In Geopolitics Today: Monday, January 20th
China Brokers Myanmar Ceasefire, Houthis Link Red Sea Attacks to Gaza Ceasefire, and other stories.
China Brokers Myanmar Ceasefire
China has brokered a ceasefire agreement between Myanmar's military and the Myanmar National Democratic Alliance Army (MNDAA). The deal, signed in Kunming, aims to halt fighting near the China-Myanmar border where the MNDAA, part of the Three Brotherhood Alliance, had seized significant territory since launching an offensive in October 2023. This included capturing a major military base near the Chinese border in July 2024.
China's intervention reflects its concerns about instability along its 2,000-kilometre border with Myanmar, where anti-government forces have gained ground and threaten to advance toward Mandalay. The MNDAA, composed of ethnic Chinese fighters, is one of several ethnic armed groups battling Myanmar's military government, which took power in a February 2021 coup. Beijing's mediation effort aims to protect its regional investments and trade interests while preventing potential spillover effects from Myanmar's ongoing civil conflict.
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Indonesia Balances Major Powers
Indonesia's strategic position in 2025 reflects a complex balancing act between major powers while maintaining its “Independent and Active” foreign policy doctrine. China has emerged as Indonesia's largest trading partner, with Chinese investments accounting for 20% of foreign direct investment in 2024. Meanwhile, US investments in Indonesia's digital economy grew 15% in 2024, while Russia maintains influence through defence sales and energy partnerships.
The country faces immediate challenges in managing these relationships. Tensions persist in the South China Sea, with 2024 incidents involving Chinese vessels near Indonesia's Natuna Islands highlighting sovereignty concerns. President Prabowo Subianto's administration must balance economic growth priorities with strategic autonomy, demonstrated by Indonesia's diversification efforts with partners like India, where trade grew 12% in 2024. Through ASEAN leadership and participation in the Indo-Pacific Economic Framework, Indonesia continues leveraging its position to maintain independence while engaging with competing powers across security, economic, and environmental initiatives.
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Japan Deploys Long-Range Anti-Ship Missiles
Japan is expanding its maritime strike capabilities with the deployment of an upgraded Type-12 anti-ship missile system. The new ground-based variant, tested in late 2024, has a range exceeding 900 kilometres — more than four times the original Type-12's reach. The missile system features reduced radar cross-section, data link capabilities for updated targeting, and a mobile launcher.
The strategic implications centre on Japan's southwestern island chain, where the Ground Self-Defense Force has already positioned Type-12 systems across the Ryukyu Islands since 2019. This deployment pattern reflects Tokyo's response to increased Chinese naval presence in the East China Sea, including around the disputed Senkaku/Diaoyu Islands. To fully utilize these extended-range capabilities, Japan plans to enhance its targeting infrastructure through new satellite constellations and increased intelligence cooperation with the United States and South Korea.
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Houthis Link Red Sea Attacks to Gaza Ceasefire
Yemen's Houthi forces announced they will restrict maritime attacks to only Israel-linked vessels once the Gaza ceasefire is fully implemented. Since November 2023, the Houthis conducted over 100 attacks in the Red Sea and Gulf of Aden, sinking two vessels and causing four deaths, which led major shipping companies to reroute around Africa's southern tip.
The impact on global shipping has been significant, despite relatively few successful attacks. Insurance premiums have increased by hundreds of thousands of dollars for seven-day voyages through the region, and major carriers like Hapag-Lloyd continue to avoid the route until security improves. The Houthi actions effectively disrupted international trade through the Bab al-Mandeb Strait, a critical choke point between Europe and Asia. While the announcement signals potential de-escalation linked to the Gaza ceasefire, shipping companies remain cautious about returning to normal Red Sea operations, suggesting a gradual restoration of maritime traffic will depend on sustained security improvements.
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The Enduring Strategic Significance of the GIUK Gap
The GIUK Gap (Greenland-Iceland-UK corridor) serves as a critical maritime choke point connecting the Arctic Ocean to the Atlantic. Multiple nations maintain active military presence in this region, with the Northern Fleet operating from Russia's ice-free ports on the Kola Peninsula and NATO forces stationed across Greenland, Iceland, and the UK. The Gap's strategic value has increased with Arctic ice melt, opening new shipping routes and access to natural resources.
The region's military dynamics centre on submarine operations and anti-submarine warfare capabilities. Modern submarines like Russia's Yasen-class and various NATO vessels regularly transit these waters, while surface detection networks include sonar arrays and maritime patrol aircraft. The Gap's importance extends beyond military concerns — it overlays crucial civilian infrastructure, including undersea cables carrying 95% of global internet traffic and energy pipelines. This combination of military traffic and civilian infrastructure makes the GIUK Gap a key focal point for maritime security operations, international commerce, and resource development in the North Atlantic.
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Nigeria's Dangote Refinery Challenges European Oil Trade Dominance
The Dangote Oil Refinery in Nigeria has begun producing petrol, marking a shift in Africa's largest oil producer's energy landscape. The $20.5 billion facility, launched in January 2024, can process 650,000 barrels of crude daily — exceeding any European refinery's capacity. Operating in Nigerian naira for both crude purchases and fuel sales, the facility promises to reduce the country's foreign exchange expenditure. This directly impacts European markets, with OPEC reporting decreased Nigerian petroleum imports from Europe, potentially disrupting a $17 billion annual petrol trade flow from Europe to Africa.
The refinery faces several challenges that could impact its success. Local oil theft and infrastructure issues limit domestic crude supply, with Nigerian National Petroleum Company (NNPC) currently only able to provide about 300,000 barrels per day to the facility. The timing coincides with President Tinubu's removal of long-standing fuel subsidies, tripling local petrol prices to $2.30 per gallon. Additionally, resistance from established oil trading networks, which Dangote himself described as “stronger than the mafia in drugs,” threatens to complicate operations. These factors, combined with declining national oil production, create significant uncertainty around the refinery's ability to reach full operational capacity and transform Nigeria's domestic fuel market as intended.