Donald Trump could be the best thing that’s happened to China in a long time


January 15, 2017

Donald Trump could be the best thing that’s happened to China in a long time

by Fareed Zakaria*

https://www.washingtonpost.com

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Donald Trump has perhaps attacked no country as consistently as China. During his campaign, he thundered that China was “raping” the United States, “killing” us on trade and artificially depressing its currency to make its goods cheap. Since being elected, he has spoken to the leader of Taiwan and continued the bellicosity toward Beijing. So it was a surprise to me, on a recent trip to Beijing, to find Chinese elites relatively sanguine about Trump. It says something about their view of Trump, but perhaps more about how they see their own country.

“Trump is a negotiator, and the rhetoric is all part of his opening bid,” said a Chinese scholar, who would not agree to be named (as was true of most policymakers and experts I spoke with). “He likes to make deals,” the scholar continued, “and we are good dealmakers as well. There are several agreements we could make on trade.” As one official noted to me, Beijing could simply agree with Trump that it is indeed a “currency manipulator” — although it has actually been trying to prop up the yuan over the past two years. After such an admission, market forces would likely make the currency drop in value, lowering the price of Chinese goods.

Chinese officials point out that they have economic weapons as well. China is a huge market for U.S. goods, and last year the country invested $46 billion in the U.S. economy (according to the Rhodium Group). But the officials’ calm derives from the reality that China is becoming far less dependent on foreign markets for its growth. Ten years ago, exports made up a staggering 37 percent of China’s gross domestic product. Today they make up just 22 percent and are falling.

China has changed

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China has changed. Western brands there are rare, and the country’s own companies now dominate almost every aspect of the huge and growing domestic economy. Few businesses take their cues from U.S. firms anymore. Technology companies are innovating, and many young Chinese boasted to me that their local versions of Google, Amazon and Facebook were better, faster and more sophisticated than the originals. The country has become its own, internally focused universe.

This situation is partly the product of government policy. Jeffrey Immelt , the Chief Executive of General Electric, noted in 2010 that China was becoming hostile to foreign firms. U.S. tech giants have struggled in China because of formal or informal rules against them.

The next stage in China’s strategy is apparently to exploit the leadership vacuum being created by the United States’ retreat on trade. As Trump was promising protectionism and threatening literally to wall off the United States from its southern neighbor, Chinese President Xi Jinping made a trip through Latin America in November, his third in four years. He signed more than 40 deals, Bloomberg reported, and committed billions of dollars of investments in the region.

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Chinese global leadership on trade gaining support from ASEAN, Australia and New Zealand

The centerpiece of China’s strategy takes advantage of Trump’s declaration that the Trans-Pacific Partnership is dead. The trade deal, negotiated between the United States and 11 other countries, lowered barriers to trade and investment, pushing large Asian economies such as Japan and Vietnam in a more open and rule-based direction. Now China has offered up its own version of the pact, one that excludes the United States and favors China’s more mercantilist approach.

Australia, once a key backer of the TPP, has announced that it supports China’s alternative. Other Asian countries will follow suit soon.

At the Asia-Pacific Economic Cooperation summit in Peru in November, John Key, who was then New Zealand’s prime minister, put it simply: “[The TPP] was all about the United States showing leadership in the Asia region. . . . We really like the U.S. being in the region. . . . But in the end if the U.S. is not there, that void has to be filled. And it will be filled by China.”

Xi’s speech at the summit was remarkable, sounding more like an address traditionally made by an American President. It praised trade, integration and openness and promised to help ensure that countries don’t close themselves off to global commerce and cooperation.

Next week, Xi will become the first Chinese President to attend the World Economic Forum at Davos, surely aiming to reinforce the message of Chinese global leadership on trade. Meanwhile, Western leaders are forfeiting their traditional roles. Angela Merkel and Justin Trudeau announced last-minute cancellations of their plans to speak at the Swiss summit. Trump has only made sneering references to globalism and globalization, and no senior member of his team currently plans to attend.

