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Annual Report 2009The Project 2049 Institute

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T his year has been a momentous time for both Asia and the Project

2049 Institute. As the Obama administration began its first year in

office, we saw the rise of a more assertive China, the historic election of

the Democratic Party of Japan (DPJ), and significant economic and

technological developments in Southeast Asia. It was also a milestone

year for various events, including the 30th anniversary of the Taiwan

Relations Act, the 50th anniversary of a major Tibetan uprising against

Chinese rule, and the 60th anniversary of the People’s Republic of China

(PRC).

In 2009, the Project 2049 Institute continued to offer future-looking

analysis and recommendations on these important strategic challenges.

During our second year, we published innovative articles and reports

evaluating the future of important strategic issues including the U.S.-

Japan alliance, Taiwan’s defense posture, China’s military modernization,

and Southeast Asia’s energy and economic developments. This year, we

have also brought together Senators, senior Department of State officials

and policy experts in public forums. Through these various mediums, we

have injected fresh ideas into policy circles, shaped key public debates,

and helped guide policymakers toward a more secure Asia.

As we enter the second decade of the 21st century in 2010, the Project

2049 Institute will continue to address urgent and under-noticed strategic

trends, challenges and opportunities in the region. We remain committed

to our main goal of influencing the public policy realm with

interdisciplinary, forward-looking and creative research, so that the Asia-

Pacific will reach an unprecedented level of prosperity, freedom and

stability in the next half-century.

President and CEOThe Project 2049 Institute

From the President

Images (top to bottom) – China’s 60th

anniversary military parade (China Military Online),APEC leaders (channelnewsasia), Japan’s President Yukio Hatoyama and Foreign MinisterKatsuya Okada (Getty Images), The U.S.S. Nimitz (cover image of “China's EvolvingConventional Strategic Strike Capability”), P-3, Pac-3 and submarine (2008 NationalDefense Report - The Republic of China).

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The Project 2049 Institute seeks to guide decision makers toward amore secure Asia by the century’s mid-point. The organization fills agap in the public policy realm through forward-looking, region-specific research on alternative security and policy solutions. Itsinterdisciplinary approach draws on rigorous analysis ofsocioeconomic, governance, military, environmental, technologicaland political trends, and input from key players in the region, withan eye toward educating the public and informing policy debate.

The Asia-Pacific region has the potential to reach an unprecedented level of prosperity, freedom,and stability in the next half-century. In recent decades, the emergence of vibrant democracies inTaiwan and South Korea, China’s rapid economic rise, and Japan’s leadership on issues rangingfrom technology to international development have helped Asia reach new levels of globalengagement and improve living standards for millions. But the region faces uncertainties as well.Fluctuating economies, a deepening divide between the urban wealthy and rural poor,worsening environmental threats, shifting military capacities, and the specter of terrorism areamong the factors that could influence regional stability in the near future.

Our research:

1. Democracy and governance. Examining the role of civil society, elections and politicalprocesses, rule of law, and anti-corruption activities in young democracies or countries intransition, and assesses the impact of democratic consolidation on security.

2. Alliances, coalitions and partnerships. Forecasting risks and opportunities arising fromestablished and nascent regional alliances, and analyze how pooling of resources and politicalcapital might shift the region’s balance of power.

3. Non-traditional security. Examining regional impacts of terrorism/extremism, pandemicdisease control, natural disasters, and environmental and energy security—issues that are ofincreasing concern to security experts but remain relatively new to the field.

4. China studies. Assessing the impact of China’s rapid economic, social and militarydevelopment on the Asia-Pacific security environment, and how neighboring countries and theUnited States are managing China’s rise.

5. Asia and the world. Analyzing Asia's interactions with countries and organizations outside theregion to better understand future global dynamics.

Our mission

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Occasional Papers

The U.S.-Japan Alliance: President Obama’s First100 Days

The Taiwan Quadrennial Defense Review:Implications for U.S. - Taiwan Relations

The Great Game in Space: China's Evolving ASATWeapons Programs and Their Implications forFuture U.S. Strategy

China's Evolving Conventional Strategic StrikeCapability: the anti-ship ballistic missilechallenge to U.S. maritime operations in theWestern Pacific and beyond

Futuregrams

In 2009, we added a new publication series titled“Futuregrams” to offer exclusive insights intounder-noticed economic and securitydevelopments.

