Japan loses credibility as corruption-tainted aid projects continue

Another suspected bribery case related to Japan’s development aid has come to light.

A Tokyo-based railway consulting company allegedly paid a total of 100 million yen ($972,762) in kickbacks to government employees and others from Vietnam, Uzbekistan and Indonesia. The company had been awarded contracts for Japan’s official development assistance projects worth 6 billion yen in these countries.

The Japanese government has been pursuing what it calls “values-based diplomacy” designed to promote democracy and the rule of law in developing countries.

As part of this foreign policy agenda, Japan has pledged to provide 2 trillion yen in aid to Southeast Asian nations. It has also announced plans to expand Japan’s exports of infrastructure-related technologies and services.

The government’s planned expansion of the development aid program underscores the need for Japan to prevent itself from being considered a nation tolerant of corruption.

In a troubling sign, a report by an international nongovernmental organization classified Japan as a nation that is not eager to pursue cases involving Japanese businesses bribing foreign parties.

To clear its name, Japan must do more to elicit cooperation from countries that receive Japanese money to stamp out corruption related to aid projects. Japan should also step up its efforts at home to crack down on such cases.

Companies charged with overseas bribery face a fine of up to 300 million yen. That’s no small amount. But it has been pointed out that the penalty doesn’t deter businesses from bribery if the expected benefits from aid projects are bigger than the maximum fine.

The United Nations Convention against Corruption calls for establishing legislation to confiscate all benefits from contracts won through bribery. More than a decade has passed since Japan signed the treaty. The government should act swiftly to revise its related laws accordingly.

In another recent case, the U.S. Justice Department fined a Japanese trading company 9 billion yen for bribing Indonesian government officials to secure a thermal power project. The United States and Britain are stiffening penalties against companies that have failed to take measures aimed at deterring misconduct by employees. This is an age when companies with poor legal compliance records are punished harshly.

It is said that in many cases, overseas subsidiaries actually pay bribes to bag juicy contracts on behalf of their Japanese parent companies.

Experts say companies should establish a system for coordinated anti-corruption campaigns involving all members of corporate groups and ensure that parent companies provide effective compliance guidance for subsidiaries and affiliates.

Japanese companies should heed that advice.

Companies often face demands for bribes from foreign government officials who have decision-making power concerning aid projects. Granting such demands promotes corruption in the countries and effectively hampers their economic growth.

Markets don’t develop in corrupt countries because they cannot attract foreign investment. Any act of greasing the palms of officialdom runs counter to the purpose of official development assistance.

In other words, Japan can significantly contribute to the development of countries by proposing steps to root out corruption and supporting their efforts to take such steps. If companies try to use bribes to win contracts, aid donors have to pay more for projects while development costs for recipients rise. Such a breach of trust is detrimental to the interests of both sides.

Independent efforts to clean up corruption by single countries cannot be very effective. Japan should work with other countries and demand anti-graft measures from aid recipients as a condition for development assistance.

As an ODA policy priority in this new age, the Foreign Ministry has decided to expand support to help developing countries build up legal systems by dispatching legal experts there. The planned legal systems are expected to include anti-corruption laws and training for legal experts.

When a bribery scandal involving a Japanese company in Vietnam surfaced six years ago, the ministry announced plans to increase aid in this area as a way to prevent a recurrence.

But Japan’s aid to this area is still small.

This time around, the government should follow through on its pledge and restore the credibility of Japan.

--The Asahi Shimbun

Resource depletion threatens Indonesia’s future

The 2014 general election in Indonesia brings an opportunity for the Indonesian public to demand better natural resource management and environmental protection. Resource depletion may shake the very foundation of Indonesia’s exports and eventually its economy. With global demand for commodities likely to increase — especially in fast-growing emerging markets — export growth from Indonesia can only remain buoyant if the country manages its resources wisely.

Indonesia’s economy is the 16th largest in the world. Natural resources and commodities, such as oil, gas, coal and crude palm oil (CPO) — making up around 50 per cent of Indonesia’s exports — have contributed significantly to its strength. Indonesia’s energy supply, employment and food security rely on these resources.

Indonesia has pushed the production of coal and gas energy sources in recent years — not only for domestic consumption but also for meeting export demand. At times, the proportion of coal exported exceeded 90 per cent from 2007–09, according to the Energy and Mineral Resources Ministry.

Indonesia’s employment also relies on natural resources. The forest-related sectors employed a total of 3.76 million people — 4 per cent of Indonesia’s working population — according to the 2011 International Trade Strategies Report. Forest commodities also contributed roughly 3 per cent to the country’s GDP. In 2010, agriculture accounted for 38.3 per cent of total employment in Indonesia.

Since its economy recovered from the late-1990s financial crisis, Indonesia has experienced stable growth and maintained its real growth performance — averaging above 5 per cent from 2000–11, as reported by the World Bank.

A big question remains: can the country maintain strong growth and support the population’s livelihoods when these resources are extremely degraded or depleted?

In the mid- to long-term, resource depletion will hurt the country’s economy domestically.

Oil subsidies have already caused some damage. Indonesia has become a net importer of both crude oil and refined products since 2004. Oil consumption has been heavily subsidised, costing the government Rp306.5 trillion (US$31.5 billion) in 2012 — much higher than in 2010 (Rp139.9 trillion or US$14.4 billion).

To address this issue, the Indonesian government and parliament approved a government budget that increased the price of a litre of petrol by 44 per cent and diesel by 22 per cent in 2013 . This intervention may have helped the government’s budget deficit — but even after the price rise the deficit is still expected to reach 2.4 per cent of GDP, up 1.8 per cent on 2012.

In 2012, the Vice Minister of the Energy and Mineral Resources Ministry stated that high energy consumption could accelerate the imbalance between the exploitation of fossil energy resources (such as oil, gas and coal) and the speed of inventing new reserves — leading to a depletion of Indonesia’s reserves and increased dependency on imported energy.

Other economic costs exist in the form of environmental degradation.

