By Jacob L. Shapiro

GPF’s 2018 forecast predicted that the world’s two most volatile regions would be the Middle East and East Asia. So far, so good. Popular frustration in Iran over the country’s economic performance boiled over at the end of last week and has continued into the new year. It’s at the point that it threatens the position of the region’s most influential actor in 2018. Meanwhile, on New Year’s Day in East Asia, North Korean leader Kim Jong Un suggested that North Korea and South Korea should meet urgently to discuss his country’s participation in the Winter Olympics in February in Pyeongchang, South Korea. This raised the serious question of whether North Korea is finally open to negotiations on its nuclear program.


Let’s begin with the unrest in Iran. The protests started Dec. 28 in Mashhad, Iran’s second-most populous city, apparently in response to a spike in prices for staples like eggs and poultry. In reality, the price increases were just a consequence of a temporary shortage, but for the people they were the last straw. The deeper issue is that Iran’s impressive bottom-line gross domestic product growth figures since the nuclear deal in 2015 have not led to prosperity for the typical Iranian citizen. Unemployment has been more than 12 percent for well over a year and is approaching 2012 levels, when it was around 14 percent. Inflation is nearing 10 percent – despite a promise by President Hassan Rouhani that it would not exceed single digits. The banking sector is in shambles.

The protests couldn’t have come at a worse time for Iran. The Islamic State, a serious enemy of Iran, has been defeated. The Bashar Assad regime, an Iranian ally, has been saved. Hezbollah, an Iranian proxy, can get back to running Lebanon instead of fighting Sunnis in Syria. Iraq, Iran’s most serious geopolitical threat as recently as the 1980s, is under Tehran’s control. Turkey, a potential rival, is more interested in temporary coordination to deal with the Kurds and the Russians than it is in blocking Iranian ambitions. And Saudi Arabia, the last Arab power standing between Iran and its aspirations, is dealing with existential economic and political problems of its own. For Iran, the Middle East is ripe for the taking.

(click to enlarge)

Most countries spend their time chasing the basic imperatives for survival – if they even get that far – but Iran is in a place and time where it can aspire to much more. Iran is the modern heir to the Persian empires that have existed at different points in history, empires that at their height spanned from Greece to the Hindu Kush, from Cairo to Samarkand. Iran occupies the same core territory as those Persian empires, and that means Iran often behaves in similar ways to them. But as impressive as imperial Persia’s reach was, its power was fleeting. Roughly a millennium went by between the Achaemenids and the Sasanians. Another millennium went by before the Safavids reached their zenith. There’s a reason for that: geography.

On the one hand, Iran’s geography is advantageous. Iran is smaller than its imperial forebears, and yet even today it borders both the Caspian Sea and the Persian Gulf, as well as the Indian subcontinent, Central Asia, the Caucasus, Turkey and the Arab world. If Iran can get access to either the Black Sea or the Mediterranean, whether by proxy or conquest, its domain begins to look very Persian.

(click to enlarge)

On the other hand, for all its geographic advantages, geography is also one of Iran’s weaknesses. Iran is a mountain nation, which means that, when unified, it is difficult to attack by land. But the same mountains that keep invaders out also keep Iran in. For Iran to project power in the Middle East, for example, it must support long supply chains across the Zagros Mountains or the equally imposing ranges in the South Caucasus. This is both technically challenging and financially costly and explains why Iranian and Persian strategy has always focused on developing proxies or strategic relationships with countries amenable to its designs.

It will be important to watch the protests to see if they coalesce into something more than a frustrated populace letting off steam, but at this point, considering their small size and that Iran’s economy has been far worse than this in recent years, we don’t yet think that the Islamic Republic is in danger of falling. The protests are important, but not because of what they say about the country’s stability. Rather, they are important because they show how Iran is running into the age-old problem of all bygone Persian empires: Iran’s imperial imperatives outstrip its capabilities.

It is easy for Iran to dominate its surrounding regions if they are much weaker than Iran. If it meets resistance, however, Iran is forced to spend money and to overextend itself in a quest to push out of its mountain fortress. Central Asia and the Middle East are experiencing enough turmoil to create an opportunity for Iran, but that’s not enough for the Iranians to complete the conquest. Turkey is strong, Russia is holding on for dear life, and the U.S. and Israel are determined. The protests in Iran are a reminder that Tehran can spend its resources abroad for only so long before it becomes answerable to its own people. The cost of empire is too high for Iran to pay; it can only acquire its empire at a discount. The strategic opportunity is not yet opportune enough. That is the lesson from this past week’s protests.

North Korea

If Iran is coming to grips with its geographic constraints, then North Korea is a case study in how a geographically weak country can turn weakness into strength. Defiant as ever, Kim Jong Un raised the possibility Jan. 1 of easing tensions with South Korea during the same speech in which he threatened the entire continental United States with nuclear weapons. Kim’s statement could be read two ways. The first would be that North Korea is looking for a way to extricate itself from the cycle of escalation while still saving face. The second would be that North Korea believes the U.S. has bluffed on a military strike and so is looking to split South Korea from the United States. The second interpretation appears more likely.

