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                                                                                                                       Asean Affairs  20 February  2015 

Biweekly Update


Malaysia opposition leader jailed for sodomy. Malaysia’s high court on February 10 handed down a five-year jail term to opposition leader Anwar Ibrahim for sodomy charges, ending a controversial six-and-a-half-year trial. Anwar’s jailing created a leadership vacuum within the opposition coalition, which he built and led to a number of electoral successes. The United States, Australia, and several human rights groups have criticized the ruling and expressed concerns about political interference in the case and the impartiality of Malaysia’s judicial system.

Cartoonist briefly detained for tweet about Anwar’s jailing. Malaysian police on February 13 released well-known satirical cartoonist Zunar after arresting him two days earlier for a tweet he made about the jailing of opposition leader Anwar Ibrahim. Police alleged that the tweet, which claimed the judges were influenced by the government, was seditious. Zunar joins a growing list of opposition politicians, academics, and activists who have been charged under the Sedition Act. Malaysia faces growing criticisms over its use of the law against political opponents.

1MDB settles debt with tycoon help after banks threaten to put it in default. State investment firm 1Malaysia Development Bhd (1MDB) has settled in full a $550 million loan issued by local banks, according to a February 13 Wall Street Journal report. Several banks earlier threatened to put the fund in default if it missed a payment deadline at the end of February. 1MDB, which is chaired by Prime Minister Najib Razak, still has another $11.5 billion in debt, according to reports released in March 2014. Its struggle to cover debt payments has led to concerns about Malaysia’s sovereign credit risk.

Malaysian bank CIMB aims to cut costs and revise strategy after merger plan fails. Malaysian bank CIMB on February 6 announced plans to cut costs at its investment banking and equities divisions across the Asia Pacific and merge some of its units. The plans followed the collapse of the $18 billion, three-way merger between CIMB and two other Malaysian banks last month. CIMB expanded rapidly after buying the Asian operations of the Royal Bank of Scotland in 2012, but has struggled since with higher costs and growing regional competition.


Jokowi drops nomination of graft-tainted official for police chief. President Joko “Jokowi” Widodo on February 18 dropped the nomination of Budi Gunawan for National Police chief in the face of widespread public criticism. Budi has been tainted by graft allegations. Jokowi instead nominated acting chief Badrodin Haiti for the position. Jokowi’s decision came despite a Jakarta court ruling two days earlier that Indonesia’s Corruption Eradication Commission (KPK) erred in naming Budi a graft suspect in January. The court ruled that Budi’s position at the time of the alleged graft—head of police career development—did not qualify as the type of official or law enforcement position that the commission is empowered to prosecute.

Jokowi visits Malaysia, Philippines, Brunei. President Joko “Jokowi” Widodo made his first state visits to neighboring Malaysia, the Philippines, and Brunei from February 5 to 10. He reached an agreement with Malaysia’s prime minister, Najib Razak, to establish a negotiating group to resolve the two countries’ outstanding boundary disputes, and oversaw the signing of a controversial deal with Malaysia’s state car company, Proton, to help Indonesia develop a national car. He also signed an agreement with Philippine president Benigno Aquino to jointly combat drug trafficking. In Brunei, Jokowi reiterated the close ties between Indonesia and the sultanate.

Jokowi suspends KPK chief, deputy amid criminal cases. President Joko “Jokowi” Widodo on February 18 ordered the suspension of Corruption Eradication Commission (KPK) chairman Abraham Samad and his deputy, Bambang Widjojanto, replacing them with three interim commissioners. Indonesian police on February 9 named Abraham a suspect in a document falsification case for allegedly helping a West Kalimantan resident illegally register as a member of Abraham’s family in 2007 to obtain a passport. Police earlier arrested Bambang for alleged perjury during a 2010 election dispute. The legal investigations into the KPK members were widely seen by observers as retribution for the commission’s naming former National Police chief nominee Budi Gunawan a graft suspect in January.

Thousands displaced by Jakarta flooding. Flooding due to heavy rains on February 8–9 paralyzed parts of northern and western Jakarta with some parts of the city under three feet of water. Roads and public transportation were unusable in areas, while tens of thousands of businesses remained closed even after the rains ceased. Nearly 6,000 residents were evacuated to shelters. More rain and floods are expected in the coming weeks.

Growth slumps to lowest point in five years. Indonesia’s Central Statistics Agency on February 5 announced that the nation’s economic growth fell to just over 5 percent in 2014, from 5.8 percent in 2013. It was Indonesia’s lowest level of growth since 2009. Exports of goods and services, which make up nearly a quarter of the economy, rose only 1 percent. The news casts doubt about the feasibility of President Joko Widodo’s 7 percent annual growth target for his first term, which ends in 2019.


