2018 in Environmental Review for Southeast Asia


November 10, 2018

By: Gregory McCann

ttps://www.asiasentinel.com/society/2018-environmental-review-southeast-asia/

As 2018 comes to a close it is worth taking a look at the environmental trends throughout the year, with a special emphasis on those within the last six months or so, in order to gain an understanding of what has been happening to this region’s natural heritage and so that we might know what to look for in 2019—and how to address the upcoming challenges.

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A lloincloth-clad tribesmen blockading blockading logging roads in Malaysian Borneo.

While we can say that a lot has been happening everywhere, and this is especially true for Malaysia. The country produces durian that Chinese consumers covet. This means rain forests that are currently home to tigers are being converted into plantations so that more and more of the spiky, pungent fruit can be sold to China. That means bad environmental news, with China the driver. Furthermore, clearing forests will drastically reduce the number of pollinators such as bats and other wild animals, which will in turn lower the durian’s quality.

Another fruit—palm oil—is almost always the whipping boy for conservation problems in Malaysia (and beyond), however, the country is making headway in its own sustainable certification program, which attempts to incorporate Environmentally Sensitive Areas (ESAs) into development blueprints across Malaysian Borneo. Nonetheless, huge development projects in Peninsular Malaysia are pushing the environment to the breaking point, with gargantuan Chinese-funded residential projects such as Forest City across the strait from Singapore serving as a striking case in point.

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However, Prime Minister Mahathir Mohamad recently shut down several Chinese Belt and Road projects.  Malaysia also wants to ban importing plastic waste, as well as single-use plastic straws. Nonetheless, serious problems remain. Even without the durians-to-China issue, tiger numbers are tumbling fast, scenic Langkawi island is coming under so much stress that it may lose its Unesco status, while in Sarawak the forest-dwelling Penan indigenous group continue to block bulldozers and fight for their traditional lands.

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Tabin Wildlife Reserve is located in the eastern part of Sabah, Malaysia

However, a rehabilitated Bornean orangutan was successfully rewilded in Sabah’s Tabin Wildlife Sanctuary, the first orangutan to fully return to the forest after such a long spell in captivity and rehabilitation, and a clouded leopard was sighted within the vicinity of a local hospital.

Across the Strait in Indonesia ecological issues are festering as well. While a new species of songbird has been identified on Rote Island, five other bird species have lost their protected status. The endemic Sumatran laughing thrush is fast disappearing, while the Helmeted Hornbill is relentlessly persecuted in Indonesia. The caged bird trade is bringing many species to the brink of extinction in the archipelago, and biologists say many forests where they work are becoming increasingly “quiet.”

Forest fires raged in South Sumatra and Riau provinces in 2018, and Chinese developers are stubbornly pushing ahead with a hydroelectric dam in the , home to the rarest species of orangutan in the world. The Critically Endangered Sumatra rhinoceros is still in big trouble but there is a movement on to save it, while a pregnant Sumatran tigress was caught and died in a pig trap in Riau.

Like Malaysia, Indonesia has a major palm oil problem, but the country’s anti-graft department says it’s ready to take action against transgressors who are felling natural forest and breaking other laws. Sadly, the Bali government wants to build an elevated highway right on top of some of its last undeveloped sandy beaches. The small volcanic island of Krakatoa in the Sunda Strait between Java and Sumatra has spewed lava and ash this year.   Widespread deforestation, poaching, overfishing, and plastic pollution has been taking over this island nation. Indonesian Presidential contender Prabowo has said that if he is elected to office he will review China’s Belt and Road plans, which could include a cancellation of the , and a court in Aceh recently threw down its stiffest penalty to date for two men caught trying to sell a tiger pelt.

Asia Sentinel recently reported on the surprising number of wildlife to be found in Singapore today. Thailand also received high environmental marks in a recent Asia Sentinel critique, however, Thai-language media recently uncovered a story about a Vietnamese national caught with tiger bones in the kingdom— particularly worrying report as Vietnamese poachers are among the most tenacious in Asia.

Making matters worse, a new and improved road through Kaeng Krachan National Park will likely lead to greater disturbance to the forest’s wildlife, while a few provinces to the north a Burmese national gunned down a binturong. There is rising sentiment to build a Kra Isthmus Canal in Thailand. A large crocodile was caught off the Krabi coast, a whale shark was recently spotted of Koh Racha, and local conservationists have thus far succeeded in fending off a new marina development project in Phuket. However, the deluge of Chinese tourists into the kingdom is pushing Thailand to its breaking point, and it was largely Chinese tourists who are responsible for the closing of Maya Bay in Koh Phi Phi, which remains closed indefinitely so that it can recover.

In Laos, the Nam Theun 2 Dam has been such a disaster that its main financer, the World Bank, has thrown in the towel and walked away.  In Dead in the Water: Global Lessons from the World Bank’s Hydropower Project in Laos contributing author Glenn Hunt remarks: “For one of the pillars that was supposed to be the primary source of income, it’s been an unmitigated disaster.” With about 140 dams either under construction or on the drawing board in its quest to be the “battery of Asia,” Laos faces the potential for most disasters and large-scale environmental and social degradation in a country that has already lost its wild tigers, leopards and many other species.

Despite the tragedy that unfolded in Attapeu province when a large dam collapsed, Laos remains bullish about constructing more dams. And the dam-building frenzy is harming the environment and wildlife all around the country. And while a recent Guardian write-up describing the fantastic-look Nam Et-Phou Luey ecotourism program up in the north of the country describes a healthy tiger population in this region, perhaps the author was given old data.

