NightWatch

For the Night of 27 March 2008

North Korea: Reuters reported North Korea launched several missiles on 28 March from a west coast missile site into the Yellow Sea. The type of missile was not identified, but the North has been developing an extended-range – up to 200 kms -- anti-ship cruise missile system since the early 1990s and needs to test the missiles periodically usually in spring. South Korean authorities released information last December that there have been 10 KN-01 missile launches between February 2003 and June 2007, according to Janes.

North Korean authorities are prone to use missile launches, including anti-ship missiles, as military demonstrations to influence the political climate with South Korea, the US or Japan. For example they tested the KN-01 on 24 February and 10 March 2003 on the occasion of President Roh’s inauguration five years ago. The first launch on inauguration day failed, so they did a second.

On the other hand, research and development needs and system serviceability requirements are the primary drivers in testing. The timing of a launch, however, is variable because of weather and maintenance as well as politics. Short-range missile launches do not make much of a political statement, but the North Koreans seem to think they make a contribution.

North Korea-South Korea: In response to strong public statements by the Lee government in the South, the North expelled the 11 South Koreans who work at the Kaesong development zone, just north of Panmunjom. Apparently the rail service for delivering supplies continues. This action-reaction cycle is likely to be common during the Lee government, as a form of public negotiations.

Pakistan: The World Bank warned the newly-elected coalition government in to adjust POL products and commodities prices in line with international rates in order to avert severe economic crisis.

Praful Patel, World Bank Vice-President ended a three-day visit to Pakistan, noting that high international prices for petroleum and food commodities are creating challenges for the Pakistan economy. "Working with government data, the World Bank has determined that rapid adjustments and reforms are necessary to avert an economic crisis," said the WB here on Thursday.

During his visit, Praful Patel held meetings with PPP Co-chairman Asif Ali Zardari, economic team of the PPP, PML-N President Shahbaz Sharif and Secretary Finance Dr Waqar Masood Khan to get firsthand knowledge about Islamabad's economy and the future plans of Prime Minister Gillani’s government to control the growing fiscal deficit. The bank pointed out that while foreign direct investment and remittances have maintained pace and the stock market has posted gains, the fiscal deficit, inflation, current account deficit and foreign exchange reserves will miss their target this year.

In security developments, for the past two days several tribes in the northwest have engaged in sectarian fighting between Sunni and Shia Pashtun tribes, resulting in at least 40 people killed today. The news services reported the cause of the fighting was related to government operations.

In recent feedback an extremely well informed reader questioned, “Who wants to govern Pakistan?”

Iraq: Aswat Aliraq quoted a government spokesman who said that official talks with the Sadrist movement are talking place in different channels and related them to the parliament’s call for measures to end the bloodshed. "Today we reviewed the situation in Basra. We agreed to hold an emergency session tomorrow to discuss the Basra situation and how to resolve it," speaker Mahmoud Mashhadani told reporters in Baghdad.

Iraqi security forces operations against Sadrist militias have so far resulted in the killing of more than 225 people. Authorities have imposed a three-day curfew in Baghdad, in addition to other cities. Shiite cleric Muqtada al-Sadr has asked for a political solution to avoid more bloodshed.

Reports of fighting posted today by Aswat Aliraq showed some government progress in containing the violence in several governates, but limited information from Basra indicates the Sadrist continue to control neighborhoods. Two separate news services reported separate incidents of Army and police personnel discarding their uniforms and joining the Sadrists or handing over arms and ammunition.

The Sunni coverage of the fighting is limited. One account from a Sunni controlled television station in Baghdad blamed al Maliki for needlessly provoking violence without first trying dialogue.

The Prime Minister announced that his government is the only authority and has rejected negotiations with the “gangs.” The statement was released after al-Maliki received a delegation from Basra city's tribes that "announced full support and agreement with the law imposing plan, fulfilling security and stability, and cleansing Basra from the criminal gangs."

The statements by the parliament and al Sadr favoring negotiations support divergent goals. For parliament, a quick end to the fighting with no winner would leave power relationships unchanged. A clear winner would have significantly increased political clout. Sadr’s statement seems crafted to promote him as more statesmanlike than al Maliki.

Traditionally, Shiite fratricide would be the outcome most favorable to Sunni Arab interests. The installation of an elected Shiite government alters that time-honored convention. A stronger Shiite central authority or a stronger Sadrist movement are equally unfavorable outcomes for them under present political conditions. Sunni interests are best served by trying to mediate an end to the fighting that makes both sides beholden to the Sunnis. Recognition of that might explain the benign television commentary reported above.

Turkey: The Constitutional Court is expected to begin examining the indictment in the closure case against the ruling Justice and Development (AK) Party on March 31, Turkish press reported today. The investigation report is due to the Court on 28 March.

Yesterday, Turkey's biggest business group, the Turkish Industrialists and Businessmen's Association (TÜSİAD), had talks with Parliament Speaker Köksal Toptan and representatives of labor unions and employers groups as part of its efforts for political compromise. Toptan thanked TÜSİAD Chairwoman Arzuhan Yalçındağ for her efforts and said the group’s initiative to ease tension was an "encouraging development."

The industrialists called for both parties to the constitutional dispute to “step back.” Prime Minister Erdogan in Bulgaria ridiculed the intervention of the economic leaders, as did the parliamentary leader of the AK.

The large economic interests have already begun reporting a decline in the value of Turkey’s dinar relative to the US dollar and the Euro in reaction to the constitutional challenge to the ruling Justice and Development Party as being Islamist and anti-secular. The Party has responded by preparing to amend the constitution for the second time in less than a year. The risk of investing in Turkey has increased, according to the business community, because of the political dispute.

The AK Party has the strength in Parliament to pass amendments that could make the Court case moot, but without support from the opposition parties, the amendments would require approval in a national referendum. Minority party leaders predicted today that there will be a "regime crisis,” if the AK Party pursues constitutional change.

The latest analysis of the Constitutional Court reported in Today’s Zaman is that it would rule against the AK Party and order its closure. That prospect leaves Prime Minister Erdogan no choice but to gamble on amending the constitution to ensure his party survives. Meanwhile, his opponents, including the professional bureaucracy and the legal profession, will not entertain withdrawing the petition before the Court.

Some analysts interpret the prediction of a “regime crisis” as a veiled reference to a military coup.

For new analysts: One of the most reliable predictors of political behavior is the activities and attitudes of the professional and business communities because they finance the political system. Today’s action by Turkey’s industrial and business leaders suggests they have not yet taken sides in the constitutional dispute, but their public assertion of an interest spotlights the gravity of the issue, which they would prefer to disappear. If the politicians and attorneys force them to choose, their vote with financial support will exert a powerful influence on the outcome. Today in Turkey, the business community reminded the political elite that politics is economics.

Russia-US: For the record. Foreign Minister Lavrov said Russian experts were studying the latest U.S. proposals for easing Russian concerns about the proposed missile shield in Poland and the Czech Republic. He reaffirmed Moscow's call for Washington to drop the system. "We are convinced that the best way to assuage Russia's concerns ... will be to abandon such plans and turn to a truly collective project," Lavrov told reporters.

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