southeast asia from the corner of 18th & k streets · pdf filethe year of the dragon: ......

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Southeast AsiaProgram

Volume III | Issue 1 | January 19, 2012

Southeast Asia from the Corner of 18th & K Streets

The Year of the Dragon: ASEAN’s Existential Questionsernest z. bower

Inside This Issue

the week that was

looking ahead

January 19, 2012

Ernest Z. Bower is the senior adviser and director of the Southeast Asia Program at the Center for Strategic and International Studies in Washington, D.C.

Inside This Issue

the week that was

• Anwar Ibrahim acquitted of sodomy charges

• United States to restore full diplomatic ties with Myanmar

• Philippines begins impeachment trial of Supreme Court judge

looking ahead

• “Year of the Dragon” begins January 23

• Lecture on investing in Asia at Georgetown University

• “The Singapore Conference @ CSIS” on February 8

As the year of the dragon approaches, ASEAN must ask and answer existential questions about itself and the great powers around it.

ASEAN is positioned to become the foundation of regional economic and security frameworks that will provide the construct for nations’ grand strategy in the coming decades. Can it play this role and sustain its central position?

Achieving that goal presents a major challenge. ASEAN must step up its game by taking real steps toward realizing economic, political, and sociocultural integration. The challenge is to build on the effective effort at the East Asia Summit in Bali last November where ASEAN took the lead in tabling the most pressing regional and global issues, ranging from political reform in Myanmar to the nuclear threat of North Korea to resolving disputes in the South China Sea. Finally, it will have to cope with transnational issues such as nuclear proliferation, food and energy security, climate change, and humanitarian assistance and disaster relief.

As ASEAN works to address the challenges of its regional role, member countries are undergoing nothing less than quiet revolution for the empowerment of voters. Citizens around the region are asserting themselves while governments scramble to reform and adapt. The process is a healthy one. Time magazine said 2011 was the Year of the Protester, but in Asia, it was the Year of the Voter.

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Southeast Asia from the Corner of 18th & K Streets January 19, 2012 | 2

The Year of the Dragon: ASEAN’s Existential Questions (continued)

In Southeast Asia, protesters did not have to use the violence seen in the Arab Spring. Regional governments are no longer the autocratic regimes of the Cold War era. They are moving to accommodate voters by competing with new ideas about political and economic reform. Opposition parties are seen less as security threats and more as competitors in a market for governance and economic models that will deliver the goods to an increasingly demanding customer—Asia’s fast-growing middle class.

Asia’s voters are more focused than those of the “Occupy” movements in the United States and Europe. ASEAN’s citizens are converting economic empowerment into political clout—a probable harbinger of things to come, most interestingly in China.

In addition, 2012 will present Southeast Asia’s litmus test for China, India, and the United States. Where do these powers stand and who do they want to be in the Asia Pacific?

Political bandwidth in China and the United States this year will focus on domestic political transitions. China will hold the 18th National Congress of the Communist Party and the United States will hold national elections selecting a president and new congress. These cycles are traditionally characterized by an intensive focus on domestic issues. But in the-Asia Pacific context, both major powers need to sustain a focus on regional economic and foreign policy and address the questions of what they want and who they want to be.

For India, whose 2012 elections will be at the state, not national, level, the same questions are relevant. Is India serious about becoming an Asia-Pacific power? To date, it has attended the meetings and gone through the motions, but it has yet to internalize and focus its engagement.

who does china want to be?

Southeast Asia’s primary concern about China is understanding what its massive neighbor wants and who it wants to be. Will the

Regular elections in Indonesia and other ASEAN nations, though imperfect, still signal a quiet revolution. http://www.flickr.com/photos/ikhlasulamal/3446542247/

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year of the dragon reveal a China guided by Deng Xiaoping’s caution to ask “what should China do?,” or a more aggressive and nationalist neighbor testing its newfound economic power by asserting sovereignty in disputed territories and asking “what can China do?”

China’s actions in the South China Sea and maritime northeast Asia have triggered age-old anxieties in Southeast Asia—even to the extent that countries once assumed fully under China’s influence such as Myanmar have charted new courses to assert sovereignty through political and economic reform. To be certain, China’s economic dynamism and global presence are vital to the region’s interests. Southeast Asia needs a strong China, but in the form of a confident neighbor willing to work with its neighbors in developing rules and guidelines within the new Asia-Pacific frameworks. By so doing, China will build trust and champion peace and prosperity.

will the united states focus and follow through?

The region’s concern about the United States is whether it will focus and follow through on its commitments to the Asia Pacific. In 2011, President Obama and his foreign policy and national security teams made a compelling case that the United States was pivoting toward Asia. He said the Asia-Pacific region will be the center point for new economic growth and security concerns in the first part of the twenty-first century. Asian allies and strategic partners were encouraged by those words and by the actions that backed them up—U.S. leadership in trade with the Trans-Pacific Partnership negotiations, the United States’ first attendance at the East Asia Summit, the announcement of new basing agreements in Australia, and a strong and consistent focus on resolving South China Sea disputes.