Wild elephants are reportedly being skinned alive in Myanmar to satisfy a new Chinese demand—for “blood beads,” which are blood-filled chunks of elephant fat. The previous link provides a window into some twisted tastes: “The online trader wants his customers to know the elephant was skinned quickly, with blood still fresh in its veins.” Chinese demand for elephant skin used in bags in jewelry was already shocking, but things can always get worse when it comes to wildlife.

But in more uplifting news from the country, Irrawaddy dolphins are being given greater protection, and the government is also cracking down on illegal wildlife trade in the city of Yangon.

Taking note of how poorly elephants working in tourism are treated across Asia, Vietnam has launched the region’s first “ethical elephant experience.” The country has also taken an interest in seeing that its shrimp farming industry become more sustainable, while the government also recently signed a deal with the EU that promises a reduction in illegal logging (though some in neighboring Cambodia have serious doubts about this). We reported earlier this year that Vietnam’s wildlife is in rough shape, and things haven’t taken much of a turn for the better since.

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Virachey National Park—A major tourist attraction in Cambodia

And finally, Cambodia.  A recent camera-trap check in Virachey National Park so delighted the Ministry of Environment that he shared some of the photos on their Facebook page; even the Thai media took notice of the results. Asia Sentinel reported earlier this year that Cambodia is probably the last hope for Indochina’s wildlife, and this still holds true, despite the fact that nearly 110,000 snares were found in a single national park. A man was recently killed by a wild boar near the Cardamom Mountains, while Kratie province is cracking down on illegal mining, and at the same time the central government is demanding that villagers who grabbed national park land return it.

In other news from the region, the Maubere tribe of Timor-Leste is bringing back ancient customary laws to help protect its forests, seas, and coastline. Chinese demand for logs is wiping out the forests of the Solomon Islands. India is losing tigers and elephants, while two elephants were struck by a train and killed in Sri Lanka.

As always, China casts a menacing shadow over Southeast Asia, and nowhere is this more clear than on the Mekong River and in the South China Sea. The region, with the help of the US and Japan, must find a way to manage Chinese aggression in the South China Sea and beyond, and the some of the numerous dams that it has planned for the region have to be cancelled or scaled down.

Beyond that, Chinese citizens have to be educated about wildlife product consumption, including shark fins, tiger parts, bear gallbladder, elephant skin and blood, and much more, which have no known scientific value. And in a shocking and disturbing announcement,  China has said that it will lift its decades-old ban on the trading of tiger parts and rhino horn, a move that will almost certainly put these species in greater danger.  Or else one of the most biologically rich regions of the world loses everything that made it so special.

Gregory McCann is the Project Coordinator of Habitat ID, and the author of Called Away by a Mountain Spirit: Journeys to the Green Corridor. You can support his conservation projects in Cambodia and Sumatra here.

Safeguarding A Rules-based Trading System against America First Trade Economics


October 16, 2018

Safeguarding A Rules-based Trading System against America First Trade Economics

by Dr. Mari Pangestu, Universitas Indonesia

http://www.eastasiaforum.org

 

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“Without concerted effort and a coalition of willing leadership, including from the EU and East Asia, the future of the rules-based trading system will remain under threat.”–Dr. Mari Elka Pangestu

Despite expectations that the US Federal Reserve would raise interest rates, capital flows to the United States have led to the appreciation of the US dollar against most major currencies.

The hardest hit countries are Argentina and Turkey, which are experiencing fiscal issues complicated by their political situations. Brazil, South Africa and the emerging countries in Asia have also been affected — albeit at a lower rate of depreciation of their currencies in the 10 to 12 per cent range. Even Australia and China have experienced depreciation of around 8 per cent and 5 per cent respectively.

The level of depreciation experienced by different economies reflects how investors perceive their different fundamental macroeconomic conditions, especially the level of their current account and fiscal deficits and policy outlooks.

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The rising US dollar raises questions about the capacity of emerging economies to service their dollar-denominated debts and the vulnerabilities this could expose in their financial systems. Even if the current economic conditions point to a low potential for contagion from Argentina and Turkey, IMF Managing Director Christine Lagarde recently warned that ‘these things could change rapidly’. The uncertainty that already exists is a clear and present danger.

The uncertainty in the world economy has been increasing since Brexit and the election of President Trump in 2016, and in 2017 as the United States left the Trans-Pacific Partnership and announced many threats to impose trade restrictions. This uncertainty has heightened since January 2018 when US President Donald Trump made good on his threats to remedy bilateral trade deficits — what he sees as ‘unfair trade’ practices against the United States — by imposing tariffs on imported solar panels and washing machines, followed by aluminium and steel.

Since March, the greatest uncertainty has been from the brewing tit for tat trade conflict between the United States and China, which started with the imposition of 25 per cent tariffs on US$50 billion worth of China’s exports to the United States. China retaliated with the same sized tariffs on the same amount of trade from the United States. Trump then escalated the trade war further in September with the announcement of 10 per cent tariffs on US$200 billion worth of China’s exports to the United States.

The US–China trade conflict and the uncertainty surrounding it is expected to have knock on effects on global trade and investment flows. The impact of the reduction in China’s exports to the United States on China’s growth will reduce China’s imports, which in turn will impact the many countries that China has become a major trading partner for.

This means that China and other countries facing US trade restrictions will look for new markets for their goods. The situation has already led some countries to impose restrictions or initiate trade remedy investigations, for instance on steel. This uncertainty has and will continue to influence trade and investment, as businesses evaluate how the increased restrictions will affect their supply chains.