Destructive, illegal and uncontrolled resources extraction in forestry, agriculture, mining and fishery sectors has led to environmental disasters such as droughts, floods and landslides that adversely affect agricultural production. This impacts the local economy and the balance of trade and the current account — potentially upsetting Indonesia’s macroeconomic equilibrium.

According to the Agriculture Ministry, more than a million hectares of the country’s paddy fields and more than 100,000 hectares of corn fields have been impacted by diseases, floods and drought in the period of 2007–11. If production losses are not dealt with, Indonesia may face difficulties in ensuring food security for its people. Even if such losses are compensated through imports, similar imbalances may surface in other areas, as dependency on foreign agriculture commodities would increase.

So, it is important to continue reforming Indonesia’s natural resources management. Indonesian presidential candidates and parties should be reminded that Indonesia’s economy could be in jeopardy if its current and future economic platforms lead to further resource depletion and environmental degradation.

It is time for the Indonesian people to demand better natural resource management and environmental protection from their politicians and leaders — for the future of their economy and livelihoods.

Fitrian Ardiansyah is a PhD scholar at The Australian National University and the recipient of Australian Leadership Award and Allison Sudradjat Award.

A version of this article first appeared in Coal Asia.

Abbott pivots from enragement to engagement of Asia

Australian Prime Minister Tony Abbott heads off on a major expedition at the end of this week in a make-or-break effort to unlock the opportunities of the Asian century for his country in Japan, South Korea and China. The mission includes a large delegation of businesspeople and state premiers as well as many of Australia’s top officials. It embraces Australia’s top-three export markets and a group of countries that are central to the prospects for the Asian economy and the region’s political future. Australia sells more to these three markets than it does to the rest of all of our trading partners put together.

China, Japan and South Korea have a combined population of 1.5 billion and a GDP of US$15 trillion. Collectively, as the prime minister said in a watershed speech in the lead-up to his departure, they have decisively shifted the world’s centre of economic gravity. They are, of course, not only Australia’s major trading partners; China is also both Japan’s and South Korea’s largest trading and investment partner and Japan and South Korea are China’s second and third largest single trading partners after the United States. Northeast Asia is a region characterised by intense economic interdependence. That interdependence has grown within the framework of the global trading regime, not through bilateral or regional trading arrangements. The three economies account for almost one fifth of world trade and their intra-regional trade in turn accounts for over one fifth of their global trade.

Abbott’s immediate political objective is to conclude bilateral ‘free trade’ deals with the three partners. In this he’s playing catch-up with New Zealand and the ASEAN economies which have had such arrangements in place with these partners (in most cases) for some time. Such deals will level out some of the preferential discrimination of those and other arrangements (with the United States and Chile in the case of South Korea) that affect Australia’s export access. They will also attend to other issues in the relationships, such as providing more confidence to Chinese investors in the Australian market. Abbott is rightly cautious about winning the so called ‘great trifecta’ on this trip — South Korea is a done deal, but Japan is still trading interests with Australia into the putative Trans-Pacific Partnership (TPP) negotiations and China is cooling things while it works out what the new Australian government’s early stumbled-footed diplomacy really means.

As former Australian Ambassador to Beijing Geoff Raby wrote recently, ‘early missteps in managing the relationship … have been noted with considerable displeasure in Beijing. These were the unfortunate gaffes that Japan was our “best friend in the region” (the usual formula is “we have no better friend”); continuing the previous government’s blanket exclusion of Huawei’s participation in the National Broadband Network when a review was foreshadowed by some ministers; and the unnecessarily high-profile, media-driven account of representations made to the Chinese Ambassador over China’s declaration without consultation of an Air Defence Identification Zone in the East China Sea’. Failure in managing the diplomacy of Japanese prime minister Abe’s visit to Yasukuni Shrine also offended Japan’s Northeast Asian neighbours.

In his speech last week, Abbott was on much firmer ground with a careful and overall very finely tuned statement of Australia’s huge interests in the China, Japan and South Korea partnerships. Some would fuss about the tone being a tad too mercantilist though the spirit wasn’t. Others would worry at the insinuation of conditionality on the China relationship to political change when the reality is here and now, but there was no hint that the prime minister was unwilling to engage with China as it is today on entirely constructive terms. To underline the point, he highlighted the deft initiative to engage Chinese naval and air force resources in the Australian-led search for the Malaysia Airlines plane MH370 in the Southern Indian Ocean. If he sticks to script in Tokyo, Seoul, Chengdu, Shanghai, Beijing and elsewhere in China, he’ll both regain trust in Australia’s intentions in the region and position for significant engagement with China, Japan and South Korea severally and collectively. The read on Australian intentions had been on the rise with the publication of the previous government’s Asian Century White Paper but has taken a buffeting not only from the missteps in Northeast Asia but also because of the policy gaffes in managing the Indonesia relationship, which will gnaw at the heart of the relationship unless they are eventually corrected.

Prime Minister Abbott concluded that he was ‘confident that the Asian Century will be Australia’s moment too’. He observed that for ‘much of our first century as a nation, Australia’s leaders lamented our isolation from the centres of world affairs. How that has changed. We are not at the wrong end of the world but the right one. We are in the right place, at the right time, with the right spirit. Australia will work with its partners to seize this moment’. This sentiment is spot on and will be well received by his hosts over the coming week or two.

Recent assertions by Australia’s foreign minister that the United States is a more important economic partner than China have muddied the waters on how the government viewed the relationship, so the prime minister’s forthright statement ahead of his visit to Northeast Asia will go a long way to clarifying Australia’s strategic economic and political interests. As Shiro Armstrong asks in this week’s lead essay, ‘how do the diplomats who advise Foreign Minister Bishop make the figures add up in that way when your average Australian citizen commonsensically thinks that China is now much more important [than the United States] on every economic count they are familiar with?’ He politely suggests that maybe the punters are wrong or that alternatively there’s a proclivity among some in the foreign policy circles who hanker for the past, rather than face the reality of the present or the future, to massage the scale of American influence on the Australian economy. He leaves no doubt where his judgment lies. They did this, he says, when Japan was on the rise; they’re now doing it with China.

