Regional Roundup for Week of 12.6.15

EXSE FOCUS

China Creates a World Bank of Its Own, and the U.S. Balks-NYT In setting up the Asian Infrastructure Investment Bank, China enlisted American allies, including Britain, even as Washington expressed skepticism. As top leaders met at a lush Bali resort in October 2013, President Xi Jinping of China described his vision for a new multinational, multibillion-dollar bank to finance roads, rails and power grids across Asia. Under Chinese stewardship, the bank would tackle the slow development in poor countries that was holding the region back from becoming the wealth center of the world. The enthusiasm didn’t last long, as the Obama administration began a rear-guard battle to minimize the bank’s influence.//Useful overview of the development of the bank. Note the banks inspiration came from a trip to Laos and observations that people there should no longer live in stilted huts. Also helpful insight into the approaches current AIIB head Jin Liqun used to recruit the UK (succesfully) and the US (unsuccessfully).

Net loss: fish stocks dwindle in Cambodia’s Tonlé Sap lake-The Guardian Despite the creation of a 200-hectare conservation area, fishing communities on south-east Asia’s largest freshwater lake fear their way of life is slipping away. Until three years ago, life around the lake was very different. Before then, much of the fishing was divided up into government-approved lots worked by commercial vessels, leaving many local people excluded. In March 2012, the Cambodian prime minister, Hun Sen, ordered an end to the lots and opened up the waters to those living along its shores. Although the move was well received by local communities, it has raised fears that unrestricted access could destroy fish stocks. In a bid to safeguard the lake’s population and diversity, an EU-funded programme has established a 200-hectare (494-acre) fish conservation area (FCA) close to the Kampong Phluk commune, which is home to nearly 3,900 people.//govt regulators make locals pay through their teeth in the form of bribes for fishing access. No wonder there’s pressure to over-fish. Also paying a bribe to fish is seen as a vote for the CCP – one way Hun Sen’s party campaigns.

In Vietnam, a Fisherman’s Village With No Fish-The Diplomat In the Mekong Delta’s largest city, overfishing has forever altered the livelihoods of a whole community. We were in Can Tho, Vietnam’s fourth largest city and the de facto capital of the Mekong delta. We had based ourselves out of Can Tho for nearly a week, driving into the surrounding countryside each morning and afternoon, but spent very little time exploring the city. With a population of nearly 1.5 million people straddling the Song Hau river (one of the main Mekong distributaries running through the delta), Can Tho was a logical place to investigate the stories of the river in an urban context. //Gives firsthand account of Can Tho’s fishermen and the plight they are currently facing. With decreasing fish stocks in Cambodia and Vietnam, throughout the same watershed, what are the solutions to this issue of livelihood and food security?

 China’s ‘One Belt, One Road’ Initiative: Outlook For OBOR and the US Rebalance-The Diplomat The Rebalance authors Mercy Kuo and Angie Tang regularly engage subject-matter experts, policy practitioners and strategic thinkers across the globe for their diverse insights into the U.S. rebalance to Asia.  This conversation with Dr. Erica Downs – Senior Analyst at Eurasia Group and former fellow in the John. L Thornton China Center at the Brookings Institution – is the 22nd in “The Rebalance Insight Series.”

A ‘Critical Point’ for US Strategic Tolerance of China-The Diplomat US-China relations are caught in a critical point — poised between one paradigm and the next. n a way, the ongoing U.S.-China disputes have quite a few similarities with thermodynamic changes or chemical reactions. We may take the U.S. strategic tolerance of China’s rise — or more specifically China’s active involvements in the U.S.-led world system — as an example. China has been actively involved in international institutions over the past decades, probably with the encouragement and tolerance of the United States as long as several conditions were met: first, that China does not truly challenge the U.S. predominance; second, that China takes up its shared responsibilities under the U.S. leadership; and third, that China changes domestically (or politically in a sense) as the United States has been expecting.