It is too early to tell how large the disruption will be, as it is not easy to dismantle supply chains. But the costs down the line could be great as businesses re-evaluate their trade and investment decisions to insulate themselves from tariffs rather than to maximise their competitiveness.

The most concerning aspect of all this is that, after 75 years of being its greatest advocate, the United States is now the biggest threat to the future of the rules-based trading system that has provided predictability and fairness in the way the world engages in trade. There is no clear light at the end of the tunnel.

The key question is: what is Trump’s intention? Is it to change the rules of the game to benefit the United States and address China’s ‘non-market-oriented policies’ or is it just anti-trade and America First? Assuming it is the former, there are at least three important responses needed.

First is safeguarding the stability of the World Trade Organization (WTO) as the overarching framework to provide predictability, fairness and stability. To this end, it is vital that the WTO dispute settlement mechanism continues to operate. The test case is the Chinese and EU case against US steel and aluminium tariffs and getting past the blocking of panel judge nominations by the United States.

Ensuring that the United States does not use blunt unilateral instruments to address its concerns also means that reforms to the WTO rule book are needed. More must be done to address concerns around intellectual property rights, investment, the environment, labour, competition policy, subsidies, tax, digital data and the treatment of developing countries.

Second, the process of opening-up must continue, with or without the United States. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership is a good start. And it is of the utmost importance that the Regional Comprehensive Economic Partnership negotiations are concluded in November this year. These are all important processes to signal the continued commitment of East Asia to expanding markets and fostering flows of trade and investment.

Third, and what most will agree is the most important process, is unilateral reforms. Given increased global uncertainty and limited policy space for fiscal stimulus, structural reforms are a must for East Asian countries, especially China. These range from trade and investment reforms, as well as reforms related to competition policy, intellectual property, the role of state-owned enterprises and sustainability. As in the past, unilateral reforms are more successfully undertaken when there is peer pressure and benchmarking from international commitments.

Without concerted effort and a coalition of willing leadership, including from the EU and East Asia, the future of the rules-based trading system will remain under threat.

Dr. Mari Pangestu is former Indonesian trade minister and Professor at the University of Indonesia.

This article appeared in the most recent edition of East Asia Forum Quarterly, ‘Asian crisis, ready or not’.

Southeast Asia: Changing Geo-Political Dynamics in the Trump Era


August 30, 2018

Southeast Asia: Changing Geo-Political Dynamics in the Trump Era

Widespread reports of China’s hegemony over the neighboring region miss the nuance of fast-shifting political and strategic dynamics

Phnom Penh 
A historical map depicting China's flag over Southeast Asia. Photo: iStock

Is China truly establishing dominance over neighboring Southeast Asia, or is it a prevailing perception among academics and journalists who have uncritically adopted a pervasive pro-China narrative built on Beijing’s rising investment and influence in the region?

Two recent Southeast Asian elections denote a shifting spectrum. Last month’s general election in Cambodia, by far China’s most loyal ally in the region, was taken by some as indication of how far the country has moved away from its past Western backers and closer to Beijing.

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As Cambodia abandons multi-party democracy for one-party authoritarianism, similar to the dominance of the Communist Party in China, some see Cambodia as the first domino to fall in China’s grand regional ambition for political and economic control over the nearby region.

Indeed, some in Cambodia’s exiled opposition have claimed that the country has become a de facto “Chinese colony” under Prime Minister Hun Sen’s ruling Cambodian People’s Party (CPP).

The Harapan coalition’s win at Malaysia’s May 9 general election, however, pointed in the opposite direction. The long-ruling United Malays National Organization (UMNO) was ousted by an alliance whose campaign narrative was built in part on opposing Chinese investment, which boomed under the previous government.

Now as prime minister, Mahathir Mohamad has cancelled US$22 billion worth of Chinese-backed infrastructure projects, including a Belt and Road Initiative-inspired high-speed rail line, for reasons of fiscal prudence.

While Mahathir warned of the risk of new forms of “colonialism” during a recently concluded tour of China, he also made the diplomatic point that his government isn’t anti-China.

Indeed, some in Cambodia’s exiled opposition have claimed that the country has become a de facto “Chinese colony” under Prime Minister Hun Sen’s ruling Cambodian People’s Party (CPP).

The Harapan coalition’s win at Malaysia’s May 9 general election, however, pointed in the opposite direction. The long-ruling United Malays National Organization (UMNO) was ousted by an alliance whose campaign narrative was built in part on opposing Chinese investment, which boomed under the previous government.

Now as Prime Minister, Mahathir Mohamad has cancelled US$22 billion worth of Chinese-backed infrastructure projects, including a Belt and Road Initiative-inspired high-speed rail line, for reasons of fiscal prudence.

While Mahathir warned of the risk of new forms of “colonialism” during a recently concluded tour of China, he also made the diplomatic point that his government isn’t anti-China.

Malaysia's Prime Minister Mahathir Mohamad (L) and China's Premier Li Keqiang talk during a signing ceremony at the Great Hall of the People in Beijing on August 20, 2018.Mahathir is on a visit to China from August 17 to 21. / AFP PHOTO / POOL / HOW HWEE YOUNG

“We should always remember that the level of development of countries are not all the same,” Mahathir said this week at a joint press conference with Chinese premier Li Keqiang. “We do not want a situation where there is a new version of colonialism happening because poor countries are unable to compete with rich countries, therefore we need fair trade.”

It is undeniable that China now plays a major and growing role in Southeast Asian affairs, even if judged by only its economic heft.