Solar Flair: Taiwan’s Photovoltaic IndustryAspires to Lead the Clean Energy Revolution

China's Commercial Aviation Sector Looks to theFuture

China and Congo's Coltan Connection

Vietnam's Port Potential: The Economic andPolitical Implications of Vietnam's PortRenovation

The Assassin Under the Radar: China's DH-10Cruise Missile Program

Southeast Asia’s Nuclear Future: Promises andPerils

Co-Authored Reports

In addition to our own publications, the Project2049 Institute staff also co-authored several highprofile reports on strategic issues in Asia.

Deter, Defend, Repel, and Partner: A DefenseStrategy for Taiwan - The Taiwan Policy WorkingGroup.

“The U.S.-ROK Alliance: Regional Challenges for

an Evolving Alliance”- Center for a New AmericanSecurity.

Making an impact The Project 2049 Institute stimulates policy discussion through

in-depth analysis of key strategic trends in the Asia – Pacific and

bringing together regional experts in public forums. The

Institute also contributes to policymaking through active

interaction on Capitol Hill.

Guiding decision makers toward a more secure Asia by 2049

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China 2025

China 2025 addressed the core questions of China’s domestic and

foreign policy priorities and their likely implications for the rest of the

world. The one day conference featured keynote addresses by

Assistant Secretary of State Kurt Campbell and Chairman of Morgan

Stanley Asia Dr. Stephen Roach. The panelists included Minxin Pei,

David Shinn and Evan Feigenbaum. The conference was attended by

over 250 members of the public and international media.

The Taiwan Relations Act at 30

This seminar on Capitol Hill commemorated the 30th anniversary of

the Taiwan Relations Act and reflected upon its legacy in policymaking

to this day as well as into the future. Speakers included 3 U.S.

Senators, academics and think tank experts and former Assistant

Secretary of State James Kelly. The event drew an audience of over

100 people and was widely reported in the Taiwanese media.

Events

Top row, left to right: Dr. Stephen Roach (Morgan

Stanley, Asia), Senator Sherrod Brown (D-Iowa),

The Hon. Kurt Campbell (Assistant Secretary of

State for East Asian and Pacific Affairs), The Hon.

James Kelly (former Assistant Secretary of State

for East Asian and Pacific Affairs) and Ambassador

David Shinn (George Washington University).

Bottom row, left to right: Senator Mel Martinez

(former Florida representative), Dr. Minxin Pei

(Claremont McKenna College) and Senator James

Inhofe (R-Oklahoma).

This is an economy that, while it's hitting its growth target, is one that is increasingly

unstable, unbalanced, uncoordinated and ultimately unsustainable. For China, and I

think this is the lesson in this crisis; China is no different than the rest of us.

- Dr. Stephen Roach speaking about China’s economic growth at China 2025.

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Exploring the Nature of UighurNationalism: Freedom Fighters orTerrorists?

U.S. House of Representatives Subcommittee onInternational Organizations, Human Rights andOversight.

“Nationalism characterized by love of country,

pride in culture and heritage, and activism to

promote the community is to be admired and

encouraged… But nationalism can also engender

more problematic and even dangerous activities.

Unfortunately, the Uighur community does not

appear to be immune to this type of nationalistic

manifestation. Even if this represents a very small

minority within the minority, it would be wrong,

in my judgment, to condone nationalistic

sentiment that leads individuals or groups to

commit acts of violence against innocent

civilians.” – Randall Schriver (June 16, 2009)

U.S.–China Relationship and the Role ofthe Strategic and Economic Dialogue

U.S. House of Representatives Committee on ForeignAffairs

“While it is undeniable that the United States and

China are experiencing converging interests

across a broad spectrum of issues, it is also true

that our interests diverge in important ways. We

cannot expect that there is some optimal formula

for a dialogue format that will alter the

fundamental fact that United States and China will

find cooperation difficult in the near-to-medium

term.” – Randall Schriver (September 10, 2009)

The Project 2049 Institute experts have published

op-eds on a variety of topics from Burma to

China’s military rise in major newspapers

including the Wall Street Journal, the Washington

Times, the Far Eastern Economic Review and the

Wall Street Journal Asia.

Our reports have also been cited in publications

including Washington Times, the Sydney Morning

Herald, Taipei Times, the L.A. Times, Bloomberg

and Defense News. In addition, our experts have

appeared on CNN and PBS, as well as foreign

news programs such as BBC’s “World News

Today.”

On the Hill In the News

"A threat is really two parts:

capability and intentions… [w]e'relearning about China's capability.