ADB Loan to Enhance Urban Services in Towns Along GMS Economic Corridor-ADB ADB has approved a $100 million loan to support government efforts to boost urban and water services in Bac Giang, Mong Cai and Sa Pa, three towns located along the North-South Economic Corridor within the Greater Mekong Subregion. The assistance will finance the construction and upgrading of wastewater treatment plants, provide wastewater treatment services—including connections for thousands of households, build new pumping stations, and dredge canals to protect urban areas from periodic flooding. In Sa Pa, an international tourist destination known for its trekking routes through mountains and rice fields, the assistance will also finance general improvements to the town center public area and the drafting of a green city action plan.//As OBOR favors Mekong states other than Vietnam, the West-led ADB doubles down on Vietnamese infrastructure development. 

 

REGIONAL RELATIONS

 Amid South China Sea Tensions, Japan Strengthens Ties With Philippines, Vietnam-The Diplomat

The South China Sea is a large part of Tokyo’s calculations, but aid to Manila and Hanoi has a decades-long history. As China’s construction projects and the United States’ freedom of navigation operations ratchet up tensions in the South China Sea, Japan is increasing its cooperation with other claimant states – most notably the Philippines and Vietnam. Japan’s Official Development Assistance (ODA) plays a large role in this cooperation.

China, Thailand Sign Rail, Rice, and Rubber Deals-The Diplomat Despite disagreements on details, China and Thailand move forward with a $9.7 billion railway deal. A day after Thailand’s transport minister Arkhom Termpittayapaisith said that Bangkok was postponing a railway deal with China, Thailand’s deputy prime ministers, Prawit Wongsuwon and Somkid Jatusripitak, said the deal would go ahead as scheduled. Sure enough, on Thursday China and Thailand held a signing ceremony for a document outlining the framework for intergovernmental cooperation on the railway project.//much work needs to be done to understand the motivations of this rising Sino-Thai axis and implications for US relations in Thailand.

ASEAN’s New Community – Only a Small Step-The Diplomat At an Association of Southeast Asian Nations (ASEAN) summit last week, Southeast Asian leaders signed an agreement creating an “ASEAN Community.” The Diplomat reports that the “Community,” much discussed by Southeast Asian media and leaders in recent years, will be “a step towards realizing the idea of a three-pillared community to deepen regional integration first proposed in 2003 comprising an ASEAN Political and Security Community; an ASEAN Economic Community; and an ASEAN Socio-Cultural Community.” All the specifics of what these communities will entail have not been finalized, despite long “blueprints” proposed by ASEAN for each of the communities. The most developed idea is the Economic Community, which is supposed to be the creation of a single regional market for goods and services. //What real impact will this have on the member countries of ASEAN? Will concrete ideas come forth eventually? Stay tuned.

 

SUSTAINABILITY AND RESOURCE MANAGEMENT

 Chinese Report on Climate Change Depicts Somber Scenarios-NYT Rising seas besieging China’s economically vital coastal zones. Mighty feats of infrastructure, like the Three Gorges Dam and railway to Tibet, strained by turbulent rainfall and the melting of frozen earth. And on the Himalayan frontiers, the risk in future decades of international conflict over dwindling water supplies as glaciers retreat. These and other somber scenarios are laid out in the Chinese government’s latest scientific assessment of global warming, released just before negotiations in Paris for a new international agreement on climate change.

Paris Deal Would Herald an Important First Step on Climate Change-NYT President Obama and more than 100 world leaders will convene with thousands of diplomats on Monday on the outskirts of Paris to open two weeks of intense negotiations aimed at forging an accord that could begin to avert the most devastating effects of global warming and redefine the economy of the 21st century. If the talks fail—as they did in two previous attempts to achieve such a deal—then nations will continue on a trajectory that scientists say locks the planet into a future of rising sea levels, more frequent floods, worsening droughts, food and water shortages, destructive hurricanes and other catastrophic events.

