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Asean Affairs   26 October 2012


U.S., Myanmar officials conduct first human rights dialogue. A U.S. delegation led by Assistant Secretary of State Michael Posner and Deputy Assistant Secretary of Defense Vikram Singh met their Myanmar counterparts October 16–18 in Naypyidaw for the first U.S.-Myanmar human rights dialogue. The dialogue, which is expected to become a regular event, aims to build a channel for the United States to engage Myanmar on human rights issues as bilateral ties progress. U.S. officials stressed that Myanmar needs to release all remaining political prisoners and expressed concern over ongoing fighting with ethnic minorities. U.S. military officials participating in the talks included Lt. Gen. Francis J. Wiercinski, commanding general of the U.S. Army, Pacific.

Thein Sein reelected head of ruling USDP. Myanmar’s ruling Union Solidarity and Development Party (USDP) surprised observers October 16 by reelecting President Thein Sein as party chairman at its first convention since 2011. Lower House speaker and USDP deputy chairman Shwe Mann is expected to take over the day-to-day operations of the party as it prepares for elections in 2015. Many observers had expected Shwe Mann to replace Thein Sein following the party’s poor showing in by-elections earlier this year. The military-backed USDP has about 4 million members nationwide, according to party statistics. It won three quarters of the seats in parliament in the 2010 general election, but captured only 1 seat out of 45 seats in April by-elections.

U.S. to invite Myanmar to observe military exercises. Thailand’s defense ministry on October 19 said Myanmar would be invited to observe the annual U.S.-Thai Cobra Gold joint military exercises in 2013, contingent upon the agreement of participating countries at a meeting in late October. The Pentagon confirmed an invitation could be forthcoming "as long as it is consistent with U.S. efforts to advance protection of human rights, civilian rule of the military, anti-corruption efforts, and other reform issues." Singapore, Japan, South Korea, Indonesia, and Malaysia are expected to participate in next year’s exercise, along with 13 observer nations.

International partners speed up economic engagement with Myanmar. International partners in October took steps to offer increased support to Myanmar as it continues to open its economy. South Korean president Lee Myung-bak and Myanmar president Thein Sein agreed October 9 to launch negotiations for an investment guarantee agreement that will accelerate economic cooperation between their countries. Japan announced October 11 it will forgive more than half of Myanmar’s bilateral debt and offer a loan to clear its arrears with the Asia Development Bank and the World Bank, allowing Myanmar to resume borrowing from those institutions by January. The United States weighed in October 13, restating its support for Myanmar to fully restore relations with global lenders.

Myanmar will not allow OIC liaison office. President Thein Sein’s office announced October 16 that it will not allow the Organization of Islamic Cooperation (OIC) to set up a liaison office in western Rakhine state. Myanmar last month agreed to the OIC’s request to open an office to provide aid to Rohingya Muslims displaced by sectarian violence since June. The government withdrew its position after Buddhist monks and supporters staged protests across the country opposing the OIC presence.

Myanmar moves closer to passing foreign investment law. A parliamentary joint committee October 22 submitted a new draft of Myanmar’s long-delayed foreign investment law to the parliament for final approval. The parliament previously passed the law in early September, but that draft was sent back by President Thein Sein with suggestions to make it more investor-friendly. The committee followed some of the president’s recommendations, including allowing foreign investment of up to 50 percent in companies in restricted sectors. But it rejected others, such as a proposal to grant skilled foreign workers higher wages and benefits than their Myanmar counterparts. Thein Sein said during his first ever press conference October 21 that he expects the law to be passed “within days.”

Government, Moro rebels sign historic peace deal. Representatives of the Moro Islamic Liberation Front (MILF) traveled to Manila October 15 to ratify a groundbreaking framework peace agreement with the government. The agreement establishes an autonomous political entity called Bangsamoro on the southern Philippine island of Mindanao in exchange for the MILF laying down its arms. Negotiations on details for a final peace pact, including power and revenue sharing agreements, will begin in November in Malaysia. The MILF, a splinter group of the older Moro National Liberation Front, has waged a guerilla war for independence since 1978.

Subic Bay to play pivotal role in U.S. military rebalancing. U.S. and Philippine officials during joint military exercises October 8–18 announced that Subic Bay, a former U.S. military base 50 miles northeast of Manila, will reopen as a major hub for U.S. military operations in the Asia Pacific region. Subic Bay will house a range of U.S. Pacific Fleet naval assets on a semipermanent basis. The U.S. strategic rebalancing toward the Asia Pacific requires access to deepwater ports like Subic Bay to dock ships and submarines.

