ASEAN KEY DESTINATIONS
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Asean Weekly ending 17 Aug, 2012
Yudhoyono announces more commodities will be subject to price controls. President Susilo Bambang Yudhoyono announced August 6 that the State Logistics Agency, also known as Bulog, will be strengthened to control the prices of additional commodities. Bulog currently controls only rice. The president did not say which commodities would be included, but intimated that the prices of rice, sugar, corn, meat, and soy needed to be controlled. Authorities have debated Bulog’s revival since 2008, but the current drought in the United States, which has resulted in skyrocketing soy prices, spurred the decision.
Mining companies scramble as deadline for domestic processing draws closer. The Indonesia Mining Society said August 3 that no smelters will be complete by 2014, when a new law banning the export of unprocessed ores will take effect, despite mining companies’ frantic efforts to comply with the law. The organization cited financial and infrastructure constraints for the delay. Industry Minister MS Hidayat said July 24 he would push for tax breaks for companies building smelters in cooperation with power plants, but the lack of power remains an issue. State-owned electricity distributor PT Perusahaan Listrik Negara (PLN) announced August 6 that 23 companies have submitted proposals for PT PLN to supply electricity to smelter operations.
Corruption Eradication Commission will not control police corruption investigation. A presidential spokesperson said August 7 that President Susilo Bambang Yudhoyono opposes granting the Corruption Eradication Commission (KPK) sole control over a high-profile graft investigation involving a two-star general in the Indonesian National Police. The announcement came on the same day that KPK investigators raided police offices following a 10-hour standoff in the first such operation in the KPK’s history. The National Police and the KPK have been conducting parallel investigations in the case, while lawmakers have called for the KPK to be given full control. The police are perceived as the one of the most corrupt institutions in Indonesia, according to polls.
Government suspends two news weeklies, quickly relents. The government of Myanmar July 30 suspended two news journals, the Voice Weekly and the Envoy, allegedly for articles speculating about a pending cabinet reshuffle. Journalists responded by mounting street protests of approximately 100 and 60 in Yangon and Mandalay, respectively. Protestors wore black t-shirts reading “Stop Killing the Press.” The government reversed its decision and announced the journals will be allowed to resume operations August 18. Observers have hailed both the protests and the government’s responsiveness to them as historic.
Myanmar banking sector expands services. Myanmar’s banks began using letters of credit for the first time August 1 and some banks began issuing debit cards in early August. The letter of credit system, which moves risks from buyers and sellers to banks, is expected to advance economic development and encourage international trade. Previously, only the state-owned Myanmar Investment and Commercial Bank and Myanmar Foreign Trade Bank could issue letters of credit, with significant costs and red tape. Banks also plan to make credit cards available in 2013.
Former Thai Rak Thai member to head charter reform committee. A newly formed parliamentary committee to study constitutional reform held its first meeting August 7 and named Pokin Polakul, a former executive of the Thai Rak Thai Party founded by exiled former prime minister Thaksin Shinawatra, as its chairman. Pongthep Thepkanchana, another former Thai Rak Thai executive, was named deputy chairman. The committee was established to explore strategies for amending Thailand’s constitutional charter following a court ruling in July that any attempts to change the charter would need to be approved in a public referendum.
Rice scheme problems dog Yingluck government. Top economists on August 8 again criticized Prime Minister Yingluck Shinawatra’s controversial rice purchasing scheme, saying that it did not benefit poor farmers as promised. The U.S. Department of Agriculture said it will send an investigator to Thailand over concerns the scheme is creating global rice market distortions and breaching World Trade Organization rules.
Thailand’s Commerce Ministry said August 10 that the scheme does not violate any international trading rules. Deputy Prime Minister and Finance Minister Kittiratt Na-Ranong admitted the same day that the scheme has been troubled by corruption, but said the government was rooting it out.
U.S. officials granted Thaksin a visa that specifically banned him from visiting Washington. The visit has raised some eyebrows in Thailand, with one parliamentarian calling for a break in Thai-U.S. relations if the United States allowed the former leader to visit.
Monsoon rains cause deadly flooding in Manila. Severe monsoon rains August 7 caused massive flooding and mudslides in Manila and the surrounding provinces. The death toll stood at 85 as of August 13. The disaster followed the deaths of 53 people during Typhoon Saola last month. President Benigno Aquino August 9 responded to the back-to-back disasters by announcing plans for long-term infrastructure improvements, such as new dams and embankments along rivers, to mitigate the frequent flooding that plagues the Philippines.