Military rule declared in region of northern Shan State. President Thein Sein on February 18 declared a three-month national emergency in the Kokang region of northern Shan State and placed the area under military rule amid intense fighting since February 9 between government troops and the Myanmar National Democratic Alliance Army. Dozens of government troops and rebels have been killed and tens of thousands of civilians have fled across the border to China or to other parts of Shan State. The government and other ethnic armed groups meanwhile failed to sign a nationwide cease-fire on February 12 as planned.

President greenlights constitutional referendum. President Thein Sein on February 10 approved a law to allow a referendum on constitutional amendments to take place. Some lawmakers have pushed the Union Election Commission to set a date as early as May. It remains unclear whether controversial clauses barring individuals with foreign family members to become president or granting the military 25 percent of legislative seats will be included. Parliamentary speaker Shwe Mann has previously said that the parliament will not consider constitutional changes until after national elections in late 2015.

Government sets expiration date for white cards after nationalist protests. The President’s Office on February 11 said temporary identification papers, or white cards, for several ethnic minority groups will expire on March 31, effectively revoking their right to vote, including in an expected referendum on constitutional reform. The parliament earlier this month had affirmed that holders of white cards would be able to vote in that referendum. White cards are held by members of several ethnic minorities that lack Myanmar citizenship, including more than 500,000 Muslim Rohingya. Hundreds of nationalists had earlier marched in Yangon and Sittwe in western Rakhine State to protest the idea of letting Rohingya vote at a proposed referendum.

Students take to streets to protest Education Law. Student groups on February 12 said they will continue to march to protest the existing National Education Law despite having reached an 11-point agreement with the government and parliamentary representatives on ways to amend the legislation the day before. Students had petitioned for, among other things, allocating 20 percent of the government budget to education. The leader of the opposition National League for Democracy, Aung San Suu Kyi, took over on February 10 as chairperson of the party’s education committee after its previous head was dismissed for not representing party policies during the dialogue between the government officials and students.

Activists petition for reform of election commission. A group known as the Mass Movement Acceleration Network said on February 6 it has launched a petition for the reform of the Union Election Commission, which is currently dominated by former military officers. A member of the opposition National League for Democracy told the Myanmar Times the composition of the commission violates the constitution and electoral laws. Its chairman, Tin Aye, said at a voter education event in December that there would be a coup in the case of widespread unrest.

Shell inks contract with MOGE, Ophir Energy begins offshore exploration. Royal Dutch Shell on February 5 signed a contract with state-owned Myanmar Oil and Gas Enterprise (MOGE) to explore three offshore deep-water blocks in southeastern Myanmar. Shell will hold a 90 percent stake in each of the three blocks. Meanwhile, UK-based Ophir Energy became the first of the companies awarded offshore blocks in March 2014 to begin exploration when it conducted seismic surveys off the coast of Rakhine State in western Myanmar in early February. Ophir hopes to begin drilling in late 2017.


Prayuth gives one-year timeline for elections. Prime Minister Prayuth Chan-ocha on February 9 told his Japanese counterpart, Shinzo Abe, that Thailand would hold elections by early 2016. Prayuth made his comment on a visit to Tokyo during a meeting to reaffirm economic ties. The two leaders discussed Japanese involvement in the creation of the Dawei special economic zone in Myanmar and Japanese investment in Thailand’s proposed east-west railway.

U.S., Thailand hold scaled-down Cobra Gold exercise. The United States and Thailand on February 9 launched Cobra Gold, the annual multilateral military exercise comprising participants from more than 20 Asia-Pacific countries. In response to continued military rule in Thailand, the United States cut the number of troops it sent to 3,600 from 4,300 in 2014, and scaled back the marquee live-fire field exercises to focus more on disaster assistance, humanitarian relief, and other noncombat training.

Thailand asks China to moderate loan conditions for railway project. Deputy Transport Minister Arkhom Termpittayapaisith said the Thai Ministry of Transportation has asked the Chinese government to ease the conditions on a proposed loan for the construction of Thailand’s first standard-gauge railway, according to a February 6 Thai PBS article. Arkhom said the ministry asked the Chinese government to extend the grace period on the loan and reduce the proposed interest rate of 2-4 percent. Japan offered Thailand a 1.5 percent rate on a loan for the project.

