The 5 Pluses of Japan


November 14, 2018

The 5 Pluses of Japan

By Phar Kim Beng http://www.malaysiakini.com

COMMENT | There are three Japanese policies embedded into Malaysia. The Look East Policy is but one. Even then, Look East involves learning from the rapid economic developments of South Korea and China as well.

Thus, the Look East Policy alone, while necessary, is not sufficient to understand what Prime Minister Dr Mahathir Mohamad seems to want to achieve by making three trips to Japan over the last six months.

The other two policies are Malaysian Incorporated, abbreviated as Malaysian Inc, and the policy of sogososha (huge conglomerates).

Second, as a democracy, albeit an Asiatic one, Japan was in a position to explain to the rest of the G7 if the region was heading towards more democracy. To the degree the emphasis was not on democracy but business, Mahathir was hoping that the West and Japan could see Southeast Asia as a location where their foreign direct investments (FDI) could grow. Thus the ritualistic attendance at the Nikkei Asian Conference every June, which Mahathir attends without fail.

Third, Mahathir knows, from watching it intensely from the 1960s onwards, that Japan has capable acts of heroism. While the conversation threads can occasionally veer into “hara-kiri” or ritualistic suicide to atone for one’s shame, it has also headed in the direction of volitional resignation.

When Japan Inc or the government made any mistake, it was adept at either offering a contrite apology, changing its previous behaviour completely or resigning from the positions of responsibility.

Calling the Pacific War a war of necessity rather than a war of Japanese imperial aggression, for example, was enough to make any minister resign within a window of 24 hours. Japan has, and did, learn from the conflicts of the past which is why the Peace Constitution of Japan is something which Mahathir continues to admire, even suggesting as recently as August that it could help Malaysia avoid from being entrapped in any armed conflict.

Fourth, there is a high degree of congruence between the Japan of the past, especially Tokyo Olympics 1964, the first Olympics in Asia, and the impending Tokyo Olympics 2020, which is 18 months away from now. The key point is the Japanese fascination with making things, and the future, better.

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Both are events to show case the future of Japanese technology within the context of what Asian technology can achieve. Invariably, this ranges from receiving the athletes at the major metropolises like Tokyo and Osaka to transferring them to other cities for various events. If in 1964 the focus was on bullet trains, in 2020 the key experiment would be driverless cars.

Not brittle nor delicate

Fifth, Japan is not often seen through the optics of strategic balance or to counter to the emergence of China or even North Korea.

When Mahathir became the Seventh Prime Minister in May 2018, he did not block Malaysia from reopening its mission in Pyongyang in North Korea. Yet North Korea, to this day, remains the arch enemy of Japan.

Nor did Mahathir try to pitch Japan against China, another strategic rival to Tokyo. The Mahathir doctrine is about clearing all warships from the South China Sea without fail.

By using Robert Kuok (on left in photo) as a conduit to get to know President Xi Jinping and Vice-President Wang QiShan of China, Mahathir knew he was using a practical “centrist” (and one who is Malaysian, too) to reach out to the top leadership in China.

He wasn’t trying to use someone who believes in transforming Japan into America’s “unsinkable aircraft carrier”, an expression used by former Prime Minister Yasuhiro Nakasone during Mahathir’s first tenure as the fourth Prime Minister of Malaysia (1981-2003).

By obviating the importance of the fifth aspect of the Japanese Malaysian relationship, Mahathir is indeed Looking East without being locked into any conflict with Japan’s nuclear and conventional arms rivals in the Northeast Pacific or the East China Sea.

In the months to come, the Japanese and Malaysian relationship can only strengthen when Anwar Ibrahim, the Prime Minister-in-Waiting, also exercises the same level of energy and pulsating pace to keep the two countries locked in a strategic embrace.

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There are no signs to suggest that Anwar won’t keep up the tempo with Japan. First, Anwar is a big believer in the “Asian Renaissance,” a theme he explored in the book which he wrote in the 1990s.

He is also an ardent admirer of the Quranic scholarship and hermeneutics of the late Toshihiko Izutsu , one of the best scholars to have ever emerged from Japan.

 

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Philosopher Toshihiko Izutsu

Anwar  is also a huge fan of Rabindranath Tagore, the Indian writer who was inspired by Japanese Pan Asianists like Ogawa Shumei and Tenshin Okakura at the start of the 20th century. The trio believed that Pan Asianism could be the ideological glue for the region.