As Armstrong points out, it makes no sense to confuse flows of trade and investment with stocks especially when the comparison is with a country that already accounts for a third of Australian exports and a fifth of its imports; is the biggest source of foreign fee-paying students; is commonly the largest source of migrants; and is the largest source of tourist visitors. ‘By the correct measure’, Armstrong concludes, ‘Australia’s trade and investment relationship with China is worth around $134 billion a year, $79.6 billion with Japan and $70.4 billion with the United States using the most recent data’.

The scale of what’s happening in China, and the deep economic interdependence among China, Japan and South Korea, provide the opportunity of which Abbott spoke, not merely from the perspective of a narrow focus on preferential bilateral ‘free trade’ arrangements but from the perspective of their importance in the regional and global economy. Quietly encouraging these Northeast Asian partners to lift their sights beyond backward-looking political troubles and focus on the regional economic cooperation opportunity and their role as stakeholders in the global system would be a real achievement of the Abbott mission.

Peter Drysdale is Editor of the East Asia Forum.

India’s State of Denial

Blaming democracy for shortcomings

India has been in a state of denial for years. It is rightly proud of its vibrant and chaotic democracy which is on show in the current general election and has survived and been accepted almost without question since Independence. But it is in denial because it has not been prepared to recognize that the vagaries of democracy are providing smokescreens that obfuscate many of the negative aspects of how the country works.

Consequently, democracy has become an unchallengeable fig leaf covering what is not achieved. It allows the negative and under-performing aspects of Indian life to flourish. It blocks change and acts as an excuse for ineffective government.

This helps to explain why India punches below its weight, failing to achieve what it could and should be doing with the vast potential of a billion-plus people and abundant natural resources. It constantly disappoints admirers and validates the views of critics. Most recently, with declining economic performance, poor governance and endemic corruption, people have begun to ask, 'Why is India proving such a failure?'

Narendra Modi's answer to that question is of course to vote for him to lead the country to growth and glory. Progress, he implies, will automatically follow. The Gandhis offer repetitive sops and promises, which show that the Congress, and the family, need a time in opposition. Arvind Kejriwal and his collection of broom-wielding Aam Aadmi volunteers offer the basic political upheaval that India surely needs if it is to shake itself free of widespread corruption, crony capitalism, and poor governance - but that is a long-term play with all the risks inherent in necessary but unpredictable disruption.

Modi does not have anywhere near all the answers, and in particular will not dig deep into crony capitalism and political and bureaucratic corruption, though he will presumably have a "cleaner" cabinet than Sonia Gandhi has allowed Manmohan Singh to appoint. He will also do more to project an incorruptible image.

After a time, however, Modi too will no doubt follow the general line and blame democracy for India's shortcomings. Manmohan Singh has attempted to pass off prime ministerial vacillation in policy and questionable decision-making as the inevitable result of the democratic compulsions of coalition government, and has allowed opposition from other parties to become an excuse for years of policy delays. A strong prime minister, supported by adept top ministers and a powerful and persuasive PMO, would do better but coalitions are here to stay.

Democracy has also provided an excuse and a cover for the gradual criminalization of politics that has been allowed to grow for decades to such an extent that election campaigns are distorted, large bribes are paid when coalitions are being formed, and many members of parliament and state assemblies have criminal charges pending against them.

Democracy is also a drag on development because, while it has rightly opened the way for dissent and opposition to changes in land use and environmental concerns, no effort has been made to curb its misuse by vested interests who corruptly manipulate not only policies but their implementation. This has contributed to India becoming an increasingly unpredictable, unreliable, uncompetitive and difficult place to live and do business.

Because of all that, India has given up trying to compete with China's far faster economic development, shrugging its metaphorical shoulders and saying that of course China is ahead, it is not a democracy! The excuse allows lessons that could be learned about China's administrative systems, technological abilities and other pluses to be ignored.

Democracy also creates an environment where jugaad fixes are easy, and where the failures of the system in terms of poor governance and weakened institutions make the fatalism of chalta hai (“it’s okay”) a welcome safe haven. A system that relies on an ability to fix things and then assumes that all will be eventually well whatever is or is not done, surely cannot be a success.

This is not an argument for doing away with democracy, but to recognize and change the negative way in which it operates. Democracy has helped to hold India together since Independence, providing an outlet for people's frustrations and anger, ousting prime ministers, chief ministers and their governments. Though far from perfect, it has given the great mass of the electorate the feeling that they have a say in how the country is run, however faint and rare that may be, and however much they are cheated and maltreated by those they elect.

It is not democracy that is at fault but a lack of leadership and a failure to shape clean transparent systems and procedures that operate effectively without being manipulated and hijacked by vested interests and those who resist change. That is the challenge for the next government.

 

John Elliott is Asia Sentinel’s New Delhi-based correspondent. This column, which appeared yesterday on the Edit Page of the Times of India Sunday edition , is drawn from the final chapter of his new book "IMPLOSION: India’s Tryst with Reality"

Michelle Obama’s China Visit a Disappointment

Tiananmen survivor says First Lady missed the reality of China

American First Lady Michelle Obama’s “good-will” tour with her family in China last week wasn’t good for the Chinese: a number of people (some aren’t even dissidents) were detained, kidnapped, assaulted or put under house arrest. Yet, Mrs. Obama self-censored herself on the topic of human rights during the entire trip and seemed blind and mute, despite worsening abuses in my motherland. As a Tiananmen Massacre survivor who voted for Barack Obama, I’m utterly disappointed.

With her mother, two daughters and hundreds of Chinese police, Mrs. Obama was busy playing ping pong and Tai Chi, jumping rope, practicing calligraphy, hiking on the Great Wall, watching pandas, sampling Chinese and Tibetan food. She did work a bit --‑ delivering two speeches to students.

On March 25 she spoke to students at Chengdu No. 7 High School about the American fight against racism and offered this subtle message about the power of ordinary citizens: “They held peaceful protests and marches. They called on government officials to change those laws, and they voted to elect new officials who shared their views.”

