In Geopolitics Today - Wednesday, December 8th
Indonesian Persistence at Strategic Autonomy and The Arctic Could Prove Lucrative to Shipping
Indonesian Persistence at Strategic Autonomy
In the coming years, Indonesia has the potential to sway the strategic balance in the Indo-Pacific. It is the largest archipelagic country in the world, and the country sits adjacent to the Indian and Pacific Oceans. Indonesia’s growing economic power, regional political capital, and control over strategic sea lanes also mean that the country is likely to play an influential role in an era of US-China competition. Yet historically, Indonesia has maintained a clear focus on strategic autonomy even while regional power rivalries intensify matters. To maintain that autonomy, the leadership in Jakarta embraces a doctrine of non-alignment, striking a flexible and pragmatic approach toward both Beijing and Washington.
Successive Indonesian governments have avoided engaging with great powers in ways that could undermine domestic legitimacy. In general, the leadership in Jakarta tends to avoid engagement with a great power so as not to limit how it defines and defends its own interests, and in this regard, Indonesia’s idea of strategic autonomy has seen success, as was the case when the country gained US recognition of Indonesia’s sovereignty over West Papua by threatening to align with the Soviet Union. In this way a condition of limited rivalry between China and the United States allows Indonesia to play both great powers off each other, and thereby reap economic and political benefits in the process.
And for now, Indonesia is attracting some benefits via such a policy, as both Beijing and Washington try to tip the balance in their increasingly confrontational competition. China has fostered deep economic ties by investing in remote regions of Indonesia, while also applying pressure to Jakarta via assertive actions undertaken in Indonesia’s Natuna islands exclusive economic zone. To counter China’s influence over Indonesia, the United States has increased defence cooperation with Jakarta, demonstrated recently by the largest joint military exercises ever held between Indonesia and the United States in August. In this way, in the near-term at least, Jakarta extracts benefits from a limited rivalry between great powers, which for the moment, seems a desirable outcome for Indonesia.
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The Arctic Could Prove Lucrative to Shipping
Climate models project dramatic ice reductions in the Arctic. The planet’s fast-warming climate will bring new opportunities for international transportation networks and offer shorter maritime navigation distances. In particular, the opening of Russia’s Northern Sea Route (NSR) promises to drastically reduce shipping costs between Europe and Asia, with significant investments already made toward developing the route. But with the route still frozen for most of the year, for the NSR to offer reduced costs to global shipping it will require widespread investments in icebreaker vessels and port infrastructure.
Arctic shipping is facilitated by various vessels and icebreakers, without which navigating between Europe and Asia through the Arctic Circle would not be possible. Due to the complexities of operating in the harsh environments of the Arctic, consistent shipping here needs to be supported by a system of hubs. And this is problematic in the Arctic. The region is scarce and harsh, and it has very little infrastructure offering refuge, port depth, marine salvage, reception facilities, towing services, or other capacities which attract shipping. The lack of developed port infrastructure raises the level of risk associated with transiting a particular waterway, which — together with the lack of year-round access — represent barriers to the NSR becoming a major transit route for international trade.
Nevertheless, Russia has spotted opportunities for the NSR, and has designated the entire Russian Arctic as a “Free Trade Zone” under Russian national law, covering an area almost 5 million square kilometres in size. Local Arctic residents will seemingly enjoy tax benefits and smoother administrative procedures as Russia seeks to attract investments into rail infrastructure for the region. While the importance of the Arctic zone to the Russian economy is growing, with a share of Russian GDP close to 10 percent, the region suffers from severe under-population. The vast Arctic region contains less than 1.5 percent of the entire Russian population, and trending toward a continued decline in human capital.
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