Some of the think tanks of Anwar – such as the Institut Kajian Dasar (IKD) and the Institut Rakyat – have had good relationships with the Sasakawa Peace Foundation and the Nippon Foundation in Tokyo. Such links have been cultivated over the course of the last 25 years.

Their ties are not brittle and delicate. In fact, these organisations are keen on working with Mahathir and Anwar jointly. The future of Malaysia and Japan can only brighten when all Malaysians take Japan as seriously as the top two.

When Waseda University, the University of Tsukuba, the Toyo University, and potentially other Japanese education groups begin working closely with Malaysia, the Look East policy will then gain in ascendancy, creating room for similar entities from China and South Korea to do the same in Malaysia.

For now, the key is to send more workers, students, trainees, interns and even future leaders from Malaysia to Japan’s Graduate School of Policy Studies.

By 2020, the Japanese Prime Minister wants a total of 300,000 foreign students in Japan.

It would be an exceptional feat if one-third of them are Malaysians. That would be 100,000 Malaysians who understand contemporary Japan and how she competes with South Korea and China in a healthy manner.

These 100,000 Malaysians will help to move the country towards 2025 – the period when Mahathir believes Malaysia can be a developed country on par with Japan.


PHAR KIM BENG is a former visiting scholar of the Japan Institute of International Relations in Tokyo.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.

 

How to win the Cold War with China–Dr. Fareed Zakaria


October 15, 2018

How to win the cold war with China–Dr. Fareed Zakaria

https://www.washingtonpost.com

The Trump administration’s most significant and lasting decisions will be about U.S. policy toward China. Far more consequential than even the Supreme Court’s composition or immigration policy is whether the 21st century will be marked by conflict or cooperation between the two most prosperous and powerful countries on the planet. The last time there was such a question — when Britain confronted a rising Germany 150 years ago — it did not work out so well.

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Since the end of the Cold War, we have lived in an era of almost no genuine great-power competition, which has led to the emergence of a dynamic global economy and a huge expansion of international trade, travel, culture and contact. All this happened under the United States’ uncontested supremacy — military, political, economic and cultural.

That age is over. Twenty-five years ago, China made up less than 2 percent of the global gross domestic product. Today that figure is 15 percent, second only to the United States’ 24 percent. In the next decade or so, the Chinese economy will surpass the size of America’s. Already, nine of the 20 most valuable technology companies in the world are based in China. Beijing has also become far more active on the global stage, ramping up its defense spending, foreign aid and international cultural missions. Its Belt and Road Initiative, infrastructure investment in dozens of countries, will ultimately be at least seven times larger than the Marshall Plan, if not far more, in inflation-adjusted terms.

The Trump administration has many of the right instincts on China. Beijing has taken advantage of free trade and the United States’ desire to integrate China into the global system. The administration is right to push back and try to get a fundamentally different attitude from China on trade. But instincts do not make for a grand strategy.

Were Washington to be more strategic, it would have allied with Europe, Japan and Canada on trade and presented China with a united front, almost guaranteeing that Beijing would have to acquiesce. It would have embraced the Trans-Pacific Partnership as a way to provide Pacific countries an alternative to the Chinese economic system. But in place of a China strategy, we have a series of contradictory initiatives and rhetoric.

President Trump’s Trade Gangster–Peter Navarro

If there is one person in the White House whose ‘to do’ list you want to avoid, it’s Peter Navarro. They call him the ‘most dangerous’ man for the global economic order. He is radical, determined and wields enormous influence on US President Donald Trump– source–https://blogs.economictimes.indiatimes.com/letterfromwashington/peter-navarro-most-dangerous-man-for-the-global-economic-order/

In fact, the administration seems divided on the broader issue of U.S.-China relations. On one side are people such as Treasury Secretary Steven Mnuchin, who want to use tough talk and tariffs to extract a better deal from China, while staying within the basic framework of the international system. Others, such as trade adviser Peter Navarro, would prefer that the United States and China were far less intertwined. This would undoubtedly mean a more mercantilist world economy and a more tense international order. There is a similar split among geo-politicians, with the Pentagon being more hawkish (not least because it ensures huge budgets) and the State Department more conciliatory.

