Kim’s Curveball — US vs The Fantastic Five — High-Tech Acrobatics

Happy Wednesday!

It’s Kevin Allison here, with a fresh mid-week edition of Signal, GZERO Media’s take on the most important stories in global politics.

In today’s edition, we look at Kim’s latest curveball, ask whether the Fantastic Five can save the Iran nuclear deal, examine President Trump’s high-tech acrobatics, and see what we can learn from a series of deadly bombings in Indonesia. I’ve also got your photo of the week and some hard numbers worth crunching.

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- Kevin

KIM’S CURVEBALL

Late last night, a top North Korean foreign ministry official issued a scathing statement that cast doubt on the upcoming summit between US President Donald Trump and North Korean leader Kim Jong-un in Singapore, saying that a combination of US demands on nuclear disarmament, recent US-South Korean military drills, and comments from newly arrived National Security Advisor John Bolton’s had led it to reconsider attending. The North also cancelled a planned meeting with South Korea that had been set for today.
 
A curveball? Sure. But last-minute bluster and brinkmanship are nothing new from North Korea — it may just be returning to form after the sudden thaw that led to the historic handshake between Kim and South Korean President Moon Jae-in in the DMZ last month.
 
No one said negotiating with most opaque, repressive regime in the world would be easy.

THE US VS THE FANTASTIC FIVE

And then there were five — well, P4 +1 if you’re really counting. Last week’s decision by the US to exit the Iran deal has set off a flurry of diplomacy among the deal’s remaining signatories, four of the five permanent members of the UN Security Council (P4) and Germany (+1), to try and salvage the agreement.

Yesterday, Iranian Foreign Minister Javid Zarif (pictured above) arrived in Brussels, after earlier trips to Beijing and Moscow, to talk to his counterparts about the tough road ahead.

Here’s Gabe with details on how the key players view things:

Europe: The billion-euro question is whether Europe’s leaders can keep the continent’s firms invested in Iran while the threat of US sanctions looms, as Alex Kliment pointed out yesterday. Big multinationals like Siemens and Airbus risk losing billions. But thousands of smaller European firms, less reliant on the US, now trade with Iran as well — some 10,000 in Germany alone. Can Europe keep enough cash flowing to convince Tehran that it hasn’t broken its side of the bargain? The clock is ticking

China: For Iran, China represents an economic and security lifeline. China is Iran’s top trade partner and a large consumer of Iranian crude oil. Iran is a crucial link in China’s expansive One Belt, One Road initiative. And the threat of US sanctions bites less for Chinese firms, which have fewer tie-ups in the West — so Chinese investment in Iran will continue. The biggest worry for Beijing is escalation that leads to conflict in a region to which it has increasingly tied its economic fortunes.

Russia: The threat of US sanctions is nothing new for Moscow. And Russia’s involvement in Iran is more oriented toward security issues — in Syria and across the region — than economics. Yes, scrapping the deal has boosted oil prices, a temporary boon for the Russian economy. But long term, Russia is far more interested in preventing increased proxy conflict throughout the region that could blowback directly on its troops stationed in Syria.

What’s at stake? If Iran’s chief diplomat returns home with nothing to show, domestic hardliners — who never cared for the deal in the first place — could seize the opportunity to challenge more moderate figures, only furthering the distance between Tehran and the West.

HIGH-TECH ACROBATICS

High-stakes negotiations between the US and China over technology and trade continue this week, with top Chinese envoy Liu He arriving in Washington. One of the main items on the agenda will be the fate of Chinese tech giant ZTE. Some backstory, for those who haven’t been following every twist and turn:

  • Last month, amid delicate negotiations over the future of US-China trade and industrial policy, officials at the Commerce Department barred US companies from selling parts to ZTE for seven years.
  • The move, a result of the cell phone and networking equipment maker’s failure to abide by a settlement agreement struck after it was found to have violated sanctions against Iran and North Korea, apparently took Trump and other players in the White House by surprise, and left one of China’s biggest tech companies on the brink of collapse.
  • Over the weekend, President Trump reversed course, saying he was working with Beijing to save the company, along with tens of thousands of Chinese jobs. Mr. Liu got on a plane to Washington. Now there’s talk of a deal to lift the ban on ZTE in return for China easing tariffs on US agricultural imports (whether it can be consummated is still an open question).

There’s a lot of noise here: Some Republicans and Democrats have wondered out loud why an America-first President wants to help a Chinese company that US intelligence services consider to be a security threat. Although Trump’s decision removes a major irritant to the US-China relationship at a sensitive time, deeper security concerns about Chinese telecom companies and China’s broader technology rise will persist.

