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The Biweekly Update
Government enacts long-awaited fuel subsidy cuts. Fuel prices in Indonesia increased by over 40 percent on June 21 following a vote by the country’s House of Representatives four days earlier to slash massive fuel subsidies. The price of subsidized gasoline rose from about $0.12 to $0.17 per gallon, and subsidized diesel from about $0.12 to $0.15 per gallon. Minor protests have erupted in Jakarta and other cities over the subsidy cuts, which labor groups say will spark inflation and hurt the poor. The central government on June 22 initiated a cash transfer program to the country’s poorest families in an attempt to offset the effects of rising prices.
Smog from illegal forest clearing chokes Singapore and Malaysia. Smog from intentional forest-clearing fires in Indonesia has wreaked havoc on air quality and disrupted daily life in Singapore and Malaysia. Authorities in both countries closed some schools and workplaces and cautioned citizens to stay indoors. While forest fires in Indonesia often affect its two neighbors, pollution in Singapore has hit unprecedented levels. The pollution standards index in Singapore hit 371 on June 20, well above hazardous levels and a record high for the country.
Corruption commission detains Riau governor. The Corruption Eradication Commission (KPK) detained Riau governor and Golkar Party central executive board member Rusli Zainal on June 14. Rusli faces a 20-day detention for his alleged role in several corruption cases, including a forestry permit graft scheme and bribery of legislatures to increase the budget for the Riau venue of the 2012 National Games. The long-expected detention comes after the KPK’s repeated questioning of Rusli for his involvement in the schemes. Riau is the Indonesian province with the worst forest fires, causing much of the smog over Malaysia and Singapore.
Mob in Papua burns down police station. A mob destroyed a police station in the Papua town of Oksibil on June 16, injuring two police officers and two soldiers. The incident occurred after a police officer reportedly beat a local man who was intoxicated and was causing a disturbance. A Papua police spokesman denied the officer had committed any wrongdoing. Police on June 19 arrested 14 people in connection with the attacks.
U.S. report criticizes religious minority persecution; last synagogue in Java demolished. The United States released an annual report on June 18 that found Indonesia is not adequately addressing the persecution of religious minorities. The report criticizes the Indonesian government for failing to prevent attacks on minorities or prosecute those responsible. The report comes after extremists in May demolished Surabaya’s Beth Shalom synagogue, the last synagogue in Java. Only one synagogue, located in North Sulawesi, remains in Indonesia.
Buddhist leaders conference rejects interfaith marriage ban, calls for peace. Buddhist religious leaders rejected a proposed law prohibiting marriage between Muslim men and Buddhist women in Myanmar following a June 13–14 conference in Yangon. Wirathu, a monk and leader of the “969 movement”—a reference to Buddhist tenets—thought to be behind much of the anti-Muslim violence that has erupted throughout Myanmar since 2012, proposed the law at the opening ceremony of the event. Organizers released a statement at the conference’s conclusion calling for interfaith peace, and law and order.
ILO lifts ban on Myanmar. The International Labor Organization (ILO) voted at its annual conference in Geneva on June 12 to lift decades-old membership restrictions on Myanmar. The decision follows the government’s progress on trade union legislation and a pledge to end forced labor by 2015. It came just before opposition leader Aung San Suu Kyi arrived in Geneva. The ban’s removal paves the way for Myanmar to join the ILO. Meanwhile, the European Union earlier in June voted to readmit Myanmar to its generalized system of preferences, allowing it to benefit from lower duties on exports to the EU.
Karenni joint monitoring committee established; government plans major conference with ethnic groups. Representatives from the Karenni National Progressive Party and the Myanmar government agreed at the conclusion of peace talks on June 20 to form a joint monitoring committee to watch over ongoing peace agreements. The two sides also agreed to work toward a nationwide cease-fire accord. The Myanmar government plans to hold a major conference with ethnic groups in July in hopes of reaching such an accord, according to a June 20 report by the Irrawaddy.