Vice President Pence recently gave a fiery speech that came close to declaring that we are in a new Cold War with China. An outright labeling of China as the enemy would be a seismic shift in U.S. strategy and would certainly trigger a Chinese response. It could lead us to a divided, unstable and less prosperous world. Here’s hoping the Trump administration has thought through the dangers of such a confrontational approach.

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History tells us that if China is indeed now the United States’ main rival for superpower status, the best way to handle such a challenge lies less in tariffs and military threats and more in revitalization at home. The United States prevailed over the Soviet Union not because it waged war in Vietnam or funded the contras in Nicaragua, but because it had a fundamentally more vibrant and productive political-economic model. The Soviet threat pushed the United States to build the interstate highway system, put a man on the moon, and lavishly fund science and technology.

The former head of Google China, Kai-Fu Lee, has written an important book arguing that China is likely to win the race for artificial intelligence — the crucial technology of the 21st century. He points out that China’s companies are highly innovative, its government is willing to make big bets for the long term, and its entrepreneurs are driven and determined.

Tariffs and military maneuvers might be fine at a tactical level, but they don’t address the core challenge. The United States desperately needs to rebuild its infrastructure, fix its educational system, spend money on basic scientific research and solve the political dysfunction that has made its model less appealing around the world. If China is a threat, that’s the best response.

China-US Relations: Whither the Trade War?


August 6, 2018

China-US Relations: Whither the Trade War?

by Bunn Nagara

http://www.thestar.com.my

FOR further proof that China’s planners don’t always get it right, look no further than the current trade war with the United States.

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According to the latest reports including from within China, Beijing is flitting between damage control mode and full-on panic. A senior researcher at a Chinese think tank recently remarked that China has never seen anything as aggressive as the Trump administration’s current actions on trade.

Yet these are still early days – far worse may yet come. China is unsure what to do and never saw any of it coming. It cannot understand Trump, and there is no sign it ever will. Not that Donald Trump’s style is necessarily comprehensible or even decipherable.

China is now reportedly casting about for useful advice on managing Trump. It is even looking abroad for workable tips.

Amid all the uncertainty, at least three things are clear. One, things are all set to get worse before they get any better. And while China still has buttons to press, it is inadequately prepared for more fallout.

Two, China cannot “read” Trump’s moves because they seem coded or inaccessible to sensible interpretation. That is actually his strength.

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A trade war hurts everybody and benefits nobody. A shooting war, likewise. An expenditure war, or competition to build transnational infrastructure, improves connectivity for trade and travel. It benefits everybody and hurts nobody. In the past, however, a country such as the US would have to borrow from China to initiate such projects.–Bunn Nagara

Three, the prospect of meaningful trade talks is virtually nil. China just has to sweat it out or worse, at least for now.

As of midweek, the US and China have imposed 25% tariffs on US$34bil (RM139bil) of each other’s goods with another US$16bil (RM65bil) of products as the next tranche.

At this point, Trump’s legion of critics in the US may need to take a breather to suspend their cynicism about his style. His very unpredictability, so often an object of ridicule, is actually a tactical advantage useful for keeping his opponents guessing, distracted and off-balance.

By bobbing and weaving, he seems to be inconsistent and even unsteady. But it helps to keep the other side wrong-footed. It is something China should know about – drunken kung fu or drunken boxing. China’s stiff and straitlaced policymakers today forget their own culture and history at their peril.

An international consensus is developing that China should have acted to address US trade complaints, and acted sooner. Now the costs of delay for China may be higher than anticipated.

It is not just the tariffs and trade restrictions, of course. For today’s excess-capacity China the problems include the risk of ballooning unemployment, crimped liquidity and the knock-on domestic social problems they can cause.

Paradoxically, the years of cruising on fat growth figures have bred a crippling complacency. Thus the sense of unpreparedness now stings so much more.

China’s once-abundant funds are now becoming cramped. Last week the People’s Bank of China injected US$74bil (RM302bil) into the system and the State Council announced another US$200bil (RM815bil) for infrastructure.

Among China’s miscalculations was its assertiveness over its South China Sea claims. With its overbearing presence in disputed territory, it upset neighbours and consumed decades-long goodwill and trust in the region.

