What We’re Watching

What our analysts are watching and key events they are keeping an eye on
20th December 20217 min

Pakistan running out of Gas. For a nation that bakes under a scorching sun for nine out of twelve months per year it never made any sense to lay a network of gas pipes to every house in every city rather than investing in local production of cylinders and their efficient distribution. But clientelism and patronage don’t succumb easily to economic and strategic efficiency. Pakistan faces a severe shortage of gas this coming winter and the government is already rolling out its excuses. Chaudary Fawad Hussain, Pakistan’s erstwhile information minister bleats that Pakistan is fast depleting its gas reserves which are decreasing by over 9% per year, but future prediction and excuses do little to help the housewife who cannot cook breakfast due to the paucity of the gas supply or the worker laid off due to factory closures. International LNG prices have risen beyond the reach of most Pakistani  households and bulk consumers and a resort to electricity will only exacerbate an already precarious position in its provision. Severe rationing of both gas and electricity are expected  and this will surely be a winter of discontent for the PTI administration. Missed opportunities and vested interests conspire to maintain the status quo and as with most issues facing Pakistan there is no easy solution as decades of mismanagement cannot be reversed in weeks.

Putin’s end-of-year press conference. Like always, Russian President Vladimir Putin will offer his views on the biggest domestic and international issues on 23rd December 2021 at his annual press conference. What makes this year important are the rising tensions due to escalation with Ukraine. It’s possible Putin could make statements preparing foreign and domestic audiences for the possibility of war due to the west not taking Russia’s proposals seriously. Belarus will likely also be on the agenda as well as Syria. We will be watching any major announcements. 

US Navy tests new advanced laser weapon. The US Navy’s 5th Fleet announced that on the 14th December 2021 it had successfully tested a weaponized laser in the Gulf of Aden. The USS Portland fired the prototype and “successfully engaged” a floating training target, the Navy said in a statement. The US military has been testing new weapons and remote monitoring systems in the Middle East in response to Iran’s rapid development and use of drone, ballistic and cruise missile technology in recent years. Tehran’s advances mean the US military no longer has complete air superiority in the region, the head of US Central Command told Congress earlier this year. The region’s geography, climate, and strategic importance were also factors that allowed the US Navy to test this technological innovation. The same ship USS Portland tested a laser weapon system in the pacific last year by neutralising a drone. As a new arms race heats up, the US is demonstrating its newly acquired weaponized laser in different regions of the world with a message indicated to its rivals.

China naval exercises. The Chinese People’s Liberation Army (PLA) launched on Wednesday the 15th December a series of exercises in three different directions of Hainan Island, which is slightly smaller than the island of Taiwan, in a move analysts are seeing aimings to enhance the troops’ joint combat preparedness in possible amphibious landing missions on Taiwan. The drills included surrounding Hainan from three different directions. Just as the drills were about to begin, an RC-135W electronic reconnaissance aircraft of the US Air Force conducted what seems to be a close-in reconnaissance mission on the southeast coastlines of the Chinese mainland, covering South China’s Guangdong Province, Hainan Island and Xisha Islands in the South China Sea, according to the monitoring of the South China Sea Strategic Situation Probing Initiative, a Beijing-based think tank. With Ukraine already simmering, we will watch if China really does make a move for Taiwan.

In historic visit Israeli prime minister visited UAE. A year after the two countries normalised relations, Israeli leader Naftali Bennett became the first Israeli leader to visit the United Arab Emirates, as he attempts to deepen ties at a time of rising tensions over Iran. Israel’s prime minister said he wanted to boost economic and commercial ties and is expected to urge the UAE to take a tougher stance in response to Iran’s expanding nuclear programme. The UAE became only the third Arab state to fully recognise Israel last year as part of the so-called Abraham Accords brokered by the US. The 2 countries have established diplomatic Ambassador relations and signed trade deals and agreements on defence and arms development. Sheikh Mohammed expressed hope that the visit would “advance the relationship of co-operation towards more positive steps in the interests of the people of the two nations and of the region”, the official Wam news agency reported. Bennett said afterwards he enjoyed “meaningful, in-depth and straightforward talks” about “the region, our economy and technology.”

US congress passes $778 billion defense bill. In a show of strong bipartisan support, the US Senate passed a $768 billion defense bill (known as the National Defense Authorization Act) on Wednesday the 15th December (voting 88-11),  that will increase the Pentagon’s budget by roughly $24 billion more than President Biden had requested. Just three Republicans and eight members of the Democratic Caucus voted against the NDAA. An effort to scrap decades-old war authorizations was also left off the final measure. The bill contains nearly twice as much funding on an annual basis compared to social spending and climate bills. Critics slammed the act as “a reckless misuse of resources, a windfall for war profiteers” and criticised the Congress for showing “little concern for the actual security of people in the United States or around the world.” The vote received more support from Republicans than Democrats in the House. One of the Representatives who voted against the bill explained the reasons in his tweet – “it is astounding how quickly Congress moves weapons but we can’t ensure housing, care, and justice for our veterans, nor invest in robust jobs programs for districts like mine.”

Trouble in the Balkans. The Bosnian Serb leader, Milorad Dodik, has threatened to pull out of many Bosnia state-level institutions, including the national army, Judiciary and tax authority endangering an already fragile peace. Whether this is simply a Russian ploy to divert attention from the tense situation in Ukraine or a serious attempt to disrupt the Drayton peace agreement remains to be seen. The move threatens to reignite Europe’s worst conflict since the second world war and plunge the region back into ethnic and religious strife. The position of Russia and Serbia together with the expected response of the US and its allies have significant influence on what will occur as without Russian and Serbian approval Republika Srpska has little chance of success. We will be watching how the US responds as a significant military response from the US will dampen enthusiasm in both Moscow and Belgrade.

Libya Elections. Both presidential and parliamentary elections are due in the war torn country on the 24th December 2021, but it remains unclear whether the elections will even take place amid security and political challenges. There is a list of nearly a hundred presidential candidates, but the country’s electoral commission has yet to authorise the list, which has prevented the candidates from campaigning. Meanwhile, militia groups that oppose the UN.-backed election process have threatened violence if elections are held. If the vote is postponed, the elections will likely be held sometime in 2022. But it remains uncertain whether the election will help heal the country’s numerous political problems or just aggravate them. 

Insecurity in West Africa. A terrorist attack this week in Burkina Faso caused the deaths of military personnel near the northern town of Inata. It later surfaced that many army officers spent two weeks without food rations before the assault. The ensuing popular protests led to the forced resignation of Prime Minister Christophe Joseph Marie Dabiré and the eventual sacking of the entire government. Lassina Zerbo was named as the country’s new Prime Minister by President Roch Marc Christian Kaboré, with a new cabinet announced on Monday. The move to sacrifice official heads has been interpreted as a move to placate the protesters without really taking effective steps. Insecurity is a major problem on the African continent including its most populated nation Nigeria, where 30 traveller passengers were burnt to death. Other places like Mali and Chad also face significant security challenges. We will be watching the insecurity in the region to see if the instability leads to the fall of other governments. 

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