In 2012 the world once again found itself in the midst of signifi cant change. The importance of the emerging Asia-Pacific region continued to grow in the international community, while many Middle Eastern and African countries are going through a transitional phase. The intensifying challenges of globalization; the limits of the international community’s existing decision-making system; threats that put at risk the property and lives of Japanese people; and threats against its territories, waters and airspace have all contributed to placing Japan in a situation that is becoming increasingly diffi cult.
　If Japan is to enhance its national interests and conduct strategic foreign diplomacy, it is crucial that Japan view the world as a whole. Below we will review the significant international developments of 2012 in part one and in part two we will discuss Japan’s foreign policy changes made in response to those developments.

(1)The Increasing Importance of the Asia-Pacific Region

　The security environment of the Asia-Pacific region continues to become increasingly strained. Increasing numbers of Asian nations are making greater budgetary allocations to military spending, while tensions over maritime issues are growing throughout the region. In the waters surrounding the Senkaku Islands in the East China Sea, repeated territorial water intrusions by Chinese vessels, airspace violation by Chinese Government aircraft and a fi re-control radar direction by a Chinese navy vessel are among the events to have occurred since the Japanese Government acquired ownership, from a Japanese private citizen, of three of the islands in September 2012.
　Tensions between China and Association of Southeast Asian Nations (ASEAN) countries also persist in the South China Sea. There is true need to commence the development of an eff ective code of conduct (COC), which will contribute to dispute resolution. Countries within the region are required to strengthen cooperation in order to resolve the issues.
　There was a change of leader in North Korea, which is now led by Kim Jong-Un, but the country continues its nuclear and missile development. In 2012, North Korea went ahead with missile launches on two occasions, both of which they claim to be satellite launches, while in February 2013, North Korea completed its third round of nuclear tests, contributing to the growing tensions on and around the Korean Peninsula.
　Amidst all this, the United States (U.S.) continued to take a policy of rebalancing toward the Asia-Pacific region. This is symbolic of the growing importance of the region. The Defense Strategic Guidance released by the U.S. Government in January 2012 also shows strategies that place　importance on the Asia-Pacifi c region, with specifi cinitiatives, such as a greater allocation of U.S.military forces (aircraft, naval vessels) to the Pacifi cregion already underway. Russia is also placing　emphasis on the Asia-Pacifi c region, but its focus is　on energy. Meanwhile, interest in the growing Asia-Pacific region from European countries, where the　intra-regional economy is struggling, continues to rise.
　The growing presence of the Asia-Pacifi c region shows no sign of slowing down. The middle class(*1) of the region, the world’s growth center, is expanding at remarkable pace. The domestic Japanese market is forecast to gradually decline over the coming years, meaning that economic growth in the region is extremely important for the health of the Japanese economy. There have been a number of initiatives, such as the Free Trade Area of the Asia-Pacific (FTAAP), that have been implemented to integrate the regional economy. In November 2012, the commencement of negotiations for the Free Trade Agreement (FTA) among Japan, China and the Republic of Korea (ROK) was announced, while the launch of negoriations for the Regional Comprehensive Economic Partnership (RCEP) was also declared. These regional initiatives, together with the Trans-Pacific Partnership (TPP), serve for realizing the FTAAP.
　In a number of countries, the economic development has brought about a number of social issues. Emerging countries with high economic growth have experienced worsening environmental pollution, corruption and economic disparity between coastal and inland regions and between urban and rural communities, among other problems.
　The remarkable economic development of the Asia-Pacific region has inevitably brought with it increased energy consumption. According to the World Energy Outlook 2012 (WEO2012) by the International Energy Agency (IEA), global energy demand is forecast to grow by more than one third from 2010 to 2035. It is expected that China and India will account for more than 50 percent of this growth. Increased energy consumption within the Asia-Pacific region will not only have a substantial impact on the region itself, but also greatly influence the global economy and global affairs.
　The year 2012 was the year in which the development of new energy sources also gained prominence. In the U.S., technological innovation has enabled the production of non-conventional oil and natural gas, which were previously difficult to extract. This has resulted in a significant increase in production volumes (the “Shale Revolution”(*2). The IEA’s WEO2012 forecast that production volumes of natural gas by the U.S. will exceed that of Russia (currently the world’s largest producer) sometime between 2015 and the late 2020s. By 2020, the U.S. is anticipated to have become a net exporter of natural gas.
　There were fewer opportunities in 2012 for personal exchanges between Japanese nationals and nationals of some particular countries, but overall there were generally more opportunities for personal exchanges with people from the Asia-Pacific region. For instance, since the launch of Japan-East Asia Network of Exchange for Students and Youths (JENESYS) Programme (21st Century Exchange Program) in 2007, the program has provided opportunities for 54,000 youths to interact over the last five years. In January 2013, JENESYS2.0, the follow-up to JENESYS, was announced and approximately 30,000 youths would be involved in this new youth exchange program. Furthermore, Japan has been actively accepting nursing and care worker candidates.

