Asia Daily: May 22, 2025
China
Chinese army reveals helicopter encounters with foreign navy over East China Sea. China’s military reported 11 close-range helicopter encounters with a foreign navy over 10 days in the East China Sea. State media said a Z-19 pilot from the Eastern Theatre Command responded to repeated “provocations,” with aircraft coming within 10 meters. While the foreign force wasn’t named, footage suggested a U.S. Navy MH-60R. Liu Zhen, South China Morning Post, May 22
China expresses grave concern over U.S. ‘Golden Dome’ missile defense system: FM spokesperson. China criticized the U.S. “Golden Dome” missile defense system as a global, multi-domain network with offensive implications, violating the Outer Space Treaty. Foreign Ministry spokesperson Mao Ning warned it could escalate space militarization and destabilize international security. Global Times, May 21
Japan
Shinjiro Koizumi takes farm ministry reins after predecessor's rice gaffe. Former Environment Minister Shinjiro Koizumi has replaced Taku Eto as Japan’s agriculture minister after Eto resigned over backlash to his remarks about receiving free rice. Koizumi, stressing affordability, pledged to address soaring rice prices. In his first comments, he emphasized prioritizing rice policy and public needs. Gabriele Ninivaggi, The Japan Times, May 21
Nippon Ishin grapples with poor governance ahead of Upper House election. Once poised to become Japan’s main opposition party, Nippon Ishin no Kai is now struggling with internal confusion, scandals, and declining public support ahead of the Upper House election. Former leader Ichiro Matsui criticized the party’s lack of direction, while recent local election setbacks and leadership resignations have further weakened its credibility. Eric Johnston, The Japan Times, May 21
South Korea
DP's Lee leads PPP's Kim 46% to 32%: poll. Democratic Party presidential candidate Lee Jae-myung leads People Power Party’s Kim Moon-soo 46% to 32% in a National Barometer Survey conducted May 19–21. Lee Jun-seok of the New Reform Party placed third with 10%. The survey showed 55% of respondents favored regime change via the June 3 election, while 34% preferred a PPP extension. The poll surveyed 1,002 adults with a 3.1-point margin of error. Kim Eun-jung, Yonhap News Agency, May 22
PPP's Kim pledges to cut number of lawmakers by 10%. People Power Party candidate Kim Moon-soo pledged to reduce lawmakers by 10% and revise the Constitution to allow a four-year, two-term presidency aligned with other elections. He vowed to shorten his own term to three years and relinquish broad presidential powers. Kim also proposed new impeachment standards, a special inspector for presidential relatives, and reforms to strengthen election oversight. Kim Eun-jung, Yonhap News Agency, May 22
North Korea
North Korean leader Kim Jong Un condemns warship accident as 'criminal'. Kim Jong Un denounced a failed launch of a 5,000-ton destroyer in Chongjin as a "criminal act," blaming carelessness and unscientific methods for damaging the vessel and shaming the state. The ship, North Korea’s largest warship, reportedly tipped sideways during a rare side-launch. Kim ordered repairs before a key party meeting in June, framing restoration as a political imperative. Jack Kim, Josh Smith, Joyce Lee, Hyunsu Yim and Ju-min Park, Reuters, May 21
Russia coordinating N. Korean leader Kim's visit: report. Russia is arranging a visit by North Korean leader Kim Jong-un, though the timing remains undecided, according to Deputy Foreign Minister Andrey Rudenko. Kim was invited by President Vladimir Putin following their June 2024 summit in Pyongyang. Possible dates include June or the September Eastern Economic Forum. Park Boram, Yonhap News Agency, May 21
Workers scoff at 'worthless' propaganda materials as N. Korea demands impossible production goals. North Korea has distributed political propaganda urging workers to boost output and economize, but many dismiss the materials as outdated and unrealistic. Workers criticized the messaging as detached from current conditions and unhelpful in achieving the regime’s year-end targets set by the Eighth Party Congress. Seon Hwa, Daily NK, May 22
Thailand