A recent New York Times report noted that every Asian country now trades more with China than the United States, often by a factor of two to one, an imbalance that is only growing as China’s economic growth outpaces that of America’s.

With China’s economic ascendency projected to continue – the International Monetary Fund (IMF) predicts China could become the world’s largest economy by 2030 – some believe that Beijing aims to replace the US-backed liberal international order in place since the 1950’s with a new less liberal and less orderly model.

Cambodia’s case, however, tests the limits of that forward-looking analysis. The US and European Union (EU) refused to send electoral monitors to Cambodia’s general election last month on the grounds the process was “illegitimate” due to the court-ordered dissolution of the country’s largest opposition party.

Washington has since imposed targeted sanctions on Cambodian officials seen as leading the anti-democratic crackdown, while new legislation now before the US Senate could significantly ramp up the punitive measures.

Hun Sen aired a combative response to threats of sanctions, saying with bravado that he “welcomes” the measures. Some commentators read this as an indication that Phnom Penh no longer cares about the actions and perceptions of democratic nations because it has China’s strong and lucrative backing.

Yet the CPP still made painstaking efforts to present a veneer of democratic legitimacy on to its rigged elections, something it would not have done if it only cared about Beijing’s opinions. Hun Sen now says he will soon defend the election’s legitimacy at the United Nations General Assembly, yet another indication that he still cares what the West thinks.

China’s rise in Southeast Asia is viewed primarily in relation to the US’ long-standing strong position, both economically and strategically. Many see this competition as a zero-sum game where China’s gain is America’s loss.

Along those lines, some analysts saw US Secretary of State Mike Pompeo’s recent whirlwind trip to Southeast Asia as “parachute diplomacy” that only underscored certain entrenched regional perceptions of the US as an episodic actor that has no real strategy for Southeast Asia.

The Donald Trump administration certainly lacks an overarching policy comparable to his predecessor Barack Obama’s “pivot to Asia,” a much-vaunted scheme with strategic and economic components that made Southeast Asia key to America’s policy of counterbalancing China.

Despite no new policy moniker, Trump’s administration has in many ways continued Obama’s scheme: Vietnam remains a key ally, support for other South China Sea claimants is unbending, military sales remain high, and containing Chinese expansion is still the raison d’etre.

It’s also been seen in the number of visits to Southeast Asia by senior White House officials, including high profile tours by Pompeo and his predecessor Rex Tillerson, Defense Secretary Jim Mattis, and Trump himself to Vietnam in November 2017 and Singapore in June.

A little noticed December 2017 National Security Strategy document, produced by Trump’s White House, explicitly notes that “China seeks to displace the United States in the Indo-Pacific region, expand the reaches of its state-driven economic model, and reorder the region in its favor.”

Yet perceptions of new Cold War-like competition in Southeast Asia often fail to note the imbalance between America and China’s spheres of influence in the region.

 

US President Donald Trump (L) and Vietnam's President Tran Dai Quang (R) attend a welcoming ceremony at the Presidential Palace in Hanoi in Hanoi on November 12, 2017.Trump told his Vietnamese counterpart on November 12 he is ready to help resolve the dispute in the resource-rich South China Sea, which Beijing claims most of. / AFP PHOTO / POOL / KHAM

Absent President Donald Trump’s Asia Policy, China emerges as the dominant  player in Southeast Asia

China’s two most loyal regional allies are arguably Cambodia and Laos, countries of less economic and strategic importance than America’s main partners Indonesia, Thailand, Singapore and Vietnam.

The historically pro-US Philippines has gravitated somewhat into China’s orbit under President Rodrigo Duterte, though at most there has been an equalization of its relations between the two powers rather than outright domination by China.

Strategic analyst Richard Javad Heydarian recently noted that Duterte likes to think of himself as a “reincarnation of mid-20th century titans of the so-called Non-Aligned Movement,” though Heydarian suggested that this could prompt a backlash from the Philippine public that remains resolutely pro-America.

Malaysia, another country that was thought to have been moving closer to China, has ricocheted strongly in the other direction after the change in leadership from pro-China Najib Razak to China-skeptic Mahathir Mohamad.

Thailand has boosted military ties with Beijing since the country’s military coup in 2014, which caused some panic in Washington, but a recent incident has shown just how fragile their bilateral relations remain.

After two boats sank near the resort island of Phuket in early July, killing dozens of Chinese tourists, Deputy Prime Minister Prawit Wongsuwan blamed the Chinese tour operators, commenting the accident was “entirely Chinese harming Chinese.”

His claim led to calls in China for tourists to boycott Thailand, which could cost the country roughly US$1.5 billion in cancellations, according to some estimates. Thailand’s tourism sector is now facing a major public relations problem after China’s jingoist state-owned media lambasted Prawit’s tactless response.

More explosively, rare nationwide protests in Vietnam in June were sparked by nationalistic concerns that a new law allowing 99-year land leases in special economic zones would effectively sell sovereign territory to China.

There are strong perceptions, aired widely over social media, that Vietnam’s ruling Communist Party is too close to Beijing, a cause of resentment that some analysts suggest is the country’s biggest potential source of instability.

Even in perceived pro-China nations like Cambodia and Laos, anti-China sentiment is rising in certain sections of the public. Arguments that Chinese investment actually harms the livelihoods of many Cambodians, especially in places like coastal Sihanoukville and Koh Kong, is on the ascendency.

Social media criticism has centered on a concession deal the Cambodian government entered with a Chinese company that effectively gives it land rights to an estimated 20% of Cambodia’s coastline.