Perhaps she didn’t know when she landed in Chengdu that about a dozen ordinary local Chinese citizens were kidnapped by police in the streets. The Chengdu-based NGO, 64 Tianwang Human Rights Affairs Center, reported a few were brutally beaten and put in detention. The victims were villagers, petitioning the government over the loss of their homes and farm land through forceful demolition and government land grabbing.

On March 24, a young tour guide collapsed as police kicked and beat him severely to clear the terra-cotta warrior museum before the Obamas showed up. As she wandered among those cold clay figures, perhaps she didn’t know they are symbols of an ancient totalitarian regime, the Qin Dynasty, whose first emperor burnt books and buried scholars alive.

Perhaps she also doesn’t know that the current Communist regime is much worse. Why was she so demure and subtle, so Chinese? She could have been more American and she could have done so much more.

In a speech at Peking University on March 22, Mrs. Obama said: “It is so important for information and ideas to flow freely over the Internet and through the media. Because that’s how we discover the truth, that’s how we learn what’s really happening in our communities, in our country and our world.”

I hope she knows the truth of China, Tibet, East Turkestan (Chinese: Xinjiang), Hong Kong, Taiwan and Southern Mongolia (Chinese: Inner Mongolia). She failed to mention the case of Cao Shunli, a Peking University alumnus. Six days before the Obamas landed in Beijing, Cao, a legal scholar, died after six months’ detention. She had been kidnapped by the police from the Beijing Airport last September, where she was to board a flight to Geneva for a United Nations human rights workshop.

Nor did Mrs. Obama say a word about Xu Zhiyong, a legal scholar who led the peaceful New Citizen’s Movement and called on officials to disclose personal assets. He was recently sentenced to four years in prison. Xu’s two-month-old daughter hasn’t met her father because she was born after he was detained. History has been repeating itself: my artist father was in detention before I was born during the Cultural Revolution for criticizing Mao Zedong in his personal diaries.

In 2012, I voted for Barack Obama. I admired the Obamas for their tenacity and courage. It was my first time to vote in America, and I cherished the moment. Many Chinese died for demonstrating for this basic right. I was lucky to have survived that massacre in Beijing nearly 25 years ago. To this day, any texts or pictures of that tragedy are banned in China.

Mrs. Obama was in China to talk about women. As the wife of a Nobel Peace Prize winner, she should know that poet Liu Xia, the wife of jailed Chinese Nobel Peace Prize winner Liu Xiaobo, has been under house arrest for more than three years. Her only crime is to be married to Liu Xiaobo.

Her home prison is about two miles away from the restaurant where Mrs. Obama dined with Chinese First Lady Peng Liyuan and posed with her and her husband President Xi Jinping for photos. Peng, a prominent entertainer, serenaded military troops in Tiananmen Square shortly after they mowed down unarmed students and civilians in June 1989.

As Mrs. Obama strolled with her daughters Malia and Sasha on an empty Great Wall usually packed with tourists, did she realize the police had driven petitioners out of the city and put activists under house arrest? Beijing-based activist Hu Jia Tweeted: “(The Wall) was tailor made by the Party for Michelle. As long as she's in China, I have to accompany her by being under house arrest.” To this day, Hu is still detained at home, well after the Obamas left. The Chinese government has banned posting her Great Wall photos, citing bad publicity.

Mrs. Obama said Chengdu is her favorite Chinese city. Thousands of Sichuanese children perished in earthquakes around Chengdu and near the panda areas in 2008, when their shoddily built classrooms collapsed. Their parents are still banned from visiting the sites.

The First Lady swooned over pandas and ate Tibetan food in Chengdu. My hometown. Why send subtle messages about Tibet through eating? Where are her teeth? Does she know pandas are from Tibet and Tibetans are “endangered people”? Their culture and environment have been raped by the Chinese government. More than 130 Tibetans have burnt themselves to death and so many more are in jail. Some are imprisoned in Chengdu.

The restaurant, Zangxiang Renjia (Tibetan Village Home), is part of a state guesthouse, Chengdu Tibet Sky Lake Hotel, owned and operated by the “the Representative Office of the People’s Government of the Tibetan Autonomous Region.” In her travel log about the meal, she wrote that Tibet is “a region of China” and Tibetans are a “minority” group. Many Tibetans and Tibet supporters were shocked at this statement, posting comments on social media with messages such as “Shame on you!”

The hotel where she dined proudly states on its website (http://www.th-hotel.com) that the former Chinese President Hu Jintao visited there in 1990 when he was Communist Party secretary of Tibet. Hu and four other senior Communist Party leaders last month were given Interpol arrest warrants by Spain’s National Court on charges of “genocide, torture and crimes against humanity” as a result of ordering some of the bloodiest crackdowns in Tibet’s history when Hu was party secretary in Tibet from 1988-1992. Does the First Lady know that?

I’m not asking Mrs. Obama to be as politically involved as Hilary Clinton or Eleanor Roosevelt. I’ve simply been hoping she would do more and say more, rather than being a clothes horse, a mother, a spouse and a gardener advocating healthy food.

I hope that Mrs. Obama will remember what she’s seen in China and will publicly say something one day. But actually I don’t give a damn about what she says or wears. We don’t need her. People in China, Tibet and East Turkestan are waking up and rising up. The murderers and cronies she met and dined with during this trip will be held accountable. That day won't be far away.


Rose Tang is a Chinese-born New York-based writer and artist. As a student, she survived the Tiananmen massacre of 1989.

 

Japanese women and work - Holding back half the nation

Women’s lowly status in the Japanese workplace has barely improved in decades, and the country suffers as a result. Shinzo Abe would like to change that

KAREN KAWABATA represents the best of Japan’s intellectual capital. She has just graduated from the University of Tokyo, the most prestigious in the country. Wry and poised, with an American mother and Japanese father, she has the languages and cosmopolitan attitude that Japanese companies particularly value nowadays. In April she will join McKinsey, a consultancy that should give her immediate membership of a globe-trotting elite.