Budget debate set as MPs prep for scrutiny. Thailand’s House of Representatives will begin debating the 3.78-trillion-baht 2026 budget bill from May 28 to 31, with 20 hours each allotted to government and opposition MPs. Two bills and two executive decrees will be addressed first. House Speaker Wan Muhamad Noor Matha will oversee the session, and ministers have been instructed to answer questions. Aekarach Sattaburuth, Bangkok Post, May 21
Senators ask Election Commission to scrap probe. A group of Thai senators petitioned the Election Commission to suspend an inquiry panel investigating their alleged vote collusion in last year’s Senate election. Led by Pol Maj Gen Chattrawat Saengphet, they accused the panel of malfeasance, citing constitutional violations and lack of confidentiality. The senators claimed the committee, which includes. Bangkok Post, May 21
Myanmar
ASEAN to dedicate two meetings to Myanmar conflict next week, chief says. ASEAN will hold two special meetings in Malaysia to address the Myanmar crisis ahead of next week’s summit, according to Secretary-General Kao Kim Hourn. The talks, involving current, past, and future chairs as well as foreign ministers, aim to revive the bloc’s stalled Five Point Consensus peace plan. Stanley Widianto, Reuters, May 21
Two Myanmar junta choppers down in battle for Kachin’s Bhamo. The Kachin Independence Army claims to have shot down two junta helicopters delivering reinforcements to Bhamo, where clashes have intensified since December. One helicopter crashed near Shwegu; another made an emergency landing. The junta blamed mechanical failure. Resistance videos show explosions and wreckage. The Irrawaddy, May 21
Laos
China’s Hubei launches first freight train via China-Laos Railway. A freight train carrying 1,650 tonnes of fertilizer materials departed from Wuhan to Luang Prabang, marking Hubei Province’s first international train via the China-Laos Railway. The route is expected to cut transport time and reduce costs compared to shipping, enhancing trade and economic ties between central China and Southeast Asia. Vientiane Times, May 21
PM to pay official visit to Malaysia, attend 46th ASEAN Summit. Lao Prime Minister Sonexay Siphandone will visit Malaysia on May 25 at the invitation of Prime Minister Anwar Ibrahim to strengthen bilateral relations. He will also attend the 46th ASEAN Summit and related meetings in Kuala Lumpur from May 26 to 27. Malaysia, serving as ASEAN Chair for 2025, will host the summit under the theme “Inclusivity and Sustainability.” Vientiane Times, May 22
Philippines
Philippines' Marcos asks cabinet secretaries to resign in government reset. President Ferdinand Marcos Jr. has requested all cabinet secretaries to submit resignations as part of a government “reset” following poor midterm election results. Citing the need for performance, urgency, and alignment, Marcos said officials who deliver will stay. The move follows his declining approval rating and growing public dissatisfaction over inflation. Allies of Vice President Sara Duterte overperformed in the polls, intensifying political rifts. Karen Lema, Reuters, May 21
U.S., Philippines militaries conduct drills in waters adjacent to the China-claimed South China Sea. U.S. and Philippine forces conducted joint naval and air drills in the Sulu Sea, near the contested South China Sea, amid increasing Chinese harassment of Philippine vessels. Exercises included maritime surveillance, tactics, and seizure operations. The U.S., reaffirming its mutual defense treaty with the Philippines, emphasized freedom of navigation. Associated Press, May 21
Singapore
Singapore PM sticks with 'experienced hands' in cabinet reshuffle. Prime Minister Lawrence Wong retained nine ministers and added six new ones in a cabinet reshuffle following his May 3 election win. He kept the finance portfolio and reappointed Gan Kim Yong as deputy premier, citing the need for stability amid global uncertainty. The reshuffle follows retirements of several senior leaders. Xinghui Kok, Jun Yuan Yong and Bing Hong Lok, Reuters, May 21
Absence of labour chief from Cabinet a temporary arrangement, says PM Wong. Prime Minister Lawrence Wong confirmed that NTUC chief Ng Chee Meng will not join the Cabinet for now, calling it a temporary arrangement. Ng had requested to focus on his union and constituency roles amid controversy following the election. Wong emphasized the importance of the labour-Cabinet link and expects Ng or another labour representative to be included in the Cabinet in the future. Anjali Raguraman, The Straits Times, May 21
