Asia Daily: February 2, 2024
News
Chinese leaders hint at increased focus on politics and Communist Party discipline for coming year. Chinese leadership emphasizes political control and Party discipline ahead of the People's Republic's 75th anniversary. The recent Politburo meeting discussed economic recovery but prioritized political stability, signaling a strategic focus for the upcoming year. This approach may shape China's domestic and international policies, underscoring the Party's central role in governance. Phoebe Zhang and William Zheng, South China Morning Post, February 1
Japan, China, South Korea 3-way summit likely to be held in May or later. Japan, China, and South Korea are expected to conduct their trilateral summit in May or afterward, as China assesses political developments in Japan and South Korea's general election outcome. This meeting, the first since December 2019, aims to foster cooperation among the three nations amidst varying domestic challenges and broader regional issues. The summit's timing and agenda are still under discussion, reflecting the intricate diplomatic relationships in East Asia. Kyodo News, February 1
Top legislator extends Tet greetings to border guard force. National Assembly Chairman Vương Đình Huệ offered Lunar New Year greetings to Vietnam's border guard force, underscoring their role in national defense and sovereignty protection. The ceremony, connecting leaders and soldiers across the country, highlighted the border guard's achievements in 2023. Huệ emphasized the importance of adhering to international agreements and enhancing the force's capabilities, reflecting the government's focus on security, socio-economic development, and legal education in border areas. Vietnam News, February 1
Major automakers may be using Chinese aluminum produced with Uyghur forced labor, rights group says. Human Rights Watch report alleges major car manufacturers like Tesla, General Motors, Volkswagen, and Toyota might be using aluminum produced with forced labor by Uyghurs in China's Xinjiang region. Despite China's denial of such practices, the U.S. requires importers to prove goods weren't made with forced labor. The automotive industry's reliance on Xinjiang's aluminum, crucial for various car parts, underscores the challenge of ensuring ethical supply chains in global manufacturing. Simina Mistreanu, AP News, February 1
Indonesia leader accused of bias, interference in presidential election. Indonesian President Joko Widodo faces criticism for apparent political interference and bias as he makes public appearances with election frontrunner Prabowo Subianto. Critics argue these actions breach traditional neutrality and may influence the election's integrity. Amidst rising discontent, key figures and academic groups call for a return to democratic principles. Kate Lamb and Stanley Widianto, Reuters, February 1
China dethrones Japan as top car exporter in 2023 as EV sales grow. For the first time, China surpassed Japan as the world's leading car exporter in 2023, buoyed by a surge in electric vehicle (EV) sales. China's car exports jumped 58 percent to 4.91 million vehicles, driven by robust overseas demand for EVs and an increase in gasoline-powered car exports to Russia. This shift underscores China's growing influence in the global automotive market and the significant role of EVs in shaping future trade dynamics. Kyodo News, February 1
Sok Chenda Sophea in Brussels for discussions at ASEAN-EU summit. Cambodia's Foreign Minister Sok Chenda Sophea is in Brussels to participate in key ASEAN and EU forums, focusing on strengthening regional cooperation and discussing shared prosperity, economic resilience, and sustainable development. The meetings aim to follow up on previous summit decisions and enhance the strategic partnership between ASEAN and the EU. Sophea's visit represents Cambodia's commitment to international collaboration and its role within ASEAN-EU relations. Mom Kunthear, Phnom Penh Post, February 1
Member of Taiwan’s pro-unification Nationalists elected speaker in a consolation prize for China. Han Kuo-yu, representing the Kuomintang (KMT), has been elected as the speaker of Taiwan's legislature, marking a significant political development for China, which sees Taiwan as part of its territory. The KMT's victory in the legislative seats and Han's election reflect the ongoing political dynamics between pro-unification forces and the independence-leaning Democratic Progressive Party (DPP) in Taiwan. Christopher Bodeen, AP News, February 1
LDP's biggest faction to form liquidation committee for dissolution. The largest faction within Japan's Liberal Democratic Party, once led by Shinzo Abe, is dissolving. This decision, prompted by a slush funds scandal, marks the end of a significant chapter in LDP's history since its 1979 foundation. The dissolution process includes establishing a liquidation management committee, amidst broader scrutiny over political funds within the party. This move reflects ongoing challenges in Japanese political finance and governance. Kyodo News, February 1
Requests for Move Forward Party disbandment filed. Petitions have been submitted to Thailand's Election Commission seeking the dissolution of the Move Forward Party. This action follows a Constitutional Court ruling, which found the party's efforts to amend the lese-majeste law as undermining the constitutional monarchy. The petitions argue that such actions warrant disbandment and possible electoral bans for party executives. This development adds to the contentious political landscape, highlighting deep divisions over the lese-majeste law and its implications for freedom of expression. Bangkok Post, February 1
Ailing Myanmar ex-leader Suu Kyi in 'good spirits' in solitary, says son - media. Aung San Suu Kyi remains strong in spirit despite health concerns, according to her son, Kim Aris. Detained since the 2021 military coup, Suu Kyi's resilience shines through in a handwritten letter shared via the British Foreign Office. As Myanmar marks three years since the coup, calls for her release intensify amid ongoing political unrest and resistance movements. Suu Kyi faces a lengthy prison term on charges she denies. Reuters, February 2