Looking beyond Trump’s tweets, Beijing seems to have concluded that his presidency might well prove to be the best thing that’s happened to China in a long time.

*Fareed Zakaria writes a foreign affairs column for The Post. He is also the host of CNN’s Fareed Zakaria GPS and a contributing editor for The Atlantic. Follow @FareedZakaria

2017 — A Thunderous Clash of Politics, Economies and Policies


January 6, 2017

2017 — A Thunderous Clash of Politics, Economies and Policies

Martin Khor is Executive Director of the South Centre, a think tank for developing countries, based in Geneva.

The Paris agreement, which was adopted in December 2015 and which came into force in record time in October 2016 as a demonstration of international concern over climate change, may face a major test and even an existential challenge in 2017, if Trump fulfils his election promise to pull the US out. Credit: Diego Arguedas Ortiz/IPS.

The Paris agreement, which was adopted in December 2015 and which came into force in record time in October 2016 as a demonstration of international concern over climate change, may face a major test and even an existential challenge in 2017, if Trump fulfils his election promise to pull the US out. Credit: Diego Arguedas Ortiz/IPS.

PENANG, Jan 2 2017 (IPS) – Yet another new year has dawned.   But 2017 will be a year like no other.

There will be a thunderous clash of policies, economies and politics worldwide.   We will therefore be on a roller-coaster ride, and we should prepare for it and not only be spectators on the side-lines in danger of being swept away by the waves.

With his extreme views and bulldozing style, Donald Trump is set to create an upheaval if not revolution in the United States and the world.

He is installing an oil company chief as the Secretary of State, investment bankers in key finance positions, climate sceptics and anti-environmentalists in environmental and energy agencies and an extreme rightwing internet media mogul as his chief strategist

US-China relations, the most important for global stability, could change from big-power co-existence with a careful combination of competition and cooperation, to outright crisis.

Trump, through a phone call with Taiwan’s leader and subsequent remarks, signalled he could withdraw the longstanding US adherence to the One China policy and instead use Taiwan as a bargaining card when negotiating economic policies with China.  The Chinese perceive this as an extreme provocation.

He has appointed as head of the new National Trade Council an economist known for his books demonising China, including “Death by China: Confronting the Dragon”.

Trump seems intent on doing an about-turn on US trade and investment policies, starting with ditching the Trans Pacific Partnership Agreement and re-negotiating the North American Free Trade Agreement.

Other measures being considered include a 45% duty on Chinese products, extra duties and taxes on American companies located abroad, and even a 10% tariff on all imports.

Martin Khor

Thus 2017 will see a rise in protectionism in the US, the extent still unknown.  That is bad news for those developing countries whose economies have grown on the back of exports and international investments.

Europe in 2017 will also be preoccupied with its own regional problems.  The Brexit shock of 2016 will continue to reverberate and several European countries facing elections will see challenges to their traditional values and established order from xenophobic and narrow nationalist parties.

As Western societies become less open to the world and more inward looking, developing countries should revise their development strategies and rely more on domestic and regional demand and investments.

As North-South economic relations decline, this should also be the moment for expanding South-South cooperation, spurred as much by necessity as by principles.

2017 may be the year when resource-rich China, with its huge Road and Belt initiative and its immense financing capacity, fills in the economic void created by western trade and investment protectionism.

But this may not be sufficient to prevent a finance shock in many developing countries now beginning to suffer a reversal of capital flowing back to the US, attracted by the prospect of higher interest rates and economic growth.

Several emerging economies which together received many hundreds of billions of dollars of hot money in recent years are now vulnerable to the latest downturn phase of the boom-bust cycle of capital flows.

Some of these countries opened up their capital markets to foreign funds which now own large portions of government bonds denominated in the domestic currency, as well as shares in the equity market.

As the tide turns, foreign investors are expected to sell off and transfer back a significant part of the bonds and shares they bought, and this new vulnerability is in addition to the traditional external debt contracted by the developing countries in foreign currencies.

Some countries will be hit by a terrible combination of capital outflow, reduced export earnings, currency depreciation and an increased debt servicing burden caused by higher US interest rates.

