Sunday, July 31, 2011

Ramadan and Restraint

A yearly life cycle – at least and particularly in Islamic terms – has passed. After 12 months of routine activities, Muslims will have to exercise a variety of restraint starting today, Monday.

While the beginning of the fasting month of Ramadan may be different for one group or another, such technical matters should not be an obstacle for Indonesian Muslims in pursuing their ultimate goal of achieving “perfection” of their religiousness.
Indonesia, as a country with a majority Muslim population, welcomes the peace, the goodwill, the reprieve and the break from the routine that the fasting month always entails. Beyond refraining from food and drink, and sex between dawn and dusk, Ramadan also requires Muslims to show restraint, especially not to let their emotions get the better of them.

Personal endurance to contain hunger and thirst during the daytime supposedly helps people to exercise restraint and to control their emotions. In addition, extra worship performed throughout the month – reciting the Koran and distributing alms to the poor – should also contribute to the peace and harmony and shared prosperity we have all come to associate with Ramadan. Being a multicultural nation, Indonesia has had its fair share of violence, conflict and tension over the past year. It is therefore a relief to have Ramadan, as we can all put our differences and problems aside and concentrate on our religious obligations for one full month in the year.
To fast may be self-serving, but the impact will benefit society as a whole.

Traditionally, we have seen more peace during Ramadan, while the non-Muslim minority, an inseparable part of the nation, also benefits from this period. Some even join Muslims in their fasting, while others participate in celebrations at the end of the month. Many others show tolerance and respect for Muslims in performing their rituals. Ramadan offers the perfect picture of what Indonesia should be like. Indonesia is a nation that regards religion and its rituals as a very important part of life, but individuals are encouraged to show great restraint, help one another and show mutual respect in terms of interfaith relations.

However, there will always be a gap between the ideal and reality. There are those who pay lip service to the rituals of Ramadan and cannot wait to get back to their routine of thieving and scheming as soon as the month is over. Again, going by the Indonesian experience, we can be fairly sure nothing will really change once the fasting month is over. Everything will go back to normal.

Still, one month of peace and harmony is better than nothing. At least, some of us may learn something and will change our ways for the better by upholding the values Ramadan imparts all through the year. It is also beneficial to learn during Ramadan of what this nation can achieve when we put our minds to it.

To all Indonesian Muslims, we wish you a happy and successful endeavor during Ramadan. Jakarta Post Editorial

Complacency Is the Danger in Asia's Power Games

IN an interview given to the University of Central Florida's Global Perspectives Office in late 2010, Paul Wolfowitz summed up his response to China's rise as "hoping for the best, but preparing for the worse".

Even if one disagrees with Wolfowitz's thinking on the Middle East, this viewpoint on China policy cannot be easily dismissed. The assistant secretary of state for east Asia and the Pacific when Ferdinand Marcos was eased from power in the Philippines in 1986, and then the widely respected US ambassador to Indonesia from 1986 to 1989, Wolfowitz was arguably the senior official with the greatest Asia expertise in the George W. Bush administration. In the early days of the previous administration and before the September 11 attacks, Wolfowitz stated in an interview with The Washington Post on August 29, 2001, that while China need not necessarily become a threat, US complacency could actually lead to an opposite and disastrous effect.

These sentiments were criticised by China-watchers as unnecessarily provocative.
In light of increasingly assertive Chinese behaviour during the past decade, views such as this are now gaining respect and currency, even among leading Asia hands within the Barack Obama administration.

The crude caricature of the China debate is between panda hugging or bashing. In reality, even so-called China bashers take genuine heart from the hundreds of millions of Chinese lifted out of poverty over the past three decades, embrace the economic opportunities provided by its rise, and hope for the best when it comes to how the potential superpower might evolve. If there is little difference in the aspirations for China and its people, there are fundamental differences with respect to how the US and allies such as Australia, Japan and South Korea should respond to China's rise.

On the one end, there are those hoping that by determining the nature and circumstances of its rise, the US and its allies can play a decisive role in shaping or taming future Chinese ambitions in Asia. Advocates of this approach stress the importance of reassuring China, focusing on areas that deepen common interests, such as trade, and removing misunderstanding through intensifying diplomatic, cultural and people-to-people links. The tag-line here is that "To treat China as a strategic competitor is to create the self-fulfilling prophecy that it will become one".
At the other end, the primary approach is to deter China from engaging in behaviour that might harm our interests. Although supportive of greater economic, diplomatic and cultural engagement, they warn that comprehensive engagement is not itself a strategy.

In particular, the fact of deepening economic ties is no strong guarantee of peaceful relations in the future. As Wolfowitz alluded to in the interview with the Global Perspectives Office, trade between the major European powers before World War II was far more extensive as a proportion of GDP than contemporary trade between China, other Asian states and the US. By 1913, Britain had become the leading market for German exports. The mingling of cultures and people-to-people links between these European countries was more mature than that between China and the region today.

Then there are the suspected flaws in any enterprise to shape and tame Chinese ambitions from the outside. After all, such an enterprise assumes an inherent passivity about a government ruling over a civilisation that has been the dominant power in Asia for all but 200 of the past 2000 years -- something the Chinese Communist Party is continually repeating to its people and the world. As an authoritarian outsider in a US-led order with democratic community as one of its pillars, it is questionable whether Beijing's forbearance of American (and allied) strategic and military dominance in the region will be permanent. Indeed, there is a strong case to be made that China already views the US as a strategic competitor.

China's military build-up is designed to negate American advantages, and much of its strategy is intended to dilute the robustness of US alliances and influence in Asia.

Even as China's importance as a trading partner to the US grows, strategic and military competition with China has intensified rather than softened. As China rises, Beijing becomes more assertive and disruptive rather than less so.

That China is seeking an influence and military capability commensurate with its economic size is undoubtedly true but irrelevant. The more important observation is that the prospect of shaping China's future ambitions, or taming such a vast country and civilisation, is failing or is a flawed project to begin with.

If one cannot mould China's future ambitions, we can at least try to deter Beijing from using force to get its way in disagreements over issues such as Taiwan or the South China Sea. For the foreseeable future, China is only able to decisively intimidate -- let alone dominate -- the rest of Asia through an act of US strategic cession. Even if China continues its rise, acquiring proportionate strategic leverage and military reach is not always a straightforward and linear process. This is where beefing up US military capabilities, as well as strengthening existing and emerging relationships with regional allies and partners, is seen as the primary strategy to deter Chinese adventurism.

The Obama administration has belatedly caught on to this game-plan after flirting with nascent doctrines such as the new order of a Group-of-Two comprising the US and China, or ambiguous doctrines of strategic reassurance. There is still an ongoing debate in Washington and regional capitals about how much to spend on defence and on what. But when it comes to China, there is growing appreciation that hoping for the best now means preparing for the worse.

Paul Wolfowitz delivers a lecture on China's rise for the Centre for Independent Studies tomorrow. Details:

By John Lee research fellow at the CIS and the Hudson Institute in Washington DC.
The Australian

Saturday, July 30, 2011

On a Bali high

Reasons to cheer, even if ASEAN is selling the same horses again

THE ten-member Association of South-East Asian Nations, ASEAN, does not do breakthroughs. The “ASEAN way” involves consensus, bonhomie and progress that is at best incremental and often imperceptible. Yet as this year’s meeting of the club’s foreign ministers and “dialogue partners” in Bali wound up on July 23rd with the ASEAN Regional Forum, a security talking-shop, ASEAN could at least point to noticeable movement on two of East Asia’s perennial sources of tension.

At its meeting with China, ASEAN agreed on “guidelines” for implementing a 2002 declaration on a “code of conduct” to minimise the risk of conflict in the contested waters of the South China Sea. And in the margins of the ASEAN meetings North and South Korea held their first public talks for two-and-a-half years. Prospects of a resumption of talks on getting rid of North Korea’s nuclear arsenal rose further when Hillary Clinton, America’s secretary of state, used her time in Bali to invite a North Korean negotiator for talks in New York this week.

Meanwhile, Thailand and Cambodia, two ASEAN neighbours whose soldiers this year have been shooting at each other around the disputed border temple of Preah Vihear, kept their differences from souring the mood. All in all the organisation and the host, Indonesia, which holds the rotating chairmanship, could congratulate themselves on a useful set of meetings.

After fraught months even modest progress comes as a relief. In the South China Sea, China, whose maps include dotted lines showing virtually all the sea as Chinese, has been alarming other claimants by throwing its weight around. Vietnam, which claims both the Chinese-controlled Paracel islands in the north and the Spratly chain in the south, has been especially incensed. But just ahead of the ASEAN meeting it moved to end anti-Chinese street protests in Hanoi. In the Philippines activists are less malleable. On July 20th, as the foreign ministers met in Bali, five congressmen landed on a Philippine-occupied island in the Spratlys, Pagasa, to plant the national flag.

China argued, plausibly enough, that this broke the 2002 declaration, which enjoins signatories to avoid provocations. Even so it did sign up to short—and vague—guidelines on turning the declaration into the formal code of conduct promised for nearly a decade now. Even Mrs Clinton, who at last year’s ASEAN meetings in Hanoi angered China by declaring an American “national interest” in the sea and offering to act as a mediator, commended China and ASEAN for the agreement, as a “first step”.
She also welcomed the breaking of the ice between the Koreas, as Wi Sung-lac, South Korea’s delegate to nuclear talks, met his new North Korean counterpart, Ri Yung Ho.