That was not what the China of Deng Xiaoping or his immediate successors would have done. China then was wiser and more circumspect, knowing how to bide its time and apply soft power to win friends and influence people.

But that is not today’s China. Nonetheless, questionable conduct comes with a price tag quite regardless of any positive achievements before.

Another mistake was to misread European complaints about Trump’s trade policies. China thought it could lead an alliance of sorts against those policies, only to find that core Western interests meant more to Europe.

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As a result of these missteps, the US excluded China from its biennial Rimpac (Rim of the Pacific) 26-nation military exercise this year, while inviting Vietnam for the first time. But another exercise hosted this month by Australia, and involving 27 countries including China, will proceed as planned. However, there will be no live-fire drills for China.

Meanwhile Britain is raising its level of naval activity in the region but will not be part of Australia’s programme. A calibrated response to China’s South China Sea assertiveness seems to be emerging among the Western allies.

China will not fail to take notice. But whether it will have any effect on Beijing’s plans and policies is another matter.

Nonetheless, regardless of what concessions Australia is prepared to make with China, Canberra is still competing with Beijing on some issues.

One of these is Australia’s aid programmes for South Pacific island nations. This comes to A$1.3bil (RM4bil) for this year. Although this amount may seem paltry, it compares favourably to China’s US$1.7bil (RM7bil) for 2006 to 2016.

Ordinarily, China would be able to top Australia’s allocation in a single stroke. But the trade war with the US is making itself felt. Besides, China has other cost items to look after, not least the sprawling multi-nation Belt and Road Initiative (BRI).

The BRI is not just another project – it has been set in stone in the destinies of the Communist Party of China, the state system and President Xi Jinping himself.

If Australia’s aid efforts in the South Pacific still appear limited, the US State Department is on a spending spree in a renamed Asia-Pacific with an India option, now dubbed the “Indo-Pacific.”

At an Indo-Pacific Business Forum in Washington last Monday, Secretary of State Mike Pompeo unveiled new largesse for developing infrastructure in the region.

The trio of countries in this scheduled spending exercise are the US, Japan and Australia.

Not officially mentioned is the great big elephant in the room, China, the object of this round of manoeuvres.

Can the US really hope to outspend and out-construct China? Can it do so even with the help of Japan and Australia? There was also a time when the answer would be an unqualified no. But now China’s spending style has become somewhat cramped.

The trade war aside, little if anything has changed in the fortunes of Japan and Australia.

Japan’s economy remains largely in the doldrums for a quarter of a century now. No great elevation in fortunes seems likely.

The Australian economy is increasingly drawn into China’s orbit, while Canberra is in two minds about opting to be more Asian or staying fully within the Western alliance.

The US economy has not risen substantially in recent times, nor has it shown much sign of doing so sustainably over the long term.

A trade war hurts everybody and benefits nobody. A shooting war, likewise. An expenditure war, or competition to build transnational infrastructure, improves connectivity for trade and travel. It benefits everybody and hurts nobody. In the past, however, a country such as the US would have to borrow from China to initiate such projects.

It may still have to do so. The countries between them would probably benefit the most. In spite of itself, China has begun to undergo a sobering experience about the costs of massive infrastructure projects.

It has unwittingly become more conscious of the predicament of countries like Malaysia. Asking questions about the viability and returns on investment of such projects is Beijing’s new normal.

The larger question is whether the trade war will hurt China or the US first, appreciably, to alter the course in the other’s favour.

But don’t hold your breath.

Bunn Nagara is a Senior Fellow at the Institute of Strategic and International Studies (ISIS) Malaysia.

Malaysia: Embracing Abe-san and Bro Modi


August 1, 2018

Dr. Mahathir’s Look East (Japan) and West (India) Geo-Economics–Embracing Abe San and Bro Modi

by Dr. Shankaran Nambiar, MIER

http://www.eastasiaforum.org/2018/07/13/mahathirs-foreign-policy-reset/

Image result for Mahathir and Modi

Malaysian Prime Minister Dr.Mahathir greets Bro Modi

Prime Minister Mahathir Mohamad appears to be setting the tone for a revision of Malaysia’s geo-economic policy, if the bilateral meetings with his Indian and Japanese counterparts in the early days of his administration are anything to go by. 