Shwe Mann, parliamentary delegation visit the United States. Lower House speaker and head of the ruling Union Solidary and Development Party Shwe Mann and several members of the Myanmar parliament visited the United States in mid-June. The delegation, invited by U.S. House of Representatives speaker John Boehner, met with members of Congress, the State Department, the business community, and civil society groups. During a speech at a Washington think tank, Shwe Mann called for Myanmar to work toward an “inclusive society.” The nine-day trip was Myanmar’s first official parliamentary visit to the United States since a civilian government assumed power in March 2011.
Firms submit bids for oil and gas blocks as United States signs transparency agreement with Myanmar. Exxon Mobil, Woodside Petroleum of Australia, and Oil India were among 59 pre-approved firms to submit letters of intent to explore for oil and gas in 30 blocks off the coast of Myanmar ahead of a June 14 deadline. The same day, the U.S. State Department announced it had formed a partnership with Myanmar to support implementation of the Extractive Industries Transparency Initiative, an international standard to promote accountability in the mining and hydrocarbon sectors. Myanmar’s proven natural gas reserves are estimated to be worth $75 billion.
Opposition holds rally despite police warnings. Opposition leader Anwar Ibrahim led thousands of supporters in a rally on June 22 in Kuala Lumpur dubbed “Black 505” to protest accusations of fraud during Malaysia’s closely contested May 5 national elections. The rally went forward despite city officials’ refusal to grant a permit and police warnings that action would be taken if it was held. Turnout was far below the 100,000 that some organizers predicted, with observers blaming both choking haze from fires in neighboring Indonesia and waning commitment after nearly two months of protests.
Sovereign wealth fund plans $1 billion IPO. Sovereign wealth fund 1Malaysia Development Bhd plans to raise about $1 billion in a 2014 initial public offering (IPO) of its power plant assets, according to a June 17 Wall Street Journal report. The IPO will be the latest in a number of share sales by Malaysian companies that had put planned listings on hold due to uncertainty over the country’s May 5 general elections. The opposition Pakatan Rakyat coalition criticized 1Malaysia's operations during the lead-up to the elections and promised to close the fund if elected.
Petronas to invest $16 billion in Canadian natural gas facility. Malaysia’s state-owned oil giant Petronas announced on June 11 that it plans to invest up to $16 billion in two liquefied natural gas (LNG) plants on Lelu Island in British Columbia, Canada. The LNG project will capitalize on growing demand in Asia by selling to Japan Petroleum Exploration Co. The project will include a more-than-650-mile pipeline to be built by TransCanada at an estimated cost of $5 billion.
UMNO senior leaders urge no contest for top posts. United Malays National Organization (UMNO) secretary-general Tengku Adnan on June 16 urged party members not to contest the posts of party president and deputy president currently held by Prime Minister Najib Razak and Deputy Prime Minister Muhyiddin Yassin, respectively, during party elections expected in the fall. Former prime minister Mahathir Mohamad voiced his support for the decision on June 17. Many have predicted a challenge to Najib following the ruling coalition’s poor showing in the May 5 national elections.
U.S. littoral combat ship takes part in joint exercises. The USS Freedom, the first of four U.S. littoral combat ships to be deployed to Singapore on a rotational basis, took part in the annual U.S.-Malaysia Cooperation Afloat Readiness and Training (CARAT) exercises in Kuantan, Malaysia, from June 15 to 23. CARAT Malaysia was the first of several maritime exercises the ship is to conduct with the U.S. Seventh Fleet and regional partners during its maiden deployment to Southeast Asia.
Thailand slashes rice subsidy price by 20 percent. Prime Minister Yingluck Shinawatra’s government agreed on June 19 to cut the prices it pays farmers for subsidized rice by 20 percent to $386 per metric ton. Yingluck pledged during the 2011 election campaign to buy unlimited quantities of rice for as much as 50 percent above the market price. Those subsidies have cost the government $4.4 billion and significantly inflated the price of Thai rice. The subsidy cut is expected to bring down prices, but not enough to make Thai rice exports competitive with those from India and Vietnam.
