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ASEAN ANALYSIS  28 July 2010

China is buying into Asean

By David Swartzentruber
AseanAffairs   28 July 2010

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Two recent news items underlined China’s growing influence in Southeast Asia-Asean countries, beyond the reactionary puppet states of Myanmar and North Korea that it has propped up for years.

Basically, the Chinese are doing it with money-infrastructure investment.

Thailand’s SRT, State Railway Transport, (SRT) is government-owned and has been a loss leader for the Thai government, practically since it came into existence.

The main reason it is still around is that it does provide low-cost travel for the country’s citizens, especially those wishing to return home for a holiday.

In the last few years, Japan, has been a major investor and supporter in infrastructure, especially with Bangkok’s subway system, which kicked off in 2004 and is looking to expand. It’s pitifully small for a city of 10 million.

Now, China is moving in with a proposal to finance a high-speed railway between Bangkok and Rayong through the country’s Eastern Seaboard, which is home to many manufacturing operations. If the deal goes through the much-needed line will be up and running by 2013 and would boost the profits of the SRT.

Next door in Cambodia the port facilities of Phnom Penh are set to expand four times by securing US$68 million in financing from the Chinese.

The Chinese investments focus on the issue that there is quite a contest in the region between the United State and China for influence in the region.

With its geographic proximity to these countries, China has and will continue to play a significant role.

Already in Laos, alarm has been raised about the “Chinazation” of villages near the infrastructure developments that the Chinese government has funded.

Do these rumblings portend similar migrations of Chinese into other Asean countries where China has made major investments.

Watch these developments closely as well as the US response to them.

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