Related: An Evolution in China’s Climate Diplomacy-The Diplomat

            Related: Raise the green lanterns-The Economist

Major powers pledge $20bn for green energy research-The Guardian The vow boosts a parallel initiative by global business leaders including Mark Zuckerberg and Ratan Tata. The US and 18 other countries have pledged to double funds for clean energy research to a total of $20bn over five years, boosting a parallel initiative by Bill Gates and Mark Zuckerberg and increasing the prospects for successful agreement at the Paris climate negotiations that start on Monday. The countries, which include the UK, Canada, China, Brazil, India and South Africa, span the biggest global economies and major emitters, oil and gas producers, and leaders in clean energy research, the White House said.

 

CHINA

 China Gives 14 Officials Jail Terms Over 2013 Oil Pipeline Blast-NYT China has sentenced 14 former officials at state energy firm Sinopec and the local government to jail for up to five years for their role in a massive oil pipeline explosion in 2013, the official Xinhua news agency said on Monday. The explosion in the eastern province of Shandong killed 63 people and injured 156, and caused losses worth 751.7 million yuan (78 million pounds), Xinhua said. It said the Sinopec officials were sentenced for violating safety regulations while the government officials had failed to fully perform their duties in dealing with the blast. The explosion was one of the biggest to hit infrastructure development in China, raising questions about safety standards in the world’s second largest economy.

Exchange of Spies With China Is Positive Sign, Taiwan Says-NYT  Taiwan’s’ presidential office said Monday that a rare exchange of spies with China was a sign of improved ties between the neighbors and historic rivals. Chu Kung-hsun and Hsu Chang-kuo, two officers from Taiwan’s Bureau of Military Intelligence, were released by China and returned to Taiwan in mid-October, Taiwan’s Ministry of National Defense said in a statement on Monday. The two men were arrested in Vietnam near the border with China in 2006 and given life sentences, which were later reduced to 20 years, according to Taiwan’s China Times newspaper, which first reported the exchange. A Chinese spy imprisoned in Taiwan, Li Zhihao, was given early parole as part of the exchange, Charles Chen, a spokesman for Taiwan’s presidential office, said in a statement.

China’s Renminbi Is Approved by I.M.F. as a Main World Currency-NYT The International Monetary Fund’s move paves the way for the currency’s wider use in trade and finance, but may add volatility to the economy. The Chinse renminbi was anointed as one of the world’s elite currencies on Monday, a milestone decision by the I.M.F. that underscores the country’s rising financial and economic heft. The move will help pave the way for broader use of the renminbi in trade and finance, securing China’s standing as a global economic power. Just four other currencies—the dollar, the euro, the pound and the yen—have the I.M.F. designation.

Related: China’s Fitful Economic Reforms-NYT

 China factory indicator at three-year low-The Guardian Purchase Managers’ Index dips to 49.6, pointing to a manufacturing slowdown and prompting predictions of a further easing of monetary policy by Beijing. A key measure of China’s manufacturing activity dropped to its weakest level in more than three years in November, underlining weaknesses in the world’s second-largest economy. It was the fourth consecutive month of decline and the lowest figure since August 2012. Investors closely watch the index as a barometer of the country’s economic health. A reading above 50 signals expanding activity while anything below indicates shrinkage. The statistics bureau blamed the disappointing figure on weak overseas and domestic demand, falling commodity prices and manufacturers’ reluctance to restock.

China’s Plan for a New, Improved Military-The Diplomat Xi Jinping just outlined an ambitious plan for military reforms, but implementation will take years. On November 26, Chinese President Xi Jinping – who also serves as chair of the Central Military Commission – announced a sweeping long-term reform plan for the People’s Liberation Army. The reforms, laid out at a meeting attended by over 200 military officials, will see streamlined command over China’s military, as well as a closer watch on corruption and graft.