The same goes for Laos’ ruling communist party, which has taken steps to curb the growth of certain sectors dominated by Chinese investment, such as banana plantations and mining, over public complaints about their adverse health and environmental impacts.

The IMF and others, meanwhile, have expressed concerns that Laos risks falling into a Chinese “debt trap”via its Beijing-backed US$6 billion high-speed rail project, a claim that Prime Minister Thongloun Sisoulith felt the need to publicly rebuff in June.

Still, there is a certain misapprehension that China’s rising economic importance to the region, both as a provider of aid and investment and market for exports, necessarily equates to strong political and strategic influence.

It doesn’t always add up that way. In January, China fractionally overtook America as the largest importer of Vietnamese goods, according to the General Department of Vietnam Customs. Nonetheless, Hanoi remains decidedly pro-US in regional affairs and that position isn’t expected to change, even if its exports to China continue to outpace those to America.

More fundamentally, China’s rising economic presence in the region is in many instances destabilizing relations. Rapid growth in Chinese investment to Malaysia in recent years prompted a public backlash, a phenomena seized on by the victorious Harapan coalition. There are incipient signs the same type of backlash is now percolating in Cambodia and Laos.

Chinese investment is likely to play a role in Indonesia’s presidential and legislative elections next year, perhaps negatively for incumbent President Joko Widodo, under whose tenure China has become the country’s third largest investor.

“The relationship with China could turn toxic for [Widodo],” Keith Loveard, senior analyst with Jakarta-based business risk firm Concord Consulting, recently told the South China Morning Post.

To be sure, China has translated some of its economic largesse to strategic advantage. Philippine President Durterte, for example, said in October 2016 that his country’s one-way security ties with the US would come to an end, though America’s provision of “technical assistance” during the Marawi City siege last year cast the extent of that into doubt.

China has also developed closer ties to the militaries of Thailand and Cambodia, so much so that the latter cancelled joint military exercises with the US last year. It has also resumed its past position of shielding Myanmar’s generals from Western condemnation during the recent Rohingya refugee crisis.

But America still remains the predominant security ally of most Southeast Asian nations, something that will only become more important as concerns about the spread of Islamic terrorism heighten. This month, Washington provided an additional US$300m in security funding to the region.

Only Laos, Cambodia and Myanmar buy more arms from China than America, according to the Stockholm International Peace Research Institute. The rest of Southeast Asia’s military procurements, sometimes exclusively, come from the US.

Still, some of China’s recent regional successes have been the result of America’s missteps. China has been greatly helped by Trump’s withdrawal of America from its long-standing leadership role in certain multilateral institutions, as well as his ad hoc policy towards Southeast Asia that favors more bilateralism.

Had Trump not withdrawn the US from the Trans-Pacific Partnership, a multilateral trade deal championed by Obama that excludes China, regional trade flows would be geared more towards America, providing an important counterbalance to many regional countries’ rising dependence on Chinese markets.

By doing so, Trump allowed Beijing’s multilateral economic institutions, like the Asian Infrastructure Investment Bank and the New Development Bank, to gain an upper hand.

Yet most reporting on China’s influence in Southeast Asia rests on the assumption that the trends of the past decade will continue into the future. But it’s not clear that Chinese investment will keep growing at the same rate – or even faster – while America continues to fumble over how best to engage with Southeast Asia.

US Secretary of State Mike Pompeo (C) poses with Thailand's Foreign Minister Don Pramudwinai (L), Vietnam's Deputy Prime Minister and Foreign Minister Pham Binh Minh (2nd L), Malaysia's Foreign Minister Saifuddin Abdullah (2nd R) and Laos Foreign Minister Saleumxay Kommasith (R) for a group photo at the 51st Association of Southeast Asian Nations (ASEAN) - US Ministerial Meeting in Singapore on August 3, 2018. Photo: AFP/Roslan Rahman

China cannot rule out that in 2021 America could have a new president able to articulate and implement a more coherent policy towards Southeast Asia, nor that upcoming elections in Indonesia and possibly even Myanmar see the rise of anti-China candidates.

Neither can Beijing rule out that India won’t become a major player in the region, despite it so far failing to live up to expectations. A recent report by the Council on Foreign Relations, a US-based think tank, asserted that it can be “a more forceful counterweight to China and hedge against a declining United States.”

Moreover, there is great uncertainty over whether the South China Sea disputes pitting China versus the Philippines, Malaysia and Vietnam, among others, might at some point turn hot, which would significantly alter the region’s security approach in place since the 1990s.

China’s growing trade war with the US could also impact on its relations with the region. Some believe China could soon devalue its currency in response to the US-China trade war, though Beijing says it won’t.

Not only would a devalued renminbi make Chinese-made products cheaper, negatively affecting competing Southeast Asian exporters, it would also affect the region’s supply chains as Chinese buyers would be expected to demand cheaper prices. Few, if any, in the region would win from rounds of competitive currency devaluations.

But viewing China’s power in the region vis-a-vis America’s is only part of the picture. Japan, and to a lesser extent South Korea, are also major players and potential counterweights to China.

Since the 2000s, Japan’s infrastructure investment in the region has been worth US$230 billion, while China’s was about US$155 billion, according to recent BMI Research, an economic research outfit. The balance might tip in China’s favor with the US$1 trillion Belt and Road Initiative, but probably not for another decade or so, BMI projects.

Tokyo rarely boasts of its own soft power in Southeast Asia. Indeed, while Philippine leader Duterte’s overtures to China are among his major talking points, quietly it has been Japan, not China, that is funding his government’s ballyhooed major infrastructure programs.