Taiwan
China can't decide whether we are a country, Taiwan foreign minister says. Taiwan Foreign Minister Lin Chia-lung said Beijing has no right to determine Taiwan’s statehood, asserting the island’s democratic governance and international recognition. Marking President Lai Ching-te’s first year in office, Lin reiterated Taiwan’s openness to dialogue and said he would gladly shake hands with his Chinese counterpart. Ben Blanchard, Reuters, May 21
Taiwan alleges China is using cash to win developing nations to its stand on the island. Taiwan’s foreign minister Lin Chia-lung accused China of using financial incentives and infrastructure deals to pressure developing nations into backing its claim over Taiwan. He said Beijing’s tactics include citing a 1971 U.N. resolution to argue Taiwan is part of China, though it makes no mention of the island. Christopher Bodeen, Associated Press, May 21
Kazakhstan
Kazakhstan, Germany advance $54.4 billion in joint investment projects. Kazakhstan and Germany are advancing 63 bilateral projects valued at $54.4 billion, with 32 completed and 12 ongoing, officials announced at the 16th Kazakhstan-German Business Council meeting. New agreements cover industrial collaboration, dual education, and water resource management. Fatima Kemelova, The Astana Times, May 21
Uzbekistan
In the ancient Uzbek city of Termez, delegates talk ties between Central and South Asia. The first Termez Dialogue on Connectivity brought together 200 participants from politics, business, and academia to discuss trade and cooperation between Central and South Asia. Uzbek officials emphasized accelerating the $5 billion Trans-Afghan Corridor linking Termez to Peshawar via Kabul. Security and logistical hurdles remain, but leaders see the corridor as crucial to regional growth. The Times of Central Asia, May 21
President of Uzbekistan sets priorities for multifaceted cooperation among Turkic states. President Shavkat Mirziyoyev proposed deeper cooperation within the Organization of Turkic States during an informal summit in Budapest. He advocated for a strategic partnership treaty, expanded trade through a “TURK-TRADE” platform, and transport integration via “green corridors.” Uzbekistan Daily, May 21
Tajikistan
Tajikistan faces uphill climb to wire the country. Tajikistan ranks last in Eurasia for fixed broadband speed and is unlisted for mobile connectivity, according to Speedtest. Officials cite mountainous terrain—covering 93% of the country—as a key obstacle. The government plans to expand server capacity and fiber-optic networks, with vague mentions of private sector involvement. Kyrgyzstan, also mountainous, ranks far higher in connectivity. Eurasianet, May 21
Northeast Asia
Chinese Investment Rebounds Despite Growing Frictions. Chinese foreign direct investment (FDI) in the EU and UK surged to EUR 10 billion in 2024, a 47% increase from 2023, marking the first rebound since 2016. This recovery, driven primarily by record greenfield investments and a revival in M&A activity, shows China's continued focus on the automotive sector, with EUR 5.2 billion invested in EV-related projects. Hungary retained its lead as top destination, capturing 31% of all Chinese FDI in Europe due to multiple EV battery and vehicle plant projects. While EV investments dominate, their future is uncertain amid a 79% plunge in newly announced projects and multiple cancellations. Political dynamics influence investment patterns, with firms favoring countries that opposed EU anti-subsidy duties on Chinese EVs. Despite the uptick, China remains a minor investor compared to the US, Japan, and South Korea. Regulatory scrutiny is increasing, with the EU proposing stricter FDI screening and potential conditions on market access tied to local value creation. The future of Chinese FDI in Europe hinges on economic conditions, evolving EU-China relations, and whether trade barriers will push Chinese firms toward local production or alternative markets. Agatha Kratz, Max J. Zenglein, Andreas Mischer, Gregor Sebastian, Armand Meyer, MERICS, May 21