Rebels place conditions on Ramadan cease-fire. The southern insurgent group Barisan Revolusi Nasional (BRN) released a YouTube video on June 24 laying out conditions for a previously agreed-upon cease-fire, including the complete withdrawal of government troops and police. Thai officials and BRN representatives had agreed to reduce violence during the Muslim holy month of Ramadan when they met in Kuala Lumpur on June 13. Both sides also agreed to continue negotiations after Ramadan, which runs from July 8 to August 7. Critics have suggested that BRN issued conditions Bangkok would not accept because it cannot force other insurgent groups to honor a cease-fire.
Bank of Thailand concerned about rising household debt. The Bank of Thailand has expressed concerns about rising household debt, which reached the level of 78 percent of the country’s gross domestic product in 2012. The government has introduced programs in recent years to encourage consumer spending, including tax rebates to first-time home and car buyers, that have led to increased consumer borrowing. The Bank of Thailand is reaching out to commercial banks to curtail personal loan advertisements and to promote financial responsibility in an effort to mitigate the problem.
Villagers protest Rohingya refugee camp. Villagers in southern Thailand are protesting the planned construction of a temporary campsite in their neighborhood for Rohingya refugees from Myanmar. The villagers have expressed fears over their communities’ safety and potential diseases from the refugees due to the proposed site’s proximity to local schools and homes. Deputy Interior Minister Pracha Prasopdee visited the site on June 21 to meet with protestors and ease their concerns. The Rohingya refugees, who fled neighboring Myanmar following the outbreak of anti-Muslim violence in May 2012, are camped in southern Thailand as the government searches for a third country to take them in.
Philippines destroys five tons of illegal ivory. Department of Environment and Natural Resources (DENR) secretary Ramon Paje announced on June 21 that the Philippines has started destroying five and a half tons of ivory, mainly elephant tusks, smuggled into the country from Africa and seized by authorities between 1996 and 2009. The World Wildlife Fund estimates the total cost of the ivory being destroyed at $10 million, though DENR says it is worth only about $2.2 million because it is not premium quality. The Philippines is the first country in Asia to publicly destroy a stockpile of smuggled ivory, according to Paje.
Manila, Taipei agree to avoid force in fishing disputes. Taiwan’s Foreign Ministry on June 16 said that Taipei and Manila have agreed not to use force in fishing disputes between the two countries. Officials reached the agreement on June 14 following their first preparatory meeting on fishery cooperation in Manila. The Philippines and Taiwan agreed to share maritime law enforcement procedures and establish means of effective notification whenever actions are taken against vessels of the other party. The Philippines and Taiwan have been seeking to reduce tensions since the May 9 killing of a Taiwanese fisherman by the Philippine coast guard.
Philippines seeks to procure missile systems from Israel. Communications Secretary Ricky Carandang confirmed on June 15 that the Philippines will be procuring surface-to-air missiles and multiple-launch rocket systems from two Israeli defense contractors. A report from the Manila Standard identified the firms as Rafael Advanced Defense Systems Ltd. and Israel Military Industries Ltd. The paper reported that Defense Secretary Voltaire Gazmin is rumored to be heading to Israel in late June to sign the agreement. The systems could be shipped to the Philippines within three to six months once an agreement is signed.
Two bloggers arrested in a month. Police in Vietnam arrested one of the country’s most prominent bloggers, Pham Viet Dao, on June 14 for “abusing democratic freedoms,” according to the Ministry of Public Security’s Web site. Dinh Nhat Uy was arrested two days later for posting “slanderous and erroneous” reports online. Uy’s brother, Dinh Nguyen Kha, who was arrested in October 2012, was sentenced to eight years in prison on May 10 for “spreading propaganda.” Authorities have convicted 46 bloggers and activists so far in 2013, significantly more than in 2012.