Long Form
East Java Looms as Key Battleground in Indonesian Presidential Contest. East Java, recognized as Indonesia's second-most populous province, stands as a pivotal battleground in the nation's presidential election, highlighting its strategic importance due to its large voter base and as a stronghold for Nahdlatul Ulama, the largest Islamic organization in the country. This province's political significance is further emphasized by the active campaign efforts of notable candidates and their families, reflecting the intense electoral competition. With 31 million voters, the political dynamics of East Java are crucial, showcasing the interplay between political, religious, and cultural factors in shaping the election's outcome. The province's role as a key electoral battleground underscores the nuanced political landscape of Indonesia, where the influence of Nahdlatul Ulama and the engagement of the electorate could significantly impact the presidential race. Joseph Rachman, The Diplomat, February 2
Markets, Makers, and the State of Play in Southeast Asia’s Electric Vehicle Industry. Southeast Asia is not just aiming to be a market for electric vehicles (EVs) but also seeks to manufacture them, reflecting a broader ambition to integrate into the global EV supply chain. With Tesla's recent entry into Malaysia, highlighted by the opening of its first showroom and the government's commitment to a nationwide network of EV charging stations, the region is signaling its readiness to embrace the EV boom. However, the distinction between being a market and a maker is crucial. While Singapore and Malaysia primarily serve as markets, with Malaysia also acting as a parts supplier, Thailand and Indonesia stand out as the leading automobile manufacturers in Southeast Asia. These countries produce parts and fully assembled vehicles for both domestic and international markets, positioning them as potential regional hubs for EV production. This dynamic landscape underscores the competitive strategies nations are adopting to secure a stake in the rapidly growing EV sector. James Guild, The Diplomat, February 2
How Indonesia Can Win the Global Race on Critical Minerals. Amidst the global energy transition, Indonesia stands at a pivotal juncture to capitalize on its rich endowment of critical minerals such as cobalt, nickel, and lithium, essential for the burgeoning electric vehicle (EV) market and renewable energy technologies. With the EV market experiencing a 60 percent growth in 2022, surpassing 10 million units worldwide, the demand for critical minerals has escalated into a strategic geo-economic issue. However, the production of these minerals is highly concentrated, with significant portions controlled by a few countries, notably the Democratic Republic of Congo for cobalt and China for rare earth minerals and processing capacities. For Indonesia to leverage its position in this competitive landscape, a comprehensive strategy extending beyond initial steps is imperative. This strategy should encompass not only the extraction but also the processing and sustainable management of these resources, positioning Indonesia as a key player in the global supply chain of critical minerals. Brurce Mecca, Azhania N. Siswadi, The Diplomat, February 2
Nvidia Chip Prices Soar in Asia on U.S. Curbs and AI Boom. In Asia, the demand for Nvidia's RTX 4090 graphics cards has surged, leading to significant price increases and shortages across the region. This trend is largely driven by U.S. export controls aimed at restricting the shipment of high-end chips to China, coupled with the booming market for artificial intelligence (AI). The RTX 4090, initially targeted at gamers, has become a coveted item in Hong Kong and China, where it can be resold for up to three times its original price due to its capabilities in AI model training. The U.S. has tightened its export controls to include not only Nvidia's top-end offerings but also the RTX 4090, affecting its availability and pricing. Retailers across Taiwan, Singapore, Vietnam, and South Korea report severe shortages and price hikes, with the RTX 4090's price increasing by as much as 60% from its launch. The situation underscores the challenges of enforcing export controls and the global race for technological supremacy in AI. Pak Yiu, Lauly Li, Cheng Ting-Fang, Lien Hoang, Dylan Loh and Kim Jaewon, Nikkei Asia, February 2
Rethinking Indonesia’s Investment Policies Through the Lens of Conditionalities. Indonesia, despite outperforming many ASEAN peers in attracting foreign direct investment (FDI) over the past five years, faces a critical challenge in enhancing its human capital and innovative capabilities. The nation's investment in research and development (R&D) and tertiary education is notably low among G20 countries, hindering its progress in high-value manufacturing and technology sectors. Indonesia's heavy reliance on natural resource exports and low-value manufacturing, a result of historical underinvestment in R&D and education, limits its workforce's skills and innovation potential. To pivot towards sustainable growth, Indonesia is urged to focus on human capital development, particularly in emerging sectors like electric vehicles (EVs), renewable energy, and semiconductors. Leveraging its nickel resources, Indonesia aims to become a key player in the global battery and semiconductor industries, essential for the EV market. However, achieving this requires significant investment in R&D and skilled labor. Conditionalities in FDI policies, such as technology transfer mandates and local employment quotas, could drive this investment, but balancing these requirements with maintaining investment attractiveness poses a challenge. Indonesia's strategy must navigate international commitments, avoid trade retaliation, and address bureaucratic inefficiencies and corruption to effectively leverage its natural resources and technological potential for economic diversification and growth. Ronald Tundang, East Asia Forum, February 2