How to Predict China’s Economic Performance for 2025: A Sectoral Approach. China’s 2025 GDP growth will almost certainly hit the government’s 5 percent target, not as a forecasted outcome but as a politically mandated objective, achieved through policy-driven allocation rather than market responsiveness. As such, analyzing the composition of growth, consumption, investment, and net exports, is more insightful than projecting headline figures. In 2024, consumption contributed 2.2 percentage points to GDP growth, investment 1.2 points, and net exports 1.5 points. For 2025, consumption is expected to rise to 3.0–3.5 points amid policy focus, while net exports may flatten due to global trade headwinds. To fill the gap, investment in manufacturing and infrastructure must increase to 1.5–2.0 points. The property sector remains weak, and infrastructure spending is expected to rise, though this may exacerbate debt burdens. Manufacturing investment persists but risks worsening trade frictions. Two growth paths are outlined: one reliant on infrastructure, benefiting commodity exporters but worsening debt, and another led by consumption, yielding more stable, sustainable expansion. Ultimately, in China, GDP growth functions as a policy input, not a reactive indicator, necessitating sectoral analysis for meaningful forecasting. Michael Pettis, Carnegie Endowment for International Peace, May 21
Less regulation, more innovation in Japan’s AI governance. Japan’s 2025 AI governance marks a change from initial regulatory ambitions to a more flexible, innovation-driven model. Abandoning calls for stricter rules, Japan now adopts a ‘light touch’ framework focused on sector-specific laws and voluntary compliance. This aligns with global developments, including the rollback of U.S. AI regulations and criticism of the EU’s AI Act, and responds to domestic imperatives like avoiding the ‘2025 digital cliff’—a projected economic loss scenario linked to digital stagnation. Japan’s draft AI Bill, introduced in February, emphasizes promotion over restriction, imposing minimal obligations on private actors. The Ministry of Economy, Trade and Industry (METI) is driving this transformation, supporting initiatives like the Digital Governance Code and the GENIAC program to accelerate AI adoption across sectors. Partnerships with firms like Nvidia, SoftBank, and OpenAI reflect a robust public-private collaboration. However, challenges persist, including insufficient digital talent, weak executive engagement, and slow sectoral uptake. Japan’s emphasis on AI-friendly policies is part of its broader ‘Society 5.0’ vision, aiming to harness digital innovation for economic resilience and societal well-being. If successful, Japan’s approach could serve as a model for balanced AI governance globally. Sun Ryung Park, East Asia Forum, May 21
Sanctioned but surging: How China is building its AI empire. Despite years of escalating US export controls, China has rapidly advanced its artificial intelligence capabilities, leveraging strengths in talent, data, power infrastructure, and adaptable innovation. With computing power as the only pillar the US can still effectively restrict, Chinese firms have narrowed technical gaps by using open-source models, increasing domestic chip production, and building a national AI ecosystem. Huawei’s new Ascend 910C chip rivals top-tier Nvidia models, exemplifying China's ability to innovate around sanctions. Companies like DeepSeek and SMIC, supported by state-led initiatives, drive AI development and semiconductor progress through localized manufacturing and novel approaches like chiplets and smaller AI models. Washington’s policies risk backfiring: sanctions have slashed US firms’ China revenue, jeopardizing R&D funding, and encouraged China to double down on self-reliance. The concept of “AI factories,” specialized infrastructures that generate intelligence rather than physical products, has emerged as central to global competition. China’s accelerated AI deployment, coupled with its expansive application field, positions it as a rising AI superpower. The race now hinges on whether China can effectively integrate large-scale infrastructure with its rapidly evolving AI economy, potentially reshaping the global technological balance. Tan Jet Min, ThinkChina, May 21
Southeast Asia
