Asia Daily: March 22, 2024
News
Võ Thị Ánh Xuân named as Vietnamese Acting President. Following the resignation of former President Võ Văn Thưởng, Vice President Võ Thị Ánh Xuân has been appointed as the acting president of Vietnam. This decision was made by the National Assembly's Standing Committee after the Sixth Extraordinary Session. Xuân will serve until a new president is elected. Thưởng's resignation came after violations of Party regulations, impacting the Party and State's reputation. Vietnam News, March 21
Beijing says Philippines made ‘illegal landing’ on disputed reef in South China Sea. Beijing has reported that 34 Philippine nationals landed on the disputed Tiexian Reef in the South China Sea, disregarding warnings from China. The Chinese coastguard responded by landing on the reef to address the situation according to law, emphasizing China's sovereign rights over the area and urging the Philippines to cease such actions to maintain regional peace and stability. Liu Zhen, South China Morning Post, March 21
Japan policy paper to focus on U.S., Philippine ties to counter China. Japan's upcoming diplomatic policy report will spotlight bolstering alliances with the United States and the Philippines as a countermeasure to China's rising assertiveness in the Indo-Pacific region. Aimed at addressing China's expanding military presence and territorial ambitions, the strategy underscores Japan's efforts in reinforcing regional security. Additionally, the report commits to tackling the issue of North Korea's abductions of Japanese citizens, reflecting a broad approach to national and regional challenges. Kyodo News, March 21
'PH not poking the bear.' President Ferdinand Marcos Jr. has stated the Philippines is not seeking to provoke China by supporting U.S. policies in the contested South China Sea. Stressing a policy of non-aggression, Marcos Jr. clarified that the Philippines has no intentions of launching attacks or using its military bases against China. This declaration addresses concerns related to China's expansive maritime claims and emphasizes the Philippines' commitment to maintaining peace in the region. The Manila Times, The Manila Times, March 21
Fiji to sign ports deal with Australia in shipbuilding boost. Fiji has announced plans to sign an agreement with Australia to upgrade its ports and shipbuilding infrastructure. This move comes months after Fiji considered partnering with China for the project. Australia will provide initial grant financing, with the project aimed at reviving Fiji's shipbuilding industry, creating job opportunities, and stimulating economic growth. This agreement underscores Australia's efforts to enhance its infrastructure support in the Pacific Islands region amid China's growing influence. Kirsty Needham, Reuters, March 21
Nearly 30 junta administrators resign in Rakhine State over conscription effort. In Thandwe Township, Rakhine State, 27 junta-appointed administrators resigned due to the regime's forced conscription efforts. These officials, fearing for their lives, stepped down amid growing tensions and opposition to the military's recruitment tactics. The resignations reflect significant dissent within regions still under junta control, highlighting the complex dynamics of governance and resistance in Myanmar. Moe Oo, Myanmar Now, March 21
China says it is considering maritime talks with Australia. In the context of heightened tensions in the South China Sea, China is contemplating initiating maritime discussions with Australia. This development was mentioned by a Chinese Foreign Ministry spokesperson and aligns with efforts to mend ties, particularly after a dip in Sino-Australian relations in 2020. The talks aim to address trade and regional security differences, highlighting the importance of dialogue in managing complex international relationships. Laurie Chen, Liz Lee, Joe Cash and Xu Jing, Reuters, March 21
UNESCO says Uzbekistan broke promises over Bukhara development. UNESCO has criticized Uzbekistan for not halting construction activities near the historic zones of Bukhara, directly contradicting previous commitments. The organization expressed concerns after recent demolitions threatened the World Heritage Site's integrity. This incident accentuates the ongoing conflict between Uzbekistan's development goals and the imperative of preserving its rich cultural heritage. Eurasianet, March 21
Tech war: Chinese chip executives put faith in global cooperation despite intensifying US restrictions. At the Semicon China expo, China's top semiconductor leaders advocated for increased global collaboration amidst growing US export restrictions on advanced chip technology. Highlighting China's vital role in the international chip supply chain, the discussions did not directly address US sanctions. Che Pan, South China Morning Post, March 21
PPP lawmaker suggests Ambassador Lee resign, face investigation under civilian status. Rep. Kim Tae-ho, a People Power Party lawmaker has recommended that Ambassador to Australia, Lee Jong-sub, resign to undergo an investigation related to a young Marine's death as a civilian. This suggestion comes as Lee returned to South Korea, amid criticisms over his recent appointment and subsequent departure. The lawmaker's comments aim to align with public sentiment and avoid political fallout ahead of upcoming general elections. Kang Jae-eun, Yonhap News Agency, March 21
Kazakhstan: Light punishment for ex-president’s nephew sparks anger. The trial of Samat Abish, nephew of Kazakhstan’s former president, concluded with an eight-year suspended sentence for his alleged involvement in the 2022 unrest, causing widespread dismay. The trial's secrecy and the perceived leniency have ignited discussions on political influence and justice in Kazakhstan, highlighting ongoing tensions within the nation's political landscape. Almaz Kumenov, Eurasianet, March 21
