After Hanoi. The finger-pointing that has followed the Hanoi summit sheds some light on why the meeting ended in failure. On Thursday, U.S. President Donald Trump said talks collapsed because North Korea demanded nothing less than full sanctions relief. A few hours later, North Korean Foreign Minister Ri Yong Ho told reporters that Pyongyang had demanded the elimination of just five of the 11 U.N. Security Council sanctions currently in place. In truth, Ri is picking nits here. The five sanctions he identified — those implemented since 2016 — are easily the most severe and therefore are the primary source of U.S. leverage, without which the U.S. will not be able to influence the size and shape of North Korea’s nuclear arsenal or its behavior as a nuclear power. (Pyongyang reportedly offered to decommission just one of the three enrichment facilities it is believed to have.) The U.S. was apparently willing to ease only some of the existing sanctions, including one that would allow for cross-border projects with South Korea. These kinds of preliminary steps toward unification are important to North Korea, but considering Trump flew halfway around the world for a meeting that by all accounts he needed a win on, Kim believed he could do better. Clearly, Kim was wrong, but North Korea hasn’t lost much ground. The longer the North refrains from nuclear and missile tests, the harder it will be for the U.S. to sustain international support for the sanctions. Watch what China and Russia do here. But regardless of how they react, the tacit “freeze for freeze” deal — whereby the U.S. refrains from conducting major joint exercises simulating an invasion of the North, while Pyongyang refrains from conducting ICBM tests – that has been in place since before the Singapore summit is still in place. That’s what matters most.

India and Pakistan back away from the precipice, for now. Pakistan has released the Indian pilot of the MiG-21 that was shot down in Pakistan-controlled Kashmir on Wednesday, providing an opening for de-escalation. Pakistan reopened its airspace and said it accepted Moscow’s offer to mediate. (India hasn’t responded to the offer yet, but it’s unlikely to spurn Russia, its most important defense partner.) Notably, though, satellite images released by several sources suggest that India’s initial attack on an alleged terrorist training camp did little if any damage to the facility, undercutting India’s claims that 200-300 terrorists were killed in their sleep. To whatever extent the operation was motivated by domestic political factors (Indian Prime Minister Narendra Modi is facing a tough re-election fight in April and May), the apparent failure of the operation may keep public pressure high on New Delhi to demonstrate an ability to manage cross-border militant threats. But regardless of the success of the airstrikes themselves, that India launched the operation over Pakistani soil has already made an important point clear: The risk of matters escalating into nuclear war, which has deterred India from undertaking major cross-border operations following terrorist attacks in the past, won’t automatically keep India on such a short leash going forward.

Bad signs for the Chinese economy. Chinese leaders will kick off a two-week economic policy summit next week. A slew of negative data released this week underscores yet again just how much they’ll have to talk about. On Thursday, China’s official composite purchasing managers’ index, which gauges activity at mostly large, state-owned firms, fell to 52.4 in February from 53.2 in January – the lowest reading since Beijing began publishing the index two years ago. (Anything below 50 reflects a contraction.) Manufacturing dipped further into negative territory, dropping to 49.2 from 49.5 a month earlier, while services slowed from 54.7 to 54.3. (Part of this can be explained by an annual slowdown that accompanies the Lunar New Year holiday.) Meanwhile, data from China UnionPay shows credit card defaults surpassing 4 percent in at least a half dozen provinces. A survey of Chinese bankers showed widespread concern about the growing risk of a sudden spike in nonperforming loans. And official data showed prices for new housing in first-tier cities rising just 0.4 percent in January, compared to 0.9 percent in December, while prices for preowned houses fell 0.1 percent – the fourth consecutive month of decline. If real estate in China collapses, everything collapses.

Belarus cozies back up to Russia. On Friday, Belarusian President Alexander Lukashenko shared his thoughts on his government’s all-important but occasionally frosty relationship with Moscow. For the most part, Lukashenko signaled a warming trend, saying the two countries are bound by fate and need to remain close. It wasn’t just rhetoric; the president also announced that he was ready to sign an extension of an agreement allowing for two Russian military facilities in the country and that Minsk wasn’t even going to take extra money for it. Lukashenko also reiterated his support for the establishment of a common currency with Russia. At the same time, though, the president accused Russia of providing insufficient support to the Belarusian military and said the country was ready to seek out new sources of oil if its ongoing dispute with Moscow over subsidized supplies can’t be resolved, hinting that Russia needs to put up or shut up. Bottom line: Belarus can’t break from Russia, and it doesn’t really have an interest in doing so anyway. But it benefits from exploiting Moscow’s deep fears of a Belarusian pivot to the West.

Honorable Mentions

  • U.S. Treasury Secretary Steven Mnuchin said the U.S. and China are working on a 150-page trade agreement, addressing concerns that only a symbolic deal could be reached.
  • China’s National People’s Congress, the top legislative body, is set to review a draft law ensuring health and pension benefits for the country’s 57 million oft-disgruntled war veterans.
  • Chad and Turkey signed a military cooperation agreement.
  • The office of the U.S. trade representative released an 18-page list of demands for a post-Brexit trade deal with the U.K.
  • Moscow and Beijing vetoed a U.S.-drafted U.N. Security Council resolution Thursday calling for free elections in Venezuela.