Why Chinese investors are racing to plant durians in Southeast Asia. Chinese entrepreneurs are increasingly investing in durian cultivation across Southeast Asia, driven by rising domestic demand and the region’s favorable growing conditions. Investors like Wang Junbo in Vietnam and Xiao Yuanxing in Laos exemplify a broader trend of Chinese capital moving upstream in the durian supply chain. While Thailand remains a key exporter, Vietnam, Malaysia, and the Philippines have gained access to the Chinese market, reshaping regional dynamics. In Laos, government support and infrastructure developments such as the China-Laos Railway have further encouraged Chinese ventures. However, land ownership restrictions compel investors to partner with locals or operate through leaseholds. In Thailand, collaborative models like Wen Ji Durian’s partnerships with farmers offer alternatives to direct land control while enabling quality oversight. Despite long gestation periods and regulatory uncertainties, investors remain optimistic, though wary of market saturation and policy risks. The rapid influx of Chinese capital has sparked local concerns over land use and market dominance. With land disputes and environmental issues emerging, the durability of this investment wave may depend on regulatory clarity and the broader trajectory of China’s durian demand. Lim Zhan Ting, ThinkChina, May 21
A Call for Ecological Justice: Why Indonesia’s Pesantrens ‘Reject’ Renewable Energy. Indonesia’s push to reach 23% renewable energy by 2025 has faced resistance from pesantrens in East Java’s Sumenep region, despite their longstanding commitment to environmental activism. Pesantren leaders from institutions like Annuqayah and Patapan oppose the government's solar plant plans not because they reject renewable energy, but because they view the projects as ecologically and socially unjust. Implemented through a top-down, technocratic approach, the initiatives have overlooked community input, threatening biodiverse forests and essential water sources—the lifelines of pesantren-run and rural communities. The targeted site, considered the “lungs” of East Guluk-Guluk, supports agriculture and prevents flooding, and its destruction risks water scarcity and loss of livelihood. Pesantrens advocate alternative, decentralized renewable options like rooftop solar panels, floating installations on dams, and microgrids on unproductive land. Their stance shows a broader critique: development that ignores local wisdom and justice is greenwashing. Resistance to similar projects in East Nusa Tenggara and Banten underscores the importance of equitable participation in Indonesia’s energy transition. A sustainable future, pesantrens argue, must integrate environmental ethics, community ownership, and economic inclusivity. Iim Halimatusa’diyah, FULCRUM, May 22
Why the Asia-Pacific Needs a Regional Green Industrial Strategy. The Asia-Pacific’s cleantech momentum is under threat from rising protectionism, fragmented policies, and fossil fuel dependence, despite being home to nearly half of global energy demand and over 80% of growth. While Southeast Asia has emerged as a major solar module producer and Indonesia has launched its first EV battery plants, these successes rest on fragile export-led models. External shocks, such as US tariff hikes and the withdrawal from Just Energy Transition Partnerships, expose the vulnerability of relying on Western markets. The region’s energy systems, built around fossil fuels, hinder the scaling of renewables. A proposed solution is the establishment of regional net-zero industrial parks that cluster major energy users, reduce infrastructure costs, and bypass legacy grids. These parks could integrate Australia's minerals, Southeast Asia’s manufacturing, China's cleantech, Japan’s engineering, and Gulf investment. However, realizing this vision requires coordinated regional governance beyond siloed bilateral deals. Platforms like the East Asia Summit and RCEP may facilitate cooperation, but practical execution remains uncertain. Green industrial parks not only promise economic resilience and job creation but could also create local belief in the energy transition’s benefits, turning clean growth into a regional reality. Muyi Yang and Christopher Wright, FULCRUM, May 21
South Asia