Thailand agrees to improve military ties with China during defense minister’s visit. China's defense minister, Chang Wanquan, visited Bangkok on February 6 and reached several agreements with Thai officials to strengthen military cooperation over the next five years. Officials reiterated a previous agreement to hold joint air force exercises, and agreed to boost defense research and development cooperation and to discount arms sales from China to Thailand. Chang said Beijing will not interfere in Thai affairs, implicitly rebuking comments by U.S. assistant secretary of state Daniel Russel a week earlier calling on Thai authorities to lift martial law and return to democracy.

Authorities arrest alleged mastermind of online lèse-majesté ring. Thai police on February 9 arrested Hasadin Uraipraiwan, the alleged leader of an online network suspected of publishing and distributing anti-monarchy recordings, after a two-week investigation. A police official said authorities had dismantled the network, allegedly the largest engaged in online lèse-majesté. Hasadin is suspected of being sympathetic to the Red Shirts—supporters of ousted prime ministers Thaksin and Yingluck Shinawatra—though police said his online network had no connections to other groups.


Aquino under fire for response to botched Mamasapano raid. President Benigno Aquino is facing intense criticism over his role during and after the botched raid into the rebel-controlled village of Mamasapano in Mindanao on January 25 that left 44 Philippine police dead. The military reiterated its support for Aquino after a February 12 Senate hearing revealed a coup plot to oust him. Many in the police and military have derided Aquino for trying to salvage a peace deal with Moro rebels instead of seeking justice for the slain police. Lawmakers and the public, meanwhile, are questioning how much knowledge Aquino had ahead of the operation, which was greenlighted by his long-time friend, suspended National Police chief Alan Purisima, who resigned on February 6.

Congress indefinitely suspends Bangsamoro law debate. The Philippine House of Representatives has suspended deliberations on the proposed Bangsamoro Basic Law, which would establish an autonomous political unit in Mindanao and cement the peace deal the government reached in early 2013 with the Moro Islamic Liberation Front, though Speaker Feliciano Belmonte Jr. on February 10 insisted the bill is not dead. The committee drafting the bill decided to suspend its work pending the results of investigations by both the House and Senate into the January 25 clash between Moro rebels and police that left 44 Philippine commandos and at 15 rebels and civilians dead.

Court orders freeze on prominent senator’s assets in pork barrel case. The Philippine anticorruption court, or Sandiganbayan, on February 5 froze all bank deposits and properties of detained Senator Bong Revilla pending his trial on plunder and graft for his role in a scam that misused money from the now-defunct Priority Development Assistance Fund. Ombudsman Conchita Carpio Morales on the same day filed charges in the anticorruption court against five former members of the House of Representatives. The ombudsman has also asked the court to freeze the assets of Senator Jinggoy Estrada, who is detained for his role in the plunder and graft scam.

Senate debating emergency powers for Aquino to address electricity crisis. The Philippine Senate committee on energy on February 9 issued its report on a proposed resolution authorizing President Benigno Aquino to tackle an expected energy shortage in Luzon from March 1 to July 31 by asking large electricity consumers to run generators, for which the government will reimburse them, rather than use the power grid. The House of Representatives approved its own version of the bill in late 2014. Once the Senate approves its version, the two will need to be reconciled by a joint committee before receiving final approval.


Vietnam accelerates banking system reforms. Vietnam’s central bank on February 5 announced a takeover of the loss-making Vietnam Construction Bank as part of efforts to accelerate the restructuring of the banking system. Shares in the bank were forcibly acquired and transferred to state-owned Vietcombank. The government’s plan to speed up the privatization of state-owned banks and encourage the merging of weak banks, which was first announced in 2012, has seen little progress.

Vietnam releases two bloggers arrested for criticizing the government. Vietnam released on February 11 and 12 two political bloggers, Hong Le Tho and Nguyen Quang Lap, who had been arrested in December for criticizing the government. The two bloggers remain under investigation. Lap, who is partially paralyzed, was released on medical parole. The United States often criticizes Vietnam for targeting bloggers who exercise their rights to free speech. Reporters without Borders ranked Vietnam 175 out of 180 in its 2014 World Press Freedom Index.

Asian Development Bank lends Vietnam $234 million for policy reform and subway construction. The Asian Development Bank on February 11 announced plans to lend Vietnam $234 million to fund policy reforms that would strengthen the country’s competitiveness and help finance the construction of Hanoi’s subway system. Most of the funds will go to areas prioritized for policy reforms, including state enterprise management and the financial sector. Vietnam has the second-lowest ranking among Southeast Asian countries on the World Economic Forum’s Global Competitiveness Index.

Thai drink companies vie for stake in Vietnam’s largest brewing company. Two Thai drink companies, Thai Beverage and Singha Corp, are seeking to buy a stake in Vietnam’s largest brewer, Sabeco, according to a February 3 Wall Street Journal report. The firms are attracted to Vietnam due to the country’s growing beer consumption amid declining sales in Thailand. The Vietnamese government, which owns 89 percent of Sabeco, previously said it wanted to sell a stake in the brewer but it has not responded to either offer.

