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                                                                                                                       Asean Affairs  October 312014 

Biweekly Update


Jokowi names cabinet. Newly inaugurated president Joko “Jokowi” Widodo on October 27 announced the names of the 34 ministers in his cabinet. The announcement drew mixed reactions, with supporters noting that 18 of the 34 are experts rather than political appointees and a record 8 are women. But detractors noted that despite including a number of reformers and highly competent selections, the cabinet overall was less transformational than many previous ones The new defense minister, former general Ryamizard Ryacudu, has proven especially controversial as human rights groups quickly decried his record of violations.

Kerry visits Jakarta for Jokowi inauguration. Secretary of State John Kerry traveled to Indonesia on October 20 for Joko “Jokowi” Widodo’s inauguration as president. Kerry held a number of bilateral meetings with other visiting dignitaries, including Australian prime minister Tony Abbot, Malaysian premier Najib Razak, Singaporean prime minister Lee Hsien Loong, Brunei’s Sultan Hassanal Bolkiah, and Philippine foreign secretary Albert del Rosario. The meetings included discussions on the South China Sea disputes, the Trans-Pacific Partnership trade negotiations, and Southeast Asian support for combating the Islamic State in Iraq and Syria and confronting the spread of Ebola in West Africa.

Currency, stocks bounce back. Indonesian stocks were up 3.3 percent on October 29 from a three-month low two weeks earlier, despite suffering a 1.4 percent drop on October 27 due to disappointment that President Joko Widodo’s new cabinet did not appear to be as reformist as many investors had hoped. The rupiah meanwhile fell below 12,000 to the dollar on October 22 for the first time since September, and stood at more than 12,080 to the dollar as of October 29.

Mineral output plummets because of mineral ore export ban. Indonesia’s ban on the export of unprocessed ore has caused output of many minerals to drop precipitously in 2014 compared to the year before, according to an October 20 Jakarta Post report. For example, Indonesian miners produced just 2.8 million tons of bauxite from January to August, compared to 60 million tons in 2013. The ban caused months-long shutdowns for many large mine companies, including foreign companies like U.S.-based Freeport McMoran and Newmont Mining, as they tried to negotiate with the government.

SoftBank, Sequoia lead $100 million investment in Indonesian ecommerce firm Tokopedia. Japanese investment firm SoftBank Corp. and U.S.-based Sequoia Capital on October 22 announced that they had raised $100 million to invest in PT Tokopedia, Indonesia’s leading e-commerce company. Tokopedia was launched in 2009 as an online marketplace, similar to Amazon and China’s Alibaba, where individuals and business owners can open and operate online stores.


Anwar begins final appeal against sodomy conviction. A Malaysian federal court on October 28 began hearing opposition leader Anwar Ibrahim’s final appeal against a lower court’s decision in March to overturn his earlier acquittal and convict him of sodomy,. Anwar currently faces five years prison if his appeal is denied, but prosecutors have said they will seek an even stiffer penalty of up to 20 years. The appeal proceedings in the politically charged case were expected to wrap up after two days, but the court has since said it will need more time and expects the hearing to last through November 3. Domestic and international critics have decried what they see as a politically motivated witch hunt against Anwar.

Anwar speaks to supporters at university despite ban. Opposition leader Anwar Ibrahim on October 27 addressed an estimated 2,000 supporters at his alma mater, the University Malaya, despite university officials’ declaring the event illegal. Supporters removed barriers that had been placed at campus gates to block entry and listened to Anwar speak even after the university lights were shut off. Anwar, speaking the day before his final appeal on sodomy charges, criticized the university administration for not standing up for academic freedom.

Malaysia wins UN Security Council seat. The UN General Assembly on October 16 elected Malaysia to a nonpermanent seat on the Security Council for the 2015–2016 term. Malaysia garnered 187 of 192 votes in its unopposed candidacy for a seat to represent the Asia Pacific. It will be Malaysia’s fourth stint on the council and its first in 15 years. The other four available seats went to Angola, New Zealand, Spain, and Venezuela.