Intentions are not clear at this point."

– Executive Director Mark Stokes in reference to

China’s military development in the L.A. Times.

Kelley Currie interviewed by

BBC’s World News Today

Randall Schriver on PBS’s

Great Decisions series

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Project 2049online

Web & New Media

In 2009, the Project 2049 Institute launched a newinteractive website that is integrated withelements such as our Facebook page, whichprovide our readers with updates on our latestpublications, and YouTube page, which hostsvideos of our conferences and interviews.

The Project 2049 Institute blog, Asia Eye, was

launched this fall. As web-based media becomes

more and more popular, AsiaEye has allowed us to

harness the growing influence of the blogosphere.

The Project 2049 Institute broadened our online presence by

constructing a new website and utilizing additional media

applications. These resources have allowed us to expand our

worldwide outreach and readership in order to heighten public

interest and deepen our impact in the global marketplace of

ideas.

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Board of Directors

Ian BrzezinskiFormer Deputy AssistantSecretary of Defense

Sharon BurkeCenter for a New AmericanSecurity

Lisa CurtisHeritage Foundation

Rodney FaraonCrumpton Group

Rupert Hammond-ChambersUS-Taiwan Business Council

Ted HobartChart Venture Partners

Randall SchriverProject 2049 Institute

Board of Advisors

David AsherDeloitte

Dan BlumenthalAmerican Enterprise Institute

Larry Estrada,Hewlett Packard

Stewart Verdery,Monument Policy Group

Phoebe Yang,Russell Reynolds Associates

International AdvisoryCouncil

Tetsuo KotaniOcean Policy ResearchFoundation

Andrew N.D. Yang

Andrew ShearerLowy Institute

Hsiao Bi-KhimFormer Taiwanese Legislator

Yeling TanLee Kuan Yew School Centre onAsia and Globalisation

Board, Advisors& Staff

The Project 2049 Institute works under the guidance of our

Board of Directors, Board of Advisors and International

Advisory Council. Our Board members and Advisors hold

varied backgrounds in government, private sector and

academia.

In 2009 we welcomed Sharon Burke to our Board of Directors, DanBlumenthal to our Board of Advisors, and Tetsuo Kotani and AndrewYang to our International Advisory Council. We congratulate formerBoard of Directors member Derek Mitchell, who took up the positionof Principal Deputy Assistant Secretary of Defense for Asian andPacific Security Affairs, and Andrew N.D. Yang, who is currentlyserving as Taiwan’s Deputy Minister of Defense.

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Staff

Randall Schriver

President and CEO

Mark Stokes

Executive Director

Tiffany Ma

Research Associate

Prashanth Parameswaran

Research Assistant

Fellows & Affiliates

Kelley Currie

Senior Fellow

Julia M. Famularo

Research Affiliate

Ian Easton

Research Affiliate

Amanda C. Morrow Jensen

Research Affiliate

Contributors

Anne An

Alex Brooke

Blair Foulds

Steve Gummo

Kolby Hanson

Hideki Murai

New location and contact information

In April 2009, the Project 2049 Institute officially relocated to

Arlington, Virginia. We are now located at 2300 Clarendon Blvd,

Suite 250, next to the Court House metro station.

For general inquiries please call (703) 879-3993 or email

project2049@project2049.net.

For more information about the Institute, please visit us online

at www.project2049.net.

Images: our new state-of-the-art conference facility (left) and the office foyer (right).

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Statement of Activities 2009(as of December 1, 2009)

Revenue

Contributions and Grants $420,148

Total Revenue $420,148

Expenses

Salaries and Other Compensation $227,548

Project Sub-Contracting $4,700

Travel $53,602

Office Expenses $36,900

Conferences and Seminars $25,401

Accountant and Legal $8,000

Supplies $1,068

Other Expenses $2,035

Total Expenses $359,254

Statement of Financial Position (Balance Sheet)(as of November 30, 2009)

Assets

Cash $119,648.92

Accounts Receivable $190,000.00

Fixed Assets $1840.00

Total Assets $311,488.92

Liabilities

Accounts Payable $25,625.03

Total liabilities $25,625.03

Statements of Activities and Financial Position

Supporters:

The Project 2049 Institute would like to thank thegenerosity of our supporters which make our research,events and other work possible. Their support allowsus to create forward-looking, region-specific researchon alternative security and policy solutions and toeducate the public and inform policy debate.

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