Ukraine crawling back
Ukraine is recovering from the economic damage suffered because of the war with Russia. In 2016 GDP grew 1.5% and, in 2017, is expected to be 3%; contrast that to 2015 when GDP declined 10%.

Out with the old
There has been progress in the chronic corruption battle that crippled Ukraine even before it became independent again in 1991. The threat of losing their independence and becoming part of Russia again has caused other changes, too, such as eliminating any lingering nostalgia for decades of communist rule. In the last year the government removed 1,320 statues of Soviet Union founder Vladimir Lenin, who remains something of a folk hero to most Russians, and renamed 51,500 streets that had names associated with Lenin or any other Soviet-era notable.

Dealing with aggression
An opinion poll revealed that a majority of Ukrainians would now vote to join NATO, something for which, over the last decade, Russia threatened to declare war over. Because of Russia’s threats, by 2009 the U.S. lost its enthusiasm for letting Ukraine join NATO, thus leaving them on their own to deal with Russian aggression. That led to a popular uprising in 2014 in which Ukraine’s very corrupt, pro-Russian president was ousted and triggered Russia’s war against Ukraine.

Stingers to Syria
Russia criticized an American decision to loosen up their restrictions on what kinds of weapons are sent to Syrian rebel groups still backed by the U.S., mainly those who do not openly call for attacks on the West. What this means is that the U.S. will send new anti-aircraft weapons, and they will most likely be Stingers. This was the case in 2008 when the U.S. sought a suitable response to Russian sales of air defense systems to Syria and Iran. Missiles like the Stinger would be a serious threat to Russian aircraft in Syria.

Fuel prices on the rise
Protests continue in Mexico over the rise in gas and diesel prices, which have increased by 20% since January, when the government began reducing fuel subsidies. Authorities now estimate 1,500 people have been arrested for looting businesses and attacking gas stations.

It’s about the money
The Mexican government announced it would spend $50 million to hire lawyers in the U.S. to defend Mexican citizens who are there illegally and facing deportation. This is all about money and it’s much more than $50 million. The Mexican central bank tracks how much money Mexicans abroad send home and, in 2016, it was $25 billion — almost all of it from Mexicans in the U.S., and much of it from those in the U.S. illegally. That remittance cash accounts for more foreign exchange than Mexican oil exports.

Veiled criticism
On its southwestern border, China has become a major ally of Pakistan and is making major investments there, but with conditions. China has threatened to cut back if Pakistan does not improve security and is calling for greater international efforts to do the same in Afghanistan — a veiled criticism of Pakistan’s support of Islamic terrorism. Pakistan is the largest customer for Chinese weapons exports and is increasingly dependent on China as a military ally and supplier of weapons.

Trying to stay in power
Thailand’s military government knows how unpopular they are, but they are striving to figure out how to stay in power permanently, without being a military government. A start is changing the constitution, and Thailand’s government is depending on China to help them out, which was not surprising seeing that China is the regional expert in keeping an unpopular dictatorship in power.

Chinese lessons
China has been quietly helping Thailand control their media, especially the Internet, although the military government can’t get away with it as openly as the Chinese. Instead, they quietly monitor the Internet and then arrest suspected “troublemakers” and charge them with one of a growing list of fictional offenses.

Security situation
Back in December, officials from Pakistan, Russia and China met in Russia to discuss the security situation in Afghanistan. China and Russia agreed to try and get UN sanctions against the Taliban lifted in order to encourage the Taliban to enter peace talks with Afghanistan; however, the U.S. revealed evidence that the Taliban is getting some help, sanctuary, diplomatic support and information from Iran and Russia in return for their assistance in keeping the IS out of Iran and Russia.

More finger pointing
During discussions over Afghanistan’s security situation, Afghanistan accused Russia and China of cooperating with Pakistan in trying to control Afghanistan via the Taliban, which was created by Pakistan in the 1990s for just that purpose. Afghanistan also accused Iran of secretly working with the Taliban to help keep Islamic terrorists out of Iran. And, in another back-scratching move, Russia has come out in support of the Chinese-financed rail link between China and the Indian Ocean via Pakistan and new port facilities and a Chinese naval base on the Pakistani coast.