Armed Rivalry: Assessing India and Pakistan’s Military Buildup Amid Renewed Tensions. The May 2025 missile exchanges between India and Pakistan, following a militant attack in Pahalgam, marked the most severe escalation since the 2019 Pulwama/Balakot crisis and highlighted the deepening militarization of their relationship. While a temporary ceasefire was achieved, the broader outlook remains volatile. India’s military expenditure in 2024 reached USD $86.1 billion, eight times Pakistan’s $10.2 billion, showing its economic growth and security concerns vis-à-vis China and Pakistan. Despite lower spending, Pakistan allocates a higher share of its GDP and government budget to defense. Both nations remain top global arms importers: India increasingly sources from Western partners like France and the U.S., while Pakistan depends heavily on Chinese arms, with 81% of its imports from China between 2020 and 2024. The recent conflict featured Israeli, French, and Russian systems used by India, and advanced Chinese weaponry deployed by Pakistan, turning the clash into an informal showcase of competing global arms. Despite disparities in spending and capabilities, neither side secured a decisive advantage, indicating that military buildup alone does not guarantee deterrence or superiority. Ongoing modernization and deepening foreign defense partnerships risk exacerbating South Asia’s strategic instability. Xiao Liang and Zubaida Karim, South Asian Voices, May 21
Oceania
Australia-Indonesia relations: From Keating’s bold vision to Albanese’s careful pragmatism. Anthony Albanese’s recent visit to Jakarta demonstrates the enduring but evolving importance of Indonesia in Australia’s foreign policy. Echoing Paul Keating’s 1990s assertion that “no country is more important to Australia than Indonesia,” Albanese reaffirmed the relationship’s centrality, albeit with greater caution and pragmatism. While Keating pushed bold initiatives—most notably the 1996 security agreement that unraveled over Timor—Albanese emphasizes measured progress amid shifting geopolitical dynamics. Despite opportunities for cooperation, Indonesia’s expanding global ties complicate Australia’s diplomatic positioning. Australia supports Indonesia’s OECD and CPTPP aspirations, yet official language remains restrained, reflecting hesitancy amid Indonesia’s engagement with non-Western blocs like BRICS. Economic ties, once focused on electric vehicle supply chains and superannuation fund investments, now prioritize healthcare and sovereign wealth fund collaboration. Initiatives such as Monash University’s Jakarta campus and hospital ventures in Bali and Kalimantan signal deeper integration, though progress on critical minerals cooperation lags. Albanese’s approach reveals a more nuanced strategy shaped by past disappointments and Indonesia’s growing assertiveness, illustrating the challenges of maintaining strategic relevance as Indonesia’s global stature rises. Greg Earl, Lowy Institute, May 21
Europe’s faltering statecraft in the Pacific. European engagement in the Pacific has proven inconsistent and largely ineffective amid escalating geopolitical competition. While France, the UK, Germany, and the EU have introduced Indo-Pacific strategies since 2021, their focus has largely centered on other subregions, sidelining the Pacific. France retains the strongest regional presence due to its territories, yet its handling of independence tensions in New Caledonia has damaged trust. Despite President Macron’s outreach, France’s militarized and colonial posture has drawn criticism. The UK’s renewed diplomatic push since 2019 has similarly waned, especially after aid cuts and the revocation of Vanuatu’s visa waiver. The EU’s involvement, though highlighted by its Global Gateway initiative and selective infrastructure investments, has suffered from bureaucratic overreach and mishandled negotiations, eroding its regional credibility. Compounding the issue, many European actors are slashing aid budgets and reorienting resources toward defense due to domestic and transatlantic security pressures. As a result, Pacific nations, increasingly assertive in setting the terms of engagement, view European overtures as self-serving and transient. Without sincere partnerships on core regional concerns, like climate change, sovereignty, and illegal fishing, Europe risks irrelevance in a region managing its priorities without them. Nicholas Ross Smith, East Asia Forum, May 22