House approves $48.2 billion budget for 2013. The Philippines’ House of Representatives October 15 passed the 2013 government budget. The proposed budget includes increased funding for poverty-reduction programs and infrastructure development, moves that financial forecasters highlight as pivotal for attracting greater foreign investment. The proposed budget quickly drew criticism from opponents who claim the administration of President Benigno Aquino will exploit its control over the allocation of money to influence the country’s 2013 legislative elections.
Philippines proposes strategic partnership with Australia. President Benigno Aquino on October 15 said the Philippines is seeking to negotiate a strategic partnership with Australia. If Australia agrees to the offer, it would be the Philippines’ third strategic partnership after similar ones with the United States and Japan. Aquino cited the shared values and interests between Australia and the Philippines and highlighted already functioning peer-to-peer military programs. Aquino is set to visit Australia October 24–26 for high-level meetings with business leaders, government officials, and policy experts.

Philippines, China vow to double trade and boost tourism. A delegation of Chinese officials arrived in Manila October 19 for a series of meetings aimed at “normalizing” relations following months of tensions over disputes in the South China Sea. Chinese and Philippine officials set a goal of doubling bilateral trade to $60 billion and increasing two-way tourism arrivals to 2 million by 2016.

Party Central Committee concludes sixth plenum, promises reforms. The central committee of the Vietnamese Communist Party on October 15 concluded its unusually long sixth plenum in Hanoi, surprising many Vietnamese and foreign observers by not disciplining Prime Minister Nguyen Tan Dung. Secretary General Nguyen Phu Trong said in a televised speech that the party would undertake further economic reforms and promised to restructure state-owned enterprises (SOEs) and the banking system. Prime Minister Dung reportedly faced widespread criticism during the plenum for the country’s poor economic performance and his failure to rein in corrupt interest groups. The majority of central committee members reportedly voted in support of Dung, but he is believed to have lost substantial personal power.

National Assembly meets amid growing economic difficulties; Dung apologizes. Vietnam’s National Assembly began a month-long session October 22 that will see its deputies tackle the country’s political and economic troubles. Prime Minister Nguyen Tan Dung apologized during the opening session for what he called the government’s weak management of the economy, especially in the supervision of state-owned enterprises.

Lawmakers during this session will assess the implementation of the current year’s socioeconomic plans, discuss goals for 2013, review draft revisions to the 1992 Constitution, and ratify a resolution on votes of confidence for government officials elected or approved by the assembly.
Central bank governor declares war on interest groups. The governor of Vietnam’s central bank, Nguyen Van Binh, vowed October 8 to crack down on small groups of powerful shareholders that have been exploiting Vietnamese lending institutions for their own benefit. He acknowledged that

Vietnam’s present institutions and regulations have not kept pace over the last two decades with the country’s rapidly changing financial landscape. The central government has tasked Binh with taking measures to clean up bad debt in the banking system within the next year.

Vietnam allocates $1.3 billion to assist areas of extreme poverty, ethnic minorities. Vietnam’s Ministry of Labor on October 17 announced the allocation of $1.3 billion for poverty reduction efforts from 2012 to 2015 in ethnic minority areas and regions with extreme poverty. The program is part of the national plan to achieve the UN Millennium Development Goals (MDGs). UN officials say the country’s progress in achieving MDGs in ethnic minority areas is much slower than the national average.

Indonesia, India seek increased defense cooperation. Indonesian defense minister Purnomo Yusgiantoro and his Indian counterpart, Shri Antony, October 16 concluded the first-ever ministerial-level defense dialogue between Indonesia and India. The meeting did not result in any truly significant deliverables, but did signify a growing defense relationship between the two countries at a time when Indonesia is seeking to build a self-sufficient domestic defense industry and India’s interest in engaging Southeast Asia is on the rise. Military cooperation between the two has steadily increased since the signing of a strategic partnership agreement in 2005.

Abbot, Yudhoyono avoid “tow-back” issue during meeting. President Susilo Bambang Yudhoyono and Australian opposition leader Tony Abbot met October 15 to discuss cooperation on people smuggling, but avoided Australia’s controversial “tow-back” policy regarding asylum seekers. Australia’s official policy is to send asylum-seeker boats that originate in Indonesia back to the archipelago, which Indonesia opposes. Australian prime minister Julia Gillard heavily criticized Abbot on his return for failing to raise the issue.

