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Asean Affairs weekly summary for the week beginning June 27

By David Swartzentruber
AseanAffairs   3 July 2010

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Weekly Summary

For all the Asean countries help may be coming for small and medium enterprises (SMEs). The Asean region is attempting to set up a fund to develop small and medium-sized (SMEs), but the process may take years, say experts in the field, the Bangkok Post reports. ‘‘What is important is the correct mechanism to support it,’’ says Mr. Cope, while Mr Chaiyuth (below) says the starting point is to create a ‘‘gap analysis’’ of each country.

The Group Meeting on the Asean SME regional development fund, held by the Office of Small and Medium Enterprise Promotion (Osmep), is part of the Asean Economic Community (AEC) blueprint, which is to be established by 2015.

The regional fund would provide finance through existing country funds to meet a country's specific needs.

Under the model used in Europe, the needs of developed and non-developed countries are different, and this point is applicable to Asean, said Graham Cope, the head of regional business development for the European Investment Fund (EIF).

In the Philippines, the Aquino government plans to give the state a greater role in business by investing the proceeds of asset sales in lucrative industries, the Department of Finance (DOF) told the Manila Times.

“It is not sustainable if the proceeds of the privatization program would only be used to cover the budget shortfall. Instead, the expected proceeds from there could be invested to sectors that could generate money for the government,” newly appointed Finance Secretary Cesar Purisima told reporters during turnover ceremonies at the Finance department on Thursday.

And of course, the previous day, the new president of the Philippines was inaugurated. Benigno Aquino was sworn in as president of the Philippines on Wednesday with a vow to lift his nation out of poverty and end the crippling corruption that he said thrived under his predecessor.

In a speech to a mass of supporters wearing his family's signature yellow, the 50-year-old bachelor promised to lead by example and not break the trust of the millions of Filipinos who delivered him a landslide election victory.

"Today marks the end of a regime indifferent to the appeals of the people," Aquino said in one of many stinging criticisms of Gloria Arroyo, whose nearly 10 years in power were marred by allegations of vote rigging and massive graft.

In Indonesia, there is still religious friction and the government was accused of not doing enough. The Indonesian central government has been criticized for providing too much leeway for hardliners to grow, letting them push for sharia-based bylaws at the expense of the nation’s unity, legislators and activists said Monday, according to the Jakarta Post.

“We see it too often: the state apparatus bows down to the hardliners’ interest. This makes us question the current government’s role in managing this pluralistic country,” Indonesian Democratic Party of Struggle (PDI-P) legislator Eva Kusuma Sundari told a press conference on Monday.

Activists calling themselves the Pancasila Caucus criticized the government, which they said acted as if there was nothing worrisome about the increasing number of sharia-based laws.

China is aggressively moving to strengthen its position in Southeast Asia and joint ventures are one avenue it is pursuing. China's largest train manufacturer, Changchun Railway Vehicles Co (CRC), is in talks with the Bangkok Mass Transit System (BTSC) about joining with the Skytrain operator to develop projects outside Thailand, the Bangkok Post reports. BTS is highly competitive and offers strong technological capability, says CRC chairman Dong Xiaofeng.

CRC chairman Dong Xiaofeng said the company had seen an opportunity for jointly developing international projects with BTSC in countries such as Burma, Vietnam, Malaysia and Laos. "We have been in discussions with BTS to expand our operations outside Thailand," Mr. Dong said at a ceremony on Friday to mark the delivery of 12 sets of 4C engines and CRC-made trains to BTS at Laem Chabang port in Chon Buri.

"BTS is the most competitive train operator in Thailand with strong technological capability. That's the main reason why we want to expand our cooperation, partly by bidding for international projects together."

Although the Vietnamese economy is doing well, the World Bank still is providing aid. The banhas approved US$456.5 million in loans for Vietnam, provided by the International Development Association, the part of the bank that helps the world's poorest countries, reports the Viet Nam News.

As Vietnam approaches middle-income country status, it needs a skilled population with a strong knowledge base in order to position the country for economic expansion and integration into the global economy, according to the World Bank.

Creating a higher quality education system that is innovative and responsive to the demands of the market is essential to the economic growth and development of Vietnam.

And the Philippines made a progressive step, joining Malaysia and Vietnam with improved customs standards.

The Bureau of Customs (BOC) has acceded to the Revised Kyoto Convention (RKC), which is aimed at simplifying customs procedures worldwide. In a statement, Customs Commissioner Napoleon Morales said the agency deposited to the World Customs Organization (WCO) the Philippines’ instrument of accession, according to the Manila Times.

With this, the Philippines became the 70th contracting party to the RKC or the International Convention on the Simplification and Harmonization of Customs Procedures.

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