Military clashes with rebels in southern Philippines. Military officials said August 9 their troops and assault helicopters launched an attack on a guerrilla group in the southern Philippines that had raided at least 14 military camps and outposts since August 5. Nearly 20 people were reportedly killed in the clashes. The rebel group, the Bangsamoro Islamic Freedom Movement (BIFM), broke from the Moro Islamic Liberation Front (MILF) last year and pledged to continue to fight for independence despite ongoing peace talks between the government and the MILF. The government said the raids by the BIFM were meant to disrupt the talks.
Senate ratifies convention on domestic workers. The Philippine Senate August 6 ratified the Domestic Workers Convention, an international treaty adopted by the International Labor Organization in June 2011. The Philippines is the second country to ratify the convention after Uruguay, which satisfies the minimum condition for the treaty to enter into legal force. The convention seeks to extend protection to 100 million domestic workers worldwide, mostly women. It includes prescriptions against excessive working hours, physical and sexual abuse, and human trafficking. The treaty will come into effect in one year.
Russia to set up ship maintenance facility in Cam Ranh Bay. Vietnamese president Truong Tan Sang agreed during a visit to Russia July 26–31 to allow Russia to open a ship maintenance facility at the former U.S. and Soviet base of Cam Ranh in central Vietnam. The facility will not be a military base and will help Vietnam develop ship maintenance capacity for foreign ships docking at Cam Ranh Bay. Vietnam and Russia upgraded their relationship to a comprehensive strategic partnership during Sang’s trip.
Vietnam targets public debt reduction. The Vietnamese government July 27 approved a national strategy that aims to reduce public debt during the 2012–2020 period. Vietnam expects to issue $10.8 billion of government bonds by 2015 and $24 billion of bonds from 2016 to 2020. This will allow the government to borrow an average of $2.6 billion a year for the next eight years. Under the plan, public debt should total less than 65 percent of gross domestic product by 2020 and 60 percent by 2030.
Vietnam to launch fisheries management force in September. The Vietnamese government approved a draft decree July 31 to establish a national fisheries management force in September 2012. The force will patrol, prevent, and respond to foreign fishing boats or vessels that violate Vietnam’s exclusive economic zone, continental shelf, and territorial waters. Vietnam plans to build fisheries administration branches in 28 coastal provinces. Each branch will have a modern ship with search and rescue capacities.
United States offers qualified praise for Malaysia’s counterterrorism efforts. The U.S. State Department’s “Country Reports on Terrorism 2011,” released in July, praised Malaysia’s increased counterterrorism cooperation with the United States and noted that the country has suffered no incidents of terrorism in recent years. The report cautioned, however, that Malaysia has been used as a transit and planning site for terrorists striking elsewhere. It cited the country’s weak border controls and loopholes in maritime security as areas in need of improvement.
Rights groups call for release of radio director. Rights groups August 6 called for the release of Mam Sonando, head of Beehive Radio and founder of Cambodia’s Democrat Association. He was arrested July 15 for his alleged involvement in a May secessionist movement in southern Kratie Province in which a 14-year-old was killed. Human rights groups condemned the arrest as an attempt by Cambodian authorities to silence Sonando, who has been an outspoken critic of the government.
Workers seek a deal with supplier of Levi’s and Gap. Tai Yang Enterprises workers who were fired for participating in a highly publicized strike that began June 25 have said they are willing to compromise on their demanded bonuses if they are rehired. Tai Yang supplies clothing manufacturers including U.S.-based Levi Strauss and Gap. The American Center for International Labor Solidarity has urged the Cambodian Ministry of Social Affairs and Levi Strauss to reinstate 37 workers in an attempt to end the strike, which has involved more than 4,000 workers in one of the longest strikes in the industry’s history.
Yahoo drops copyright suit against Singapore press. Yahoo Inc.’s Southeast Asian unit dropped a countersuit on August 7 in its legal battle with Singapore Press Holdings (SPH). The latter has accused Yahoo of copyright infringement for publishing SPH news reports without permission. SPH said it will continue the suit despite the fact that Yahoo dropped its case.