Approved cooperation
Japan and Australia approved a military cooperation agreement in which both nations share information about the military threats arising from China and North Korea.

Avoiding war

Each year China offers new weapons to the world market that are visibly more advanced, but the actual performance of Chinese military technology is suspect as much of it is based on Russian designs. During the Cold War, Russian weapons seemed to be what the losers used; however, China continues to improve and has made more progress than the Soviets ever did. The world sees more Chinese involved in peacekeeping missions, but also in threats to peace. The bottom line for China is keeping their communist dictatorship in power and that may be their ultimate reason for avoiding war.

China not trusted
One of the most vulnerable victims of China’s South China Sea campaign is the Philippines. The newly elected Philippine President Duterte remains popular with his constituents and he has very high approval rating, which is more remarkable when you consider that Duterte has made some unpopular moves. Chief among these contentious decisions was trying to work with China while discouraging the U.S. from actively opposing illegal Chinese territorial claims in the South China Sea. Polls continue to reveal that China is the least-liked and -trusted nation for most Filipinos.

Profiting from aid
China, or maybe just some greedy Chinese officials, has been accused of making a profit on UN-sponsored foreign aid for North Korea that is sent via a Chinese port. China has begun barring some foreign aid from entering China and claiming they are simply enforcing the new sanctions, but the aid groups are then quietly informed that if they buy the aid (food, equipment, medicine) from Chinese firms it can be sent into North Korea.

In a rapid and surprising about-face, Mexico announced that Sinaloa cartel commander Joaquín “El Chapo” Guzmán was extradited to the U.S. in January. In a U.S. federal court in New York, Guzmán pled not guilty to a 17-count indictment. He faces narcotics trafficking and money laundering charges. He is also accused of ordering murders and kidnappings in the U.S.

Overbearing neighbor
Thailand’s military government publicly backs Chinese claims to the South China Sea, but most Thais op-pose China’s territorial claims and are uncomfortable about being this cooperative with their overbearing neighbor. China is now the third largest foreign investor in Thailand and is encouraging Chinese firms seeking overseas locations for production facilities to pay special attention to Thailand. It’s not as cheap as nearby Viet Nam, Burma or Cambodia, but Thailand is now officially recognized as being more “Chinese friendly.”

Corruption and bad government
For decades Mexico has tolerated illegal migration to the U.S. because Mexico’s corruption and bad government did little to provide jobs for the growing number of unemployed Mexicans and created a lot of potentially trouble-some young men and women. Tolerating and, for many Mexican politicians, openly supporting the illegal migrants, was a popular policy and the government came to regard it as a right. But it was also about money, and the remittances created a huge source of foreign currency flowing back to Mexico.

China adds pressure
South Korea has refused to abandon efforts to expand anti-missile defenses and as a result, China’s pressure went into high gear after they suspended discussions on joint defense matters in early November 2016. South Korea made it clear it would not, under any circumstances, abandon plans to install American THAAD anti-missile systems.

Reality vs. propaganda
China’s efforts to introduce reforms and reduce corruption are suspect because for most Chinese the reality does not match the government propaganda. As a result, the people are proving difficult to control now that they have more education, better economic prospects and access to the Internet. Despite these difficulties, China continues its long-range plan to become a military superpower.

Military corruption
The Chinese government claims that the latest anti-corruption effort in the military has so far succeeded in eliminating 40% of commercial operations run by the military, and they have plans to eliminate all military business operations by 2020. China has regularly, for thousands of years, failed to suppress corruption in the military and its officers expanding into commercial operations has become the latest form of military corruption.

The bully dragon
China and Viet Nam agreed not to escalate military activities over territorial disputes in the South China Sea. To protect itself from China, Viet Nam has been making military alliances or partnerships with a lot of nations, including the United States, Russia, Philippines, Japan and even India. The manifestation of that was a Japanese gift of six more patrol ships. China and Viet Nam are ancient enemies and the fact that Viet Nam is still independent after more than 1,000 years of Chinese threats played a role in this new temporary truce.

Protestors block bridge
Mexican police in Ciudad Juarez broke up a demonstration over rising fuel prices in which protesters tried to block the international bridge to El Paso, Texas. On the evening of January 5, demonstrators occupied Customs offices on the international bridge. A government spokesman in Mexico City said that at least four people have died in violence related to gasoline price increase protests.