Yet Ms Kawabata sees obstacles in her path. She is acutely aware of the difficulties she would face at traditional Japanese companies, should she find herself joining one. Ferociously long working hours, often stretching past midnight, are followed by sessions of “nominication”, a play on the Japanese word for drinking, nomu, and the English word “communication”; these are where young hopefuls forge connections and build reputations. Nowadays women trying to impress the boss are allowed to drink plum wine mixed with plenty of soda instead of beer, says Ms Kawabata. But that is hardly a great improvement.

Above all, she worries that having a family will be nigh on impossible to combine with a demanding career. When she met her boyfriend’s father for the first time this year, she reassured him about her intentions at McKinsey. “I told him that I would rethink my career in a few years’ time,” she says.

That one of the brightest of Japan’s graduates needs to say such things should worry Shinzo Abe, the prime minister. Japan educates its women to a higher level than nearly anywhere else in the world: its girls come near the top in education league-tables compiled by the OECD. But when they leave university their potential is often squandered, as far as the economy is concerned. Female participation in the labour force is 63%, far lower than in other rich countries. When women have their first child, 70% of them stop working for a decade or more, compared with just 30% in America. Quite a lot of those 70% are gone for good.

Beyond the Festival of the Dolls

Mr Abe says he wants to change that. In April 2013 he announced that allowing women to “shine” in the economy was the most important part of his “Abenomics” growth strategy. Raising female labour participation to the level of men’s could add 8m people to Japan’s shrinking workforce, potentially increasing GDP by as much as 15%, according to Goldman Sachs, an investment bank. More women working for more pay would also increase demand. Hence speeches from Mr Abe attaching new-found importance to matters such as the opening hours of kindergartens and the challenges of breast-feeding outside the home.

For the prime minister, who belongs to the conservative Liberal Democratic Party (LDP), this is quite a turnaround. In 2005, when a previous government was taking steps towards greater equality, Mr Abe and his fellow conservatives warned of the damage to family values and to Japanese culture that could result if men and women were treated equally. They worried that rituals such as the hina matsuri, or Festival of Dolls, an annual celebration of young girls and the state of matrimony, could be endangered. Their concern was not just based on tradition; keeping women out of the workforce, conservatives thought, made economic sense too. If the country’s “baby-making machines”, as a former LDP health minister put it, stayed at home then they would produce more babies, and thus more workers.

This insight proved to be flawed. As the LDP encouraged women to stay at home, the fertility rate, already low, plunged further, bottoming out at 1.26 children per woman in 2005 before edging up to 1.41 in 2012. The consequent dearth of young people means that Japan’s working-age population is expected to fall by 40% by 2050, exerting a powerful drag on the economy. As a solution to this, the direct measure of getting more women out into the workforce would have great advantages over the indirect tactic of encouraging them to stay at home in the unfounded hope that they will breed instead.

Indeed, it may even turn out that working and having children go hand in hand. In other rich countries, higher birth rates nearly always accompany higher female employment, and in Japan itself the birth rate is higher in the countryside, where more women work, than in the big cities, where fewer do. The changes that might encourage more urban women into work—such as better child-care provision, and a less demanding corporate culture, which would mean shorter working hours for men and women alike—might encourage them and their husbands to have more children, too.

The missing salarywoman

Mr Abe’s interest in all this is new; the problem is not. Yoko Kamikawa, an LDP politician, recently served on the party’s new committee seeking to improve the lot of women. In the 2000s, during Mr Abe’s first term as prime minister, she was his minister of gender equality. She is startled, she says, by the lack of progress since then.

In most countries women’s participation in the labour force dips around the years when they marry and bear children; after that it recovers. But this M-shaped curve is much more pronounced in Japan than in most other rich countries (see chart 1). Japan’s curve has levelled out somewhat in recent years: in 2004 the rate of full- and part-time employment for 30- to 34-year-old women was 61%, a figure which by 2012 had risen to 69%. Yet young, married mothers are still largely absent from the workforce, and many women returning to work go into part-time or temporary jobs with low pay and little security.

Those who stay in work often do so in jobs that waste their abilities. Few women hold professional, technical or managerial roles. In 2012 they made up 77% of Japan’s part-time and temporary workforce. Many of these workers are well-off married women seeking a little extra income. But others are poor and marginalised. The precarious existence of such workers was described in “Out”, a bestselling 1997 crime novel by Natsuo Kirino which had a resonance, and earned acclaim, beyond the borders of the genre. The heroine, who spends her nights toiling in a soulless packed-lunch factory, helps conceal the murder of a colleague’s no-good husband. Ms Kirino’s subsequent bestsellers have also focused on the division of gender roles, describing men slaving away in the corporate world, disconnected from women in the home.

At the very top of corporate Japan, the “bamboo ceiling”—so-called by women for being thick, hard and not even transparent—is starting to let in some chinks of light, but they are few and far between. In 2011, 4.5% of company division heads were female, up from 1.2% in 1989. But relative to other countries the numbers are still dismal. Of the most senior, executive-committee-level managers in Japan, 1% were women in 2011, according to a regional study by McKinsey. The equivalent figure for China was 9%, for Singapore 15%.

Corporate culture is by far the biggest obstacle for Japanese women. The practice of hiring graduates fresh out of university and employing them for their entire working lives makes it difficult for employees to take career breaks and seek new positions elsewhere afterwards. Promotion tends to be based on tenure and overtime, rather than on productivity and performance. And straightforward discrimination remains rampant. In a study that compared the reasons why Japanese and American college graduates leave their jobs, American women cited child care and looking after elderly relations as the main factors. Japanese women blamed dissatisfaction with their jobs and a feeling of being put into “dead-end” roles. The fact that their husbands, who spend more time at work than their counterparts in other developed countries, spend less time on child care or household chores, adds to the perceived need to stay at home (see chart 2).

When Japanese firms take their pick of university graduates they choose men and women, but they still prefer men for management, sticking most of the women on the “clerical” track. Foreign companies have been able to take advantage of this prejudice by hiring and promoting able female graduates, says Georges Desvaux, the head of McKinsey’s Tokyo office, who also leads the firm’s global research on the role of women in companies. Overseas executives inside large Japanese companies tell tales of über-secretaries with the talent to run the whole business.