The South’s demand that the North formally apologise for last year’s sinking of a South Korean naval vessel and shelling of civilians was quietly shelved, presumably at least partly at America’s urging.

Mrs Clinton’s invitation to another North Korean official, Kim Kye Gwan, to come to New York for talks was freighted with the usual stern riders about not rewarding North Korea simply for returning to the table. In fact, for North Korea, which values bilateral contacts with the United States above all other diplomatic prizes, the invitation itself is the reward. America, keen to avoid another Korean crisis, needs to find some way of engaging the North. When the North is being ignored, it tends to resort to crude attention-seeking behaviour—military provocations, missile and nuclear-bomb tests, and the like.

It is not certain that the smiles in Bali will lead to the resumption of six-party talks involving the two Koreas, America, China, Japan and Russia on denuclearisation. Since North Korea does not look like giving up its bombs anyway, not everyone agrees they should resume. In a warning against undue optimism, some observers recalled the equivalent ASEAN meeting in 2002, in Brunei, which North Korea also used to break out of isolation, establishing its first contacts with the administration of George Bush. Nine years, two nuclear tests and countless acts of bellicose aggression later, it is clear that was not a turning-point for the better.

Similarly, the guidelines on implementing the 2002 declaration on the South China Sea are hardly evidence of rapid progress. The promised code of conduct itself has still not materialised—let alone agreement even on a mechanism for tackling the complex mesh of overlapping territorial claims. China still insists it wants to negotiate bilaterally with the ASEAN countries with partial claims, which also include Brunei and Malaysia. ASEAN, China points out, has no role in disputes over sovereignty. But its members fear being bullied if picked off one by one.

That ASEAN enables them to try to negotiate from a less weak position is an achievement for the organisation. So is its provision of a forum where regional-security concerns can at least be raised, and where, in the margins, useful bilateral talks can be held. This year has been a relative success, with Indonesia, its biggest and most influential member, in the chair. But there is always the danger in ASEAN that the process of consensus is confused with the substance of actually resolving conflicts.

Concerns about the future, moreover, only grow. The next chairman is Cambodia. Since it seems unlikely that the Preah Vihear dispute will be settled by the end of the year, this could prove debilitating. Potentially even more damaging is Myanmar’s demand to take the chair in 2014. To grant its wish would be to suggest that last year’s rigged elections under an army-drafted constitution merited international acceptance. It might provoke Western boycotts of some ASEAN meetings, undermining ASEAN’s central role in regional security. But to refuse would antagonise the mufti junta in Myanmar and other ASEAN members, such as Laos and Cambodia, and suggest a willingness to follow Western norms. And that would not be the ASEAN way.
By Banyan for The Economist

Friday, July 29, 2011

Indonesia's Verdict of Shame

Religious extremists get a light tap from the court in Ahmadiyah mob murder
I still cannot get one sound from the Feb. 6 Cikeusik mob attack on a handful of Ahmadiyah followers out of my head. At some point the shouting and mayhem, which millions have seen on YouTube, seems to subside as a lifeless body in the mud is beaten with wooden staves. There follows a series of sickening wet slaps against the corpse as a crowd shouts in approval.

But that man and two other victims were not murdered, according to prosecutors who chose the lightest possible charges to throw up against the clearly identifiable suspects in the Banten province attack. On Thursday, a court made it official, handing out sentences of three to six months to 12 men accused of leading and carrying out the assault.

Dani bin Misra, a 17-year-old, smashed a victim’s skull with a stone; he was charged with manslaughter and got three months. The leader of the mob of about 1,000 people who attacked 20 Ahmadis, Idris bin Mahdani, was convicted of illegal possession of a machete and got five months and 15 days in jail.

In other words, murder — organized, premeditated and captured on video — is not much more of a crime than stealing a bunch of bananas. In Indonesia, it appears, you can get away with murder, as long as the killing is done in the name of religion.

Prosecutors actually recommended light sentences because they said Ahmadiyah members partly provoked the attack by being in the village and then compounded their error by filming and distributing videos of the attack. This is a bit like saying a woman is to blame for being raped because she wore a skirt.

The sad truth is that Indonesia, despite its progress on so many fronts, still allows preachers of hate to foment criminal acts against others. In this upside-down world, Ahmadiyah followers can be killed for their belief that their prophet came after Mohammed. They are fair game.

Thursday’s court verdict seems likely to spur still more mob terror since the crime carries virtually no punishment and the government does so little to speak out against such heinous acts.

This is a frightening black mark on a nation that prides itself on being a bastion of tolerance guided by Pancasila, whose first pillar is religious freedom and whose second is Kemanusiaan yang Adil dan Beradab, which states that all people should be treated with dignity as creatures of God.

This is not the first time such an outrage has gone virtually unpunished. Just two days after the Cikeusik killings, a mob in Temanggung, Central Java, ran riot in reaction to a blasphemy verdict. They were angry because a Christian accused of defaming Islam got only a five-year sentence — mind you, he killed no one.

That mob burned churches and buildings and injured bystanders. Most of the accused were given five-month sentences by a Semarang court last month. The ring leader, a cleric, got a year’s sentence, which was reduced by several months for time served.

What is so deeply alarming about the Cikeusik verdicts and other outrages, however, is the absence of reasoned and consistent leadership from the top reaches of government to set a tone of tolerance in the face of criminal acts committed in the name of religion.

The lesson to the people is that such attacks are understandable; the victims learn that they are without rights.

Of course, I do not mean to suggest that the government interfere in individual court cases but rather that it has a duty to uphold tolerance and speak up for the rule of law.

We already have the current spectacle of former Democratic Party official Muhammad Nazaruddin and others accused in various corruption cases fleeing from justice, seemingly with ease. Add to that mobs of thugs basically running free because prosecutors refuse to see their crimes for what they are and it looks as if we have no meaningful and consistent laws.

Last week I was in Tokyo, one of Asia’s most sophisticated cities, and an elegant woman running a gift shop asked me where I lived. “Indonesia!” she repeated with approval. “That country is very good. Japan is going down.” Imagine hearing that a decade ago.

The impression that Indonesia is a major success story is increasingly widespread. But don’t take it for granted. Mob rule, disrespect for the law and courts that treat killers with kid gloves are also still part of Indonesia’s story.

I hope the sound of a club beating against dead flesh does not one day drown out the good news that is far more prevalent in Indonesia.

(By A. Lin Neumann senior adviser to the Jakarta Globe and a co-founder of Asia Sentinel. Reprinted with permission from the Jakarta Globe.)

Philippines Aquino-Arroyo Contest Heats Up

Gloria checks into the hospital, suffering from back pain and corruption charges
The bloodhounds appear to be sniffing closer to former Philippines President Gloria Macapagal Arroyo, whom the current president, Benigno S. Aquino III, has vowed to put in jail on corruption charges.

Whether they will track her down remains problematical, given the Filipino culture of impunity. Arroyo announced earlier this week that she was to enter St. Luke’s Medical Center in Metro Manila on July 28 for what was described as a “risky” operation to correct a pinched nerve in her spine. And, despite the fact that Aquino appears intent in getting her behind bars, the MalacaƱang presidential palace asked the public to offer prayers for Mrs. Arroyo’s recovery.

Five plunder charges have been filed against the 64-year-old former president, who gambled that her election to the Philippine House of Representatives for the Second District in Pampanga would allow her to use her considerable wealth to control the body and insulate her from prosecution.

Among the charges filed against Arroyo are that her administration didn’t remit P72 million in capital gains taxes collected from the 2007 sale of the Iloilo Airport and that P530 million had been diverted from the Overseas Workers’ Welfare Administration to boost her presidential campaign in 2004. The latest filed against her involves allegations of misuse of P325 million in intelligence funds of the Philippine Charity Sweepstakes Office.

In early July, the Philippines was rocked by allegations that Arroyo had delivered cash to leaders of the Roman Catholic Church as well as half a dozen Pajero SUVs for church leaders. The cash was delivered, it was alleged, when church officials were meeting to discuss Arroyo’s impeachment in 2006 over charges of having rigged her election as president. The church apologized and offered to return the vehicles.

Slowly, over the last year, Arroyo’s defenses have been whittled away. Her big loss was the resignation to avoid impeachment by Merceditas Gutierrez, the former Ombudsman, who had deflected a long series of charges against the former president and her husband, Miguel Arroyo.

However, it has long been a truism in Philippine politics that few people ever are sent to jail for corruption. Arroyo’s predecessor, Joseph “Erap” Estrada, was impeached and forced from office in 2001 after charges of plunder were launched against him although some critics say he met his downfall not because he was a crook but because he wasn’t a member of the Filipino elite, and that he had embarrassed them.

In any case, Estrada was sentenced in 2007 to what amounted to life imprisonment, but was later pardoned by Arroyo and ended up running again for president against Aquino. Likewise, despite the fact that Ferdinand and Imelda Marcos were to have believed to have stolen billions of dollars from the state, eventually after Ferdinand’s death Imelda returned to the Philippines, ran for office and is now in the country’s Senate.

Unlike Estrada, Arroyo is a member of the Philippines’ elite families, as is Aquino. If she were actually to be arrested, let alone convicted, that would make a sea change in the structure of Filipino society and politics.

