee, indicated such a dialogue was doable if the North moved a bit closer to denuclearization. She has other things to do, of course: tame big corporations, create jobs, do a lot of social spending. And nurse an anemic South Korean economy with her “motherly” leadership.

Japan, too, has a new leader. Well, not so new because he’s been there before. Succeeding Junichiro Koizumi as prime minister six years ago, Shinzo Abe presided over a Japan that was weighed down by corruption scandals that he couldn’t stomach. Sick of it all, he resigned before he could warm his seat. Today, a new Prime Minister Shinzo Abe has emerged. Tough on North Korea and China, he has shed his pacifist genes.

Hence, the tension due to their territorial dispute over the Diaoyu/Senkaku islands will continue to take a heavy toll on both China and Japan. Their once booming economic relations will keep going down the drain.

As to China, its new leader, Xi Jinping, is no reformer. He dreams of reviving China’s ancient greatness. That means China won’t be launching any charm offensives in the South China Sea. It will continue to alarm its neighbors, including Vietnam, the Philippines, India and even Australia-New Zealand. The arms race triggered by China’s buildup of its bluewater navy will not abate.

India has made clear that its navy will protect its economic interests in the South China Sea — meaning oil exploration ventures with Vietnam. And that it’s not going to sit idly while China packs combat troops on its side of the McMahon line, which China does not recognize as its legitimate boundary with India.

It was into this complex East Asian situation that the United States in recent months made an economic, diplomatic and military “pivot” — thereby “rebalancing” the regional dynamics. And ensuring that China’s rise as an economic and military power doesn’t lead to hegemony.

Asean, with Indonesia providing much of the intellectual leadership, will continue to work hard so that the rebalancing will be constructive and yield a win-win situation.

My most fearless forecast is that 2013 won’t be the year that China goes berserk, waging “small local wars” against its neighbors. Nor will it prematurely challenge even an apparently weakened US Navy. Nor will any of the neighbors miscalculate and start shooting first. But there will be tension all year.

There will be a race between the development of the Trans-Pacific Strategic Economic Partnership (TPP), which doesn’t include China, and that of the Regional Comprehensive Economic Partnership, which doesn’t include the US. It’s just possible that these two partnerships will at some point — give two decades or three — converge with each other, AFTA and APEC.

And 2013 should end with APEC, under Indonesia’s chairmanship, defining itself more clearly and choosing a niche in a more clearly defined Asia-Pacific regional architecture.

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