Keidanren, Japan’s most powerful business lobby, has been markedly uninterested in doing much about this. Though government pressure recently got the lobby to start internal discussions on promoting women, corporate leaders regard Mr Abe’s new enthusiasm for improving the lot of women in the same way as they look on reforms to corporate governance: as costly distractions from the task of lifting Japan Inc’s profits. Keidanren refuses to ask its members even to state the number of women on their boards, in fear of being asked to increase it, or having quotas imposed. Bureaucrats seeking to find the number scan documents for the suffix “ko”, usually found on female names.

Male dominance extends beyond the corporate world: in politics, too, women are grossly under-represented. In the lower house of the Diet, women hold only 8% of seats, with 19% in the upper house. In a global survey of women in parliaments, Japan ranked 123rd out of 189 countries. The older generation of men is particularly traditionalist, and still wields the most clout.

Pampered wife, wise choice

Yet women are not simply being held back by the patriarchy. When the choice is between leisurely dependency in the home—known as sanshoku hirune tsuki (“three meals and a nap”)—and the sorry life of a salaryman there is something to be said for putting your feet up. In wealthy places like Tokyo many women simply do not wish to work, says Takeshi Niinami, chief executive of Lawson, a chain of convenience stores.

Mariko Bando, author of “The Dignity of a Woman”, a bestselling guide for women on how to succeed in the workplace, points out that many Japanese women do not feel they need a high-status job to enjoy high status. A well-educated woman working part-time in a supermarket will not see that job as defining her identity if she is the wife of, say, a high-ranking Mitsubishi Corporation executive.

Remarkably, women seem to have become more conservative about work in the past few years. In 1979, 70% of women agreed with the statement that “The husband should be the breadwinner and the wife should take care of the home”. By 2004 that had fallen to 41%. But in 2012, perhaps because of the recession in 2007-09, just over half said they preferred to stay at home. A survey last year showed that a third of very young women want to become full-time housewives. Potential husbands, meanwhile, were less traditionalist: only one in five young men said he wanted his future wife to stay in the home.

Feminism has remained a timid force in Japan. The long economic boom that began in the 1950s was a national priority which left little room for questioning traditional roles in the home or workplace, says Chizuko Ueno, Japan’s best-known feminist. And women are not without power behind the scenes. Housewives control the family finances, and in the workplace so-called “office ladies” wield a lot of influence over the lives of salarymen, quietly hindering the careers of those they dislike.

There are, however, some indications that the role of women could change. For one thing, the boom that overrode all other interests is long gone. Stagnating wages mean the three-meals-and-a-nap way of life is less widely available, with households increasingly in need of two incomes. And the divorce rate is rising. More Japanese women are opting out of marriages to overworked and largely absent salarymen, and so thus increasingly need to fend for themselves. Although a portion of young women want old-fashioned gender roles, the rest, including the “parasite singles” who prefer living with their parents to marriage, want change.

Herbivore men, carnivore women

Some of the most motivated graduates nowadays are female, and a growing number of companies are waking up to the possibility of putting them to better use than in the past. According to Sakie Fukushima, a director of another business lobby, Keizai Doyukai, human-resources executives say in private that they would hire young women ahead of men most of the time. Yet they are afraid that they will lose them when they have children. Japan’s female 20-somethings now tend to be far more internationally minded than their male equivalents, says Lawson’s Mr Niinami. They outperform soshoku danshi, or “herbivore” men, so-called for taking low-responsibility jobs and preferring shopping to sex. These same young men have little desire to follow the breadwinner/housewife model adopted by their parents. Indeed, Japanese media have recently, with some surprise, begun to note a trend towards young fathers taking on more child care.

In some corners of corporate Japan, firms are changing the old working practices. At DeNA, an internet-services company, employees have noticed that their colleagues in California never stay late at the office, instead continuing their work at home. They are now starting to follow the American example, says the company’s founder, Tomoko Namba. A few firms are trying to increase productivity while shortening hours. Mitsubishi Chemical Corporation, a leading blue-chip, is discouraging workers from staying in the office after seven o’clock.

By 2020 Mr Abe wants women to occupy 30% of all “leadership” positions—which would include members of parliament, heads of local government and corporate executives. His most practical step has been to try to shorten waiting lists for child care by allowing more private companies into a previously state-dominated sector. Here he has seized upon the work of Fumiko Hayashi, the mayor of Yokohama, who after being elected in 2009 managed to reduce the city’s child-care waiting list, then the longest in the country, to zero in just over three years. A former senior saleswoman at Honda, BMW and Nissan, she brought private firms into the sector. Mr Abe wants to expand her “Yokohama method” across the country.

Yet many Japanese women, who are particularly protective of their children, distrust day care (one reason women in the countryside have more children is that they are more likely to have parents nearby to lend a hand). What is required, more people now argue, is an army of foreign nannies. In January, at the World Economic Forum in Davos, Mr Abe suggested Japan’s immigration rules could be eased so that foreign workers could help care for children and elderly relatives, another duty that falls most heavily on women. There have been unconfirmed media reports that the government is considering allowing in as many as 200,000 foreigners a year to work in areas such as construction, child care and nursing.

As with much of the country’s ambitious programme of structural reform, however, such a loosening will face high political hurdles. Immigration is unpopular with the Japanese public; insiders note that Mr Abe may say such things in Switzerland, but has not given public voice to them in Japan.

Until overseas talk is followed by domestic action, many will think Mr Abe lacks the will to push for changes that would greatly improve the life of working women. His actions so far have not impressed. A request that firms allow mothers to take three years of maternity leave—compared with the 18 months they can take now—met with derision from all sides. Companies said it would cripple them; feminist critics said that it was part of the old agenda to keep women in the home. The target of 30% women in leadership roles by 2020 was first proposed in 2003 by then-prime minister Junichiro Koizumi. “The target is an old one, and it was not implemented,” says Yuriko Koike, head of public relations for the LDP and a former defence minister. The deadline arrives in only six years; there is little chance it will be met. The idea of reducing waiting lists for child care, too, dates back to Mr Koizumi’s time in office.

