Friday, December 23, 2011

A Year of Dubious Performances in Asia

If Asians named a person of the year, someone who brought surprise, intrigue and economic impact to the region, the choice would be Mother Nature.

From earthquakes in Japan and New Zealand to floods in the Philippines and Thailand to Chinese droughts to volcanic eruptions in Indonesia, this was a year overrun by nature’s fury. Food shortages and the effects of climate change challenged governments and inflation rates as rarely before.

Other forces of nature, meanwhile, ran out of steam. The most surprising thing about Kim Jong-il’s death is that we were so surprised. Time was never on the side of the hard-living North Korean leader after a 2008 stroke. Yet, the world seemed to think the laws of science no longer applied to Kim. Unstoppable China also showed signs of being subject to a set of laws — those of economics, which guarantee that rapid growth inevitably slows.

As 2011 draws to a close, 10 awards are in order for the countries, people and companies that shaped Asia’s tumultuous year — natural disasters aside.

H omer Simpson Award: T o the hapless crowd at Tokyo Electric Power Co., whose corruption and negligence turned Japan’s March 11 earthquake and tsunami into the worst crisis since Chernobyl. Japan’s nuclear industry was proved to be no sounder than that of the fictional Springfield Nuclear Power Plant, where, th e bumbling Homer heads safety. Only for Japan’s 126 million people, there’s nothing to laugh about.

Ready or Not Award: To Kim Jong-un, the 20-something son expected to replace Kim Jong-il. Grandfather Kim Il-sung spent decades preparing his son to take over in 1994. Kim Jong-il had far less time to show his successor the ropes. Get him a copy of “Dictatorships for Dummies.”

Reality TV Award: To Philippine President Benigno Aquino, for offering nary a dull moment. First, he stood up to the Catholic Church’s stance against contraception and family planning. Then he went after the billions of dollars watchdog groups say Ferdinand Marcos looted during his 21 years in power. Next, he arrested predecessor Gloria Arroyo on corruption charges. And you think things are tense in Washington?

Overwhelmed Freshman Award: To Yingluck Shinawatra, the fresh-faced prime minister of Thailand. With her unsteady handling of massive floods that breached Bangkok’s defenses, Yingluck confirmed concerns that she is both unqualified for the job and a proxy for her brother Thaksin Shinawatra, who was ousted from the premiership in 2006 amid huge street protests.

Coming Out Party Award: To Burma, for shocking the globe by taking steps toward democracy. If you told Hillary Clinton a year ago that she would be in Rangoon and embracing Aung Sang Suu Kyi, the secretary of state might have laughed. It makes you wonder whether Pope Benedict XVI will soon get an invite.

Underdog Award: To Anna Hazare, whose hunger strike shook India. Only history will tell if the anti-corruption movement touched off by the Gandhian social activist will drive the change India’s inefficient economy needs. It’s a dialog that India must have if it’s going to keep up with China.

Grrl Power Award: To Julia Gillard, the Australian prime minister who is thriving in a man’s world. After toppling predecessor Kevin Rudd in a June 2010 party coup, word was that Gillard wouldn’t last. Today, she’s running an economy that’s the envy of the developed world and planning to lead the Labor Party to the next election in 2013. Gillard is also working to increase female participation in Australia’s executive suites. Good on you, mate.

Clueless Executive Award: Although it’s hard to top Japan’s Tepco for dismal leadership, Olympus deserves honorable mention for a scandal that left a $1.3 billion hole in its balance sheet and President Shuichi Takayama struggling to save the company’s board. And the next recall by Sony, which is on course for a fourth straight annual loss, should be chairman Howard Stringer.

Contrarian Indicator Award: To Standard & Poor’s, which might as well have flashed a “buy” signal on American debt when it cut the United States’ AAA rating in August. Far from fleeing the dollar, investors — many of them from Asia — loaded up anew on US Treasuries. Does that signify complete distrust of our credit-rating system, or what?

Meredith Whitney Award: To Muddy Waters, the Hong Kong-based short-seller that claimed to have found financial shenanigans at timberland owner Sino-Forest. Whitney’s 2007 prediction that Citigroup’s dividend was i n danger — it was later cut — drew denials and rebukes. Muddy Waters’s report, initially disputed, is looking more accurate by the day. Among the investors tripped up was John Paulson, he of the colossally profitable bet on subprime mortgages.

It’s fitting that the final award concerns China, because Asia’s prospects are so dependent on the region’s dominant economic power. Maybe next year is when we will find out if Sino-Forest was an anomaly or a microcosm of the Chinese growth miracle. If it’s the latter, then what Mother Nature served up this year might seem tame by comparison.

By William Pesek Bloomberg View columnist.

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