While 2011 was an impressive year for advancing U.S. goals and engagement in Asia, ASEAN and other partners in the region are anxious about whether the United States can sustain the new level of commitment it has staked out. Most Asian countries have sought a more robust U.S. presence in the region to help convince a rising China to engage in regional frameworks that will result in the collective development of rules around trade and security.

Southeast Asia is legitimately concerned about the United States’ financial capability to sustain and expand its presence and questions whether the political focus can be sustained in an election year. The




natural inclination of politicians in an election year is to focus almost exclusively on issues that will get them reelected. Foreign policy, trade, and national security issues rarely rank high on that list. Sadly, campaign professionals assiduously steer their candidates away from those topics.

This will present a real challenge for the Obama White House to remain focused and follow through on its commitments to Asian engagement. This White House has already demonstrated its sensitivity to foreign travel and potentially alienating its labor base with trade agreements. Alarming new levels of partisanship coupled with brinksmanship on budgetary issues in Congress will present additional threats to sustaining the U.S. commitment.

If the United States falters so early on in its self-proclaimed new focus on Asia, allies and partners in the

region will be forced to ask questions and explore hedging strategies that could undermine the vast potential for new security partnerships, growing trade and investment, and strengthening regional architecture.

when will india assert its asia-pacific credentials?

India shares land and maritime borders with China and Southeast Asia. Like China, it has deep affinities with Southeast Asia through history, governance, language, religion, and culture. It is a party to nascent regional architecture including free trade agreements with ASEAN as well as other Asia-Pacific countries and membership in the East Asia Summit, ASEAN Defense Ministers Meeting Plus, and the ASEAN Regional Forum.

However, India remains the most internally focused of the big three powers engaged in Asia-Pacific regional frameworks. Southeast Asia wants to know when India will assert its regional credentials and is searching for the factors that will motivate India to advance its effort to integrate and participate more intensely. Of these factors, the two most viable are, first, an Indian private sector seeking to diversify from stifling corruption and the efficiency-slaking regulatory maze at home and, second, a

The attendance of Secretary of State Hillary Clinton and other high-level U.S. officials at regional forums (shown above at the 2011 ASEAN Summit) signals the U.S. intention to remain engaged in the region. http://www.flickr.com/photos/usembassyjakarta/5965488785/in/photostream/

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military increasingly aware of security concerns in the Indian Ocean.

India should play a stronger leadership role in Asia-Pacific regional architecture. In that context, supporting political and economic reform in Myanmar would be an ideal entrée. India’s nationalist leaders Gandhi and Nehru played a critical inspirational role for Myanmar’s independence movement (then called the Union of Burma). India has economic, political, security, and social interests in seeing a stable and prosperous Myanmar develop on its eastern border. A peaceful Myanmar with a balanced foreign policy is in India’s interests. So is a Myanmar engaged in economic initiatives linking mainland Southeast Asia, China, and India through roads, rail, and maritime cooperation. Finally, a stable and reformed Myanmar will strengthen ASEAN as a solid foundation for developing regional economic and security cooperation, which should be a core national security concern for India.

myanmar: the breakthrough opportunity of 2012

The biggest opportunity for Southeast Asia in 2012 is the chance for Myanmar to emerge from the darkness of five decades of repression and self-imposed isolation from the global community. Myanmar’s progress is important to Southeast Asia because the grouping has been dragging the draconian regime around like a ball and chain since it joined in 1997.

Substantial actions have backed up the rhetoric of the government, including the release of many political prisoners, the reform of laws limiting use of the Internet, and the easing of restrictions on the media and free association. In addition, opposition leader Aung San Suu Kyi has been released from house arrest, and she and her party are allowed to run in by-elections planned for early 2012.

Myanmar’s reforms offer Asia-Pacific countries a substantial opportunity to strengthen ASEAN as a foundation for building new regional trade and security architecture. That will encourage China to come to the table and work with other countries to establish rules governing trade and security, promote regional peace and prosperity, and cooperate on areas of concern such as the South China Sea.

Political reform in Myanmar is indicative of the trend of continued empowerment for people and voters across Southeast Asia.


Southeast Asia from the Corner of 18th & K Streets November 9, 2011 | 6

Two Models for Integrating Asia: A Must Win for President Obama (continued)




Should this trend hold, regional governments will be compelled to accelerate campaigns against corruption, advance political and economic reforms, and strengthen institutions. These steps augur well for a just and sustainable governance infrastructure in Southeast Asia. Over the coming decade, this trend toward empowerment and good governance may have more impact on China than Chinese economic momentum has on Southeast Asia.