Japan's Prime Minister Shinzo Abe (R) and Malaysia's Prime Minister Mahathir Mohamad shake hands during joint press remarks at Abe's official residence in Tokyo on June 12, 2018. / AFP PHOTO / POOL / Toshifumi KITAMURA

Japanese diplomacy towards the region falls somewhere between China and America’s. While Washington’s, at least past, insistence on human rights and democracy-building puts off to many regional countries, Beijing’s diplomacy is more laissez faire, as long as Chinese interests are protected by sitting governments.

Tokyo, by contrast, tends to practice quiet sustained diplomacy, decidedly in support of rule of law but without the threat of punitive measures if a partner government strays. That is likely one reason why there is little anti-Japan sentiment in the region and why its relations receive much less public attention.

Malaysia’s Mahathir, whose first trip abroad after May’s election win was to Tokyo, not Beijing or Washington, has recently spoken of Japan’s importance in regional affairs.

Mahathir shaped Southeast Asia’s approach to great powers during his previous tenure as Prime Minister from 1981-2003, and his belief that Japan can play an even larger role in regional affairs could soon be taken up by other regional governments.

“Specific Southeast Asian states are now seeking to diversify their strategic partnerships, beyond a binary choice between Beijing and Washington,” reads a recent report by the Council on Foreign Relations.

Mahathir’s apparent desire is for a more diversified regional network, similar to the hedging policies he promoted in the 1990s. Mahathir is certainly not pro-China, but neither is he pro-US.

What most Southeast Asian nations desire is not unipolarity but competition among many foreign partners that allows them to maximize benefits and negotiating leverage. When America and China, or Japan and India, compete to gain an economic and political footing, regional nations often win through the bidding.

 

 

India-Indonesia Relations and Indo-Pacific Security


August 17, 2018

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Foreign Policy: India-Indonesia Relations and Indo-Pacific Security

by Vinay Kaura

Asia Pacific Bulletin, No. 437

Publisher: Washington, DC: East-West Center
Available From: August 14, 2018
Publication Date: August 14, 2018
Binding: Electronic
PDF

Vinay Kaura, Assistant Professor at Sardar Patel University in Rajastan, explains that “Modi and President Joko ‘Jokowi’ Widodo agreed to elevate the India-Indonesia relationship to a comprehensive strategic partnership.”

Though India and Indonesia do have long historical and cultural linkages, strategic partnership has been a recent development. The two share multiple common concerns, one of which pertains to China’s rapid rise and its intentions in the maritime theater. Since 2014, the government of Prime Minister Narendra Modi has been trying to boost India’s ties with many Southeast Asian countries as part of its ‘Act East Policy’ which was recently manifest in his visit to Indonesia in late May just ahead of his first-ever speech at the Shangri-La Dialogue in Singapore.

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India, no longer content to look east, wants to be an active contributor to the regional balance of power by acting east. Although it is not India’s role to dictate the nature and scope of Indo-Pacific cooperation, through discussion and experimentation, India can find areas where increased cooperation will serve mutual security interests. In the words of Luhut Pandjaitan, Indonesia’s minister for maritime affairs, “India and Indonesia relations are important to the balance of power in Asia.” Clearly, Indonesia is equally keen to ensure that Beijing is effectively prevented from moving ahead on its current antagonistic trajectory.

The Modi government’s attempt to connect India to its traditional maritime neighborhood, particularly in the Indo-Pacific, is aimed at sustaining a rules-based liberal international order by ensuring free movement of people, goods, and services through the Strait of Malacca, one of the busiest shipping routes between the Indian Ocean and Pacific Ocean. The freedom of navigation, availability of port infrastructure, and unhindered access to markets are mandatory for this purpose. Hence, the major focus of  Modi’s visit to Indonesia was to highlight that the two countries are close maritime neighbors. Modi and President Joko ‘Jokowi’ Widodo agreed to elevate the India-Indonesia relationship to a comprehensive strategic partnership. Their joint statement emphasized the “importance of achieving a free, open, transparent, rules-based, peaceful, prosperous, and inclusive Indo-Pacific region,” which would uphold “sovereignty and territorial integrity, international law, in particular UNCLOS, freedom of navigation and overflight, sustainable development.”

Jokowi, meanwhile, seeks to transform Indonesia into a maritime power, and is passionate about maritime sovereignty for his country. Hence, repeated assertions about protecting freedom of navigation is unmistakably targeted at Beijing which is engaged in hotly contested territorial disputes in the South and East China Seas. Jakarta claims that it is not a party to any territorial disputes with Beijing in the South China Sea; however, Indonesia has not hesitated in clashing with China over fishing rights around the Natuna Islands. Jokowi’s dramatic gesture of holding a cabinet meeting aboard a warship off the Natuna just days after a Sino-Indonesian naval skirmish in 2016 was seen as a show of resolve to Beijing.

Not as bitterly opposed to the Beijing-led Belt and Road Initiative (BRI) as India, Indonesia is also not as supportive as China expects. After their meeting, Modi sought to link India’s ‘Act East Policy’ and ‘SAGAR’ (Security and Growth for All in the Region) with Jokowi’s ambitious ‘Maritime Fulcrum Policy’.