As the local currency depreciates further, the affected countries’ companies will have to pay more for servicing loans contracted in foreign currencies and imported machinery and parts, while consumers suffer from a rapid rise in the prices of imports.

On the positive side, the currency depreciation will make exporters more competitive and make tourism more attractive, but for many countries this will not be enough to offset the negative effects.

Thus 2017 will not be kind to the economy, business and the pockets of the common man and woman.  It might even spark a new global financial crisis.

The old year ended with mixed blessings for Palestinians. On one hand they won a significant victory when the outgoing President Obama allowed the adoption of a UN Security Council resolution condemning Israeli settlements in occupied Palestinian territories by not exercising a veto.

The resolution will spur international actions against the expansion of settlements which have become a big obstacle to peace talks.

On the other hand the Israeli leadership, which responded defiantly with plans for more settlements, will find in Trump a much more sympathetic President.  He is appointing a pro-Israel hawk who has cheered the expansion of settlements as the new US ambassador to Israel.

With Trump also indicating he will tear up the nuclear power deal with Iran, the Middle East will have an even more tumultuous time in 2017.

Some countries will be hit by a terrible combination of capital outflow, reduced export earnings, currency depreciation and an increased debt servicing burden caused by higher US interest rates.

In the area of health care, the battle for affordable access to medicines will continue, as public frustration grows over the high and often astronomical prices of patented medicines including for the treatment of HIV AIDS, hepatitis C, tuberculosis and cancers.

There will be more powerful calls for governments to curb the excesses of drug companies, as well as more extensive use of the flexibilities in the patent laws to counter the high cost of medicines.

Momentum will also increase to deal with antibiotic resistance which in 2016 was recognised by political leaders meeting at the United Nations to be perhaps the gravest threat to global health.

All countries pledged to come up with national action plans to counter antibiotic and anti-microbial resistance by May 2017 and the challenge will then be to review the adequacy of these plans and to finance and implement them.

The new year will also see its fair share of natural disasters and a continued decline in the state of the environment.  Both will continue to be major issues in 2017, just as the worsening of air pollution and the many earthquakes, big storms and heat-waves marked the previous few years.

Unfortunately low priority is given to the environment.  Hundreds of billions of dollars are allocated for highways, railways and urban buildings but only a trickle for conservation and rehabilitation of hills, watersheds, forests, mangroves, coastal areas, biodiversity or for serious climate change actions.

2017 should be the year when priorities change, that when people talk about infrastructure or development, they put actions to protect and promote the environment as the first items for allocation of funds.

This new year will also be make or break for climate change.  The momentum for action painfully built up in recent years will find a roadblock in the US as the new President dismantles Obama-initiated policies and measures.

The Paris agreement, which was adopted in December 2015 and which came into force in record time in October 2016 as a demonstration of international concern over climate change, may face a major test and even an existential challenge in 2017, if Trump fulfils his election promise to pull the US out.

But Trump and his team will face resistance domestically including from state governments and municipalities which have their own climate plans, and from other countries determined to carry on without the US on board.

Indeed if 2017 will bring big changes initiated by the new US administration, it will also generate many counter actions to fill in the void left in the world by a withdrawing US or to counter its new unsettling actions.

Many people around the world, from politicians and policy makers to citizen groups and community organisers are already bracing themselves to come up with responses and actions.

Indeed 2017 will be characterised by the Trump effect but also the consequent counter-effects.

There are opportunities to think through, alternatives to chart and reforms to carry out that are anyway needed on the global and national economies, on the environment, and on geo-politics.

Most of the main levers of power and decision-making are still in the hands of a few countries and a few people, but there has also been the emergence of many new centres of economic, environmental and intellectual capabilities and community-based organising.

2017 will be a year in which ideas, policies, economies and politics will all clash, thunderously, and we should be prepared to meet the challenges ahead and not only be spectators.