President Sang visits Beijing, pledges cooperation with China. President Truong Tan Sang paid an official three-day visit to Beijing on June 19–21 for talks with Chinese president Xi Jinping. The two leaders pledged to pursue cooperative measures in settling territorial disputes, agreed to comprehensively implement the 2002 Declaration on the Conduct of Parties in the South China Sea, and extended until 2016 an agreement on joint exploration for oil and gas in the Gulf of Tonkin. They also agreed that their countries will take necessary measures to maintain stable growth in bilateral trade.
More petroleum distributors join Vietnamese market. The Ministry of Industry and Trade on June 17 awarded four private businesses and joint stock companies the licenses required to operate as petroleum distributors in Vietnam. Just six distributors account for 90 percent of market share in Vietnam, but the entry of new companies could lead to a more competitive domestic petroleum market. Vietnam now has a total of 17 petroleum distributors.
Anticorruption curriculum to be taught in schools. Prime Minister Nguyen Tan Dung on June 17 issued a directive ordering the government to develop an anticorruption curriculum to be taught in high schools, colleges, and universities beginning in the 2013–2014 academic year. The Ministry of Education and Training has been tasked with guiding schools in the introduction of the new curriculum. The government inspectorate has been told to compile documents on corruption prevention and to update its Web site with corruption cases in Vietnam and abroad. It is also responsible for monitoring the implementation of the new curriculum.
John Kerry to attend first ASEAN Regional Forum on July 2. Secretary of State John Kerry began a multination trip on June 21 that will include stops in the Middle East and India before wrapping up with his first appearance at the ASEAN Regional Forum (ARF) on July 2 in Brunei. ASEAN foreign ministers will convene for the ASEAN Ministerial Meeting on June 29–July 1, followed by the ARF, which involves 27 countries and the European Union. Officials are expected to discuss ASEAN economic integration, sovereignty disputes in the South China Sea, and North Korea’s nuclear program.
Singapore, Malaysia lead ASEAN in Global Peace Index. The Institute for Economics and Peace’s 2013 Global Peace Index (GPI), released on June 11, showed mixed results for ASEAN member states. The GPI measures internal and external peace in 162 countries according to 22 indicators. Singapore and Malaysia ranked among the most peaceful countries in the world, placing 26th and 29th respectively. The Philippines (129th), Thailand (130th), and Myanmar (140th) ranked among the least peaceful. The report found that, overall, the world has become 5 percent less peaceful since 2008.
ASEAN less protectionist than developed nations. ASEAN members implemented significantly fewer protectionist measures between June 2012 and May 2013 than their counterparts in the European Union and the Group of Eight (G8), according to the Centre for Economic Policy Research’s Global Trade Alert (GTA). The GTA provides real-time information on measures taken during the global economic crisis that discriminate against foreign commerce. ASEAN implemented 136 protectionist measures, compared to the European Union’s 375 and the G8’s 548. Indonesia, with 71 measures, was more protectionist than all other ASEAN countries combined.
Trafficking in Persons report shows minimal changes in ASEAN. The U.S. State Department’s 2013 Trafficking in Persons (TIP) report, released on June 19, shows minimal changes for ASEAN members since 2012. The TIP ranks countries in four categories based on their efforts to combat trafficking, with the best ranking in Tier 1 and the worst in Tier 3. No ASEAN member ranked in Tier 1. Most were placed in Tier 2, with Myanmar, Thailand, Malaysia, and Cambodia on the Tier 2 Watch List, meaning their anti-trafficking efforts are insufficient and they risk being downgraded next year if they do not improve. Cambodia, which moved down from Tier 2, was the only ASEAN member whose rank changed from 2012.
