In Geopolitics Today - Monday, January 10th
Indonesia Asked to Lift Ban on Coal Exports, Japan’s Worsening Demographic Crisis, Russia and the United States Open Week of Security Talks
Indonesia Asked to Lift Ban on Coal Exports
Indonesia’s government announced last week that it was banning coal exports for the month of January. The decision was made amid a rising risk of widespread blackouts due to critically low supplies of coal at domestic power plants. But just days after the ban came into effect, Asian countries that rely on Indonesian coal made statements calling for an end to the ban on exports of the commodity.
Officials from the Philippines, South Korea and Japan have all made statements requesting that Indonesia reconsider the ban and promptly restart coal shipments. Eager to resume coal imports from Indonesia, all three have intensified dialogue with Jakarta to find a solution that will ensure their own domestic energy needs. Jakarta now holds regional political power as a result of this move as Indonesia would typically export roughly 30 million tonnes of coal in the month of January. The ban will push global coal prices higher in coming weeks as stockpiles continue to decline.
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Japan’s Worsening Demographic Crisis
Japan is experiencing a demographic crisis. Its people are the oldest in the world and the country’s population of 127 million is expected to contract by over 25 percent by the year 2065. These demographic changes will have dramatic social and economic implications as fewer Japanese will be able and willing to work, leading to reduced productivity.
The consequences of the country's shrinking population include economic crises, budgetary challenges, and pressures on job markets, all impacting Japan’s ability to compete internationally. An aging population will likely result in a larger percentage of Japanese citizens dependent on medical care, which, coupled with reduced domestic productivity due to contractions in the working-age population, threaten economic crises and budgetary challenges in the years ahead. To tackle this issue, future policy solutions will try to encourage a shift in social attitudes toward immigration.
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Russia and the United States Open Week of Security Talks
The United States and Russia have opened a week of talks in Geneva which will focus around arms control and NATO expansion in Eastern Europe. Talks continued today with a meeting between US Deputy Secretary of State Wendy R. Sherman and Russian Deputy Foreign Minister Sergey Ryabkov. Yet Moscow and Washington are conducting talks on European security without the participation of France, Germany or the EU.
Ahead of the talks, Moscow is insisting that NATO halt its eastward expansion and military activities near Russia’s borders. Washington publicly rejects this assessment, and hopes to diffuse the situation without ceding any ground to Moscow. However, there are reasons for Washington to reach some kind of agreement with Moscow going forward, of which China is perhaps the most obvious. In seeking to avoid conflict in Europe and the Pacific, Washington may be inclined to find common ground with Moscow in a way that will work to damage relations between Beijing and Moscow going forward.
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