Japan watching foreign exchange moves with urgency: finance chief. Finance Minister Shunichi Suzuki has highlighted Japan's close monitoring of recent foreign exchange fluctuations, particularly the yen's decline to a four-month low against the dollar. This concern arises amid market expectations that the Bank of Japan will continue with its low interest rate policy. Suzuki's comments reflect the government's attentiveness to currency market movements and their potential impact on Japan's economic stability. Kyodo News, March 21
Long Form
Modi’s Success Story in West Asia. Prime Minister Narendra Modi's foreign policy during his second term has been particularly noteworthy in West Asia. Amidst a term filled with both remarkable successes and challenges, including the global COVID-19 pandemic and tensions with China, Modi's engagement with West Asia has stood out. His diplomacy in the region has been marked by strengthened ties and significant engagements, such as his reception by Sheikh Mohamed bin Zayed Al Nahyan, president of the UAE. Rajeev Agarwal, The Diplomat, March 22
The Rise of Indonesia’s Banks. Indonesia's banking sector has experienced a dramatic turnaround since the Asian Financial Crisis in the late 1990s, which saw the collapse of numerous banks due to bad loans. From the ashes of this crisis, Bank Mandiri was formed in 1998 through the merger of four failing state-owned banks. Today, it stands as Indonesia's largest bank, boasting $138 billion in assets and a net income of around $3.9 billion in 2023. The sector, dominated by state-owned entities including Bank Mandiri, Bank Rakyat Indonesia, and Bank Negara Indonesia, showcases the robust recovery and growth of Indonesian banks. The government holds a majority stake in these banks, with the rest publicly traded, highlighting the strategic role of banking in Indonesia's economic resilience and growth. James Guild, The Diplomat, March 22
Attack in Pakistan's Gwadar Strikes Near Heart of China's Interests. A militant attack near the port of Gwadar in southwestern Pakistan has reignited concerns over the security of China's Belt and Road projects in the region. Eight militants targeted the Gwadar Port Authority complex, resulting in casualties among security personnel but failing to fully detonate their explosives. The attack, claimed by the Balochistan Liberation Army, displays the challenges faced by the Pakistani government and Chinese investments in securing strategic infrastructure projects. The incident not only highlights the ongoing security issues in Balochistan but also raises questions about the effectiveness of Pakistan's efforts to protect foreign investments, particularly those linked to the China-Pakistan Economic Corridor (CPEC). Adnan Aamir, Nikkei Asia, March 22
India Pharma Quality Lapses Force U.S. to Look to China for Lifesaving Drugs. Quality control issues in Indian pharmaceutical manufacturing have led the U.S. to pivot towards China for essential cancer drugs, showing broader challenges in the global drug supply chain. Inspectors found evidence of data manipulation at Intas Pharmaceuticals, resulting in a ban on imports from their plant and exacerbating a shortage of life-saving cancer medication in the U.S. The shift to China, despite ongoing efforts to decrease dependency, demonstrates the critical nature of maintaining high manufacturing standards and the geopolitical dynamics affecting the global pharmaceutical trade. India's struggle with regulatory compliance and quality assurance in drug production risks its position as a major supplier to the U.S. market, spotlighting the need for systemic improvements to meet international standards. Sayan Chakraborty and Cissy Zhou, Nikkei Asia, March 22
Lessons Gleaned from China’s Property Market Woes. China's real estate sector transformation since its economic reforms showcases rapid urbanization and shifts in the Asia Pacific region. With policies like the 'Three Red Lines' aimed at curbing developers' borrowing, China's approach has led to high-profile insolvencies, showcasing the balance between regulation and market dynamics. Efforts to stabilize housing markets, such as in Beijing, and reliance on land sales for local revenue reflect broader trends in Asian economies. Strategies to revitalize 'Ghost Cities' and manage household debt reveal the challenges of ensuring market stability and transparency. Lessons from China's property market, including the importance of comprehensive policy frameworks and the need for diversification beyond real estate, offer insights for other Asian countries navigating similar urbanization and economic challenges. Kaize Zhu, East Asia Forum, March 22
Southeast Asia Stymied in South China Sea Dispute. Philippine President Ferdinand R. Marcos Jr.’s recent outreach to Vietnam shows ASEAN's struggle with China's assertiveness in the South China Sea (SCS). Both countries signed Memorandums of Understanding on maritime cooperation, establishing a hotline between their coast guards, as regional countries seek alternatives to ASEAN-led negotiations due to its ineffectiveness in resolving the SCS dispute. Despite individual efforts, such as the Philippines strengthening ties within the US alliance network and Vietnam's more cautious approach with China, ASEAN's lack of cohesion and internal politics hinder a unified stance against China's aggression. Beijing's strategy, combining psychological warfare and economic incentives, has effectively paralyzed ASEAN's ability to present a united front, pointing out the complexity of regional dynamics in the face of Chinese dominance. Harshit Prajapati and Prisie L. Patnayak, East Asia Forum, March 22