Monday, July 7, 2014

Asian Alliances, Endless Encirclements

China and Pakistan are engaged in an alliance of convenience because both countries have few, if any, friends in the region. They need each other on all levels specifically: political, military, and trade. Their alliance represents an “encirclement” of India whose intents they view with suspicion given their occasional violent border disputes. Ironically China must be trend carefully with their alliance with Pakistan, a Muslim country, because China’s far west regions have a large Muslim population who are violently subjugated. In turn as a counter-weight, India and Japan are seeking to renew the “strategic global partnership” in 2006-2007 during Abe’s during his first period as Prime Minister.


China and Pakistan are dictatorships seeking power and control. India and Japan are large democracies who seek power and freedom. Because these alliances speak the same political language, each joint venture can be quite effective that enables them to “watch each other’s back” so to speak. Additionally all these countries have new leaderships that may seek to change the rules and make their mark creating increasing an already highly volatile situation.


China: Squeezed between India to the west and Japan to the east.  Has the money but can’t buy friendship because of territorial bullying.

Japan: Island nation must protect imports which they are dependent but have considerable historical baggage which reduces their credibility for strong alliances.

Pakistan: A feudal nation with a cauldron of problems inside and outside its borders and always suspicious of Indian intentions who have considerable business and political interests west of Pakistan.

India: Has the most friends in the region due to lack of hegemony desires but must deal with a militarily aggressive China and schizophrenic Pakistan on its borders.

Underscoring the impact of the dynamics, these countries represent 40% of the world’s population within their own borders and 50% of the world’s population with respect to the entire Asian region!

In business, in certain highly competitive industries, every firm has unusual strengths (perhaps financing, expertise) at the same time unusual weaknesses (poor management, high turnover, lack of technical skills).  No one is as strong or as weak as they appear to be.  The danger is that they themselves may not think so.  As a corporate leader it’s a delicate dance how to proceed forward both short-term and long-term.  Nevertheless one must take calculated risks – become a moving target - because remaining still or on the fence is the greatest risk.  A possibility is to hire a neutral party without the emotional connection to dispassionately propose options.

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