Petronas expected to benefit from LNG tax deal in Canada. Malaysian state-owned oil company Petronas will likely be a major beneficiary of revised tax policy for liquefied natural gas projects (LNG) announced by British Columbia’s government on October 21. Authorities in the western Canadian province cut the maximum proposed tax on profits from LNG projects to 3.5 percent from an initially planned 7 percent. Petronas had warned in early October that it might delay a decision on whether to build a $32 billion LNG plant in the province if authorities set the tax rate too high.

Malaysia arrests 14 people suspected of ties to ISIS. Malaysian police on October 13–15 arrested 14 people suspected of having ties to the Islamic State in Iraq and Syria (ISIS). Three of the suspects were reportedly responsible for recruiting, financing, and arranging travel for Malaysians wanting to join the fighting in Syria. Five others were members of a family planning to head to Syria to fight. Malaysian authorities have arrested 36 people for suspected links to ISIS since April.


Myanmar sets provisional date for 2015 elections. Election officials on October 21 confirmed that Myanmar’s next general elections will be held either the last week of October or the first week of November 2015, with an exact date to be determined in August 2015. The announcement came a day before Myanmar lawmakers tasked with studying potential amendments to the constitution issued a report to the parliament recommending against lifting a ban on those with foreign spouses or children, including opposition leader Aung Sang Suu Kyi, serving as president, or reducing or eliminating the 25 percent of legislative seats reserved for the military. Despite these and other restrictions, Myanmar’s Election Commission has insisted that the polls will be the freest in the country’s history.

Rebels say recent military clashes could end peace talks. A representative of the United Nationalities Federal Council, which represents 11 armed ethnic groups, said October 17 that national cease-fire talks could be put at risk if Myanmar’s military continues to increase incursions into rebel-controlled areas. Several clashes between ethnic groups and the military have been reported in recent weeks in the northern states of Kachin and Shan, as well as Karen State in the east. The latest round of talks aimed at achieving a nationwide cease-fire ended in September without resolution.

Courts jail former minister, farmers, and journalists. Court officials on October 17 sentenced former religious affairs minister Hsan Hsint to 13 years in prison for sedition and misappropriating state funds. The ruling came a day after a judge sentenced nine farmers to seven-year sentences for working on land seized by the government and a separate court sentenced five journalists from the defunct Bi Mon Te Nay journal to prison for incitement and defamation. Prominent rights groups have accused the rulings of being politically motivated and representing a broader crackdown on political freedoms ahead of 2015 general elections.

Journalist killed in military custody. Myanmar’s military on October 24 confirmed a report by the Assistance Association for Political Prisoners that soldiers in eastern Myanmar on October 4 shot and killed freelance journalist Par Gyi four days after he was arrested while covering fighting between the Myanmar army and the Democratic Karen Benevolent Army. The military claims Par Gyi was actually a member of another rebel group and was killed after attempting to grab a gun and flee military custody. Par Gyi’s wife, former political prisoner Than Dar, has denied those allegations and is demanding a full investigation. The U.S. State Department along with numerous local and international rights groups has echoed her call.

Government proposes repeal of property requisition law. Myanmar’s deputy minister for home affairs on October 14 submitted a bill to the parliament proposing the abolition of the country’s 1947 Requisitioning Act. The act gives the president emergency powers to seize any land or property and expresses the exclusive right of the government and civil servants to requisition land. Both the Attorney General’s Office and the President’s Office approved the proposal, saying the old law is no longer appropriate for modern Myanmar.


Vietnam, U.S. hold defense policy talks. Delegations led by U.S. deputy assistant secretary of defense for South and Southeast Asia Amy Searight and Vietnamese deputy minister of defense Nguyen Chi Vinh met in Hanoi on October 21 for a bilateral defense policy dialogue—the first since the United States eased its ban on military sales to Vietnam. The two sides discussed existing cooperation on finding U.S. service members missing in action during the Vietnam War and cleaning up dioxin and unexploded ordnance. They also examined ways to boost security cooperation, including on peacekeeping, humanitarian assistance and disaster relief, and military medicine.

Assistant Secretary Malinowski visits Vietnam to discuss human rights. Assistant Secretary of State Tom Malinowski wrapped up a visit to Vietnam on October 25, telling reporters that the country has made progress on human rights issues but needs to do more to forge closer trade and security relations with the United States. That same day, Vietnamese authorities released imprisoned blogger Nguyen Van Hai, known by his pen name Dieu Cay, and allowed him to board a flight to the United States. Vietnam has released 12 prisoners of conscience in 2014.