Vigorously enforced
After years of being accused of permitting the abuse of Central American migrants who enter Mexico, the Mexican government has agreed to pay more attention to security on its own southern border. Many of the illegal migrants from Central America are heading for the U.S. and that was not seen as a Mexican problem, however criminal gangs rob and kidnap migrants and the government did little to stop it, which resulted in gangsters attacking Mexican citizens as well. Mexico has more severe laws against illegal immigrants and they enforce them more vigorously than the United States.

Cumulative payoff
In response to China committing to $3.7 billion for projects to address “poverty reduction” in the Philippines, the government has temporarily agreed to not upgrade any of its military installations in the South China Sea. China has pledged more deals like this, in return for some good will from the Philippines. Chinese and Filipino officials know that Philippine opinion polls show that over 80% of the population oppose China’s claims in the South China Sea. China sees this as a victory because they have managed to buy similar victories all over the region, and the world. The cumulative effort pays off.

More of a threat
While China continues its post-Cold War policy of aggressive territorial claims and risking war with its neighbors, it has had to take into account growing internal problems. That is unfortunate because the use of nationalism and reviving ancient, sometimes fictional, territorial claims was supposed to distract an increasingly wealthy and concerned population from very real internal problems with corruption, pollution and ineffective government. Many Chinese were distracted, but not enough, and the domestic unrest continues while the neighbors increasingly see China as more of a threat than an ally and business partner.

Bans Korean culture
China’s subtle pressure on South Korea to abandon their efforts to expand anti-missile defenses has not been working out so well. Two months after China banned all legal use of South Korean movies, TV shows and popular music, the list of banned imports has expanded to now include popular consumer items like air purifiers and heated toilet seats. These were the most popular items in China and are very lucrative for the South Korean firms that produce them. It’s also a point of pride for South Koreans that the Chinese admire, and pays for, a very public aspect of Korean culture.

China’s refugee issues
Burmese refugees continue to flood into China and the government is getting angry. Since late 2016, Chinese soldiers and police have either stopped Burmese refugees at the border or they find them inside China and force them to leave. The latest outbreak of tribal rebel violence in the Burmese states of Shan and Kachin has driven over 30,000 Burmese into China, interfering with trade and movement across the border. China wants the Burmese government to do something about it or face reduced Chinese investment, a threat that has largely been ignored.

Banned dual-use items
China has officially banned the export of “dual-use” items to North Korea. The long list contains items that could be used for nuclear weapons, ballistic missiles or any military use at all. For several years, China has come under increased international criticism for allowing its manufacturers to export “dual-use” vehicles to North Korea when it was clear that North Korea only wants them for military purposes. Though it is has gone on for decades, it became big news in 2012 when a North Korea parade featured a 16-wheel Transporter Erector Launcher (TEL) carrying what appeared to be a three-stage ballistic missile.

China unhappy
China is angry with South Korea for rebuilding its relationships with Taiwan, which might even include South Korea exporting weapons to Taiwan, something China would not like. South Korea is becoming a major exporter of modern weapons and Taiwan is in the midst of rebuilding its military.

New sheriff in town

With the South China Sea dispute, China has given many of its neighbors reason to unite and cooperate as never before. Add to that a new set of American leaders who are less inclined to back down from Chinese threats and you have new options for those in the way of Chinese aggression.

Taco prices up
The price of tortillas in Mexico has increased again, up almost 20% in the last six months. When the prices of corn and other staple goods increase, the government faces instant criticism, but, for the record, the prices of eggs and milk have also spiked. President Enrique Peña’s poll ratings are already miserable and the majority of Mexican citizens believe his government is corrupt. Peña is trying to blame macroeconomics and the new Trump administration. Fuel prices have increased and the peso has slipped against the dollar.

Mexico safe for investors
Mexico’s government is again encouraging foreign companies to invest in Mexico, assuaging their fears of violence.

Chinese tank
Photos have emerged of China’s new ZTQ light tanks as they were being shipped by rail car, painted in army colors and headed to units in southern China, which indicates that, after five years of testing and tinkering with the design, the military had placed an order. Although pictures of the ZTQ have been around since 2011, it was not until recently that details of the turret were visible. The ZTQ was designed for rough, mountainous terrain, like that found in Tibet and the mountainous jungles on the Vietnamese border. The ZTQ has already been seen in the highlands of western China.