(2)Volatility in the Middle East and Africa

　Following the transformation that swept through Middle Eastern and North African countries in early 2011, commonly known as the Arab Spring, some countries began to explore new systems of government, while other countries still remain in turmoil.
　Most notably, in Syria the conflict between antigovernment forces and the al-Assad regime escalated in 2012 and it is believed to have claimed more than 60,000 lives across the nation between January 2011 and the end of 2012. In 2012, four Ministerial Meetings of the Group of Friends of the Syrian People took place. Through occasions such as these meetings, the international community has repeatedly demanded that Syrian authorities cease the violence. However, the situation has yet to improve. The humanitarian crisis in Syria is extremely severe and it is expected that the number of Syrian refugees will increase. Furthermore, international efforts are being continually made to enable a Syrian-led transition of government, but for now there remains no prospect of a positive outcome.
　The turmoil that followed the Arab Spring also increased the threat of terrorism in the Middle East and North Africa. Prompted by the unrest in Libya, large volumes of armaments were distributed throughout the region, and it is believed that this has led to the ongoing expansion of areas in which terrorists operate, particularly in desert areas where border control is difficult. In April 2012, Islamic extremists in Mali took effective control of the northern areas of the country, which led to France deploying its armed forces to the area in January 2013. The terrorist attack that occurred in Algeria in January 2013 reminded Japan that the North African situation is not irrelevant to Japan or its people even though North Africa is very distant from Japan.
　In Iran, despite the repeated accusations by the international community since the revelation of the country’s secret uranium enrichment program in 2002, their nuclear program has been steadily advancing. The international community including Japan has attempted to come to a peaceful, diplomatic resolution of the Iranian nuclear issue by using a dialogue and pressure approach. Talks between Iran and the European Union (EU)3+3(*3) and the International Atomic Energy Agency (IAEA) have been held with no practical progress made so far in coming to a resolution. Consequently, the international community has stepped up the pressure it is exerting on Iran. The U.S. and the EU have, in particular, imposed sanctions on the Central Bank of Iran and Iranian crude oil.
　The International Security Assistance Force (ISAF), which has been deployed to Afghanistan to maintain law and order, is expected to withdraw from the country by the end of 2014. In order for Afghanistan to realize long term independence and prosperity, it is vital that the country successfully achieves sustainable development and growth during Afghanistan’s transformation decade beginning in 2015. To this end, the international community continues their initiatives to ensure success.
　Peace negotiations between Israel and Palestine have been on hold since September 2010. In January 2012, peace negotiators from both sides had the opportunity to engage in direct negotiations, however they did not lead to a resumption of peace negotiations. In November the same year, Israel and Hamas clashed violently, while the General Assembly of the United Nations (UN) voted by majority to upgrade Palestine’s status to “nonmember observer state.” The international community, including Japan, has been urging the two parties to resume negotiations; however there is currently no prospect of a breakthrough.

(3)Intensifying Challenges of Globalization and the Limits of the International Community’s Existing Decision-making System
(a)Growing Global Issues