China’s President Xi Visits ‘All-Weather Friend’ Zimbabwe-The Diplomat Xi’s stop in Zimbabwe provides a glimpse of the pros and cons of economic dependence on China. Chinese President Xi Jinping spent Tuesday in Zimbabwe, the first stop on a two-country trip to Africa. It was the first time a Chinese president had visited the country since 1996. Xi was welcomed to Zimbabwe by his counterpart, President Robert Mugabe. Both leaders called their two countries “all-weather friends,” and pledged to boost bilateral ties. According to Xinhua, Xi said the goals of his visit were “consolidating the China-Zimbabwe traditional friendship, deepening practical cooperation and lifting bilateral relations to a higher level.”

 

SOUTHEAST ASIA

Aung San Suu Kyi and Myanmar General Meet, Taking Steps Toward Sharing Power-NYT The talks were the first face-to-face foray in what will surely be complex negotiations over how Ms. Aung San Suu Kyi and Senior Gen. Min Aung Hlaing will govern. She is the former political prisoner whose party triumphed in elections last month. He is commander in chief of the military that jailed her for the better part of two decades. They are the two most powerful people in Myanmar, and their meeting on Wednesday was a crucial first step in a transition from a military-backed government to one in which the military will share power with the democracy activists it once oppressed.

 Thai Economy and Spirits Are Sagging-NYT Thailand was once the torchbearer of freedom and prosperity in Southeast Asia. But now when Thais look to their neighbors, they feel envy, not pity. Do not be fooled by the throngs of Chinese tourists clogging the entrance to the gilded Grand Palace, the roads buzzing with traffic or the plastic smiles of hostesses greeting the business lunch crowd at luxury hotels. Thailand is in a rut. The economy is moribund and Thai households are among the most indebted in Asia. “No one feels like smiling anymore,” said Sompetch Pimsri, a merchant at a fruit and vegetable market behind the Temple of Dawn, a tourist landmark along the Chao Phraya River.

Cambodians Deserve Better-NYT The Hun Sen government cracks down, but the opposition won’t rise to the occasion. Cambodia politics is in the midst of an ugly crisis. Prime Minister Hun Sen, after officially winning the 2013 election by just a narrow margin and facing months of massive anti-government protests, seemed to have regained control. Yet in recent weeks the authorities have cracked down on the opposition Cambodia National Rescue Party, C.N.R.P.

 Vietnam bets on coal power despite rising risks-The Third Pole A heap of coal waste the size of an apartment complex looms above Do Thi Chung’s low-rise neighbourhood. One evening this July, she watched as the heap was pelted by heavy rains. Soon a river of muddy sludge was pouring downhill from the heap toward Chung’s front door, she recalled. When the water level of the landslide reached knee level, she took her children up to their home’s second level. Now her ward of this northern Vietnamese city is mostly deserted. Chung, whose husband works at a nearby coal mine, said all but seven of the ward’s 47 families have moved out. By 2030, coal is expected to contribute 56% of Vietnam’s power mix, up from 36% today. Vietnam’s embrace of coal – the fuel blamed most for climate change and a major polluter in industrialising societies over the last few centuries – is already an environmental disaster.

Lao Government Blocks Funds For Rural Road Repair in Favor of ASEAN Projects in the Capital-Radio Free Asia Government authorities in cash-strapped Laos are withholding funds urgently needed to repair flood-damaged roads in the country’s provinces, saying that available resources must be spent on improvements in the capital Vientiane ahead of regional summit meetings next year. Provincial public works and transport departments may also not draw funds assigned to other needs to carry out repairs, according to a central-government notice sent out in October, government sources told RFA’s Lao Service. Authorities are now “rushing to repair and improve roads” in the capital, Nouanta, a deputy director of Vientiane’s Public Works and Transport Department, said. “This must be done in time for the celebration of National Day on December 2 and to accommodate the ASEAN [Association of Southeast Asian Nations] Summit in late 2016,” Nouanta said.

This week’s digest was compiled by Brooke Rose with commentary by Brooke Rose and Brian Eyler

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