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In the past, India-Indonesia maritime cooperation has remained largely confined to coordinated bilateral patrols, anti-piracy patrols, and search and rescue exercises. It is thus important for them to move to a more intensive engagement, as together they control the entry point from the Bay of Bengal to the Strait of Malacca. India’s interest in joining the Malacca Straits Patrol (MSP) – a four-nation arrangement between Indonesia, Malaysia, Singapore, and Thailand – should be seen in this context. But Indian participation is easier said than done. A meeting among technical experts on May 10 in Bali explored the issue but soon revealed that the Indian side did not have full comprehension of the operational nuances of MSP. Since no forward movement seemed possible, the Modi-Jokowi joint statement merely noted that the May 10 meeting was “to explore ways in enhancing strategic technical cooperation on maritime security.”

Indonesia is the de-facto leader of ASEAN. As the security environment in the region is increasingly exacerbated by US–China rivalry, Jakarta wants ASEAN to be at the center of the conceptualization and evolution of the Indo-Pacific region. Jokowi has been outlining the Indonesian conception of the Indo-Pacific as “Open, transparent and inclusive, promoting a habit of dialogue, promoting cooperation and friendship, and upholding international law”. Modi’s Indo-Pacific vision sounds strikingly similar. He has indicated that India is keen to preserve a free and open regional security architecture in Asia with “ASEAN centrality”, and even without American leadership.

Although New Delhi has thrown its weight behind the Quadrilateral – the grouping of India,  United States, Japan, and Australia that is widely perceived as a counterbalance to rising Chinese geoeconomic and geopolitical assertiveness – in its quest to reshape the Indo-Pacific balance of power, India continues to pursue a hedging approach by both engaging directly with China and seeking to contain Chinese behaviour. Positive momentum generated by the ‘Wuhan consensus’ may have further exacerbated India’s skepticism on the quad.

Strategically, Indonesia is equally important to the United States and China as it straddles vital Indo-Pacific chokepoints.  Jakarta has secured Chinese investment without showing any evidence of a tilt towards Beijing. Being one of the very few countries in the region that has the capability and credibility in making significant contributions towards countering Chinese assertiveness, Jakarta now reckons New Delhi as a credible strategic partner. However, the possibility of Indonesia joining the quad seems remote.

Modi signed a deal with Jokowi allowing India access to northern Sumatra’s Sabang port, enhancing the Indian navy’s ability to maintain a forward presence in the Straits of Malacca. China is not oblivious to its implications. A day ahead of Modi’s trip to Indonesia, China’s state-run Global Times asserted that Beijing would not “turn a blind eye” if New Delhi sought “military access to the strategic island of Sabang,” advising India not to “wrongfully entrap itself into a strategic competition with China and eventually burn its own fingers.”

Given the irreversible geopolitical shifts, the Indo-Pacific has emerged as one of the major hotbeds of global power politics. India’s emerging consensus with Indonesia, as reflected in the elevation of their relationship to the level of a comprehensive strategic partnership, can provide a basis for a closer engagement between the two countries to further develop the Indo-Pacific concept. Delhi and Jakarta have agreed to take concrete steps to accelerate economic and security cooperation in the maritime domain. But the renewed awareness that they are close neighbors, sharing broadly common challenges regarding sustainable use of the oceans must make it imperative for them to contribute more to the maintenance of the regional security order in the Indo-Pacific. The challenge for both Modi and Jokowi will be to institutionalize the maritime cooperation so that the Indo-Pacific becomes truly free, open, and inclusive.

Mahathir indicates possibility of a Malaysia-Indonesia car


June 29, 2018

COMMENT: This is going to be the shortest comment I intend to make. Stop wasting public funds by going into another car project. We have invested and lost millions of money on Proton. But you are free, Dr. Mahathir to put your own money in your proposed joint Indonesia-Malaysia car for the ASEAN market.–Din Merican

Mahathir indicates possibility of a Malaysia-Indonesia car

by Bernama

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Prime Minister Dr Mahathir Mohamad Friday spoke of the possibility of reviving the proposed project of a Malaysia-Indonesia car for the Asean market.

He said the idea was brought up when he test drove a Proton car in Malaysia in February 2015 with visiting Indonesian President Joko Widodo sitting beside him.

“I was no longer the prime minister then,” he said.

Mahathir was the prime minister from 1981 to 2003 and became the premier for the second time on May 10, 2018.

“I drove the car at a speed of 180 km per hour on the Sepang race circuit. The President (Joko Widodo) did not complain at all (when the car was driven at that speed),” Mahathir said at the joint press conference with Jokowi, as the Indonesian President is fondly called, in conjunction with his official visit to Indonesia.

Jokowi had recalled the test drive when he spoke earlier at the press conference and said he had no cause for worry because the person behind the wheel was Mahathir.

“I was not afraid because the driver was Mahathir,” he said.

— Bernama

Indonesia: Bribery Issues Mar Polls


June 28, 2018

Indonesia: Bribery Issues Mar  Polls

by Ainur Rohmah

http://www.asiasentinel.com

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With Indonesia’s regional elections underway on June 27, 152 million Indonesian voters will choose governors, regents, mayors and representatives simultaneously in 13 provinces, 115 districts and 39 cities across the country in a process that is rife with bribery and influence-peddling.

Data collected by the country’s formidable Corruption Eradication Commission show that 78 regional heads have been tried on various corruption cases over the past 15 years. Since January alone, at least seven regional heads have been arrested on various charges of bribery and abuse of power. One, for instance, was Nyono Suharli, the regent of Jombang, who received bribes related to the licensing of government offices. The bribes were to be used for Nyono to fund his 2018 campaign.

Abdon Nababan, a prominent community activist in North Sumatra, described a typical case – involving his own abortive run for power. The country’s political mafia block independent candidates, he said, to effect make “investments” in people they can control through bribery. The system itself in effect thus blocks genuine independent candidates by making the nomination process nearly insurmountable.