Vietnam targets online newspaper after it reports graft allegations. The Ministry of Information and Communications on February 9 revoked the license of the online newspaper The Elderly and the reporting credentials of its editor after it published articles that exposed alleged government corruption. The ministry requested the removal of the editor and ordered an investigation of the paper. The newspaper’s editor, Kim Quoc Hoa, claims to have exposed 2,500 cases of corruption in the newspaper over the past seven years.


U.S., Singapore hold third Strategic Partnership Dialogue. U.S. and Singapore officials on February 13 met in Washington for the third Strategic Partnership Dialogue to review current areas of bilateral cooperation and exchange views on issues of mutual concern. The two sides affirmed their commitment to completing the Trans-Pacific Partnership trade agreement and discussed the renewal and expansion of the Singapore-U.S. Third Country Training Program, which has trained officials from Southeast Asia in various areas of governance. Assistant Secretary of State for East Asian and Pacific Affairs Daniel Russel led the U.S. delegation to the talks.

Prime Minister Lee Hsien Loong undergoes successful prostate cancer surgery. The Singapore government said on February 16 Prime Minister Lee Hsien Loong has undergone successful surgery to treat prostate cancer and is expected to fully recover. Lee will be on medical leave for a week, during which time Deputy Prime Minister Teo Chee Hean will serve in his place.

U.S. Navy punishes three admirals connected to a ship-servicing corruption scandal. The U.S. Navy on February 10 announced it had punished three admirals for ethics violations in connection with the corruption scandal involving Singapore-based contractor Glenn Defense Marine Asia. The admirals improperly accepted gifts in 2006 and 2007 from the company, which supplies U.S. Navy vessels during port visits in Asia. Leonard Francis, a company executive, pleaded guilty to corruption in January and faces up to 25 years in prison.

Singapore tourism suffers first annual decline in visitors since 2009. The Singapore Tourism Board on February 11 reported a 3 percent drop in international visitor arrivals in 2014, due to a stronger Singapore dollar as well as regional factors such as the two accidents involving Malaysia Airlines and the political unrest in Thailand. Singapore relies on tourism for about 4 percent of its economic output.

Hindu Thaipusam arrests and complaints about police conduct raise racial concerns. Singapore on February 7 arrested three men for disorderly behavior during a Hindu religious procession for Thaipusam. Police were called in after a group of people decided to play musical instruments, which are usually banned at religious processions in Singapore. The wife of one of the arrested men claims police assaulted her during the incident. A video clip of the incident spread on social media and raised questions about the strict permit conditions and the treatment of Hindus in Singapore.


CPP central committee adds more than 300 members, including Hun Sen’s sons. The ruling Cambodian People’s Party (CPP) on February 1 appointed 302 new members, including at least 80 security personnel, to its central committee. Prime Minister Hun Sen’s three sons—Hun Manet, Hun Manithk, and Hun Many—were among those appointed. Independent observers view the appointments as a way of further integrating Cambodia’s military into the ruling party’s political apparatus and preparing Hun Sen’s sons to succeed him in power.

Cambodia, Thailand work together on product quality control system. Cambodia’s Ministry of Industry and Handicrafts and Thailand’s Ministry of Industry on February 9 signed an agreement in Phnom Penh to create a National Accreditation System for Cambodian goods. The system will ensure that all Cambodian-made products meet both ASEAN and international standards ahead of the increased integration expected when the ASEAN Economic Community launches at the end of 2015.

Ruling and opposition officials propose restrictions on political speech by NGOs. Deputy Prime Minister Bin Chhin of the ruling Cambodian People’s Party and Kuoy Bunroeun of the opposition Cambodia National Rescue Party have said they are considering measures to ban nongovernmental organizations (NGOs) from making “insulting” statements about political parties during election periods, according to a February 4 Phnom Penh Post article. Nine NGOs spoke out against the proposed measures, saying they would restrict freedom of speech and violate the constitution.


Former health minister replaces Gusmão as prime minister. Former health minister Rui Araujo was sworn in as Timor-Leste’s new prime minister on February 16, replacing Xanana Gusmão, who stepped down 10 days earlier to make room for a younger generation of leaders. Gusmão, 68, had served as either president or prime minister since Timor-Leste gained independence in 2002. He will remain in the cabinet as investment minister. Araujo is a member of the Revolutionary Front for an Independent East Timor, or FRETILIN, previously Timor-Leste’s largest opposition party, and his inauguration establishes a new unity government.