The year of the dragon presents Southeast Asia and its partners with important questions. As those queries are answered, the region will make important decisions about the direction of emerging political, economic, and security norms. A strengthened ASEAN is in the interests of all countries in the Asia Pacific. The coming year will reveal who understands this strategic thrust and who is willing to invest in achieving that goal. ■

CSIS Launches Study: “Developing an Enduring Strategy for ASEAN”

A new report released by the CSIS Southeast Asia

Program underlines a growing recognition in the United

States that Southeast Asia is vital to U.S. national secu-

rity and economic interests. The report’s authors provide

recommendations outlining ways the United States can

develop an enduring strategy toward the region. The study

can be downloaded from the CSIS website here.

The Southeast Asia Program launched the study, titled

“Developing an Enduring Strategy for ASEAN,” in

November 2010. The report was formally rolled out in

Washington, D.C., on November 4, 2011, in meetings with

administration officials, members of Congress, and the

ASEAN ambassadors to the United States ahead of the

Asia-Pacific Economic Cooperation summit in Hawaii and

the East Asia Summit in Bali.

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The Week That Was


The surprise acquittal of Malaysian opposition leader Anwar Ibrahim paves the way for him to contest national elections widely expected this year. http://www.flickr.com/photos/adzliyana/2286808153/

malaysia

• Anwar acquitted of sodomy charges. Former deputy prime minister and current opposition leader Anwar Ibrahim was acquitted of sodomy charges in a surprise decision January 9. The two-year trial came to end when Judge Zabidin Diah said the prosecution’s evidence could have been compromised and did not substantiate the charges against Anwar. The acquittal will allow Anwar to compete in national elections expected this year, but also gives a boost to Prime Minister Najib Razak and his ruling party as it weakens the opposition’s claims of government interference in the courts.

• Malaysia’s high court denies overseas absentee voting rights. The Malaysian high court announced January 6 that it had denied the request of a group of overseas Malaysians for absentee voting rights. The suit, originally filed in November, was denied on the grounds that the Malaysians in question did not meet the criteria for absentee voters established under the 2002 elections regulations, which allow only soldiers and political appointees to vote abroad.

• Malaysia and Singapore seek to cooperate on electricity sale. Singaporean prime minister Lee Hsien Loong and Malaysian prime minister Najib Razak met on January 5 at a leaders retreat to discuss a possible energy deal that would see Malaysia supply Singapore with electricity. The leaders agreed to begin drafting a framework for the initiative, which would be a private-sector project. Singapore emphasized that the possible environmental impact from the project would need to be studied before any deal enters into force.

• Malaysia’s national debt to equal GDP by 2019. The Malaysian Institute for Economic Research (MIER) announced January 10 that, based on current government spending, Malaysia’s national debt will equal its gross domestic product by 2019. Mohd Ariff Abdul, the institute’s distinguished fellow, warned that the government’s spending was exceeding its revenue intake, creating a financial burden for the country.

myanmar

• Government releases high-profile political prisoners. Myanmar freed the majority of its most prominent political prisoners January 13 in the fourth mass prisoner amnesty in a year. The government said that 651 prisoners were released, including 302 prisoners of conscience and 349 ousted government officials and their families. Among those released were leader

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of the 1988 student uprising Min Ko Naing; U Gambira, a monk who led the 2007 “saffron revolution” protests; prominent Shan politician Khun Htun Oo; and former prime minister Khin Nyunt.

• United States announces restoration of full diplomatic ties. President Barack Obama said that Myanmar’s January 13 political prisoner release was “a substantial step forward for democratic reform” and an important step in the process of national reconciliation. Following his statement, Secretary of State Hillary Clinton said that the United States would restore full diplomatic ties with Myanmar by sending an ambassador to the country, and she invited Myanmar to do the same. The last U.S. ambassador to Myanmar was withdrawn after the crackdown following the country’s 1990 national elections.

• Government signs cease-fire deal with Karen National Union. The Myanmar government signed a cease-fire agreement January 12 with the Karen National Union (KNU), bringing a halt to the country’s longest-running insurgency. An end to fighting in the ethnic minority areas is one of the preconditions set by western governments for improving relations. The government is reported to be pursuing cease-fire talks with most of the country’s remaining armed groups, though talks with the Kachin Independence Army seem to have stalled and open hostilities continue.

• International visitors seek improved ties with Myanmar. Indian army chief Gen. VK Singh visited Myanmar January 5–9 seeking to bolster defense cooperation between the two neighbors. William Hague became the first British foreign secretary to visit Myanmar in more than 50 years January 5–6. During his visit, Hague said EU sanctions against Myanmar could be lifted in April if the country’s democratic reforms continue, and the European Union announced January 5 that it would begin the process of opening a representative office in Yangon. U.S. philanthropist George Soros visited Myanmar January 3 and announced that he plans to establish an office to further his philanthropic operations in the country.