South China Sea
New judge appointed for Philippines-China case. The Philippine Foreign Ministry announced on June 25 that Shunji Yanai, president of the International Tribunal of the Law of the Sea, has appointed Ghanaian judge Thomas Mensah to lead the five-member tribunal that is hearing Manila’s case against Beijing’s claims in the South China Sea. Mensah replaces Sri Lankan judge Chris Pinto, who resigned from the tribunal on May 6 to avoid a conflict of interest because his wife is a Philippine national.
WWF report says South China Sea among waterways with highest incidence of shipping accidents. A new report released by World Wildlife Fund (WWF) on June 7, entitled Accidents at Sea, identifies the South China Sea as among the world’s most dangerous waters for shipping accidents. There have been 293 shipping accidents in the South China Sea and East Indies, home to 76 percent of the world’s coral species, since 1999, the most for any body of water in that period. WWF blames the volume of accidents in the disputed waters on the region’s large number of tramp steamers, older vessels, and unregulated flags of convenience.
Philippines deploys marines to Second Thomas Shoal. Philippine defense secretary Voltaire Gazmin said on June 19 that Manila has deployed a new contingent of marines to Second Thomas Shoal in the Spratly Islands. The feature has been occupied by Philippine forces since 1999. A Chinese warship and a surveillance vessel appeared near the disputed shoal on May 25 and Chinese ships have remained in the area since, sparking diplomatic protests by Manila. Gazmin said he discussed the marine deployment with Chinese ambassador Ma Keqing to avoid a confrontation. China’s Foreign Ministry on June 21 condemned the Philippine’s “illegal occupation” of the shoal.
Opposition lawmakers seek return to Parliament. Fourteen of the 27 opposition lawmakers stripped of their positions petitioned the Constitutional Council on June 19 to review the legality of their removal from Parliament. A legislative committee composed entirely of ruling Cambodia Peoples Party (CPP) members voted on June 5 to strip all opposition lawmakers of their salaries and status, precluding them from participating in the upcoming July 28 national elections. The CPP said that by trying to run under the newly formed Cambodia National Rescue Party, the lawmakers had violated election rules by maintaining membership in more than one party.
Appeals court upholds conviction of land activist. The Phnom Penh Court of Appeals on July 14 upheld the guilty verdict of Yorm Bopha, a prominent land rights activist. The 29-year-old mother had campaigned for the release of the Boeung Kak 13, a well-known land rights group that has led protests against the forced eviction of thousands of residents near Boeung Kak Lake in Phnom Penh since 2007. Yorm Bopha was sentenced to three years imprisonment in December 2012 on politically orchestrated charges of ordering an assault on two motorbike taxi drivers.
Thailand, Cambodia commit to cooperation and peace along contentious border. Cambodian foreign minister Hor Namhong said during a June 17 meeting with United Nations Educational, Scientific, and Cultural Organization director-general Irina Bokova in Phnom Penh that Cambodia and Thailand have agreed to maintain stability and peace along their border after the International Court of Justice rules on ownership of disputed land near the Preah Vihear temple. That decision is expected in October. Hor Namhong’s statement follows a June 11 pledge by Cambodia and Thailand to boost connectivity and trade along their shared border.
Singapore censures 20 banks over rate manipulation. The Monetary Authority of Singapore (MAS) censured 20 of the world’s largest banks on June 14 for attempted manipulation of local benchmark interest rates, a move that is part of financial regulators’ investigation of a larger rate-rigging scandal. MAS found that 133 traders at the censured firms had tried to influence the local benchmark rate for their own financial gain since 2007. Three-quarters of the traders identified have already resigned or been fired, while the rest face disciplinary action, including loss of bonuses, according to MAS.
Government launches Web site on labor market data. Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam said on June 17 that the government of Singapore has adopted a new “Open Data” philosophy, launching a Web site that will make information on the local labor market available to the public. The new data service, called “Population Query,” will allow Singaporean citizens access to government data such as an area’s demographics, available schools, transport options, and other amenities. The government also plans to encourage crowd-sourcing of information, as well as research and analysis on issues of public concern through the Web site.