Singapore Airlines orders 54 Boeing jets. Singapore Airline’s regional unit, SilkAir, August 3 announced an order for 54 Boeing 737 jets at a cost of $4.9 billion. It is the regional carrier’s largest single purchase in six years. SilkAir also plans to order 23 Boeing 737-800s and 31 Boeing 737 Max jets in the next few years to replace the older 737 model.
ASEAN celebrates 45th birthday. ASEAN celebrated its 45th birthday August 8 at a commemorative ceremony outside the ASEAN Secretariat in Jakarta, Indonesia. Envoys from ASEAN member countries, the United States, Japan, and the European Union attended the ceremony. ASEAN secretary-general Surin Pitsuwan urged the grouping to consolidate itself and present a united front on every issue.
ASEAN considers humanitarian assistance for Rohingya refugees. ASEAN secretary-general Surin Pitsuwan August 8 said he had proposed that ASEAN member countries offer humanitarian assistance to Rohingya refugees in western Myanmar. He cited help ASEAN had extended to Myanmar in the aftermath of Cyclone Nargis in 2008 as a precedent. Pitsuwan called on ASEAN to not stand by in the face of a humanitarian crisis and said he believes the grouping should be part of a solution to the Rohingyas’ plight. Indonesia and Malaysia have offered to directly assist the Rohingyas.
Vietnam’s deputy foreign minister set to be next ASEAN secretary-general. Vietnamese deputy foreign minister Le Luong Minh will be officially presented to ASEAN leaders and dialogue partners in Phnom Penh in November as Vietnam’s nominee to be the next ASEAN secretary-general. He is expected to take office in January 2013. The position of secretary-general traditionally rotates between ASEAN’s 10 member states and this will be Vietnam’s first turn. Minh is a career diplomat and former ambassador to the United Nations in Geneva and New York.
Three new hydropower plants to begin operations this year. The Lao government announced August 7 that three new hydropower plants in Luang Prabang, Borikhamxay, and Xekong provinces are near completion and will come online during 2012. The projects are joint ventures between state-run Electricité du Laos and investors from China, Europe, and Vietnam. Approximately 90 percent of the power produced at the plants will be exported to Thailand and Vietnam. Laos strives to become an energy exporter to neighboring countries ahead of the inauguration of the ASEAN Economic Community in 2015.
World Bank extends financing for road sector project in Laos. The World Bank provided Laos an additional grant of $21 million on August 8 as part of an ongoing Lao road construction project. The Lao government will use the grant to improve road services and reinforce disaster response capabilities on national roads in Phongsaly and Huaphan provinces in the northeast. The World Bank launched the project in 2010 with initial funding of $27.8 million. Road improvement and expansion are key to increasing Laos’s connectivity to the region.
South China Sea
Vietnamese police detain anti-China protesters. Vietnamese police on August 5 detained at least 20 protesters in Hanoi who had gathered to denounce China’s recent moves to bolster its claims to the disputed Paracel and Spratly Islands in the South China Sea. Vietnamese authorities had allowed three other large anti-China protests in the capital in the last month without any arrests. Human Rights Watch said the detainees included bloggers, an anticorruption activist, and a teacher.
New president asks government to work harder. President Taur Matan Ruak called for the fifth government of Timor-Leste to work harder to serve the people at his swearing-in ceremony August 8. He said government services should be decentralized to better serve the needs of districts and subdistricts in “school management support, agricultural extension services…health and justice services, [and] social security,” and called for overall capacity building. A ruling party parliamentarian said July 30 that the Veteran’s Law, the Land Law, and the Anti-Corruption Act will be the priorities of the next parliament.
14th negotiating round of the Trans-Pacific Partnership. The 14th round of negotiations of the Trans-Pacific Partnership will take place between September 6 and 15 in Leesburg, Virginia, outside of Washington. Despite continued progress, negotiations are unlikely to conclude in December as originally hoped.
20th Asia-Pacific Economic Cooperation leader’s meeting. The 20th APEC Economic Leaders’ Meeting will take place on September 8–9 in Vladivostok, Russia. The Economic Leaders’ Meeting will be preceded by other APEC-related events beginning September 2, including the APEC Ministerial Meeting September 5–6 and the APEC CEO Summit September 7–8. U.S. president Barack Obama, who is not expected to attend the meeting because of the U.S. presidential campaign, will likely be represented by Secretary of State Hillary Clinton.
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