Trans-Pacific Partnership

Senior U.S. lawmakers to visit Japan, Malaysia, and Singapore to discuss trade negotiations. U.S. House Ways and Means Committee chairman Paul Ryan on February 16 led a bipartisan congressional delegation to Japan, Malaysia, and Singapore to discuss the Trans-Pacific Partnership trade agreement. The delegation was scheduled to meet with senior government officials and U.S. and local business leaders during its weeklong trip. Ryan suggested earlier that Japan and Canada should be left out of a final agreement if they do not sufficiently lower import barriers for agricultural goods.

U.S.-Japan talks on sensitive issues progress toward ministerial discussions. Japan’s lead negotiator, Takeo Mori, told a press conference on February 3 that talks between the United States and Japan on agricultural market access and auto trade had progressed to a point where remaining issues would be discussed at the ministerial level. Mori said that at least one more technical-level meeting will be required. Negotiations on beef, pork, and dairy have largely been settled, while rice and wheat remain outstanding items that need to be resolved by ministers.

U.S. lawmakers plan to introduce Trade Promotion Authority bill in late February. Representative Charles Boustany on February 3 said that leaders of the House Ways and Means and Senate Finance committees plan to push for a new Trade Promotion Authority (TPA) bill in the last week of February. TPA is crucial to getting the Trans-Pacific Partnership approved as it limits Congress to a yes or no vote on the final agreement. The timeframe is ambitious because many members of U.S. president Barack Obama’s own Democratic Party do not support the agreement.

South China Sea

Philippines protests Chinese construction at Mischief Reef. The Philippine government on February 10 sent a diplomatic protest to the Chinese Embassy in Manila calling on Beijing to halt reclamation activities at Mischief Reef, which is claimed by the Philippines but was occupied by China in 1995. The Philippine Navy first reported the reclamation activities at the reef a week earlier. Mischief Reef is the seventh feature in the Spratly Islands that China has reportedly begun expanding since late 2013. The Philippines first released photos showing Chinese reclamation work in the Spratlys in June 2014.

Taiwanese government releases details of Chinese ship that carried materials to Itu Aba. Taiwanese officials on February 6 confirmed reports that the government relied on a Chinese state-owned shipper to transport construction materials to Itu Aba, the largest of the Spratly Islands and the only one occupied by Taiwan, on January 24. Taiwanese lawmakers had raised concerns that the decision to use a ship from Shanghai Zhenhua Heavy Industry had threatened national security. But Taiwanese officials insist it was a purely commercial decision and was made only because they were unable to find a ship in Taiwan capable of transporting the materials needed for the $100 million port Taiwan is constructing at Itu Aba.


First APEC 2015 Senior Officials Meeting held in Manila. The Philippines hosted the first major meeting of the 2015 Asia-Pacific Economic Cooperation (APEC) season on February 6–7 with a gathering of senior officials from the 21 member economies. The meeting was intended to set the agenda for higher-level gatherings later in the year. Officials discussed health threats, reducing risks from natural disasters, and improving food security. A minor scandal erupted when the Chinese delegation threatened to walk out after one of the entertainment acts during the event displayed a Taiwanese flag alongside those of the other members.


ADB to give $40 million loan for tourism development. The Lao Ministry of Information, Culture, and Tourism and the Asian Development Bank (ADB) on February 9 launched a stakeholder partnership for “Destination Development and Management.” As part of the partnership, the ADB will provide Laos with a low-interest $40 million loan through 2019 that will be used to improve tourism infrastructure and development of handicrafts in Laos.

Nearly half of Lao children under five are stunted. Deputy Prime Minister Phankham Viphavanh told a February 9 meeting of the National Nutrition Committee that 44 percent of Lao children below age five are stunted, 27 percent are underweight, and another 6 percent are malnourished. Phankham added that the government has approved a budget to improve nutrition for children, targeting remote and rural areas in particular. The government hopes to improve the maternal and children’s health situation to meet the nation’s Millennium Development Goals.


ASEAN military chiefs propose formal dialogue of chiefs of defense forces under ADMM Plus. Military chiefs from ASEAN countries on February 10 suggested during an informal meeting in Kuala Lumpur the establishment of a formal dialogue for the chiefs of defense forces of countries under the Asian Defense Ministers’ Meetings (ADMM) Plus platform. ADMM Plus consists of 10 ASEAN countries and the grouping’s 8 dialogue partners. The military chiefs also discussed ways to increase military cooperation among ASEAN countries by, among other things, transforming bilateral exercises into multilateral drills.

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This year in Thailand-what next?

AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More






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