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Watch List: April 9, 2018

Iran’s currency falls, push for autonomy in Taiwan, labor protests in China

|April 9, 2018

The items listed below represent potential emerging issues that our analysts are tracking. These can be long term or short term, but will be updated daily. If an item on our Watch List becomes critical, we will email you a full analysis explaining its significance.

Each Saturday, we will follow up our daily Watch List for each week with our conclusions on these issues.

Iran: The value of Iran’s currency has been falling for over two months and currently sits at 61,000 rials to the dollar. We are also seeing reports of continued protests in Khuzestan province. These conditions can undermine President Hasan Rouhani’s position. How bad is the Iranian economy, and has it deteriorated further since early January? Can we detect any signs of protest outside of the Arab area of Khuzestan?

Vietnam: The Hanoi People’s Court sentenced six people to 7-15 years in prison for trying to overthrow the government. From March 2013 to July 2017, the accused established the Brotherhood for Democracy, which spreads propaganda against the state. This is a relatively new group. Court documents refer to financial and institutional ties to foreign and illegal groups. We need a basic understanding of the group’s mission, size and international ties.

Taiwan: Pro-independence groups in Taiwan formed the Formosa Alliance over the weekend to push for an independence referendum and a change to the island’s official name from the Republic of China to Taiwan. The announcement was accompanied by a rally in Kaohsiung. This recent push for autonomy will surely anger Beijing. We need to check if there is a notable shift in momentum.

China: China’s sanitation workers went on strike and staged protests over low wages in Shanghai, Liuzhou and Taiyuan. These groups held large protests in 2013 and 2014 as well. Given that we are on alert for unrest in China, we need to look into this. What are the workers’ specific demands, and can the government meet them? Is there any talk of these strikes spreading or continuing?

Afghanistan, Pakistan: Afghanistan and Pakistan agreed on seven key components of the Afghanistan-Pakistan Action Plan for Peace and Solidarity, an initiative to enhance anti-terrorism cooperation between the two countries. This comes as calls for peace talks in Afghanistan are building. Is this some kind of new peace plan? Are we seeing a shift in Pakistan’s approach to dealing with cross-border terrorism?

Azerbaijan, Armenia: Tensions between Azerbaijan and Armenia appear to be rising. An analyst for the American-Azerbaijani Progress Promotion Foundation alleged that laboratories in Armenia renovated with funding from the U.S. Embassy are developing bacteriological weapons. In addition, the Armenian Defense Ministry claims that Azerbaijan has committed cease-fire violations in the Azerbaijani exclave of Nakhchivan. Meanwhile, Armenia’s new president was sworn in on April 9, and Azerbaijan will hold its own presidential election on April 11. Are the current tensions related to these votes, or is there something deeper going on here?

Russia: Russian aluminum company Rusal said it is at risk of defaulting on part of its debt as a result of U.S. sanctions. This led the company’s shares to drop nearly 47 percent on April 9 before recovering somewhat and ending the day 30 percent down. The Kremlin has been critical of the sanctions and is already looking for ways to respond. What other companies or industries are at risk of default or other financial crises as a result of U.S. sanctions? What type of responses are being discussed by Russian ministers and other government officials?

Turkey: Turkish media report that the U.S.-Turkey working group overseeing operations in Manbij, Syria, will be on hold until new U.S. Secretary of State Mike Pompeo is sworn in. Meanwhile, U.S. and French forces, including 18 military and armored vehicles, have reportedly entered Manbij to provide support for Kurdish fighters, and groups in the Kurdish city of Hasakah have reportedly started forming armed units to confront U.S. and Turkish troops. Is the pause in the working group really a delay until Pompeo is confirmed, or does it portend bad things for U.S.-Turkey relations?

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