The Age of Trump


January 2, 2017

The Age of Trump

by Joseph E. Stiglitz

http://www.straitstimes.com/opinion/the-age-of-trump

NEW YORK • On January 20, Mr Donald Trump will be inaugurated as the 45th President of the United States. I would hate to say “I told you so”, but his election should not have come as a surprise.

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As I explained in my 2002 book, Globalization And Its Discontents, the policies we have used to manage globalisation have sown the seeds of widespread disaffection. Ironically, a candidate from the same party that has pushed the hardest for international financial and trade integration won by promising to undo both.

Of course, there is no going back. China and India are now integrated into the global economy, and technological innovation is reducing the number of manufacturing jobs worldwide. Mr Trump cannot re-create the well-paying manufacturing jobs of past decades; he can push only for advanced manufacturing, which requires higher skill sets and employs fewer people.

Rising inequality, meanwhile, will continue to contribute to widespread despair, especially among the white voters in Middle America who handed Mr Trump his victory. As economists Anne Case and Angus Deaton showed in their study published in December 2015, life expectancy among middle-aged white Americans is declining, as rates of suicides, drug use and alcoholism increase. A year later, the National Centre for Health Statistics reported that life expectancy for the US as a whole has declined for the first time in more than 20 years.

In the first three years of the so-called recovery after the 2008 financial crisis, 91 per cent of the gains went to the top 1 per cent of earners. While Wall Street banks were bailed out with billions of dollars in taxpayer money, home owners received only a pittance. President Barack Obama saved not only the banks, but also the bankers, shareholders and bond holders. His economic policy team of Wall Street insiders broke the rules of capitalism to save the elite, confirming millions of Americans’ suspicion that the system is, as Mr Trump would say, “rigged”.

Though Mr Trump ran on a pro-growth platform, the economic agenda he has professed could be undermined if he exacerbates inequality through his tax proposals, starts a trade war or abandons America's commitments to reduce greenhouse gas emissions, sa

Though Mr Trump ran on a pro-growth platform, the economic agenda he has professed could be undermined if he exacerbates inequality through his tax proposals, starts a trade war or abandons America’s commitments to reduce greenhouse gas emissions, says Prof Stiglitz. PHOTO: AGENCE FRANCE-PRESSE

Though wealthy, Mr Trump is clearly not a member of the traditional elite, which lent credence to his promise of “real” change. And yet it will be business as usual under Mr Trump, who will adhere to Republican orthodoxy on taxation and, by appointing lobbyists and industry insiders to his administration, has already broken his promise to “drain the swamp”.

Mr Obama brought “change you can believe in” on certain issues, such as climate policy; but with respect to the economy, he bolstered the status quo – the 30-year experiment with neoliberalism, which promised that the benefits of globalisation and liberalisation would “trickle down” to everyone. Instead, the benefits trickled up, partly owing to a political system that now seems to be based on the principle of “one dollar, one vote”, rather than “one person, one vote”.

Rising inequality, an unfair political system and a government that spoke as if it was working for the people while acting for the elites created ideal conditions for a candidate like Mr Trump to exploit. Though wealthy, Mr Trump is clearly not a member of the traditional elite, which lent credence to his promise of “real” change. And yet it will be business as usual under Mr Trump, who will adhere to Republican orthodoxy on taxation and, by appointing lobbyists and industry insiders to his administration, has already broken his promise to “drain the swamp” in Washington, DC.

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The rest of Mr Trump’s economic agenda will depend largely on whether House Speaker Paul Ryan is a true fiscal conservative. Mr Trump has proposed that large tax cuts for the rich be combined with massive infrastructure spending programmes, which would boost gross domestic product and improve the government’s fiscal position somewhat, though not nearly as much as advocates of supply-side economics hope. If Mr Ryan is not as concerned about the deficit as he says he is, he will rubberstamp Mr Trump’s agenda and the economy will receive the Keynesian fiscal stimulus that it has long needed.

Another uncertainty relates to monetary policy. Mr Trump has already spoken out against low interest rates, and there are two vacancies on the US Federal Reserve’s Board of Governors. Add to that the large numbers of Fed officials itching to normalise rates, and it is a fair bet that they will do so – perhaps more than offsetting Mr Trump’s Keynesian stimulus.