Vietnam, India sign defense pact, offshore oil agreement. Vietnamese and Indian officials concluded an agreement during Prime Minister Nguyen Tan Dung’s October 27–28 visit to New Delhi that will allow Vietnam to purchase more military equipment from India, including maritime patrol vessels. The pact builds on an arrangement reached in September under which India agreed to extend to Vietnam a $100 million line of credit to purchase military equipment. India’s and Vietnam’s state-owned oil companies, ONGC Videsh and PetroVietnam, also signed an agreement during Dung’s visit. ONGC agreed to purchase stakes of 40 and 50 percent in two oil blocks in undisputed waters in the South China Sea.

Vietnam, Vatican make progress on restoring diplomatic relations. Prime Minister Nguyen Tan Dung and Pope Francis discussed progress toward restoring diplomatic relations during an October 18 meeting in Rome following Dung’s attendance at the Asia-Europe Meeting in Milan. Their discussion followed a September 10–11 visit to Vietnam by a Vatican delegation to meet with officials and observe the treatment of Catholics. The Vatican released a statement after the Rome meeting welcoming the Vietnamese government’s support for the more than 6 million Catholics in Vietnam. Vietnam and the Vatican broke off diplomatic ties in 1975.

Vietnam’s economy expected to grow quicker in 2015. Prime Minister Nguyen Tan Dung on October 20 told Vietnam’s National Assembly that he expects the economy to expand at a quicker pace in 2015 due to increasing exports. The government is targeting economic growth of 6.2 percent for 2015, up from 5.8 percent in 2014. Vietnam has been trying to offset weak domestic demand by increasing exports, which grew 14.4 percent in the first nine months of 2014.


House panel rejects emergency powers request for Aquino. Reynaldo Umali, the chair of the Philippine House of Representatives’ energy committee, on October 21 rejected President Benigno Aquino’s request for emergency powers to address energy shortages expected to hit the northern island of Luzon in 2015. The president had sought power to use $260 million from the emergency Malampaya Fund to pay foreign suppliers to produce surplus electricity. The energy committee will instead focus on implementing an interruptible load program that will ask businesses to run their own personal generators during peak hours to relieve stress on the Luzon grid.

Philippine militants free two kidnapped Germans. Defense Secretary Voltaire Gazmin on October 18 confirmed that the militant group Abu Sayyaf had released two German tourists taken hostage in early May. The tourists, Stefan Okonek and Henrike Dielen, were flown to Manila shortly after the payment of a $5.6 million ransom, according to militant spokesperson Abu Rami. The Philippine Armed Forces denied any ransom was paid, calling Abu Sayyaf’s statement propaganda. Abu Sayyaf reportedly still has 11 hostages in its custody, including seven Filipinos, two Europeans, a Malaysian, and a Chinese citizen.

Philippines will not send medics to Ebola-hit areas. Philippine Department of Health spokesperson Lyndon Lee Suy on October 17 said the Philippines will not send health workers to join the effort to contain the devastating Ebola epidemic in West Africa, but instead will send money and other forms of assistance. Health Secretary Enrique Ona had responded positively earlier to a request by the United States and others to send Philippine medical personnel. Ona on October 22 announced the allocation of $11 million from the Department of Health budget to Ebola containment preparations in case the virus spreads to the Philippines.

U.S. transfers marine accused of murdering transgender Filipino to Philippine base. The United States Marine Corps Forces Pacific on October 22 confirmed that Scott Pemberton, the marine suspected in the slaying of transgender Filipina Jennifer “Jeffery” Laude, had been transferred from the USS Peleliu to Camp Aguinaldo, the headquarters of the Armed Forces of the Philippines in Quezon City. According to the visiting forces agreement between the United States and the Philippines, the United States reserves the right to keep custody of U.S. service members accused of crimes during their court proceedings, but the decision to transfer Pemberton was made amid widening protests in the Philippines.


Academic charged under lèse-majesté. Thai authorities have charged social campaigner and academic Sulak Sivaraksa with lèse-majesté for comments he made about a former monarch during an October 12 seminar. Two retired army officers filed a complaint about Sulak’s comments allegedly defaming King Naresuan the Great, a national hero who died in 1605. Sulak faces 15 years in prison. Thailand’s strict lèse-majesté laws are supposed to apply only to the sitting king, queen, heir-apparent, and regent, but in practice their scope has been expanded in recent years.

