Watch List: Feb. 8, 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.

• Russia: A foreign ministry official in Russia told RIA Novosti that Russia has reinforced its military bases in Tajikistan and Kyrgyzstan, but didn’t provide any specific details. According to the official, the move is a result of new threats emanating from Afghanistan, and positive relations between Tajikistan, Kyrgyzstan and Uzbekistan were helping improve the security situation in Central Asia. What is Russia doing at these bases, and what is the threat from Afghanistan that the official referred to?
• Uzbekistan: Radio Free Europe has posted an audio recording of the Uzbek president criticizing the National Security Service, which was reorganized earlier this week. In the recording, which was reportedly made two weeks before the head of the NSS was dismissed, the president calls the deputy head of the NSS a rogue and a traitor, and says he is “responsible for corruption.” What all of this means is unclear, but it suggests that Uzbekistan has gone through a serious political struggle and that the president has managed to sideline his enemies. Also note a strange report on Uzbekistan confessing that it lacks natural gas supplies, which apparently the government has been covering up for years. Uzbekistan’s supposed stability after the leadership transition was always suspicious. Is this evidence that the president has won the struggle, or is the struggle continuing? What powers does he have?
• Iraq: According to al-Monitor news site, an Iraqi Kurdish delegation told Iranian officials in Tehran that the Kurdistan Regional Government had made a mistake by relying too heavily on Turkey and the United States, and that it would be “readjusting” its policies to be more in line with Iran and Iraq. The report says that Iran is highly concerned about security on the border with the KRG and wants the Iraqi Kurds’ help taming rising Kurdish unrest in the region. We need to take a harder look at what’s happening on the Kurdish portion of the Iraq-Iran border. Let’s also try to corroborate this report. What would it mean for the KRG to lean toward Iran, Iraq and even Russia? Can it even do that considering its dependence on Turkey?
• Iraq: Separate but related, Iraq is about to receive 46 T-90S tanks from Russia. The assumption is that while Iran is influential in Baghdad right now, Iraq is still close to the United States. After all, U.S. troops are back in Iraq to help Iraqi security forces fight against the Islamic State, which still has pockets of control in the country. Is our assumption faulty? Can we even think of Iraqi policy in a unified way with the country so fractured?
• Syria: Pro-Assad forces attacked the headquarters of U.S.-backed fighters in Deir el-Zour province. In response, U.S. aircraft carried out strikes in the province on Feb. 7. The details here warrant further scrutiny, but the U.S. seems to have made a powerful statement that it will not tolerate attacks on Syrian Democratic Forces in territory that it controls. Has the U.S. carried out similar retaliatory strikes before in Deir el-Zour? Is this an indication that the U.S. is going to defend the SDF against Assad, and Turkey?
• Germany: The Association of German Chambers of Commerce and Industry has raised its growth forecast for Germany from 2.2 percent to 2.7 percent. The group’s report also indicates real wages and investment from German companies are rising. A lack of skilled labor was singled out as the biggest threat to future growth. Germany’s economy continues to buck our expectations – rising wages and increased investment are positive – but more data points are needed. Also, we need to assess the group’s track record on predictions.
• Palestinian Territories: The situation remains unstable in the Palestinian territories. In an anomaly, Hamas has blamed the Palestinian Authority – not Israel – for Gaza’s current power crisis. Hamas may already be having second thoughts about relinquishing political control to Fatah, or this may simply be a new tactic for garnering local support. Meanwhile in the West Bank, Israeli Army Radio reported that Israel has deployed three additional battalions to reinforce its security presence there. This may be a cautionary move, but even so it speaks to Israeli concern that the situation in the West Bank may be teetering on the edge.
• Azerbaijan: Azerbaijan says an Armenian soldier was killed in the Nagorno-Karabakh conflict zone because of an “attempted provocation.” The regional government said the soldier was killed because Azerbaijan violated the cease-fire. Most likely, this is par for the course, but could there be potential for the conflict to erupt?
• Turkey and Syria: We were right that reduced Turkish air activity over Syria means that Russia closed Afrin air space to Turkey. On Feb. 8, Hurriyet Daily News reported the closure, saying that Russia was working on a new air defense system. The report says Afrin air space will be reopened once testing is complete, but it seems to be an awfully fortuitous time to be testing a system, just when Turkey is in the middle of a military operation that is encountering stiff resistance. We’ll be watching to see whether Russia’s move affects Turkish deployments in Syria. Meanwhile, Turkey, Russia and Iran have agreed to a summit meeting in Istanbul. No date has been set, but we can bet that the three sides have a lot to work out in the wake of developments since the previous summit in Sochi last November.
• North Korea: China’s Foreign Ministry indirectly criticized a recent North Korean military parade in which intercontinental ballistic missiles were displayed. Then North Korean media blasted Chinese media for interfering in Korean ties. Chinese President Xi Jinping’s special envoy for Korean issues said the situation on the peninsula was undergoing “positive changes” after meeting with South Korean President Moon Jae-in. Moon also apparently agreed to meet with North Korean leader Kim Jong Un’s sister soon. This is obviously something to watch, but what is China’s role in all this?
• China: According to Nikkei Asian Review, China’s pension, health insurance and other social programs in 2016 experienced a shortfall of 70 percent. China is not alone in having trouble maintaining social safety nets, but the issue for China is that its demographic problems are already here. The shortfalls accounted for a reported 6 percent of total government expenditures, a number that is expected to rise rapidly. Let’s check the numbers and add this to our plate of understanding of China’s economic challenges.