Indonesia to reintroduce Pancasila classes. The Indonesian government will reinstate mandatory elementary school courses in Pancasila, the state ideology, in the 2013–14 academic year, according to a revised curriculum released September 27. The move comes in response to a series of ethnically and religiously motivated fatal brawls in high schools and universities. Pancasila teaches national unity and belief in an unspecified God. The new curriculum also removes English, science, and social studies from elementary schools, which critics have decried as a major setback for Indonesia’s competitiveness.

Indonesia calls for stable oil prices at Asian Cooperation Dialogue. Indonesia’s economic coordinating minister, Hatta Rajasa, spoke at the Asian Cooperation Dialogue (ACD) summit October 17 in Kuwait, emphasizing the importance of energy, the environment, and stable oil prices for eradicating poverty in Asia. Hatta also proposed an ACD Energy Action Plan to enhance regional energy connectivity and develop renewable energy technology. Kuwaiti officials in a separate meeting expressed interest in investing in Indonesia’s East Natuna gas project. Thailand will host the next ACD in 2015.

Rothschild formally resigns from Bumi Plc. British financier Nat Rothschild resigned October 15 from the board of mining giant Bumi Plc after it decided to consider a proposal from Indonesia’s Bakrie Group to purchase Bumi’s Indonesian assets in exchange for $1.2 billion in cash and the cancellation of Bakrie’s stake in Bumi. The Bakrie Group, along with Rothschild, helped found Bumi Plc in 2011. It controls Indonesia-based Bumi Resources, which is being investigated for “financial irregularities.” Bumi Plc’s board announced after Rothschild’s resignation that it would not consider the Bakrie’s proposal until the investigation into Bumi Resources is complete.

Thai government announces 3G auction winners. Thailand’s National Broadcasting and Telecommunications Commission (NBTC) October 19 announced the three winners of 15-year licenses to operate long-overdue 3G services in the country. The winners were Thailand’s top three telecommunications companies: Advanced Info Service’s Advanced Wireless Network, Total Access Communication’s DTAC Network, and True Corp’s Real Future. Media activists criticized the auction and are pursuing legal action against the NBTC for alleged collusion between officials and corporate leaders and failure to guarantee competitive prices for 3G services. An auction for 4G operation licenses is planned for 2013.

Bank of Thailand surprises market with rate cut. The Bank of Thailand cut policy interest rates October 17 by a quarter of a percentage point, a move that surprised market watchers and raised suspicions of government pressure to cut rates in order to stimulate the economy. Thailand’s economy is suffering from slowing economic growth due to decreasing demand for exports from China and the European Union and a winding down of rebuilding projects following devastating floods in late 2011. The Financial Times reported that economists expect another quarter-point rate cut in the near future.

Thaksin embroiled in new legal disputes. Thailand’s Supreme Court issued an arrest warrant October 10 for former prime minister Thaksin Shinawatra on charges related to malfeasance involving loans from state-owned Krung Thai Bank. All 26 defendants in the case except Thaksin, who remains abroad, appeared before the court to deny the charges. Separately, Thai media reported October 16 that the former prime minister will file a defamation lawsuit against key members of the opposition Democrat Party. Democrat leaders have accused Thaksin of instigating the 2010 political violence that wracked Bangkok and pulling the strings behind the infamous “black shirts,” irregular security forces blamed for some of the worst violence.

Thailand beefs up air surveillance capability with long-range radar system. Lockheed Martin reported October 16 that the Royal Thai Air Force activated its first TPS-77 radar system produced by the U.S.-based manufacturer. The TPS-77 is a ground-based air surveillance system that Lockheed describes as “specializing in early warning, situational awareness, and ballistic and tactical missile surveillance and defense.” Thailand expects to use the system to provide greater security and safety over the Gulf of Thailand. The equipment is the 34th long-range radar system in the Asia Pacific.

Malaysia, Philippines agree to scale up partnerships. Prime Minister Najib Razak and his Philippine counterpart, Benigno Aquino, issued a joint statement October 15 calling for greater economic and tourism cooperation between the two countries. The leaders singled out the 2013 Philippines–Malaysia Joint Commission Meeting in Malaysia as an ideal venue to pursue increased cooperation. Relations between the two countries received a boost with the recent signing of a framework peace accord between the Philippine government and the Moro Islamic Liberation Front, which was facilitated by and brokered in Malaysia.