(click to enlarge)

The story here is not North Korea – where bellicose threats and strange diplomatic overtures are normal behavior – but South Korea. The South, which would bear the brunt of a war on the peninsula, understandably doesn’t want the U.S. to launch a pre-emptive strike on North Korea’s nuclear program. South Korea’s imperative is to prevent that from happening at all costs. It’s one thing for South Korea to urge the U.S. not to undertake an attack in private. It’s quite another to do it in public, which South Korea has done repeatedly. It betrays a distrust between Washington and Seoul, and alliances are built on a certain degree of trust.

Consider the following developments in the six weeks leading up to Kim’s announcement. On Nov. 17, the chairwoman of South Korea’s ruling party contradicted U.S. President Donald Trump, insisting that war with North Korea was not on the table. On Dec. 14, South Korean President Moon Jae-in traveled to China, and when he left, Seoul and Beijing’s positions on a strike against North Korea were aligned. On Dec. 19, Moon suggested delaying major annual U.S.-South Korean military exercises until after the Paralympics in March. Moon has already enthusiastically responded to Kim’s proposal of discussions over a North Korean delegation at the Winter Olympics, and South Korea’s state-run Institute for National Security Strategy has already said it believes the North will ask for the South to remove certain sanctions against Pyongyang – to which it said Seoul’s agreement “cannot be ruled out.”

Of course, the U.S. doesn’t want to attack North Korea either. Washington has been hoping that a combination of sanctions and impressive military threats would cow Pyongyang into submission. South Korea’s public and repeated resistance to a U.S. strike undermines the most important part of a nonviolent U.S. strategy to get North Korea to give up its nuclear weapons: a credible threat of military action.

Kim Jong Un seems to have learned from a mistake that his grandfather made. In 1950, Kim Il Sung ordered an invasion of South Korea. The overt act of aggression, especially in the context of the Cold War, provoked a U.S. response, which caught North Korea by surprise. This time around, Kim Jong Un has no intention of trying to conquer South Korea by force. He is instead biding his time, betting that Washington will not ignore Seoul’s pleas. If it does, the U.S. will have done the hard work of destroying the U.S.-South Korea alliance without North Korea having to do much of anything. The goal is to split the U.S. off from South Korea, and eventually to get the U.S. to withdraw its military forces from the peninsula.

(click to enlarge)

Should that occur, the major winner would be China. Relations between Pyongyang and Beijing have been chilly, but on this they converge: China doesn’t like the deployment of U.S. military assets in South Korea any more than North Korea does. China’s entire strategy right now is based on slowly and incrementally pushing the U.S. farther and farther from China’s borders, while arming itself with enough area-denial capabilities to impose significant casualties on a potential U.S. attacking force. China has been the most vocal supporter of a “freeze-for-freeze” agreement – North Korea freezing its nuclear program in return for the U.S. and South Korea freezing military exercises. China doesn’t necessarily want North Korea to acquire nuclear weapons, but that is a small price to pay if it results in a break between the U.S. and South Korea.

(click to enlarge)

The major loser would be Japan. Losing South Korea would be a blow to U.S. prestige in the region, but affairs on the Korean Peninsula are of limited strategic importance to the United States. (The U.S. can build a balance of power in Asia with or without troops and air assets based in South Korea.) The same cannot be said for Japan. The U.S. has an entire ocean separating it from the Korean Peninsula; Japan is right next door. Koreans on both sides of the border have not forgotten how brutal Japanese rule of the Korean Peninsula was in the first half of the 20th century. Seoul and Tokyo’s shared desire for a denuclearized peninsula has not prevented cracks from appearing in their bilateral relationship. If China and North Korea can work together to make South Korea’s loyalties ambiguous, it represents a significant challenge to Japanese interests.

To be clear, we are still a long way from this hypothetical becoming reality. Just because South Korea is open to negotiation with the North, and just because it wants to postpone military exercises, doesn’t mean it is ready to ask U.S. forces to withdraw or capable of standing on its own. Seoul’s reluctance to support a military conflict doesn’t signal a desire to be ruled by North Korea. But North Korea is thinking about the long term. South Korea has, at least for now, taken the U.S. military option off the table, and North Korea is trying to figure out whether and how far it can press this advantage.

Iran and North Korea are the pivotal issues in the Middle East and East Asia for 2018, and just days into the new year, both are making news already. In Iran, the limits of its power are evident, and events in the Middle East will be dictated in large measure by the battle between Iran’s imperatives and its constraints. Meanwhile, in East Asia, the U.S. doesn’t appear able to bring about its most desired outcome and is looking for next-best scenarios. North Korea is taking the opportunity to test the limits on its power and is using the Winter Olympics in South Korea as a litmus test. Welcome to 2018.

GPF Team
Geopolitical Futures is a company that charts the course of the international system. It’s an ambitious mission, maybe even foolhardy, but hear us out.