“The conditions set (for independent candidates) by the electoral system in Indonesia are too heavy, and only rich persons and those sustained by (political) investors have the opportunity to run for election,” Nababan said.

Nababan for the past 20 years has championed the rights of indigenous peoples over their ancestral lands through the Alliance of Indigenous Peoples of the Archipelago (AMAN). He was rewarded the prestigious Ramon Magsaysay award in August 2017 for his dedication to protecting the rights of indigenous people.

Encouraged to seek office to combat corruption and the sway of the so-called “land mafia,” Nababan said, he decided to run as an independent for governor in North Sumatra – one of the provinces whose leaders have often been arrested for corruption – in the upcoming local elections. Although not affiliated with a political party, surveys indicated that he would be one of the strongest candidates.

Political Dowries A Bar

Regional candidates usually seek to run as independents because it is considered cheaper than running through a political party, which requires candidates to put up what is described as a “political dowry” in order to be nominated for election. In fact, the requirement to run as an independent is equally difficult, since the candidates must collect the signatures and copies of the ID cards of at least 800,000 voters.

Nababan and his volunteers collected hundreds of thousands of signatures in four months before the General Election Commission (KPU) closed the registration process. His efforts failed because he was only able to collect 560,000, falling 260,000 short.

“The distance between my appointment as a candidate with the closing of the registration was too short so we didn’t have enough time to gather support,” he said.

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Shockingly, Nababan said he had been approached by a group of people he called “bandars” or political investors who offered him the chance to run through their political party, which he didn’t name, promising him up to Rp300 billion (US$21 million) to deliver victory.

“A month after the announcement of my candidacy, around August 2017, someone contacted me to request a meeting to discuss political support,” Nababan said. He subsequently met with three unnamed individuals who offered financial support in return allowing them control of the government after the election .

“They told me that they would prepare Rp300 billion for various expenses in my campaign,” Nababan said. “I do not know who they are but I think they have access to political parties, and they have big (financial) capital,” he said.

He assumed they represented a group of influential people in plantations, mining and property, he said, all of which have long-term economic interests in North Sumatra. In order for their business activities to run smoothly, he alleged, they were looking for elected leaders who would make it easy to provide licenses and commission projects.

Nababan is not alone. Faisal Basri, an economic analyst and political activist who ran as an independent for the governorship of Jakarta in 2012, told the highly-regarded Jakarta-based news magazine Tempo (tempo.co) that he had been offered financial support of up to Rp200 billion (US$14 million) in return for promising to facilitate the donor’s project in the ​​Sundae Kelapa port area in Jakarta.

But the offer was rejected. “Such a fund could trap us,” Basri told Tempo.

High Political Costs

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Donal Fariz, the coordinator of the corruption division of the Indonesian Corruption Watch (ICW), said bribery occurs throughout the entire nomination process until the election. Fariz divides the system into three levels: pre-candidacy, candidate determination, and post-election.

“All three levels are highly loaded with transactions and bribes,” Donal said. At the pre-candidacy level, the prospective candidate’s “dowry” value reaches hundreds of billions of rupiah, paid to the party in order to be nominated. The electoral system requires that candidates gain support at least 20 percent of the party’s votes in the legislature.

“At this stage the political cost becomes the highest,” Fariz said, although he said he couldn’t confirm the size of the bribes to lawmakers. “If we asked to the candidates, they would not answer. If we asked the party, they would not admit it, even they claim to be the party who spend money,” he said.

However, some candidates have complained about the huge sums they have been asked for the dowries. In January, La Nyalla Mattalitti, the chairman of the East Java Chamber of Commerce and Industry (Kadin), claimed he had been asked for Rp40 billion (US$3 million) by Gerindra Party Chairman Prabowo Subianto, the failed 2014 presidential candidate, in return for the party’s support in the East Java gubernatorial election.

Others are Dedi Mulyadi, a candidate for the governorship of West Java, who said he had also been asked for Rp10 billion (US$740,000) by an unnamed individual in Golkar, the country’s oldest party, to smooth his candidacy. Brig. Gen. Siswandi claimed the Prosperous Justice Party (PKS) turned him down as a candidate for the Ceribon seat when he refused to pay a dowry. The Hanura Party reportedly suffered internal conflicts due to the same issue. Prabowo, Gerindra, Golkar, PKS, and Hanura have all denied asking for dowries.

Fariz of the ICW said he believes many other cases are not revealed to the public. In addition to political dowries, there are also “survey fees” by particular institutions to raise candidates’ electability, he said. The second level is candidate determination, which is the major cost required for campaign attributes and props, as well as bribes to voters.

As for the post-election level, bribes are usually awarded to election organizers from the lowest level to the most strategic one, including bribes to law enforcement officials dealing with electoral disputes. The Chief Justice of the Constitutional Court, Akil Mochtar, was thrown into prison by the Corruption Eradication Commission (KPK) for accepting bribes in adjudicating disputes over regional gubernatorial elections in 2014.

Consequences of Corrupt Process

The transactional and corrupt spaces have long-term consequences, such as the many heads of regions who abuse their power for corruption. “So do not be surprised why many elected regional heads are ultimately involved in various corruption scandal,” Fariz said.

“The system has to be improved because this kind of (corrupt) system is very expensive for good and potential people,” Nababan said. It will be almost impossible for Indonesia to elect independent, viable candidates without such reform.

Ainur Rohmah (ainur.rohmah88@gmail.com) is a Jakarta-based correspondent and a regular contributor to Asia Sentinel.