If anything, President Aquino has been criticized for vindictiveness and ignoring his duties in going after Arroyo with such zeal. So far, however, despite a year of targeting Arroyo’s allies and former officials, the government has been unable to prosecute any of them. Among those allies, besides Garcia, is former Representative Prospero Pichay Jr, who was dismissed from the ombudsman’s office for what was described as “grave misconduct” for his involvement in acquiring a controlling stake in a bank.

Also under fire are former Undersecretary of Agriculture Luis Lorenzo, ex-Undersecretary Joselyn Bolante, former Justice Secretary Agnes Devanadera and Mark Jalandoni, also a former assistant ombudsman.

Suspicions arose immediately that the decision to enter the hospital for back surgery was a ploy by the Arroyon camp to get sympathy. But, Raul Lambino, her spokesman, told The Inquirer, the charges are taking their toll.

“It adds to the stress that she is bearing,” he told The Inquirer. “Nonstop accusations affect the health of any person.”

Lambino called the charges nothing more than “statements coming from supposed witnesses who, we know, are being induced by those orchestrating the action. We don’t worry about the legal aspect because we know there is no solid evidence against her.”

He complained that Arroyo is “losing the public relations war because we don’t have the resources. The government has the Senate, House, Ombudsman, and even a friendly media, to support its position,” he said.

Arroyo, he said, “won’t take things sitting down because it’s her constitutional right to defend herself. She will face all her accusers squarely in the proper forum.” The Inquirer

Decoding China's North Korean Policy

To sway Pyongyang, China does what nations do – follow its own interests

After a rare inter-Korean nuclear meeting in Bali, a top nuclear negotiator from North Korea arrived in the US to gauge if six-party talks can resume. China is host to talks that aim to dissuade the North's nuclear ambition. In fact, China's role has been highlighted as much as the North's provocations in international headlines.

Pundits have long viewed China as having the capacity to contain Pyongyang's belligerence. With rumors of another North Korean nuclear test making the rounds to engineer legitimacy of the young heir, the usual call to China to rein in its North Korean ally may not be far off.

How much influence China has over Pyongyang’s policy remains, to quote Winston Churchill, “a riddle, wrapped in a mystery, inside an enigma.” Behind the mystery, there’s a simple truth: China will do exactly what its long-term interest dictates and it will not be swayed by entreaties of any power.

Popular commentary on Sino-North Korean relations suggests that China wields decisive influence on North Korea. A longtime mantra of the US State Department holds that China is the key to North Korean belligerence. How much influence China has over North Korea is still debated among experts. Chinese influence will ultimately depend on Beijing’s calculation of its national interests. That’s the only certainty.

This bedrock principle often eludes outside commentators’ scrutiny, and, as a result, Sino-North Korean relations often mystify international audiences.

China is seen as the major culprit that props the North Korean regime, functioning as its long-time enabler, providing food and fuel aid, neutralizing the UN sanctions. The international community has been perplexed by why China, a G20 member and “responsible stakeholder,” is so obsessed with a blip on the world map.

However, the alarm that China doesn’t do enough to contain North Korea’s provocations is a manufactured reality with a strategic purpose – more a reflection of US policy frustration rather than an objective analysis of China’s foreign-policy objectives, which should serve the national interests.

The Chinese national goal is to continue its rise as a global superpower. This requires a stable security environment in its neighborhood, especially the Korean Peninsula. Simply put, China wants to keep its backyard quiet. This offers a guide in decoding China’s foreign-policy logic on North Korea.

For the foreseeable future, that means China will be status-quo oriented: It needs to be prodded before it acts, as in US-led campaigns to intercept illegal arms sales by North Korea, and will be unenthused to join an international initiative that attempts to radically change the status quo on the Korean Peninsula. On the other hand, China will act proactively when perceiving signs of instability in North Korea – it invited North Korean leader Kim Jong Il three times in one year.

Four other pointers help in understanding China’s foreign policy behavior on North Korea:

Firstly, China will act in a way that fosters the stability of the North regime. The duo recently embarked on joint economic projects on two border areas, river island Hwanggeumpyeong and the Rajin-Sonbong area. By providing North Korea with economic incentives, China wants to stabilize North Korea amid a volatile transition process from Kim Jong Il to his third and youngest son, still in his 20s.

Secondly, China provides economic incentives to North Korea so that the North doesn’t resort to military adventurism that can destabilize the region, for instance, arms provocations against South Korea. Chinese experts call it “buying peace” from North Korea.

Thirdly, as seen in China’s behavior during the two violent incidents last year, China is not likely to rebuke North Korea in matters that could compromise its own interests. China did not join the international community in condemning North Korea in the aftermath of the Cheonan incident involving the sinking of a South Korean navy vessel. China judged that such condemnation would make North Korea feel cornered, prompting it to resort to further extreme provocations, even full-scale war on the Korean Peninsula. In the same context, like the US, China doesn’t want a nuclear North Korea. China wants to remain the sole nuclear power in East Asia and worries that North Korea’s developing nuclear weapons will spark a domino effect in neighboring countries, including arch-Asian rival Japan. But in doing so China doesn’t want to corner the North. China knows, when cornered, a mouse can bite a cat.

Simply put, China will gently nudge North Korea, but won’t pressure it. China learned a good lesson after harshly criticizing North Korea for the latter’s first nuclear testing in 2006 calling it “han ran,” or wanton. North Korea reacted: It became less responsive to China’s calls. It even carried out the second nuclear testing 50 miles from China’s border, prompting some Chinese schools to evacuate.

All in all, China is not likely to go out of its way to pressure North Korea to give up its nuclear program. But when tension in the Korean Peninsula gets of control, China will act to contain the situation. For example, China merely counseled both Koreas to stay calm in the aftermath of the Cheonan incident, but proactively managed the situation when the tension spiked further, on the verge of a war after the North Korean shelling of South’s Yeonpyeong Island, by dispatching its top foreign envoy, State Councilor Dai Bingguo, who outranks foreign minister Yang Jiechi. Dai met face-to face with top leaders of both Koreas. After Dai’s meeting with Kim last year, North Korea didn’t carry out its repeated threat of “retaliation” against South Korea in case Seoul carried out military drills near disputed waters. Predicting when China sits back and when it’s working behind the scenes can be a frustrating exercise.

Fourthly, this brings us back to the question of how much influence China really has over North Korea. China’s influence is an overstated premise. In 2006 and 2009, China demanded that North Korea not go ahead with nuclear experiments, North Korea didn’t comply. Like a parent dealing with a spoiled child, China has learned that its influence diminishes when it criticizes Pyongyang.

Chinese influence over North Korea is an assumption, strategically adopted by the US and South Korea. The two nations view China’s role as helpful in solving the North Korean problem. It’s a recognition of China’s growing stakeholder role in the region, a strategy of using China to influence North Korea. It’s also a preventive measure so that China may later be part of the solution. The US and its Asian allies, including South Korea, should not expect China to adopt their positions on North Korea, in accordance to US strategy for the region.

Track records show that China acts in its best interests. China is willing to shoulder outside criticism in defending North Korea when its national interests are at stake.

(By Seong-hyon (Sunny) Lee Seoul-born columnist and journalist, based in China. He’s completing his PhD on North Korea at Tsinghua University in Beijing. This is reprinted with permission of the Yale Center for the Study of Globalization) Asia Sentinel

Burma's Numerological Nightmare

The leaders in Naypyidaw prefer fortune tellers to foreign policy experts

When a fortune teller outranks policy experts as a head of state’s most trusted advisor, you begin to understand why a country can fall so spectacularly into ruin. That has been the case for successive Burmese leaders, whose subservience to higher powers has led to some extraordinarily bizarre decisions.

The fear of the supernatural trickles right down to the everyday folk: the three Thai army helicopters that crashed in the space of 10 days in the same area of jungle along the Thai-Burma border were brought down by angry forest spirits, some Karen villagers speculated.

Despite the arrival of Christianity in the 19th Century, Burma’s eastern frontier region remains predominately Buddhist – that goes for the vast majority of Burma, which over centuries has incorporated elements of animism, the previous dominant religion, into everyday life. Most prominent of these are the Nat spirits, who around the 12th century became the guardians of the state, and supposedly guaranteed dynastic continuity.

That elevation of otherworldly beings to the top of the chain of command provides some explanation of the current state of affairs: Burma’s era of military rule was scarred by brash and wholly irrational decisions, made by leaders who were paranoically in thrall to the supernatural. The country’s first military ruler, Ne Win (an adopted name that means “brilliant as the sun”), who closed Burma’s doors to the outside world and single-handedly orchestrated the collapse of its economy, was rumored to bathe in dolphin’s blood, believing it staved off the perils of old age. When an astrologer told him that his lucky number was 9, he banned all bank notes that were not divisible by 9. Overnight, the millions of Burmese who, distrustful of the country’s banking system tend to horde cash in their homes, were propelled further into poverty.

Then up stepped Than Shwe, whose auspicious number was 11. While perhaps not as brazen as Ne Win, his various dalliances with numerology are evident: many of his most feared opponents – including student leader Min Ko Naing and 13 other key figures in the September 2007 uprising – were handed 65 year sentences (6+5 = 11), all convicted in November 2008 (the 11th month of the year), and the guilty verdicts announced at 11am.