Mr Trump’s pro-growth policies will also be undermined if he exacerbates inequality through his tax proposals, starts a trade war or abandons America’s commitments to reduce greenhouse gas emissions (especially if others retaliate with a cross-border tax). Now that Republicans control the White House and both houses of Congress, they will be relatively free to weaken workers’ bargaining power, deregulate Wall Street and other industries and turn a blind eye to existing antitrust laws – all of which will create more inequality.

If Mr Trump follows through on his campaign threat to impose tariffs on Chinese imports, America’s economy would probably suffer more damage than China’s. Under the existing World Trade Organisation (WTO) framework, for every “illegal” tariff that the US imposes, China can retaliate anywhere it chooses, such as by using trade restrictions to target jobs in the congressional districts of those who support US tariffs.

To be sure, measures against China permitted under the WTO framework, such as anti-dumping tariffs, may be justified in some areas. But Mr Trump has enunciated no guiding principles for trade policy, and the US – which directly subsidises its automobile and aircraft industries and indirectly subsidises its banks through ultra-low interest rates – would be throwing stones from a glass house. And once this tit-for-tat game begins, it could very well end in the destruction of the open international order created since World War II.

Similarly, the international rule of law, which is enforced primarily through economic sanctions, could fare poorly under Mr Trump. How will the new president respond if Russian-aligned troops escalate the conflict in eastern Ukraine? America’s real power has always derived from its standing as an inclusive democracy. But people around the world have now lost confidence in democratic processes. Indeed, throughout Africa, I have heard remarks such as “Trump makes our dictators look good”. As American soft power continues to erode, the future of the international order will become more uncertain.

Meanwhile, the Democratic Party will surely be conducting an election post-mortem. Mrs Hillary Clinton undeniably lost because she failed to offer voters a convincing vision that was markedly different from the neoliberal agenda that her husband Bill Clinton embraced in the 1990s. Having pursued a political strategy of “triangulation” – adopting versions of its opponents’ policies – for more than a generation, the party of the left could no longer present itself as a credible alternative to the party of the right.

The Democrats will have a future only if they reject neoliberalism and adopt the progressive policies proposed by leaders such as Mrs Elizabeth Warren, Mr Bernie Sanders and Mr Sherrod Brown. This will put them in a strong position against the Republicans, who will have to figure out how to manage a coalition of evangelical Christians, corporate executives, nativists, populists and isolationists.

With the arrival of Mr Trump, and with both major parties now redefining themselves, the coming year may well be remembered as a turning point in US and world history. PROJECT SYNDICATE

• Joseph E. Stiglitz, a Nobel laureate in economics, is university professor at Columbia University and chief economist at the Roosevelt Institute. His most recent book is The Euro: How A Common Currency Threatens The Future Of Europe.

A version of this article appeared in the print edition of The Straits Times on January 02, 2017, with the headline ‘The age of Trump’. Print Edition

 

Cambodia: Sustaining high economic growth


January 1, 2017

Cambodia: Sustaining  high economic growth 

by  Heng Pheakdey, Enrich Institute

http://www.eastasiaforum.org/2017/01/01/keeping-cambodia-competitive-beyond-2016/

Here Comes Cambodia: Asia’s New Tiger Economy

After decades of conflict and poverty that captured the world’s attention, Cambodia has enjoyed five years of high economic growth that is moving it toward becoming one of the new tiger economies of Asia, according to forecasts in the Asian Development Bank’s Asian Development Outlook 2016.

For the last two decades Cambodia has been one of the fastest growing countries in Asia with an average annual GDP growth rate of 8.1 per cent.

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Cambodia has been highly successful in embracing the ‘factory Asia’ model of growth, supplying its low-cost labour to export-oriented industries. Economic progress in recent years has allowed Cambodia to invest in physical and social infrastructure, attract foreign direct investment, create jobs and lift millions of its people out of poverty. The Asian Development Bank called Cambodia Asia’s new ‘tiger economy’.