Government doles out money to rice and rubber farmers. Thailand’s government on October 20 began paying out new subsidies to rice and rubber farmers in the face of slumping prices for the two commodities. Authorities have approved payments of about $80 per acre, up to a maximum of roughly $480 per farmer. The government expects the subsidies to cost $1.2 billion for rice and $260 million for rubber.

Suspects in Koh Tao murders retract confessions. Lawyers for Zaw Lin and Win Zaw Htun, who authorities have charged with the murders of British tourists Hannah Witheridge and David Miller, officially withdrew their confessions on October 22, alleging the confessions were extracted under torture. Thai authorities reportedly denied the Myanmar nationals’ previous attempts to recant their confessions. The National Human Rights Commission of Thailand spoke with the suspects on October 13 and told reporters that their allegations were “believable.”

Thailand facing stagflation. Finance Minister Sommai Phasee said October 21 that Thailand is entering a period of stagflation, partly because high household debt is restraining domestic consumption and preventing strong economic growth. Stagflation refers to a period of low growth, high inflation, and high unemployment. Sommai nevertheless said the government is confident that recently approved stimulus measures will boost liquidity and stimulate consumption.


Defense teams for former Khmer Rouge leaders boycott trial. The defense teams representing former Khmer Rouge leaders Nuon Chea and Khieu Samphan on October 17 walked out of a UN-backed court as it opened the pair’s second trial for crimes against humanity. The defense teams, which include Cambodian and European lawyers, said they are boycotting the proceedings due to alleged bias because all but one of the judges in the trial had presided over an earlier case in which their clients were found guilty. The boycott may last one or two months until a decision is reached on disqualifying the judges.

Minister of labor wants charges against union leaders dropped. Minister of Labor Ith Sam Heng on October 17 announced that his ministry will push to have charges dropped against six union leaders involved in garment worker strikes in December 2013 that ended in a bloody police crackdown. The ministry will ask the owners of garment factories to drop their complaints against the union leaders in a bid to end criminal proceedings against them, which has been a major demand of labor activists and the political opposition.

Committee to be formed to assess minimum wage. Minister of Labor Ith Sam Heng on October 14 said that his ministry will form a committee to assess the technicalities of increasing Cambodia’s minimum wage for the garment sector. The committee is set to have nine representatives from the government, garment unions, and factory owners. Its formation comes in the wake of the latest in a series of large garment worker strikes that saw workers demand a wage increase to $177 from $100 per month.

Anti-trafficking organization closes amid scandal. The nonprofit Somaly Mam Foundation on October 17 released a statement announcing its permanent closure. The foundation shut down amid allegations that its founder and former president, Somaly Mam, had fabricated much of her widely publicized life story. The law firm Goodwin Procter that was hired by the foundation to investigate Somaly’s claims that she was a teenage victim of sex trafficking found many inconsistencies in her story. Somaly resigned in June and the foundation’s future has been in doubt since.

South China Sea

Vietnam, China agree to manage tensions, establish hotline. China’s state councilor Yang Jiechi visited Vietnam on October 27 for high-level meetings including with Deputy Prime Minister and Foreign Minister Pham Binh Minh during which the two agreed to reduce tensions in the South China Sea. Yang’s visit came a week after Defense Minister Phuong Quang Thanh led a high-level military delegation to Beijing on October 17–19 during which Vietnamese and Chinese officials agreed to deepen bilateral military ties and set up an emergency hotline between their defense ministries to avoid escalations like that seen after China’s May deployment of an oil rig in disputed waters.


Singapore’s economic growth stabilizes at lower level. Singapore’s economy grew 1.2 percent in the third quarter of 2014, according to an October 13 report by the Singaporean government, This is slower growth than in previous years, as cooling property prices and lower manufacturing activity act as a drag on growth. A government-mandated limit on hiring foreign workers meanwhile has adversely affected the manufacturing sector. Singapore’s central bank on October 14 decided to leave interest rates in the city-state unchanged, indicating that it remains more concerned about rising inflation than slow economic growth.