But Than Shwe’s most spectacular paean to the spirits arrived in 2005, when after reportedly consulting his fortune teller, E Thi (better known as ET, on account of her appearance), a deaf mute from Rangoon, he relocated the capital from Rangoon to Naypyidaw, where it now sits on a dusty, empty patch of scrubland. Her services were also sought by former Thai PM Thaksin Shinawatra, who was reportedly warned to stay out of Thailand between 8 and 22 September 2006 – he heeded the warning, but whilst in New York on 21 September was deposed in a military coup.

While not strictly a dynasty in Naypyidaw, the Nat spirits appear to have done their job. Current President Thein Sein was close to Than Shwe – the former’s name translates loosely as “hundreds of thousands of diamonds”, while Than Shwe means “millions of gold” – and may well have rode into office with the help of higher powers: according to the International Crisis Group, known more for crunchy geopolitical analysis than examinations of superstition, the date of last year’s elections, 7 November (7+1+1 = 9), should be scrutinised for celestial involvement, as should the time and date of the first legislature, at 08.55 (8+5+5 = 18 ~ 1+8 = 9) on 31/1/2011 (3+1+1+2+1+1 = 9).

Far-fetched, perhaps, but history might tell you otherwise…

(By Francis Wade blogs Asian Correspondent, with which Asia Sentinel has a content-sharing agreement. His blog is Inside Burma.)

Thursday, July 28, 2011

Taliban Role In Mumbai Attack

Terrorists thinking outside the box?

The indigenous terror group Indian Mujahideen that carried out the July 13 bombings in Mumbai appears to have been trained and given other help by the Taliban in Afghanistan, senior security officials have told Asia Sentinel.

The Mumbai serial bomb blasts killed 20 people and injured nearly 150 people, many seriously, highlighting once again the vulnerability of the city and the rest of the country to repeated terror attacks. It was the worst such attack on India’s commercial center since Nov. 26, 2008, when Pakistani militants killed 164 people and wounded at least 308.

The Indian Mujahideen are believed to have been formed in 2008 as a front group created by the Pakistani-based Lashkar-e-Taiba and the Harkat-ul-Jihad-al-Islami to confuse investigators, officials say. They have also been linked with the banned Students Islamic Movement of India, with some of its cadres derived from the local Indian population. Apparently because of a concern that Indian intelligence officials were catching up with the Pakistani-based jihadi groups, the training was switched to Afghanistan.

In order to unleash the current round of terror attacks, at least a dozen operatives were trained by the Taliban to orchestrate militant strikes in India, the officials said. The Taliban are growing increasingly hostile to India’s involvement in Afghanistan, which has included support to President Hamid Karzai, re-construction, infrastructure development and aid. New Delhi believes that an Afghanistan under Taliban rule extends the influence of Pakistan in the war-ravaged country, which is inimical to India’s interest, especially in reining in terrorism and militancy in Kashmir.

Mumbai has been attacked repeatedly by terrorist bombers or jihadi terrorists going back to 1993, raising serious questions about the competence of the police and intelligence agencies to thwart them. The officials say the earlier presumption about inadequate local levels of policing and intelligence gathering reflects a bigger failure that extends to federal agencies involved in pre-emption, counter-terror and cross national operations.

A committee set up to probe the 2008 attacks, chaired by Ram Pradhan, a former governor and home secretary, and V Balachandran, a retired police officer, issued a devastating report indicating the police were completely unprepared. That appears to have continued. Critics have pointed out, for instance, that a recommendation by the committee to install 5,000 CCTV cameras in the city is still pending in Delhi.

Taken in this context Home Minister P Chidambaram’s statement that there was absence of any intelligence inputs about an impending attack in Mumbai last week, misses the mark and points towards a bigger error. The officials say it is crucial to establish effective communication links between the higher intelligence agencies and the lower level police posts to build a comprehensive front against “low intensity-high impact” bomb attacks.

The officials involved closely with India’s internal intelligence and security, who spoke on condition of anonymity, said the operatives trained by the Taliban in all likelihood carried out the three blasts via improvised explosive devices in Mumbai. IED attacks are such that they are the most difficult to track, pre-empt and investigate. In the past, IEDs have been used during multiple instances in Delhi, Varanasi, Guwahati, Mumbai, Hyderabad and in Gujarat, to telling effect in terms of loss of human life and injury by shrapnel, especially in crowded areas such as market places, local trains and places of worship.

Jihadi strikes carried out using IEDs, wherein a pressure cooker can be turned into an explosive device, are most difficult to track simply because the attack can be broken down to multiple operatives and even “outsourced” to local criminals in exchange for money, say the officials.

Thus, a city such as Mumbai, which is a hub for the land- grabbing mafia and gold, arms and drugs smugglers and prostitution, becomes especially vulnerable. Proximity to Pakistan makes it that much more at risk. The attackers in the 2008 massacre arrived from the sea.

Although terrorists have also used RDX, which can bring down buildings, such sophisticated explosives are not easy to assemble and have to be smuggled into the country and can be tracked, as happened in the aftermath of 1993 Mumbai blasts. Thus suicide bombers and attackers regard IEDs as an effective substitute.

Attackers can be killed or caught as happened with the Delhi Parliament attack in 2001 and the November 2008 Mumbai attacks. Satellite and mobile phones, interrogation of 2008 Mumbai attacker Ajmal Kasab, who was caught alive, reveal a lot to investigators.

There are also suggestions to make Mumbai, India’s biggest city and a huge metropolis run by the Maharashtra state government, into a separate political entity like Delhi to pin political responsibility for managing internal security. Delhi, which was made into a separate state, has had some success in thwarting terror attacks. The city was last hit by serial IED blasts in October 2005 that killed 55 people. India also had success in tackling terrorism in Punjab in the 1980s when the state police under K PS Gill succeeded in eliminating militancy for good.

If the country doesn’t ultimately get its act right against terrorism, whether outsourced by jihadis or committed by suicide bombers themselves, apart from ramping up at all levels to guard against the equally venomous suicide and sophisticated bomb attacks, it appears that the terrorists will continue to regard Mumbai as a soft target, and that tragedy will continue.

By Siddharth Srivastava New Delhi-based journalist

Indonesian Mob Leaders Get Away with Murder

District court hands out slaps on the wrist for religious fanatics who murdered sect members in February

In what Human Rights Watch called “a sad day for Indonesia,’ a court Thursday gave astonishingly light sentences to religious fanatics who led a frenzied mob on that killed three members of the Ahmadiyah sect on video to between three and six months in jail.

An estimated 1,000 Muslims descended on the Ahmadiyah compound in the western Java town of Cikeusik in Banten province in February. The videotape, shot secretly, went viral across the world, showing the mob running down three men as they fled for their lives and beating them to death with rocks and sticks.

As hundreds of people prayed outside the Serang District Court, the leader, Idris bin Mahdani, was convicted of nothing more than illegal possession of a machete. He was jailed for five months and 15 days. Dani bin Misra, a 17-year-old who was shown in the film smashing a victim’s skull with a stone, received three months for manslaughter. None of the 12 who stood trial faced murder charges.

The light sentences for the 12 drew condemnation from human rights activists as well as the US Embassy in Jakarta, which in a prepared statement said that “We are disappointed by the disproportionately light sentences handed down on [Thursday] in the trials of twelve individuals implicated in the brutal murder of three Indonesian citizens during the February 6 attack on an Ahmadiyah community in Cikeusik, Pandeglang, Banten Province,” The US, the statement said, “encourages Indonesia to defend its tradition of tolerance for all religions, a tradition praised by President Obama in his November 2010 visit to Jakarta.”

Religious intolerance has been reaching deeper and deeper into the Indonesian population, with 30 percent of those polled in a study in 2010 approving of violence against members of the Ahmadiyah sect, a Muslim offshoot that preaches that its founder, Mirza Ghulam Ahmad, was the last Islamic prophet, succeeding Muhammad.

However, other religions and sects have become increasingly concerned about Islamic fundamentalist intolerance and outright violence as well in what has always been regarded as one of Islam’s most tolerant societies. Just days after the mob killed the Ahmadis, an angry mob destroyed three Christian churches after a local court in Temanggung, central Java, handed down a five-year sentence against a Christian man accused of blasphemy against Islam. The protesters were demanding a stiffer sentence, authorities said.

Even Shiite Muslims have expressed concern. The thugs in the Islamic Defenders Front (FPI) have been intimidating non-Muslims, threatening pork sellers and raiding night clubs – most recently in Surabaya in East Java against a giant prostitution complex. Attacks have even taken place against performances of wayang kulit, the famed centuries-old shadow puppet play.

While other religions and segments of society have watched the events with growing unease, however, it is the Ahmadiyah who have taken the brunt of the violence. That stems from a 2005 ruling by the Indonesian Ulema Council (MUI). The fatwah, which called Ahmadiyah’s teachings blasphemous, has been compounded, particularly in the last two to three years, by the seeming indifference of President Susilo Bambang Yudhoyono, who has displayed relatively little ambition to rein in Islamist extremists and outright thugs acting in the name of religion. The government has done little to discourage violence against the Adhmadiyah and Yudhoyono himself has never called on the police to arrest the hooligans.