Malaysia, Indonesia eye joint body to prop up palm oil prices. Indonesian trade minister Gita Wirjawan said on October 9 that Malaysia and Indonesia have entered discussions to form a joint body to drive up falling palm oil prices. Gita compared the body to the two countries’ existing cooperation in the rubber industry. No decisions on means of boosting prices have been made, but ideas include limiting plantation expansion and boosting the use of palm oil in industry and biofuels. Malaysia and Indonesia together account for about 90 percent of global palm oil supplies.

Malaysian Court rejects challenge to cross-dressing ban. Four transsexual Malaysians October 11 lost a legal challenge to a law barring Muslim men from dressing as women. A Malaysian court ruled that the men must adhere to the current law because they are Muslim and were born male. The law does not apply to non-Muslims. The four challenged the law’s constitutionality after being repeatedly arrested for dressing as women.

Theirs was the first challenge before a secular court of Malaysia’s ban on cross-dressing.

King Sihanouk’s remains returned to Phnom Penh. Prime Minister Hun Sen and King Norodom Sihamoni on October 17 escorted the remains of former king Norodom Sihanouk to Phnom Penh. Sihanouk, 89, died October 15 in Beijing after suffering a heart attack. He will be remembered as the father of Cambodia’s independence and a key political leader for more than six decades. Sihanouk will be cremated according to Cambodian and Buddhist tradition and his ashes placed in a stupa at the Royal Palace. The official national mourning period ended October 22.

Cambodia loses bid for Asia-Pacific seat on UN Security Council. Cambodia lost its bid October 18 for a two-year no-permanent seat on the UN Security Council. Members of the UN General Assembly instead elected South Korea to replace India in 2013 as a representative to the council from the Group of Asia and the Pacific Small Island Developing States. South Korea beat Cambodia in the second round of voting, 149 to 43, with many observers crediting worries over Cambodia’s human rights record.

Legislature approves ruling party nominees to election commission. Cambodia’s National Assembly October 11 unanimously approved the appointment of two new leaders and seven new members of the National Election Commission. All nine are members of the ruling Cambodian People’s Party (CPP). Twenty-six opposition lawmakers boycotted the vote, claiming political bias toward the CPP. Members of the opposition, rights monitors, and election watchdogs are calling for a reshuffle of the commission, saying that its current makeup will compromise the outcome of Cambodia’s 2013 national elections.

Cambodian government threatens U.S.-funded radio stations with legal action. Cambodian government officials October 10 threatened U.S.-funded radio stations Voice of America and Radio Free Asia with unspecified legal action during a closed-door meeting with journalists from the stations to discuss matters of cooperation. Officials accused the stations, which broadcast locally in Khmer, of being anti-Cambodian and favoring opposition parties, according to reports by Reuters. A statement from VOA said the stations value free speech and freedom of the press and will continue providing “objective and newsworthy material to the Cambodian public.”

U.S., Cambodian navies begin joint exercise. The U.S. and Cambodian navies October 22 kicked off their third annual joint military exercises, called Combat Afloat Readiness and Training (CARAT). Approximately 500 U.S. and 300 Cambodian personnel will engage in five days of operational and tactical simulations in Sihanoukville, Cambodia, to enhance maritime security skills. The U.S. Pacific Fleet engages in annual bilateral CARAT exercises with eight countries in Southeast Asia to promote cooperation and trust between forces. U.S. personnel also engage in community service projects during the exercises.

Singapore combats tax haven image with tougher rules. Singapore struck a deal October 14 with Germany to help Berlin detect potential tax evaders residing in the city-state. The move followed an announcement the previous week by the Monetary Authority of Singapore that tax crimes would be reclassified as money laundering offences. The deal suggests that Singapore is trying to comply with global standards on tax dodging.

The city-state is increasingly concerned that foreign nationals are using its financial centers to hide wealth from authorities abroad.

Singapore’s exports drop sharply in September. Singapore’s exports unexpectedly fell in September for the second consecutive month due to weak Western markets and China’s economic slowdown. Exports were down 3.4 percent compared to the same time last year. The drop suggests that Singapore’s GDP in the third quarter will be lower than projected. The Monetary Authority of Singapore meanwhile has announced plans to slow the appreciation of the Singapore dollar, which hurts the competitiveness of exports.