Singapore Airlines to bail out embattled budget carrier Tiger Airways. Singapore Airlines will bail out its embattled associate, Tiger Airways, by increasing its ownership in the budget carrier, according to an October 17 announcement by Tiger Airways. Singapore Airlines will increase its stake to 55 percent from 40 percent and will help raise new capital for Tiger Airways. The budget carrier’s failed efforts to expand in Australia, Indonesia, and the Philippines contributed to $142 million in losses in the second quarter of 2014.

Singapore Post to build $145 million e-commerce logistics hub. Singapore Post, the city-state’s main postal service, announced on October 14 that it will invest $145 million in a new e-commerce logistics center to capitalize on the growth of online retail in Southeast Asia. The new facility will be able to handle 100,000 packages daily and will begin operations in late 2016. Online shopping in Southeast Asia currently accounts for only 0.2 percent of all retail sales, but could be worth $21.6 billion in coming years according to a report by investment bank UBS.

Trans-Pacific Partnership

Negotiations make incremental progress as Japan shows market access flexibility. Ministers from the 12 Trans-Pacific Partnership (TPP) negotiating countries announced on October 27 that they had made incremental progress on outstanding market access and rules issues during talks in Sydney and Canberra. But Japan’s continued inflexibility in negotiations with the United States on access to sensitive agricultural markets has hampered progress in a number of other areas being negotiated by TPP members. Ministers said the next major meeting will be held on the sidelines of the Asia-Pacific Economic Cooperation leaders’ meeting in Shanghai on November 7–8.

Leaked trade documents outline challenges on intellectual property issues. A leaked document relating to Trans-Pacific Partnership (TPP) negotiations on the pharmaceutical sector reveals the sensitivities and divisions among members, according to an October 16 Wall Street Journal report. The 77-page document, obtained by Wikileaks, contains draft proposals from negotiations in May that deal with the sensitive rules on generic medicines and marketing for certain expensive medicines used to combat hard-to-treat illnesses. The draft shows the difficulty in reaching agreement on the full range of TPP issues.


Laos set to generate 15 billion kilowatt-hours of electricity in 2015. The Lao government expects to generate 15 billion kilowatt-hours of electricity in 2015, according to an October 14 statement from the government’s news agency. Lao authorities plan to construct additional power plants and extend power infrastructure into rural areas. The government also expects to export 11.7 billion kilowatt-hours, generating approximately $535 million in revenue.

North Korean defectors released in Laos. Lao authorities on October 18 agreed to release a group of six North Korean defectors arrested two days earlier as they passed through Laos en route to Thailand. The South Korean embassy in Laos, after receiving the arrest report, pushed Lao authorities to release the defectors. They are currently being held at a facility in Thailand before being sent to Seoul.


Timor-Leste, New Zealand sign agreements to promote aquaculture. Timorese and New Zealand officials signed an agreement on October 16 to promote fishing and aquaculture as a sustainable means to improve nutrition and reduce poverty in Timor-Leste. The $4 million “Partnership for Aquaculture Development” will work to develop Timor-Leste’s fish farming industry and help to connect fish farmers to markets. Timor-Leste’s Ministry of Agriculture and Fisheries meanwhile also signed an agreement with WorldFish to allow the nonprofit organization to formally establish operations in Timor-Leste to support the fisheries and aquaculture sector.


Hong Kong to finalize ASEAN free trade agreement by 2016. Hong Kong government officials on October 20 announced that 2016 is the target date for the completion of a free trade deal with ASEAN. The new free trade agreement will be hammered out during six rounds of negotiations, the first of which began in July. Manufacturers in Hong Kong have urged the government to join the ASEAN-China free trade network to avoid losing their position as a trading hub between China and Southeast Asia. ASEAN member states currently impose tariffs rates of between 0 and 10 percent on goods from Hong Kong.


APEC finance ministers vow flexible fiscal policies. Finance ministers from the 21 member economies of the Asia-Pacific Economic Cooperation forum issued a joint statement following an October 22 meeting in Beijing pledging to pursue "flexible" fiscal policies to support the world economy and job creation. The statement recognized that “achieving sustainable growth requires both short-term and longer-term policies” that can adapt to fluid conditions in the global marketplace. APEC heads of state will meet in Beijing for their annual summit on November 10–11.

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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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