Human Rights Watch Deputy Director for Asia Phil Robertson said.that “instead of charging the defendants with murder and other serious crimes, prosecutors came up with an almost laughable list of ‘slap-on-the wrist’ charges. The Cikeusik trial sends the chilling message that attacks on minorities like the Ahmadiyah will be treated lightly by the legal system. This is a sad day for justice in Indonesia.” Asia Sentinel

China Comes to Thailand

As Beijing’s clout grows, some Thais are uneasy

There is perhaps nowhere in Southeast Asia where the growing influence of China – economically, militarily and diplomatically – is being felt more than in Thailand, long one of the United States’ most steadfast regional allies.

Concern about China’s growing role cropped up recently at a Bangkok birthday party where the dinner guests were bubbling with cheer until the subject of China came up, causing some of the Thais at the party to suddenly turn gloomy.

“People in Thailand are worried," said a former foreign ministry diplomat, placing down his glass of red wine. "China's economy is so big, and ours is so small, that we cannot compete with all the Chinese things being sold here. It is especially a problem for Thai SMEs,” small and medium-sized enterprises.

"China will own us," said an interpreter for top government leaders, expressing her concern at Beijing's rapidly growing influence on Bangkok's economy. "Of course China will also own America, but your economy is so big you can just tell Beijing that you won't pay all the money you owe, and they can't do anything about it. But Thailand is small. We can't say no to Beijing. Thailand will be like a vassal of China,”

The birthday party attendants aren’t alone. US corporations are also fretting about how to compete in a region where the shared knowledge of Chinese dialects and an ancient heritage, give China unique advantages over America. Much of Thailand’s political and business elite are ethnic Chinese. China's ability to sell food, household goods and other items at lower prices than even Thai manufacturers has also pleased customers in this Southeast Asian nation while imperiling manufacturers.

Beijing is simultaneously increasing its military and cultural influence in Thailand, trying to wean Bangkok away from Washington and other foreign governments while expanding China's own reach southward.

As with the Chinese diaspora across Southeast Asia, migrants have been settling in Thailand for generations, arriving through Laos and across the Mekong River or, more often, by sea from China's southeast coastal towns to Bangkok. The earliest arrivals melded into a relatively unpopulated land centuries ago, maintaining some Chinese roots while mixing with ethnic Mon, Shan, Khmer and Thais to produce offspring who are today generally called Sino-Thais.

During the 1950s and 60s, Chinese also fled the Communist takeover of their country, seeking greater freedom, safety and a capitalist economy in Thailand. Some of the Chinese where suspected -- rightly or wrongly -- of being communist infiltrators and were arrested, imprisoned or shot dead by Thailand's US-backed military which supported America's Vietnam War and believed in Washington's "domino theory" of communist expansion across the region.

Many of the Chinese who survived, however, advanced upward and their descendants now occupy some of Thailand's highest political, economic, military and cultural positions. Today, Chinese faces, fashions and symbols are promoted in Thai advertisements and pop culture as badges of financial success. Many Thais admire local Chinese for educating their kids in Thailand's private "Chinese schools" while keeping their families united and working hard as a business team.

Yingluck Shinawatra, scheduled to be installed as the country's first female prime minister in August, appears eager to allow China to construct high-speed trains on five main routes across Thailand, replacing the country's decrepit, accident-prone railway. The first 380-mile (615-km) Chinese rail line would link Bangkok and Thailand's northern border town of Nong Khai, where a railway bridge over the Mekong River already leads to Vientiane, the capital of Laos.

The Chinese railway projects could take a decade or more to complete, and sources say there is considerable opposition to them that could keep them stalled for quite some time – precisely because of concern about Thailand's integration with China, but also because the collision in China on July 24 of two bullet trains, which killed at least 39 people, has raised questions among some Thais about Beijing's ability to build safe trains. The projects are extensive. Thailand’s railway tracks won’t handle super-fast trains, so entirely new roadbeds will have to be laid. Chinese officials are beginning to discover that the roadbeds for their own high-speed rail projects are substandard in many areas, and will have to be redone.

In January, Chinese investors began building a huge U$$1.5 billion China City Complex near Bangkok which its promoters say could employ more than 70,000 Chinese citizens. They would be able to import parts from China, manufacture the items into finished products on Thai territory, and export them elsewhere as "made-in-Thailand" without suffering some of the expensive tariffs which made-in-China products must pay. The Chinese will also be able to sell the 700,000-sq-meter complex's clothing, household items and other goods to people within Thailand, free of tariffs.

"Apart from the business opportunities in Thailand, Chinese exporters can also promote their products to developed markets such as the European Union and the United States through this project," said Yang Fangshu, chairman of the ASEAN-China Economic and Trade Promotion Center, according to Beijing's China Daily.

In 2006, when Thailand's military staged a coup and toppled the prime minister, Washington suspended US$24 million in military assistance and restricted high-level meetings.

Beijing, however, described the coup as Bangkok's internal affair and gave $49 million in military aid and credits to Thailand, while increasing the number of exchange students at both countries' staff colleges, and convincing the Thai military to participate in yearly, small-scale Special Forces joint exercises.

Chinese and Thai special forces held a 15-day joint anti-terrorism drill, "Strike-2010," during October in China's southern Guilin city to practice shooting, assaults and strategy. During the same month, more than 100 troops and officers from the China Marine Corps' amphibious special warfare unit participated in a 10-day "Blue Strike-2010" drill with their Thai counterparts, using light weapons, underwater combat equipment, amphibious reconnaissance and anti-terrorism equipment.

It was the first time Chinese marines had conducted a drill with a foreign army abroad. But China has sold inferior weaponry to Thailand, making some Thai military officials wary of becoming dependent on Chinese supplies.

For Bangkok, commerce with Beijing appears to be much more important than military links. Thailand's "government officials and academics sympathetic to the US see the dynamic of China rising -- and the U.S. receding -- likely to continue, unless the US takes more vigorous action to follow-up with sustained efforts to engage on issues that matter to the Thai and the region, not just what is perceived as the US's own agenda," said a confidential American Embassy cable to Washington in February 2010.

The cable, "10BANGKOK269," was titled: "China's Sustained, Successful Efforts to Court Southeast Asia and Thailand -- Perspectives and Implications." It was signed by then-U.S. Ambassador Eric John and released by WikiLeaks.

The cable's section subtitled, "China Rising, US Fading?" warned: "Indications that the US's historically close relationship with Thailand and the region is being challenged by the rise of China have become increasingly evident in recent years in a variety of arenas, not just economically but diplomatically, culturally, politically, and even in some security areas."

The U.S. Embassy even felt competition on a diplomatic level.

"We have also noticed an ever increasing quality to the Chinese diplomatic presence in Thailand,” the cable said. “Many Chinese diplomats are fully fluent in Thai, led by the Chinese Ambassador, who has spent 17 years of his career posted here and routinely makes local TV appearances.

"Those that do not have previous Thai experience, like the DCM [Deputy Chief of Mission] are smart, articulate, and increasingly confident in speaking up at English-language international relations seminars once the preserve of 'Western' diplomats," the cable said.

China's roll south also includes prostitution, gambling and other hedonistic offerings, most surprisingly in and around a tacky, Greco-Roman building complex on the Lao side of the Mekong River across from Thailand. Chinese businessmen also recently leased a 25,000-acre Special Economic Zone from the Lao government and constructed an extravagant casino, topped by a garish golden crown, in newly created Kapok City. Gaming tables reportedly employ 2,000 people. The Chinese complex will also offer golf, restaurants, hotels, an airport and shopping malls.

Several top Thai corporations are meanwhile trying to make profits by investing in China, hoping to copy the perceived success of Thailand's Charoen Pokphand Group. In 1979, CP Group -- known in China as the Chia Tai Group (Zheng Da Ji Tuan) -- was the first multinational enterprise to invest in China's agribusiness. CP expanded into China by focusing on the growing, processing and marketing of poultry and other edibles, alongside investments in huge supermarkets, entertainment complexes, automotive and other industries, plastics, and TV media.

Construction includes a 46-km road linking the casino to Huay Xai town on the Mekong River, according to Chiang Mai's Citylife magazine, and will help the area prosper. "Before, it was opium and drug businesses, maybe only 10 years before," in the area, the casino's manager told the magazine. "There were no roads, no electricity, no water. Laos is developing, and it is good for them."

The Lao government gave the Chinese a 99-year lease to develop the complex, which already has gamblers playing at its tables. Security includes private guards and metal detectors, and a ban on alcohol and photography in the casino, though smoking is allowed, the report said.

More recently, Thailand's agricultural exporters have been exporting mangosteens, durians, pomelo, tamarind and other food to China, helped by a deal signed in April which streamlined customs checks for road shipments. Sealed trucks are now able to speed to northern Thailand's border town of Chiang Khong, cross the Mekong into northwest Laos at Huay Sai, travel further north on Route 3 to the Lao-China border town of Mohan, and enter southern China's Yunnan province for delivery by superhighway to Jinghong and Kunming.

The journey takes about five days. Before the agreement, trucks had to stop at the Thai-Lao border for laborious reloading onto different vehicles inside Laos, and again be unloaded and reloaded at the Lao-China border. Alternatively, Thai exporters use Bangkok's port to ship goods along the Gulf of Thailand and South China Sea into Hong Kong.