Cambodia’s economic performance in 2016 remained robust, with growth continuing at 7 per cent. Strong garment sector exports and foreign investment in construction drove this economic performance. Exports in the garment and footwear industries rose by 9.4 per cent in the first half of the year, almost double the pace in the same period of 2015 thanks to improved production processes and high demand from the European market. As of September 2016, the value of approved commercial projects in the construction sector more than doubled to US$7.2 billion. Imports of construction equipment and materials also increased to support the construction boom.

But solid growth in the industrial sector has been offset by a slowdown in agriculture and tourism. Unfavourable weather conditions and falling commodity prices have resulted in agriculture’s sluggish performance, which grew at a rate of only 0.2 per cent in 2014–2016. Tourism also underperformed in early 2016 due to a decline in tourist arrivals from Vietnam, Laos and South Korea. 1.3 million tourists visited Cambodia in the first quarter of the year, a mere 2.6 per cent increase compared to the same period in 2015.

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The World Bank reclassified Cambodia in July 2016 as a lower middle-income country after its gross national income per capita reached US$1070 in 2015, surpassing the minimum threshold of a lower middle-income nation of US$1026. While this sign of progress should be welcomed, it comes with its own set of challenges. Analysts fear that this new classification will reduce Cambodia’s benefits from international foreign aid and preferential trade agreements that the country enjoyed while still a ‘least developed country’.

To prepare for the anticipated reduction in international assistance and trade privileges, Cambodia needs to strengthen its competitiveness, diversify its economy and upgrade its industries.

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Although garment exports have held up well so far, the sector remains narrowly based and concentrated on a few markets, making it vulnerable to external shocks. To preserve Cambodia’s attractiveness relative to its regional competitors such as Vietnam and Bangladesh, it must diversify into higher value products and services and strengthen labour productivity to reflect the rise of the minimum wage.

The modernisation of agriculture would also help to sustain productivity in the long run. Employing more than half of Cambodia’s labour force, agriculture has contributed significantly to poverty reduction. But high reliance on rain-dependent rice production, slow adoption of quality seeds and inadequate agricultural extension services and irrigation facilities remain key constraints in the sector. Diversifying to less water intensive crops, developing the agribusiness and agro-processing industry, promoting a modernised value chain and cost effective logistics are crucial to put agriculture back on a higher growth path.

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Efforts have been made so far to support economic diversification. The Cambodia Industrial Development Policy was launched in March 2015 to transform and modernise Cambodia’s industrial structure from a labour-intensive industry to a skill-driven industry by 2025. This implies increasing the GDP share of the industrial sector, diversifying goods exports including non-textiles and processed agricultural products and modernising the registration of enterprises. The policy also supports stronger regulations and enforcement and helps create a more favourable business environment.

Domestic investors also have an important role to play in the diversification process. Experts believe that the success of Cambodia’s economy will be driven by local entrepreneurs and the private sector, not by international donor assistance. Providing support to domestic investors in trade facilitation, logistics, infrastructure and human capital is just as important.

Cambodia faces many challenges to stay competitive. To realise its vision of becoming an upper middle-income country by 2030 requires strong commitments to address infrastructure bottlenecks, build a high-quality human capital base, strengthen natural resource management, enhance governance and improve financial services and the business environment.

Heng Pheakdey is the founder and chairman of Enrich Institute.

 

Malaysia’s Trade Policy post–TPP


December 10, 2016

Malaysia’s Trade Policy post–TPP

by Shankaran Nambiar, Malaysian Institute of Economic Research

http://www.eastasiaforum.org

Malaysia’s trade with the United States has been in decline. But with the Trans-Pacific Partnership (TPP) agreement dead in the water, what is next for Malaysia’s trade agenda?

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If there is a flicker of hope for the TPP, it comes from the talks that Japanese Prime Minister Shinzo Abe had with President-Elect Donald Trump during the former’s November visit to the United States.

But Abe likely won’t be able to change Trump’s mind. At best Trump might take another look at the Agreement. It may not even be legally possible to change the terms already agreed upon by the 12 member partnership.