 

Indian Prime Minister Narendra Modi called on Mahathir not too long after the latter assumed office. The meeting was significant in so far as Modi is keen on ‘Acting East’ and forging stronger ties with ASEAN. With Mahathir at the helm, Modi may well have an active and influential partner in the region.

India is likely to be an economic powerhouse in the coming decade or two, and any long-term economic architecture in the region will have to take this reality into account.

Does Mahathir run the risk of disrupting Malaysia’s economic relations with China by engaging with other partners? Not quite, but he does want to tilt the balance.

Mahathir is not questioning China’s intention to build friendly, harmonious and prosperous relations with the region or with Malaysia. But he is adding a dose of reality to some of the more questionable investment agreements that Malaysia has entered into with China and wants these deals to be reviewed. Mahathir has said that ‘we will be friendly to China but we don’t want to be indebted to China’.

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With Ali Baba’s Jack Ma of China

The Prime Minister is keen to do business with anyone who means business, provided there are no hidden caveats and Malaysia is not compromised. If there was any question of wanting to cut off China, Mahathir would not have met with Chinese entrepreneur Jack Ma.

This brings us to Mahathir’s meeting with a second foreign leader, Japanese Prime Minister Shinzo Abe. Why did Mahathir choose to go to Japan on his first official overseas trip soon after he came to power?

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Teaming with Abe-San on Look East Partnership with No.7 Jersey

Mahathir probably sees value in reviving his ‘Look East’ policy, which he pursued while prime minister in the 1980s, perhaps in a different form and for slightly different reasons. There is an element of nostalgia, to be sure. But Mahathir is not is not a sentimentalist.

The previous Najib administration did not treat the notion of equidistance from global superpowers with the sensitivity it deserved. There was a tumbling over to China coupled with a reticence to engage with Japan, at least with nothing of the enthusiasm that Tokyo enjoyed during the Mahathir 1.0 era.

Mahathir has always believed in maintaining equidistance from other powers, preferring to work with the larger economies as equals. Mahathir would, by logical extension, be willing to cooperate with China’s Belt and Road Initiative as long as the partnership is fair and without Beijing using Malaysia as its playground. In that respect, reaffirming Malaysia’s long friendship with Japan is a reassertion of Mahathir’s pragmatic approach to geo-economic policy.

But equidistance is not possible without the existence of something like the Non-Aligned Movement. In lieu of that, Mahathir will likely pursue equidistance through a more integrated ASEAN in partnership with other countries such as the United States, China, Japan, South Korea, India and the Central Asian states. This would be a revival of his East Asian Economic Caucus (EAEC) concept.

A close-knit ASEAN, through the EAEC, would be able to give countries such as Malaysia more access to foreign markets without having to pay an onerous price for doing so. It would allow countries like India to trade and invest in Southeast Asia or other places while being able to show their home constituencies that they can make gains without paying for them with tough commitments.

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Strengthening ASEAN’s economic cohesion and including other powers through the EAEC would mean that neither the United States nor China could dominate Malaysia’s foreign policy. Malaysia would not have to choose between aligning with either power.

Mahathir’s discussion with Jack Ma after his India and Japan meetings shows the Prime Minister’s pragmatism — more than being caught up in great power politics, Mahathir wants to push ahead with attracting no-strings-attached investment, be it from China, India or any other part of the world.

Mahathir understands that trade and investment are Malaysia’s lifeblood. Improving Malaysia’s networks with the rest of the world’s markets must take top priority to foster better trade and investment connections.

Mahathir’s meetings with Modi and Abe will set in motion a couple of initiatives. Malaysia will return to its default position of maintaining equidistance between superpowers. Japan will not feel it is being edged out of Malaysia’s investment landscape.

Malaysia will stand for a free and unaligned ASEAN, with Mahathir leading a campaign for a new trade architecture that might be more palatable to Southeast Asian countries  and which will minimise the conflicting demands of China, the United States and India by embracing Japan.

Of course, the EAEC idea will have its share of detractors and non-adherents. Much as Mahathir has a tough job setting domestic affairs right now, he has the no less difficult task of realigning the country’s geo-economic policy.

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Shankaran Nambiar is a senior research fellow at the Malaysian Institute of Economic Research.

A version of this article originally appeared here in The Sun Daily.