China, however, produces much larger and more diversified foods for export into Thailand, threatening local producers and worrying consumers who fear China's deadly toxic contamination. Thailand's Food and Drug Administration recently increased checks on food arriving from China, testing for mercury, melamine, pesticides and other hazardous substances.

(By Richard S. Ehrlich Bangkok-based journalist.)

Wednesday, July 27, 2011

A desperate plea from the Thailand’s Restive South

"When people here say it's business as usual, nothing has changed, they mean people still get killed and bombs continue to explode every day…"

A senior Buddhist monk made this off-the-cuff comment in a radio programme all the way from the southernmost district of Sugei Golok on the first day of Buddhist Lent last week.

A day earlier, I heard a veteran teacher in Pattani tell another radio programme:
"Not a day passes without people here being killed or maimed by violence from the insurgents… it's the kind of norm that is not acceptable."

Boontom Thongsriplai, chairman of the Federation of Teachers in the Three Southernmost Provinces, is an eloquent speaker. But he was stuck for words on how to explain the continuous trouble in the three Muslim-dominated provinces in the South.
Now that the election is over and a Pheu Thai-led government is taking shape, the desperate teacher's passionate plea to the new administration is simply to take the issue seriously.

"I would like to ask the new government to place the Southern issue on top of its list of priorities. It's getting worse every day," Boontom says.

Of course, he realises that Pheu Thai, despite its overwhelming majority in the House, doesn't have even one MP from the South which, true to tradition, placed its trust through the ballot box in the Democrat Party.

Thaksin Shinawatra's record as prime minister and Thai Rak Thai Party chief strategist on the Southern issue left much to be desired. His highly offensive statement - "If you want your province to be looked after by the government, you have to vote for my party" - still sends chills down the spine of a lot of southern voters. But even if the southerners saw a major Pheu Thai Party victory coming, they didn't waver. The Democrats gained even more seats this time.
However, the Democrats' performance in dealing with the deep South's problems wasn't that satisfactory either, although they claimed to have a deeper understanding of the area. But "understanding" didn't translate into any concrete solutions.

Thaksin's handling of the "Krue Se Incident", and the extra-judicial killings of more than 2,000 people in the then government's anti-narcotics campaign, remain vivid in the collective memory of southerners.

The ex-premier may have recently expressed his "regrets" for those "unfortunate incidents" but it's what the incoming Yingluck government does in the deep South that will determine whether saying sorry will be translated into real actions to not only make amends for the past but also contribute concrete, positive solutions in the country's most violence-plagued area.

Boontom says that past governments have committed the "honest mistake" of dispatching soldiers from regions all around the country to fight insurgents in the three southernmost provinces.

"But it's a misguided policy because most of the soldiers sent from Regions 1, 2 and 3 aren't familiar with the local people, culture and terrain. They become sitting ducks for the terrorists who become emboldened by being able to kill our military personnel," the teacher says.

Things are more complicated down south than most Bangkok-based policymakers think. "The southern mess is a mixture of politics, smuggling, drugs and, of course, corruption lies at the heart of the whole scenario," Boontom explains.

And the victims of such a complicated situation in the South have been treated as "guinea pigs" by one government after another.

"Various solutions have been tried on us. None has worked. Most officials don't even know who is really behind the ongoing violence. So, they set up one agency, scrapped it, and then proposed a new administration system which didn't even have time to prove its worth before another government introduced a new idea…"

The Democrats re-introduced the "joint agency" concept, putting the military, police and civilian personnel to work together under one roof after the previous government had disbanded it.

During the election campaign, certain Pheu Thai candidates proposed the implementation of a "Special Administration Zone" for the South if they were elected.
But since none of those candidates won a seat in the new House, it remains unclear how the new government will run the deep South.

"Teachers in the South welcome the new government. We don't care which party runs the country as long as the new government pays sufficient attention to this deteriorating situation in the South…"

Southern voters may have rejected Pheu Thai's "special administration zone" concept. But they also expect the new government to get down to work to get a deeper understanding of the root causes of the southern problems and to work with the local people in seeking real short-term and long-range solutions.

For Pheu Thai to show its humility in election victory, the new government will have to be very humble, and eager both to learn from past mistakes and to cultivate the crucial level of trust down south.

The South contains perhaps the most critical lesson for Pheu Thai to learn - as much as the Northeast does for the Democrats. The Nation, Bangkok

Capitalizing demographic bonus to avoid middle-income trap

Asia is in the midst of a truly historic transformation. If it continues to grow on its recent trajectory, it could, by 2050, account for more than half of the global Gross Domestic Product, trade and investment, and enjoy widespread affluence.

“Its per capita income could increase six-fold to reach the global average and be similar to European levels today...” (Asian Development Bank document Asia 2050 — Realizing the Asian Century).

The document categorizes Asian economies into three groups. The first group consists of seven economies that have grown rapidly since the 1950s, avoiding the “middle-income trap” and becoming high-income developed economies in one generation.

The second comprises 11 economies, including Indonesia, that have demonstrated consistently high growth since 1990 and have already reached middle-income status, but now face the greatest risk of falling into the middle-income trap. Finally, the third group comprises 31 economies that have achieved only modest growth.

The document then postulates two scenarios of Asia’s future growth path, showing how the future of these economies may unfold: the Asian century and middle-income trap scenarios.

In the Asian century scenario, Asia’s GDP is projected to increase from US$16 trillion in 2010 to $148 trillion in 2050, or half of global GDP, with a per capita GDP of $38,600, similar to Europe today. It assumes that the 11 middle-income-status economies would maintain their momentum for another 40 years and adapt to the shifting global economic and technological environment by continually recreating their comparative advantage.

In the middle-income trap scenario, the report assumes that the current converging economies would fall into a middle-income trap over the the next five to 10 years and then follow the pattern of Latin America over the past 30 years.

The document warns that long-term projections of Asia through 2050 cannot rule out the possibility of a “perfect storm” scenario, whereby the combination of bad macro-policies, exuberance combined with lax financial sector supervision, conflicts, natural disaster, demographic factors and weak governance could cause a major setback to Asian growth. Under this worst case — or “doomsday” — scenario, Asia could stumble into a financial meltdown well before 2050.

The middle-income trap refers to countries that are stagnating and unable to grow to advanced country levels.

Many middle-income countries are caught in the middle-income trap — that is, they are unable to compete with low-income, low-wage economies in manufacturing exports and are unable to compete with advanced economies in high-skill innovations. Such countries cannot make a timely transition from resource-driven growth, with low-cost labor and capital, to productivity-driven growth.

To mitigate the risk of falling into the doomsday scenario, Indonesia must embark on policies that would, among others, make sustainable long-term economic growth more inclusive and equitable, radically reduce the intensity of energy and natural resource use, harness the full potential of entrepreneurship and innovation to create breakthroughs in science and technology, and improve governance.

Moreover, Asian population giants China and India will see very different demographic trends. By 2050, China’s population will represent a smaller share of the total global population than before.

India, on the other hand, will have grown, and its share of the total global population will grow to nearly 20 percent; while Indonesia’s population in 2050 will be 288 million. In the next decades, the list of the largest countries in the world will continue to be dominated by Asia.

The demographic figures for Asia in 2050 are impressive by the sheer numbers of its growing population: 40 years from now, Asia will have a population of nearly 5 billion. But the growing number of “elderly” people is just as impressive: In 2050, nearly 860 million Asians will be 65 years and older.

What is especially striking about this phenomenon is the relative speed of the process of aging in Asia at all levels of the economic spectrum.

A valid concern is that a rapidly aging population is antithetical to achieving high-income status and creates fear that a country might become too old before it becomes rich enough, and thus is trapped in a middle-income cycle.

Clearly, the ADB document suggests that population growth is no longer a “time bomb” threat to the economy. Instead, it is the driver of and a key factor in economic growth.

However, the Indonesian government has continued to believe that Indonesia still needs to curb its rapid population growth through a United Nations Population Fund (UNFPA)-sponsored “reproductive health” campaign targeting young people.

It has also promised to revitalize the national family planning program through the distribution of condoms and other contraceptives.

In a recent seminar in Jakarta sponsored by UNFPA, Vice President Boediono even stressed that the country’s rapid population growth is the main concern of the government. I suggest that the Vice President should read carefully the ADB’s Asia 2050 document.

Armida Alisjahbana, the National Development Planning Minister, however, is more enlightened by saying in a recent seminar on “Asia 2050: Realizing the Asian Century” organized by ADB in Jakarta that what Indonesia must do in order to achieve its long-term economic goal is to work hard on the implementation issues of what have been laid out in the master plan.

This means a new attitude towards policy implementation and a new generation with more capable and competent Indonesians who will eventually emerge from highly educated, skillful, healthy and large population.

South Korea, which has been singled out as a model of a middle-income country in the 1970s that succeeded in graduating to a highly developed and advanced economy at the beginning of the 21st century, offers great lessons for Indonesia to learn from. Among the indicators of South Korea’s first-world status is its ranking as the 13th most powerful economy in the world as its GDP crosses the $1 trillion threshold in 2011.

South Korea escaped the middle-income trap by following a double-track strategy in industrialization. It gave equal importance to export promotion and to the nurturing of a large domestic market.