Singapore passes personal data protection bill. Singapore’s parliament October 15 passed a personal data protection bill in an effort to prevent the misuse of personal data. The law seeks to give individuals more control over their personal data by requiring that they give consent and be informed of the purposes of any collection, use, or disclosure of their personal information. The law also provides for a national do-not-call registry to be created by early 2014. Singaporean companies and organizations will be banned from calling or sending messages to any Singapore number on the registry.

South China Sea
U.S. carrier visits South China Sea. The U.S. aircraft carrier USS George Washington arrived in the disputed waters of the South China Sea off the coast of Vietnam October 20, where it welcomed Vietnamese security and government officials aboard and conducted live ammunition exercises.

The carrier, based in Yokosuka, Japan, has been cruising through Southeast Asia during October, including for joint exercises October 7–11 with the Malaysian navy and air force.

China prepares to bring tourists to Paracel Islands. China will start planned tourist trips to the disputed Paracel Islands by the end of October, according to a report in the Guangzhou Daily. The paper said that four-day tours to Woody Island, which houses China’s recently established Sansha city, will likely cost around $800. Illegal agents have already begun escorting tourists to the Paracels via fishing boats, charging nearly $1,250 for a weeklong trip. Vietnam has protested these actions, maintaining that China is encroaching on Vietnamese territory in the Paracels.

Timor-Leste considers nullifying oil agreement with Australia. Radio Australia, citing Timorese reports, revealed October 15 that Timor-Leste may walk away from its agreement with Australian oil and gas company Woodside Petroleum. Timorese and Woodside officials entered into agreement roughly a decade ago to exploit natural gas in the Timor Sea, but disagree over how to extract and develop it. Woodside prefers to use a floating natural gas plant, while Timor-Leste has lobbied for a more expensive onshore plant, which it argues would produce more jobs and spur economic development.

Former president Ramos-Horta appeals to Australia for public health support. Former president José Ramos-Horta called on Australia October 11 to provide more support to eliminate parasitic diseases in Timor-Leste. More than half of all Timorese children suffer from such diseases as intestinal worms and elephantiasis. The University of Sydney is involved in a joint program with Timorese health officials to eradicate the ailments, but Ramos-Horta claimed that increased aid could stamp out the epidemic within five years.

Thailand joins ASEAN Exchange link. Thailand October 15 became the third ASEAN member to join the ASEAN Exchange, which Malaysia and Singapore launched in September. The exchange joins the stock markets of Thailand, Malaysia, and Singapore, which account for nearly 70 per cent of the total market capitalization of ASEAN. Indonesia, Vietnam, and the Philippines are expected to follow suit. The exchange seeks to create a single Southeast Asian trading platform and create more investment opportunities across the region.

Former UK prime minister Tony Blair visits Vientiane; UK to open embassy in Laos. Former UK prime minister Tony Blair met with Lao prime minister Thongsing Thammavong October 15 to discuss strengthening bilateral relations between the two countries. Lao officials briefed Blair on preparations for the Asia-Europe Meeting Summit, which will take place November 5–6 in Vientiane. The British Embassy to Laos, currently based in Bangkok, is expected to officially move to Vientiane during the summit. Laos also plans to open an embassy in London in the near future.

Laos assumes control after China withdraws from high-speed rail project. The Lao National Assembly on October 18 approved the unilateral implementation of a high-speed rail project connecting Vientiane to China’s Yunnan province after a Chinese construction company withdrew from the venture. The EXIM Bank of China will finance construction of the 261-mile, $7 billion railway, which Lao government officials say is vital to the country’s development. Local villagers have voiced concerns over just compensation for relocating to make way for the ambitious project.

Mekong River
Vietnam, Thailand boost infrastructure investment in Mekong region. The governments of Vietnam and Thailand both recently announced their intentions to boost investment in the Mekong Delta. Vietnam’s state-owned Cuu Long Transport Infrastructure Management, Investment, and Development Corporation submitted a proposal to the country’s Transport Ministry for a $938 million traffic infrastructure project, according to an October 16 Tuoi Tre News report. The project aims to boost development via subprojects in six of Vietnam’s Mekong Delta provinces. Thailand announced October 5 that it too is preparing to boost investment via unspecified infrastructure and water management projects.

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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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