　It has been a long time since people first started speaking about globalization. We have been enjoying the significant benefits of globalization, such as international free trade arrangements, but meanwhile the challenges that come with globalization have become increasingly testing.
　International terrorist organizations exploit globalization to the extent possible and operate across borders. Today, globalization has increased the number of Japanese traveling overseas and consequently there is now a higher risk of Japanese nationals falling victim to terrorist attacks and other crimes. As a result of the terrorist attack that occurred in Algeria in January 2013, ten innocent Japanese nationals were killed. This was a tragedy unique to our present age, in which the economy of Japan and the rest of the world have become integrated and the movement of people and goods has become more international. Acts of terror, irrespective of the motivation, cannot be tolerated. It is crucial that the international community unites to counter terrorism.
　In the midst of a global economic environment, economies of different nations are closely intertwined and influence each other. In 2012, the European sovereign debt crisis remained one of the most important issues facing Europe and the rest of the world. Fundamental resolution of this issue requires addressing structural issues over the mid to longterm, such as strengthening fiscal discipline and financial accountability, in addition to stabilizing the financial market in the short term. Furthermore, the slowing of economic development in emerging countries became more apparent in 2012. For instance, the real Gross Domestic Product (GDP) growth rate and forecast growth rate of China and India both slowed, which can be partially attributed to the European sovereign debt crisis. Additionally, U.S. fiscal issues, including the fiscal cliff, drew much attention from the international community.
　2012 was also a year in which many people throughout the world suffered through natural disasters, such as Hurricane Sandy in the U.S. and the typhoon in the Philippines. Climate change is a global issue that threatens the human security across borders. The 2007 Fourth Assessment Report by the Intergovernmental Panel on Climate Change (IPCC) revealed that global temperatures will rise by 0.4°C by 2030 and by between 1.8 and 4.0°C by the end of the 21st century due to increased greenhouse gas emissions, while sea levels will rise by between 18 and 59 cm by the end of the century. It is also forecast that the frequency of extreme climate conditions, such as extreme high temperatures and heat waves, and extreme rainfall will continue to increase. There are a number of theories behind the causal relationship between global warming and weather anomalies; however this does not change the fact that natural disasters affecting 200 million people each year are a transnational threat.
　In recent years, cyber-attacks have rapidly become more sophisticated and diversified. In 2012, Government websites experienced technical problems that were believed to have been caused by cyber-attacks and foreign Governments have been pointed as having been involved in some of these attacks. Cyber-attacks easily transcend borders and their source can be difficult to identify. This makes cyber-attacks a problem that is difficult for a single country to address on its own.

(b)Limits of the Existing Decision-making System in the International Community

　While the challenges related to globalization intensify, we have begun to see the limits of the international community’s existing decision-making system.
　The domestic situation in Syria deteriorated significantly in 2012, but the United Nations Security Council (UNSC) was unable to take effective action. Draft resolutions to impose sanctions on Syria were vetoed by Russia and China on three occasions and therefore UNSC was unable to reach a unified solution.
　Moreover, the rise of emerging countries, such as China and India, has produced conflicting interests among the various countries participating in the World Trade Organization’s Doha Round of negotiations resulting in prolonged deadlock. Antagonism also persists between developed and developing countries over the subject of climate change. Developed countries claim that developing countries, particularly emerging countries, should also be subject to mandatory greenhouse gas emission reductions, while developing countries insist on the needs for financial and technical support from developed countries. On the other hand, the Eighteenth Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP18), which ended December 8, 2012, made some progress. The participating countries came to agreement on procedures for the establishment of a new international framework in line with the decision made at the Seventeenth Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP17) to establish a framework by 2015 in which all economies will participate. Overcoming these complex conflicts holds the key to vitalizing the international community’s decision-making system.
　In some EU member nations skepticism on the EU is growing. In 2012, Greece saw many demonstrations against the country’s austerity measures. Caught between its citizens and the EU, which was providing support, the Government of Greece was in a position that required difficult maneuvering. In the United Kingdom (UK), following the spread of the debt crisis that began with members of the Eurozone, there was increasingly strong public demand to take back authority from the EU and for a referendum on the UK withdrawal from the EU. Debate on a multi-year fiscal framework for the 2014-2020 EU budget made little headway and was put off until the following year. This is one of the prime examples of the troubled decision-making of the EU.
　Moreover, the underdeveloped international decision-making system in new fields, such as space and cyberspace, also poses further challenges. In today’s international community, where various technologies continue to advance rapidly, speed of decision-making concerning threats is a necessity. However, when positions of countries are diversified, and as Non-Governmental Organizations (NGOs), companies and individuals are also playing a greater role in the international arena, developing a new decision-making system is becoming more difficult. The international community including Japan must always explore new means of international governance that meets the changes in the international community.

1 Households with annual disposable income in excess of US $5,000 and less than US $35,000.
2 The “Shale evolution” is a term used to describe the rapid expansion of the development of unconventional oil and gas fields and the production of those resources, particularly shale gas, which is influencing energy affairs and broader spheres.
3 The framework for dialogue in regards to Iranian nuclear issue between Iran and 6 countries (EU3 (the UK, France, and Germany)and the United States, Russia, and China).