China deported 30 South Korean citizens from areas near the North Korean border. All those expelled were legal residents of China but were known, or suspected, of assisting North Koreans with their escape into China.

Keep stirring the pot
Even China has to deal with the terrorism threat created and sustained by the Pakistani military which fuels the growing struggle within the Pakistani government because the military refuses to consider shutting down the remaining Islamic terrorist sanctuaries. While Afghanistan’s internal problems are caused and sustained by Afghans, it doesn’t help that neighbors like Pakistan actively keep the pot boiling. That is beginning to cause a lot more problems for Pakistan and, in the long run, that is a good thing for Afghanistan.

Restoration project
Taiwan plans to spend $19 million in an effort to refurbish one of their WWII-era subs so that it can remain in service until 2026. This sub entered service in mid-1945 as the USS Cutlass and, in 1973, was given to Taiwan where she has served ever since as the Hai Shih. With this latest refurbishment, she will become the submarine with the longest active career: 81 years if it lasts until 2026.

Oil theft
Oil theft continues to plague Mexico’s national oil company, Pemex, and its attempts to sue U.S. oil companies that sold the stolen petroleum products have been unsuccessful. In December 2016, Pemex lost a lawsuit that ultimately involved 23 U.S. companies and several individuals, in which Pemex tried to recover monies lost from said sale of stolen products. The cartels sell the stolen oil and, in some cases, refined products to their buyers, who weren’t aware that the petroleum was ill gotten, and thus argued that fact successfully in court, resulting in Pemex’s failed suit.

Nothing to see here
The big news in Russia was the revelation that China had moved some of their ICBMs to the Russian border. The state-controlled Russian media insisted there was nothing to worry about because these missiles were meant to evade American ballistic missile defense systems and, besides, the minimum range for those DF-41 missiles is 3,000 kilometers, which means they could not be used against targets in the Russian Far East. More astute Russians observed that China could not win a nuclear exchange with the U.S. but could against Russia, and China would not want to nuke the Far East, they want to take control and fill the place with Chinese.

All propaganda
China’s government revealed some major developments in the anti-corruption effort. Two senior officials were removed because of corruption and new rules were announced for monitoring the 500,000 personnel that staff the national anti-corruption effort. Since 2012, 17 senior anti-corruption officials have been caught and removed or prosecuted. Many Chinese see this as a sign that the anti-corruption effort is more propaganda than real. For most Chinese, corrupt practices are still encountered regularly, including efforts to eliminate corruption in the military.

Hummer replacement
The U.S. Army may have its first export customer for their new Joint Light Tactical Vehicle (JLTV) right across the pond, in Britain, as the UK wants to talk terms, including local production and technology transfer. The American designer and manufacturer, Oshkosh, has been promoting the JLTV to military and police organizations worldwide.

Supply vehicle for ISS
Japan successfully launched a supply vehicle for the International Space Station (ISS) to replace the one lost on 1 December when, for the second time in two years, the launch of a Russian supply vehicle failed, this time destroying 2.5 tons of supplies for the ISS crew. It seems that Russia’s space program is plagued with poor performance issues, which have become increasingly more common. Meanwhile, 2016 was the first year in which China launched more rockets (19) than Russia (18); the U.S. barely stayed in the lead with 20.

Protests spread
Protests against increased fuel prices are spreading throughout Mexico. The price increase kicked in on January 1 and the violence began the following day. Protestors are using the term “gasolinazo” to describe their gripe, which translates as “gasoline-punch.” Apparently the rise in prices is a result of the government trying to create a competitive energy market and it’s been noted that President Enrique Peña promised that prices would drop after competition was introduced. In the initial phases of the program however, prices are on the rise.

WWII submarines
Taiwan currently has four submarines in its Navy, two of which are WWII-era, American diesel-electric subs that entered service months before that war ended in August 1945. Used only for training, these two boats are increasingly difficult and expensive to maintain despite the crew’s hard work to keep these museum pieces looking good and operational.

Many news items courtesy of & James Dunnigan. All material ©2017, StrategyWorld, Inc.