Some of Mr Abe’s allies frequently remind voters of the prime minister’s former traditional views on the family. In January Michiko Hasegawa, whom Mr Abe had approved as a board member at NHK, Japan’s national broadcaster, published a column saying that women’s most important task was to bring up their children, and that this should take priority over working outside the home. “The message on women is somewhat mixed,” concludes Ms Koike.

If the government really wants to increase female employment, argues Kathy Matsui of Goldman Sachs, it could do so by axing tax rules that keep women’s earnings low. The “head of household”, normally a man, is allowed to claim a tax deduction of ¥380,000 ($3,700) as long as his spouse’s income does not exceed ¥1.03m. The pension system, too, encourages limited earnings. As long as a wife’s annual wages remain under ¥1.3m she can claim the national pension without paying any premiums. Tackling such privileges, however, could cost the LDP the votes of millions of housewives and their husbands.

At a private dinner in Davos Mr Abe listened to a small group of senior women, including a former head of state, discuss what Japan should do differently. An awkward moment came when one of the guests, Miki Tsusaka, a partner at the Boston Consulting Group, told him she had dreaded returning to Japan after a successful career spent mostly in New York. Yet increasingly, behind their soft tones and feminine demeanour, many Japanese women are getting ready to break out of their dolls’ house. If the country’s policymakers can find the right ways to help them, those women could boost the economy and reform corporate culture. Both they and their sararimen stand greatly to benefit. ‘The Economist’

 

Rising above unfair criticism

EVEN more shocking than the tragic loss of Malaysia Airlines flight MH370 has been the disturbing and unedifying sight of the Chinese, both family members of those presumed to have perished, and Chinese government officials, reacting to the tragedy.

  I can understand the anguish and sorrow through which they have gone in the past few days and weeks, but they are not alone in having to cope with this unprecedented tragedy.

  There are Malaysian, Australian, Indonesian and many other families from several countries who have lost their loved ones. They, too, are grieving, but unlike the Chinese, they have shown great restraint and have not gone over the top with vicious and appalling imputations of improper motives and casting aspersions on our integrity in handling the crisis.

  I may be forgiven for wondering if this is what 4,000 years of civilisation has taught them to react in a crisis! Their invective is too crude to repeat and, while we may forgive them their behaviour, I personally will find it difficult to forget their insults hurled at my country and people with scant regard for our feelings.

  I know Chinese is a "tonal" language and the tone of their assault against us has taken us completely off-guard. I am proud of the behaviour of Chinese Malaysians who have lost their beloved family members and Malay Malaysians who grieve with great dignity.

  My charitable take on their behaviour is that after a long history of communist dictatorship, the Chinese, as a nation, have become so used to being given the run around as far as official information is concerned that they have become highly suspicious of any official information they are given by any government agency.

  Their demand for information about the fate of their loved ones is understandable, but to expect the Malaysian authorities to produce information when there is none to be had for love or money is bizarre to say the least.

  They should remember that it was their own authorities that released to the world that they had sighted two pieces of debris in the South China Sea. That bit of news was later withdrawn by the Chinese authorities.

  What they would like the world to see as the new China aspiring to global power status is really a nation with a thin veneer of sophistication and still unsure about its place in the global geopolitical scheme of things.

  The legal vultures in the most litigious nation on earth are rubbing their grubby hands with glee in anticipation of a windfall from representing the families of those presumed dead on board the ill-fated MH370 that disappeared on March 8. They have their noses in the trough of human tragedy.

  The haste with which they are dragging both Boeing, the aircraft manufacturer, and MAS, the airline operator, through the courts in Chicago is indecent. It is not fair to tar all lawyers with the same brush, but it is the few whose unethical behaviour which has given this great profession a bad name.  

  Malaysia has been unreasonably blamed for the handling of this crisis that any fair-minded person would readily concede as unprecedented in the history of aviation. An American friend of mine from New York sent me an email ten days after the disappearance of MH 370, in the following terms: "The disappearance of Malaysia Airlines flight 370 after its departure from Kuala Lumpur International Airport has given the world a very unsettling demonstration of how fragile our lives can be... The feeling here due to perceptions of the management of the search for flight 370 is turning quite negative on Malaysian officials."

  I responded by saying that perceptions are real in that they exist, but do not forget that more often than not, they have no basis in fact. Nothing like this has happened before to a large commercial airliner; it is unprecedented.

  To suggest that we are withholding vital information, as many are doing, when nearly all of the so-called information is nothing more than idle gossip and pure speculation, is to encourage and condone the passing on to emotionally drained relatives and friends unverified bits of "news" garnered from CNN, the New York Times and the Telegraph newspaper, and the usually unreliable sensation-peddling tabloids for which Britain is noted.

  Do you think, I asked him, in identical situations, other countries could have done any better? We won't know until another mysterious disappearance, God forbid, will we?

  What the world seems to forget is that they are not talking about a Mickey Mouse airline: MAS is a world-class airline, among the best in the world.

  There had been, until now, only one fatal crash, in 1977, killing more than a hundred people when the plane was hijacked on a domestic flight. It has had a safety record second to none, better than many "national" airlines anywhere in the world.

  Two people who have stood out in managing the crisis are undoubtedly Prime Minister Datuk Seri Najib Razak and  Acting Transport Minister Datuk Seri Hishammuddin Hussein.

  With the pressures and uncharitable innuendoes and all kinds of allegations swirling around their ankles, they remained totally focused and unflappable.

  Hishammuddin, whom the opposition had done their level best to ridicule, has shown in very trying circumstances, an unprecedented crisis no less, that he has risen like a true professional, above the murky depths of opposition politics.

  Even traditionally hostile foreign journalists have decided to give him a grudging endorsement.

  I will not waste too many words on the behaviour of the opposition beyond saying I deplore their behaviour in these difficult times: many people overseas are aghast at their conduct in a national crisis, but there is an element of some black humour when the party that could not hold its central executive committee election in an open and transparent manner is trying to make us believe that they could have done a better job of managing this unhappy affair.

  My concluding words of deep sympathy and love must go to the members of the cockpit and the cabin crew who perished in the service of a great iconic airline that Malaysia is fortunate to be able to call its own.