Crown prince calls on Islamic financial institutions to adopt public-private partnerships. Crown Prince Al-Muhtadee Billah called on Brunei’s Islamic financial institutions on June 18 to consider adopting public-private partnership (PPP) models to help realize the country’s National Development Plan. Islamic finance institutions are playing an increasingly significant role in Brunei’s international trade and cross-border investments. Adopting PPP models, according to the prince, will gain the Islamic finance model wider market access by providing it with legal and regulatory certainty and making it more accepted internationally.
Brunei hosts sports day to build camaraderie between nations. Brunei hosted a sports day on June 14 to build camaraderie among the 18 countries that participated in the ASEAN Humanitarian Assistance/Disaster Relief and Military Medicine Exercise from June 16 to June 20. Medical personnel from all 10 ASEAN countries and the other eight members of the East Asia Summit, including the United States, participated in the sports competition. A joint China-Singapore team won the relay race and the Japan-Thailand team won the tug-of-war competition.
Royal Brunei Airlines first in Southeast Asia to operate 787s. Royal Brunei Airlines (RBA) will become the first company in Southeast Asia to operate Boeing 787 Dreamliners, with four to be placed into service by the end of 2013. RBA is one of the smallest flag carriers in Asia, but it is revamping its fleet of planes to improve efficiency and usher in a new brand of service. RBA has historically been unprofitable due to its relatively few routes and Brunei’s small population. The Centre for Aviation says that RBA will find it difficult to become profitable even with the 787s.
Dengue outbreak could be worst in country’s history. Officials with Laos’s Ministry of Health and the World Health Organization warned during an ASEAN Dengue Day meeting on June 18 that Laos may be experiencing the worst outbreak of the disease in its history. They said the outbreak could soon reach epidemic levels. Thirty-one people have died so far in 2013, with the number of reported cases far exceeding that of the same period for recent years. Children are especially vulnerable to dengue, with children under 15 suffering rates of infection eight times higher than the rest of the population.
South Korea resettles 20 North Korean defectors from Laos. South Korea has facilitated the transfer of 20 North Korean defectors from Laos to Seoul, according to a June 18 report from Chosun Ilbo. The South Korean Embassy in Vientiane had housed the defectors for several weeks after Laos deported a number of orphaned North Korean defectors to China in late May. South Korean rights groups strongly condemned that decision, citing China’s policy of repatriating defectors to North Korea, where they face harsh punishment.
Noeleen Heyzer appointed UN special adviser for Timor-Leste. UN secretary-general Ban Ki-moon appointed Noeleen Heyzer as special adviser for Timor-Leste on June 10. Heyzer will assume the role in addition to her current posts as under-secretary general of the United Nations and executive secretary of the Economic and Social Commission for Asia and the Pacific. Heyzer previously led initiatives in Timor-Leste on gender violence, gender inequality, and political participation in her previous role as head of the UN Development Fund for Women.
Timor-Leste launches national fish farming program. The government of Timor-Leste on June 18 announced the launch of a national fish farming program to fight poverty and malnutrition. Small famers will be provided technical support and financial services with the goal of developing small and medium-size aquaculture projects alongside existing agriculture. The U.S. Agency for International Development-funded Coral Triangle Support Partnership is among the program’s funders.
Report says dams threaten extinction of Mekong catfish. The World Wildlife Fund released a report June 20 saying the planned Xayaburi dam in northern Laos may threaten the giant Mekong catfish with extinction. The hydropower dam, located on the mainstream of the Mekong River, may prevent the large fish from migrating upstream. The catfish, which can weigh more than 600 pounds, are a major food source for the greater Mekong population. Cambodia and Vietnam have both objected to the $3.5 billion project due to its potential negative environmental and food security impacts on the greater Mekong region.
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