Some other things I took away from the episode:

A chaotic White House was forced to improvise: Usually, executive branch agencies with a stake in a big decisions get to air their views before the president decides on a course of action. Even if President Trump has managed to bend the resulting chaos to his advantage, he may not be so fortunate next time.

China demonstrated that tech is a red line in trade talks: Chinese President Xi Jinping knows that advanced technologies are the key to China’s future. If the US wants to talk about industrial policy, fine, but China can’t be seen to be capitulating the face of US pressure.

This tiff is only one twist in what is going to be a drawn-out negotiation between the US and China.


A message from Microsoft:

How the spirit of Louis Braille lives on in today’s AI innovators

Microsoft President Brad Smith traveled to Louis Braille’s childhood home in France to look at the history behind his centuries-old invention that made reading possible through touch. This recent journey, part of the Today in Technology series, ended at Microsoft headquarters in Redmond, WA, with a demonstration of Seeing AI. The talking camera app, created for the blind community, “speaks what it sees,” says Anirudh Koul, a senior data scientist at Microsoft, and it uses the power of AI to make the visual world an auditory experience. The company will continue to leverage AI solutions like this as it invests $25 million over 5 years in the AI for Accessibility grant program to build technology for people with disabilities. For more on this AI solution with a connection to the past, visit Today in Technology.


INDONESIA: CO-EXISTING DANGEROUSLY

Last weekend, a series of suicide bombings claimed by ISIS ripped through Indonesia’s second largest city, Surabaya, hitting churches, police outposts, and other government buildings. At least 26 people, including the Indonesian perpetrators and several of their children, died in the country’s worst attacks in over a decade.

It’s too soon to say whether there is a direct ISIS link, but as Alex explains, the bombings are a reminder that since coming to power in 2014, Indonesia’s youthful and reform-oriented president Joko Widodo (pictured above) has had to deal with growing sectarian and ethnic tensions in the world’s largest Muslim-majority country (and biggest democracy in Southeast Asia).

Last year, the popular governor of Jakarta, an ethnic Chinese Christian ally of Widodo’s known as Ahok, lost a bitterly fought election after he was accused of blasphemy against Islam. The accusations prompted huge protests organized both by Islamist groups and former military men who opposed him. He was sentenced to two years in prison.

Polls show that the appeal of conservative and nationalistic interpretations of Islam is rising in Indonesia, a trend that will shape upcoming regional elections in June, as well as the presidential election next year.

At the same time, the threat of terrorism is growing. ISIS first claimed an attack in Southeast Asia in 2016, when it sent gunmen into a Jakarta shopping mall. Roughly 600 Indonesians are currently fighting under the ISIS banner in the Middle East, according to the Soufan Group. If and when they return home, they will bring the specter of further violence.

PHOTO OF THE WEEK: A TURKMEN FOR ALL SEASONS

On a lighter note, Turkmenistan has crowned a new Master of Sports. As it happens, the honoree is the former Soviet republic’s President, Gurbanguly Berdimuhamedov. Apparently, the 60-year-old Turkmen leader was visiting a race course in the country’s Karakum Desert when he realized that his BMW fit the necessary requirements to compete. He entered the race, “easily and quickly overcame all obstacles” and “showed a real art of drifting,” before beating his next closest competitor by 12 seconds, according to state media reports picked up by BBC Monitoring.

Mr Berdimuhamedov, who won a third term in 2017 with 98 percent of the vote, is no stranger to accolades. Six years before he pocketed his new Master of Sports certificate and racing trophy, he won the first automobile race ever staged in Turkmenistan in similar circumstances. He’s also a noted author, songwriter, equestrian, and weapons expert. Hey, if you’re going to try to top your predecessor’s personality cult, you might as well have fun doing it.

HARD NUMBERS

45: Fewer than 45% of eligible Iraqis voted in the country’s national election last weekend, authorities said. That’s less than in Iraq’s three previous national elections, but better than the average turnout in a typical US midterm contest.

14: Developed countries generate 60 percent of global GDP, but only contain around 14 percent of the world’s population. #NotGoingToLast

5.6: Demand for air conditioners is expected to rise to 5.6 billion units by 2050, up from about 1.6 billion today, according to the latest estimates from the International Energy Agency. Without big improvements in energy efficiency, by mid-century, AC units and fans could consume as much electricity as all of India and China do now.

1/2: Restrictions on cross-border data flows shave around half a percent off European GDP, according to the Center for International Governance. A reminder that privacy protection comes with a price tag.

This edition of Signal was prepared with editorial support from Gabe Lipton (@gflipton) and Leon Levy (@leonmlevy). Spiritual counsel from Alex Kliment and Willis Sparks.

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