Early in its development efforts in the last century after surviving the Korean War, its leaders had the wisdom to focus on rural and agricultural development. It was able to capitalize on its demographic dividend from the baby boom after the World War II through a labor-intensive, export-oriented industrialization strategy.

It escaped the middle-income trap by being able to compete with low-income, low-wage economies in manufacturing exports by investing heavily in higher education and research and development to move into higher-value and higher-technology industries.

Thus, there is no reason for the neo-Malthusian supporters to say that the world is already over-crowded and doomed to collapse. With its rapid population growth Indonesia’s economy must be able to fully realize its demographic dividend and, therefore, avoid the middle-income trap caused by a demographic winter.

Stefan S. Handoyo, CEO and chief economist of RAI Group and an expert on corporate governance.

Tuesday, July 26, 2011

Indonesia's President SBY in Trouble

Corruption, infighting in Democrat Party spark a crisis

Indonesian President Susilo Bambang Yudhoyono is said by political analysts in Jakarta to be a major crisis, with his governing Democrat Party’s fugitive former treasurer leveling charges of widespread corruption against top party members.

Political analysts say the scandal could affect the party’s chances in 2014 legislative races, with Golkar and the Indonesian Democratic Party of Struggle, the next two biggest political parties looking forward to making inroads. Aburizal Bakrie, the billionaire tycoon who heads Golkar, has ambitions to replace Yudhoyono as president in the next election as well. The Democrats, who lead a ruling coalition of 314 seats in the 560-seat legislature, hold 150 seats against Golkar’s 125 and the PDI-P, as it is known under its Indonesian initials, with 95.

The errant treasurer, Muhammad Nazaruddin skipped out for Singapore in May, a day before he was due to be banned from traveling for allegedly accepting US$3 million in bribes on tenders for the construction of the athletes’ village facilities for the Southeast Asian Games, to be hosted by Indonesia in Palembang in November. His sudden departure raised questions whether he was being helped out of the country by people who didn’t want him singing too loudly. At the time he told reporters later that he was merely going to Singapore for medical treatment and would return.

He didn’t. He has repeatedly denied the corruption charges and has resisted blandishments by Yudhoyono and others seeking to lure him home to face up to the charges. He has been fired by his party and faces questioning by the Corruption Eradication Commission, known by its Indonesian initials KPK.

Despite efforts by party officials to shut him up, Nazaruddin has been issuing a blizzard of statements from an undisclosed location via BlackBerry and Twitter on corruption scandals including allegations that the party chairman, Anas Urbangingrum, was implicated in the athletes’ village bribery scandal and that the party chairman engaged in vote-buying.

Singaporean immigration officials say Nazaruddin is no longer in the island republic. And while the national police have located several “hideouts” where they said he might be, so far they haven’t found him.

The fugitive’s cousin, Muhammad Nasir, who replaced him as a lawmaker, has urged Nazaruddin to return to the country and stop embarrassing the party, saying he wasn’t being professional. Nasir, however, faces investigation on some of the same charges that Nazaruddin is implicated in.

Nazaruddin appeared on television last week to level charges against Urbaningrum and brought the KPK, considered the country’s most incorruptible institution, itself under suspicion, saying that Urbaningrum had made a deal with Chandra M. Hamzah, the commission’s deputy chairman, to support his reelection to the KPK if Hamzah promised to protect party members – including Urbangingrum against questioning in the athletes’ village construction case.

The KPK immediately announced it would investigate Hamzah. “Regarding the information given by Nazaruddin, the KPK will form a team to investigate it because it is important to verify any information about the KPK's officials, no matter how small the information is,” a KPK official said.

Yudhoyono, who was elected as a reformist president and reelected resoundingly in 2009 on a reform platform, has been struggling with a long series of corruption problems that have tarnished his image despite his continued frustrated demands that they be cleaned up.

Over the weekend, he summoned 5,300 party members to a meeting in Jakarta to call for a cleanup in the party ranks, saying that the party’s reputation, image and dignity had to come before anything else, calling for party leaders to stop attacking each other, and pledging to lead a drive to get rid of members suspected of legal or ethical problems.

Given Indonesia’s culture of impunity, that is a big task. Nonetheless, partly leaders said they would ferret out those with legal problems and refer them to an ethics tribunal. The question is whether they can follow through. The Democrats face a very delicate situation. Expulsion of errant members could lead to serious fissures in the party. Thus, while Yudhoyono may have made it clear that he wants to shake up the party, the question is whether the party leadership can follow through. It clearly hasn’t in the past.

For instance, Nazaruddin’s charges against Urbangingrum would, if proven, bring down the head of the party. While keeping him on as chairman would contribute to the party’s image as less than savory, replacing him could create considerable instability. Yudhoyono himself in the past has shied away from drastic action like firing top officials, contributing to his image as a waffling president.

Yudhoyono is thus likely to avoid drastic changes. As for Nazaruddin’s charges, whistle-blowers in the past have mostly been ignored – most recently the tax collector Gayus Tambunan, who was arrested for taking millions of dollars in bribes to soften the tax blow for major corporations, and who named some of those who gave him bribes. Also, one of the country’s top police officials, Susno Duadji, who was ousted from the police force on bribery charges, accused three of his fellow top police officials as well as officials in the Attorney General’s Office and others of taking bribes as well to bury a criminal probe. So far nothing has happened. Asia Sentinel

Monday, July 25, 2011

Could this be Aussie’s PM Gillard retirement poster?

"Socialism is a philosophy of failure,
the creed of ignorance, and the gospel of envy,
its inherent virtue is the equal sharing of misery.."
-- Winston Churchill

Enabling China-American technology companies are eager to do business in China, sometimes too eager.

Cisco Systems and others are working on a government project in the city of Chongqing, for example, that includes creating the biggest police surveillance system in the world. A year and a half after Google pulled its search engine out of China to avoid censorship, Microsoft’s Bing still censors searches in China. Earlier this month, it agreed to provide search results in English for Baidu, China’s leading — and heavily censored — engine.

The United States needs enforceable standards of ethical behavior when American companies work with authoritarian governments.

In May, Chinese practitioners of Falun Gong sued Cisco, accusing it of helping the Chinese government design and maintain the so-called Golden Shield system used to track and target dissidents online, including Falun Gong followers who were apprehended and tortured.

Cisco denies the accusation. It says it does not customize equipment to help any government censor content, intercept communications or track users. It says it only sells the Chinese government standard-issue equipment and that it is not selling cameras or image-management software in Chongqing, only general network equipment.
Nevertheless, Cisco’s experience confirms that we need uniform principles to guide corporate behavior.

After Yahoo handed over data five years ago about a Chinese journalist who was condemned to 10 years in jail, Yahoo, Microsoft and Google joined in the Global Network Initiative to set principles that include protecting “the freedom of expression rights of their users when confronted with government demands, laws and regulations to suppress freedom of expression.” Voluntary guidelines are insufficient. Just as the Foreign Corrupt Practices Act establishes that companies cannot bribe foreign officials, legislation is needed in this area.

Internet companies should not keep user data inside countries where courts convict people for what they write, speak or think. They should warn users about their risks, and they should never censor content. American firms were barred from selling crime-control products to China after the Tiananmen Square massacre of 1989. The list must be broadened and kept up to date. Firms could be barred from selling technology to eavesdrop on VoIP communications or powerful antispam systems that could be used to target political speech. Technology companies should be barred from tailoring goods to a repressive end.

An article this month about the Chongqing project in The Wall Street Journal quoted an executive at Hewlett-Packard, which is planning to bid on the project. “It’s not my job to really understand what they’re going to use it for,” he said. That’s not nearly good enough.
Editorial The New York Times

Laos and the drugs trade -A second wind from the Golden Triangle

THE new prime minister of Laos, Thongsing Thammavong, has taken the country's drugs problem into his own hands with good Communist brio. At an event co-sponsored by the government and the UN Office on Drugs and Crime (UNODC) in late June Mr Thongsing, wearing a business suit and wielding a giant torch, helped put fire to an enormous stash of seized opium, heroin and cannabis. Three weeks later the prime minister reinforced his message by concluding a co-operation agreement with Myanmar, Laos’s big neighbour to the north-west, on the prosecution of drug trafficking. Although official policy in the Lao People’s Democratic Republic is usually kept opaque, it is easy to see that the government, led by a man eager to make an impression—is gearing up for a new stage in the war against drug producers and traffickers. In recent years it had shifted to the back foot; the production of both opium and methamphetamine is on the rise.

Laos was long regarded as one side of the Golden Triangle, which was responsible for producing over half of the world's opium as recently as the 1990s. At one point smoking crude opium had become a macabre tourist attraction for foreign visitors slumming it in northern Laos. Facing pressure from America and the UN, the Laotian government, together with its counterparts in Myanmar and Thailand, conducted a wildly successful eradication programme in the late 1990s that saw poppy cultivation plummet. From the 27,000 hectares (over 40,000 football pitches) that were under cultivation in 1998, within eight years the Laotian government had brought the total crop yield close to nil. Close enough that it was able to declare the country opium-free by early 2006. Contemporary reports suggested that it was no Potemkin clean-up job—towns such as Vang Vieng reinvented themselves as destinations for a different type of visitor.