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Perhaps the other like-minded members of the TPP will agree to go ahead without US participation. But not having the United States as part of the deal will substantially weaken any such agreement that emerges.

What, then, can Malaysia do? One possibility is to rekindle interest in a US–Malaysia free trade agreement (FTA). A bilateral agreement between the United States and Malaysia was previously considered in 2006 but negotiations came to a halt in 2009.

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If the bilateral exercise was tough back then, it would be even more demanding under Trump’s scrutiny. Trump is not likely to appreciate Malaysia’s stance on government procurement, state-owned enterprises and the Bumiputera agenda. All of these policies restrict the entry of US business into the Malaysian business space.

Given that a bilateral FTA with the United States looks unlikely, Malaysia must look elsewhere to promote its trade policy. Two other possibilities are open.

One is to pursue ASEAN’s Regional Comprehensive and Economic Partnership (RCEP) Agreement with added vigour. Malaysia can extend itself by providing RCEP with the leadership that ASEAN needs. But this depends on whether Prime Minister Najib Razak is up to the task,given his serious political troubles at home. He has some natural advantages, including his good diplomatic relationship with China.

Indonesian President Joko Widodo (Jokowi) may be the more difficult entity to handle. Jokowi has little patience for abstractions, wants to see quick results and dislikes endless meetings. ASEAN does not quite fit his  mould. It might be difficult for Najib to convince Jokowi of ASEAN’s usefulness as an institution whose integration will bring better trade and investment benefits to all member states.

If Najib can convince Jokowi, prod China, and get India to soften its negotiating stance, that would do much to accelerate the RCEP process.

RCEP negotiations is not likely to meet the 2016 deadline. The timeline might be pushed further to the end of 2017. But what can Malaysia do if there are tensions that may further delay the completion of RCEP?

The most serious endeavour that Malaysia can initiate is to unilaterally liberalise, avoiding disagreements with other countries’ agendas and not requiring their assistance. And ultimately resources do not have to be wasted on expensive trade negotiations if Malaysia were to undertake domestic reforms without waiting for any external compulsions.

It is absolutely clear Malaysia has to resolve some problems if it to take full advantage of trade in goods and services and investment. If there is a need for a checklist of issues, the TPP comes in handy. And although Malaysia obtained concessions on a number of points, an FTA of a higher standard would be without those waivers.

In the absence of any multilateral liberalisation efforts from the World Trade Organisation and given the TPP’s apparent demise, Malaysia’s best hope is to approach trade from a unilateral perspective. Whether there is the political will to do so is a different question.

Shankaran Nambiar is author of Malaysia in Troubled Times. He is also a Senior Research Fellow at the Malaysian Institute of Economic Research. The views expressed in this article are his own.

A previous version of this article appeared here in the Sun Daily (Malaysia).

 

To UMNO Leadership–Don’t Use Singapore Malays for your Politics


December 8, 2016

To UMNO Leadership–Don’t Use Singapore Malays for your Politics

by Mohsin Abdullah (received via email)

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The first ever Singapore’s Malay Brigadier General, Ishak Ismail, who is also the Commander of Sixth Army Division(left in the picture)

In wanting to garner support of the Malays and thus to cling on to power, UMNO has this habit, albeit bad, of using (or should it be misusing) the Malays of Singapore. We all know that, right? But I’ll say it again here all the same.

The party tends to portray Singapore Malays as being “discriminated”, “ill treated” and “marginalized” by the Chinese-dominated PAP government in Singapore.

Having done that, UMNO will say (or rather warn) the Malays in this country that they will suffer the same fate if UMNO loses political power in Malaysia.

In short, they’ll say, “Support UMNO or you Malays will suffer like your saudara di Singapura.” The latest UMNO leader to use this overused tactic is Puad Zarkashi, a member of the party’s supreme council.

Puad was obviously riled up when Tun Mahathir Mohamad who helmed UMNO for more than 20 years had praised DAP for upholding the Federal Constitution, the constitutional monarchy, special position of the Malays, national language, and Islam as the religion of the Federation.