By Tunku Abdul Aziz

Read more: Rising above unfair criticism - Columnist - New Straits Times http://www.nst.com.my/opinion/columnist/rising-above-unfair-criticism-1.537365#ixzz2xOMf7cIb

‘Exercise Komodo’ and the South China Sea

Today, naval representatives and warships from 18 different nations are converging in the southern part of the South China Sea known as Natuna.

Adopting humanitarian assistance and disaster relief (HADR) as its main theme, Exercise Komodo highlights the growing role of the Indonesian Navy (TNI-AL) in international naval diplomacy. But held amid lingering tensions arising from territorial disputes in the South China Sea, what can we gauge from it?

Certainly, Exercise Komodo carries mixed messages. At first glance, the exercise attempts to display Indonesia’s growing role in naval diplomacy. Bringing in naval representatives from 18 countries is no easy task. Much less is the choice of timing and location in the South China Sea, where tensions remain high following incidents among the claimants.

Indeed, owing to the growing importance of regional maritime security issues, naval-centric cooperation is becoming increasingly vital, as facilitated by the ASEAN Navy Chiefs’ Meeting (ANCM).

During the last ANCM held in Manila, ASEAN navies agreed to establish an ANCM Plus process with navies from the eight dialogue partners of ASEAN.

By complementing the ANCM Plus process, Exercise Komodo could foster greater cooperation among the navies of ASEAN Plus countries. Last year, the TNI-AL also hosted the International Maritime Security Symposium, which drew nearly 350 participants, including from various navies across the region.

To this end, Exercise Komodo is certainly something Indonesia, particularly the TNI-AL, can be proud of. But questions linger on how this exercise could be sustained in the future, as the TNI-AL expects to make it biennial. Indeed, hosting an exercise is one thing, but making it continuous and regular is quite another.

Questions should also be asked about how this exercise adds value to other multinational naval exercises held in the region, apart from it being hosted by Indonesia. For example, how different is Exercise Komodo from India’s biennial “Milan” and the ASEAN Defense Ministers’ Meeting (ADMM) Plus maritime security exercises, as the latter two also carry similar themes on HADR?

Finally, given Australia’s recent withdrawal from the event (by only sending observers), will Exercise Komodo be made exclusive to regional navies Indonesia feels comfortable to partner with? These are legitimate questions to pose, especially if Indonesia wishes Exercise Komodo to be recognized well beyond its symbolic and prestige value.

Beyond naval diplomacy, the exercise underlines the significance of the South China Sea in Indonesia’s geostrategic calculus. While proclaiming itself as a non-claimant country, Indonesia’s 200-nautical mile exclusive economic zone overlaps with China’s nine-dash line claim in the Natuna. It remains to be seen whether China will establish an Air Defense Identification Zone (ADIZ) in the South China Sea.

But Beijing will certainly continue probing the limits of what Indonesia can bear under Jakarta’s so-called “silent diplomacy”. Chinese fishermen are moving further south into Natuna, which has led to occasional skirmishes between Indonesian and Chinese maritime authorities.

Earlier this year, China conducted a naval exercise in the Indian Ocean by transiting through the Indonesian straits of Sunda and Lombok.

While nothing was illegal about the exercise, it was clearly meant to show Chinese determination to protect maritime interests beyond its traditional area of operations in the Western Pacific defined commonly as the “two island chains”. It was also an example that China expected principal littoral countries — Australia, India and Indonesia — to pay serious attention to.

Despite these concerns, Indonesia follows a more restrained approach compared to the “immediate” claimant countries.

For example, Vietnam and the Philippines protested strongly against China’s announcement of fishing regulations in the South China Sea earlier this year. And Manila starkly compared Beijing to Nazi Germany during World War II. Last year, Malaysia even protested against China’s naval exercise in James Shoal located well within Malaysia’s exclusive economic zone.

In contrast, Indonesia prefers to be seen as a neutral broker in dealing with China through ASEAN diplomatic engagements.

This might be largely owed to Jakarta’s growing economic and security linkages with Beijing.

Apart from being Indonesia’s largest trading partner, China has become an alternative arms supplier, if inferior, to Indonesia’s Russian and Western counterparts. This might exhibit increased warmth in political and security ties between the two countries, which last year elevated bilateral relations into a Comprehensive Strategic Partnership.

Exercise Komodo also demonstrates Indonesia’s own naval aspirations to become a “world class navy”. Facilitated by increased defense budgets, Indonesia continues to spur naval modernization with new platforms being gradually inducted into the fleet.

However, capabilities aren’t just platforms. Ensuring their effective use is an equally important task. In this sense, Exercise Komodo provides an opportunity for the TNI-AL not only to learn lessons from others, but also to enhance inter-operability with other navies in HADR operations, such as tsunami relief.

Accomplishing this task is neither easy nor simultaneous. A comfortable degree of trust and confidence is required as a prerequisite. Hence, Australia’s withdrawal from this exercise might signal a considerable trust deficit between the two countries.

An unstated aim of the exercise might be to reassure regional countries, especially neighbors, of Indonesia’s peaceful naval modernization. Aiming to become a “Green Water Navy”, the TNI-AL aims to acquire up to 274 warships of various types by 2024.

While that aim is quite ambitious, Indonesia’s naval acquisitions have drawn considerable interests from neighboring countries. For example, Singapore raised objections over the naming of one of TNI-AL’s newly-purchased frigates due to past historical grievances.

Finally, it would be wise to neither overvalue nor overestimate the results of Exercise Komodo. While salutary in itself for the TNI-AL to host an inaugural multinational exercise, it is only one of many building blocks toward promoting cooperation among regional navies.

Instead, the real impact of Exercise Komodo can only be gauged cumulatively with other regional cooperation initiatives, in the hope that the whole will be greater than the sum of its parts. That being said, it should be the least of what regional countries can do to stabilize the volatile waters of the South China Sea.

The writer is an associate research fellow with the Maritime Security Program at the S. Rajaratnam School of International Studies (RSIS) at Nanyang Technological University, Singapore

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