The government’s efforts at repressing production were augmented happily by a simultaneous explosion in poppy growth in Afghanistan. The Taliban had seized Kabul in 1996 but it wasn’t until 1999 that Afghanistan’s opium producers really hit their stride. That year Afghanistan’s market overtook Myanmar as the world's largest and began dictating prices worldwide (to ignore the remarkable blip of 2001). By 2006 it was growing seven times the amount of Myanmar, Thailand and Laos combined. A subsequent glut sent global prices plummeting, aiding the eradication efforts of the South-East Asian governments.

It now appears that the Laotian government became complacent almost immediately upon declaring victory. Opium production has grown every year since 2007, and in 2010 the area under cultivation leapt by 58% year-on-year, according to a recent UNODC report. The government has proved its ability to locate and destroy poppy fields, but its dedication to disbursing aid—such as might motivate the erstwhile growers to pursue other livelihoods—is more questionable. UNODC believes that less than 10% of the villages declared opium-free have received funds promised for growing alternative crops. The effects of this failure were exacerbated by the global financial crisis. Weaker demand led to a fall in farm-gate prices for legal crops, while higher input costs raised prices for household goods. As standards of living declined, the reasons to return to poppies grew stronger.

Unhelpfully, the spot price of opium has also continued to rise. As expected, a reduction in local cultivation pushed up domestic prices, from around $250 per kilogram in 2002 to almost five times that in 2008. However, even as local supply began to rise again, the price continued to increase, reaching $1,670 per kilo in 2010. Why this is happening is unclear. One theory is that the drug remains in short supply locally because traffickers have opened new supply routes, taking advantage of new road links to China; the size of its import market is almost totally unknown.

Meanwhile, hidden among the stash burned by Mr Thongsing were 1.2m tablets of methamphetamine, known in Thai or Lao as yaba. Production of yaba in hidden factories in the Golden Triangle rocketed while opium production shrank in the early 2000s, and it has now supplanted opium as the consumer’s drug of choice in Laos. It finds a ready market in the growing cities as well as in the countryside.

According to UNODC, the number of yaba pills seized in Laos is rising sharply, from 1.3m in 2007 to 2.3m in 2009. But it is hard to know whether this has anything to do with Mr Thongsing’s new campaign, which for once addresses yaba on a par with opium. The ease and speed with which yaba factories can be assembled and relocated, combined with Laos' porous borders, makes it a cinch to evade the police. Unlike poppy plots, meth labs are not easily spotted by helicopter surveillance. So it is difficult to determine whether police are making inroads or whether factories are simply scaling up production. Nor is it possible to tell if seized pills originated in Laos or only indicted midway along their journey to markets in Europe, America and elsewhere in Asia.

Mr Thongsing's very public involvement in the drug war indicates that the Laotian government is readying itself for another crackdown. The speed with which it set about destroying poppy fields a decade ago indicates that it will be a formidable foe. Its dormancy since then however seems to have given the drug industry a chance to evolve and wise up. Whether it does the country any good or not, Mr Thongsing should have plenty of torch-brandishing ahead of him. The Economist

Taiwan's Astonishing Abortion Rate

The island’s terminations appear to vastly outnumber live births

For every pregnancy leading to a Taiwanese woman giving birth, a remarkable three are estimated by a Taiwan pediatrician to have been aborted, a figure that others believe isn’t too far from reality.

When on July 17 the veteran National Taiwan University College of Medicine professor and pediatrician Lue Hung-chi told a forum that 300,000 to 500,000 abortions are carried out in Taiwan each year, he was seeking to send alarm bells ringing. If his estimate is true, it has to be one of the highest per-capita abortion rates in the world.

Statistics show that the country has one of the lowest total fertility rates in Asia, apparently driven at least partly by the ready availability of the abortion drug RU-486. The government announced earlier this year that the average number of children a Taiwanese woman would have in her lifetime was the lowest in the island’s history, at 0.91 per woman.

In fact Taiwan’s total fertility rate appears to be the lowest rate any country has recorded anywhere, according to the Population Reference Bureau, although 2010 was an abnormal year, since families were putting off having children because babies born in the Year of the Tiger are thought to be quick-tempered and willful. For whatever reason, the low birthrate was recently declared a national security issue by President Ma Ying-Jeou.

With only 166,000 babies born on the island in 2010, Lue said, the government should act urgently to tighten the island liberal abortion law, which stipulates that a woman can undergo an induced abortion “if the pregnancy adversely affects the psychological or physical health of the woman or her family life.”

Measures should be implemented to encourage people to have children, counseling should be provided and an environment created that facilitates adoption, Lue told Asia Sentinel.

“Children's health care in Taiwan is terribly underfunded. The national health system is not in favor of pediatrics,” Leu said, which he blamed as part of the reason for the low birth rate. “In over 30 percent of Taiwan's towns no pediatrician can be found.”

Lue made it clear that his estimate is just that.

“In Taiwan, there is no solid data available,” he said. “Of course, the figures I mentioned include pregnancies that are ended with the abortion drug RU-486.”

The most recent official data on abortion numbers is over a decade old. In 1999, 42,282 legal abortions were performed compared to 283,661 births. In the absence of authoritative statistics, what's left is anecdotal evidence and assumptions of those who work or do research in the field.

Some believe the figures are lower. Lee Mao-sheng, a professor at Chung Shan Medical University's College of Medicine, believes the figure could be 80,000-100,000 with the number possibly being as high as 150,000 if illegal abortions were counted.

Chao Kun-yu, deputy director-general of the Bureau of Health Promotion, said that including RU486, roughly 240,000 abortions are carried out legally per year. Pan Hun-shan, a physician with the Obstetrics and Gynecology Department at Shin Kong Wu Ho-su Memorial Hospital, believes the 300,000 to 500,000 figure to be realistic, saying that one to two mothers out of every ten who visited his hospital were there seeking abortions. Pan suspects that the percentage is significantly higher in private clinics.

Taiwan's demographers agree that it's obvious that the birth-abortion ratio is dangerously skewed.

“Demographers in Taiwan can only do their best by conjecture,” Yang Wen-Shan, a professor at Academia Sinica's Research Center for Humanities and Social Sciences, told said in an interview. “The health authority may have some estimated number of aborted fetuses, but it is never reported in the public domain.”

Every year, Yang aid, “there are around 13,000 births given by teenagers. If 90 percent of the total number of teenage girls who become pregnant would not want to give birth before they enter into marriages, we estimate that there are around 130,000 aborted fetuses by teenagers alone.”

Social demographers commonly conclude that there are around 200,000 abortions in Taiwan annually, and suggested that the 500,000 figure mentioned by pediatrician Lue came about through the estimate that each of the RU486 pills sold is counted as an abortion.

Yang agreed, however, that the high abortion rate for a good part is to blame on the lack of an adequate adoption system.

“Many of my colleagues argue that if the government would change the child adoption system in Taiwan, every year we can save enough babies to make up the deficits of the lowest-low fertility situation,” he said.

“The abortion rates are higher for unmarried women,” he continued.”According to the statistics, approximately 90 percent of them will make a decision to abort the fetus. Also women with higher parity [the number of times a woman has given birth] have higher rate of abortion, women whose husbands have higher socioeconomic status, as well as those of older age that had already given birth to a baby boy.”

Gender-selective abortions -- aborting girls before their would-be mothers had their first boy – has also led to an alarming gender imbalance. The practice, found in much of Asia, is mainly due to the belief that males will carry on the family name. By regional comparison, only South Korea and China account for male-to-female infant ratios roughly as unnatural as that of Taiwan.

In 2010, in Taiwan 1.09 males were born for every one female, while in South Korea and China the figure was 1.07 and 1.133, respectively. Taiwanese health authorities estimate that last year alone more than 3,000 female fetuses were selectively aborted on the island but prosecutors have a hard time fighting the practice because doctors often have blood samples screened by outside laboratories, meaning there is no evidence.

Unlike in the West, abortion has never been a polarizing issue in Taiwan. Neither NGOs nor public advocacy groups vociferously discourage abortion, and even the churches are remarkably quiet. Abortion was legalized in 1985 and has been generally accepted, mainly because of the stigma associated with unwed motherhood. In recent years, however, the prohibiting cost of education is overwhelmingly cited as reasons for couples not wanting children. Some 75 percent of Taiwan's children visit cram schools where tuition fees for one child alone can easily account for 25 percent of a worker's monthly income.

“Taiwan's abortion rate is high mainly because the economic growth rate is low,” said Tim Wang, deputy director of the ruling Kuomintang’s (KMT) Youth Department. “As government debts account for NT$5 trillion [US$173 billion], we can say once the child is born, it owes the country NT$200,000. Under these circumstances, young couples don't want to raise children.”

In the past, to the Taiwanese, as for societies elsewhere, it was the more children, the better. This was because filial support formed the by far most important financial pillar of retirement. But also this rationale to bear offspring has all but ceased to exist.

“Few people regard children as a means of support after retirement. Most Taiwanese who want to have children do so because they love kids,” said Joseph Tien, an assistant professor at Tamkang University's Department of Insurance. Investment-linked insurance has replaced the traditional filial support as the main means to prepare for retirement, he added.

In the eyes of pediatrician Lue, Taiwan's suspected shockingly high abortion rate has to be taken on top-down by Taiwan's policymakers.

“We cannot demand young pregnant women to think of the nation; it's the government that must think of the nation,” Lue said. By Jens Kastner