And Mahathir lauded DAP for being a Malaysian party.These remarks were made when Mahathir attended for the first time ever the DAP national convention held recently.

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Singapore’s Speaker of Parliament

In admitting his previous wrong impression of DAP, Mahathir said although the party had often been painted by its enemies as a Chinese party, the DAP anthem and the speeches at the convention by secretary-general Lim Guan Eng and acting chairman Tan Kok Wai were in Bahasa Malaysia.

Puad retorted by saying that using the Malay language for party anthem and speeches “does not ensure DAP will protect the Malays”.

 

According to him, DAP “is just following the strategy of Singapore’s PAP”, going on to say that “Singapore’s national anthem is in Malay but what happened to the Malays because of the policy (similar to DAP’s Malaysian Malaysia ) practiced by Singapore?”

He did not elaborate but in all probability he was talking about the Malays in Singapore being treated “unfairly” by the Chinese PAP.

So, are Singapore Malays marginalized by the PAP?

I can’t say for sure. But there are grouses. For instance, I’ve read of Singapore Malays wanting full equality in national service and all sectors of the armed forces, suggesting some sort of “mistrust” for the community from the authorities.

Caption: The inaugural recipients of the MERCU-SMU Excellence Scholarship are (L-R) Nur Amalina Binte Saparin, Muhammad Hafiz Bin Kasman, and Khairul Ashraf Bin Khairul Anwar.]

I’ve read also of their call for full employment opportunities for all Malay women, including the tudung-clad ones, demanding for “equal treatment, equal opportunities”.

Anyway, not too long ago, Prime Minister Lee Hsien Loong announced in Parliament that the next presidential election of Singapore due next year is reserved for candidates from the Malay race.

Meaning only Malay candidates will contest. An all-Malay contest. But, they must first be qualified, of course. This means Singapore will have a Malay as President again after more than 46 years since Yusof Ishak, the first president of an independent Singapore.

“Reserved” election is meant to ensure minority presidents or rather Singaporeans from minority communities are elected from time to time.

Hence next year the presidency of one of the world’s richest countries will be served on a silver platter to the Malay community. A gift. But, this is how the Malays in Singapore reacted to the gift. Majority of them anyway.

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A Malay Rebel

Retired Straits Times journalist Ismail Kassim had this to say among other things, via his Facebook posting: “Thank you PM for your unsolicited gift but we don’t want and don’t need it. Do you realize that your gift will only reinforce the negative images of us and undermine our past progress?”

To Ismail, “the day a Malay assumes the Elected President through a reserved race will be a day of shame for us and for all the people. It will be a step backward for multiracialism, meritocracy and democracy”.

A piece written by one Nizam Idris for the Straits Times also caught my attention. Nizam I later learned is an economist and market strategy head of an international bank in Singapore. He also viewed the reserved election as a “big step backward for the Malay community”.

Said Nizam he was brought up in an era where “we Malays were told we had to fend for ourselves in schools and in our careers as Singaporeans of other races did.”

After initial trepidation, due in part to seeing how Malays in other countries in the region depended on race-based policies to help them advance, Malay Singaporeans grew out of their historical reliance on such crutches. And that has over time become a source of pride and motivation for the community.

Nizam is proud to say the Singapore Malay community has made significant progress and proved “we could stand on our own feet”.

That, said Nizam, was thanks in no small part to the brave decision by “our earlier leaders to take away our proverbial crutches and make us compete on a level playing field”.

And like everything else, said Nizam, healthy competition drives the community to a higher level. He nevertheless admitted that not many Malays would reject a gift like the chance to have a member of the community as president.

“That’s human nature,” he said, ” but what would be even more satisfying is a hard fought campaign leading to the election of a Malay president who deserves the position based on the famously Singaporean values of grit and merit “

In a nutshell, for Nizam and most Singapore Malays, they want to earn things — be it the presidency or anything else — based on merit and ability. No short cut, no easy way out, no tongkat.

Tabik Melayu Singapura!