British foreign secretary William Hague met with Myanmar opposition leader Aung San Suu Kyi during his recent visit to the country. http://www.flickr.com/photos/foreignoffice/6641226667/

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• Myanmar government shuts down major Thai power project. The Myanmar government announced January 10 that it has halted the construction of a Thai-built coal-fired power plant in the Dawei special industrial zone in response to environmental concerns. The government’s suspension of construction of the Dawei plant follows a similar decision last year to halt construction of a controversial Chinese dam project at Myitsone and has raised hopes that the government is paying greater heed to environmental concerns.

• Series of U.S. officials visit Myanmar. U.S. ambassador at large for human trafficking Luis CdeBaca said during a January 9 visit to Myanmar that the country must change its forced labor laws and tackle child labor and sex trafficking in order to improve its tier-three status on the State Department’s annual Trafficking in Persons report. Representative Joe Crowley and Senator Mitch McConnell, both sponsors of the 2008 JADE Act sanctioning Myanmar, visited the country on January 12–13 and January 16, respectively, to investigate the state of political reforms in the country.

thailand

• Advisory panel recommends an overhaul of the lèse-majesté laws. Thailand’s Truth for Reconciliation Commission has recommended an overhaul of the country’s lèse-majesté laws. According to a letter addressed to Prime Minister Yingluck Shinawatra December 30 but not released until January 12, if the law is not changed, “it may continue to be used as a political tool and will therefore obstruct reconciliation between people in our country.” The EU and groups like Human Rights Watch have criticized Thailand’s tough laws against defaming the royal family.

• Thaksin rejects compromise offer to live in Thailand under house arrest. Thailand’s former prime minister, Thaksin Shinawatra, will not accept a compromise proposal from veteran politician and Pheu Thai member of Parliament Sanoh Thiengthong that he accept house arrest to serve out his two-year jail term. Thaksin’s personal lawyer and former foreign minister Noppadol Pattama revealed Thaksin’s sentiments, adding that accepting the compromise would mean also accepting a Supreme Court conviction on corruption charges.

• Thailand and Japan plan joint efforts to aid businesses affected by floods. Thailand and its biggest foreign investor, Japan, agreed January 11 on measures to help businesses of both countries damaged by major flooding last year, including exempting import duties on machinery and

U.S. senator Mitch McConnell, who has been an outspoken critic of Myanmar’s government for decades, visited the country on January 16. http://www.flickr.com/photos/kyngpao/6641833905/sizes/l/in/photostream/

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parts and granting financial assistance to companies. About 300 out of 1,200 Japanese companies registered in Thailand were affected, with total economic damage estimated at more than $6.3 billion. Industrial areas near Bangkok, where many Japanese companies like Honda have factories, were especially hard-hit by flooding.

• Thailand approves fund to compensate victims of political protests. Thailand’s cabinet approved $62.8 million to compensate victims of political conflicts since 2005. Reparations will be made to families of those killed and individuals unfairly detained or injured. A spokeswoman said January 10 that Prime Minister Yingluck Shinawatra wanted to show that her administration has “taken responsibility by giving to all sides.” The payments were recommended by an official Truth for Reconciliation Commission established after political violence erupted in April–May 2010 when antigovernment protests left 91 people killed and hundreds injured.

• Thailand urges U.S. to revoke travel warning after terror suspect is arrested. Thai prime minister Yingluck Shinawatra urged the United States to revoke a terrorism warning issued after the discovery of a planned bombing. The plot was uncovered when a Hezbollah-linked Lebanese suspect was arrested in Bangkok January 13. Thai defense ministry officials met with U.S. Embassy officials January 16 to discuss procedures for issuing security advisories, but an embassy spokesman said the terror warning to U.S. citizens was valid and that the United States had no plan to rescind it. As of January 16, 11 countries had issued warnings to their citizens against traveling to Thailand, which the government fears will damage its tourism sector.

• Thai defense minister meets Myanmar army chief. Myanmar army chief Min Aung Hlaing met with Thailand’s defense minister Yutthasak Sasiprapha January 9 to discuss the opening of new border checkpoints in Thailand’s western Kanchanaburi Province near Dawei in Myanmar. Dawei is the site of a planned $50 billion industrial zone complex which would be the biggest in Southeast Asia. The two officials met in Bangkok to outline plans for improved ties between their countries, which have been troubled by security problems along the ethnic conflict-plagued border.

philippines

• Impeachment proceedings against Philippine Supreme Court justice begin. The impeachment trial of Philippine Supreme Court chief justice Renato Corona opened January 16 in Manila. He stands accused of eight

A Red Shirt protester in Ratchaprasong Thailand, November 2010. http://www.flickr.com/photos/58bits/5189175509/

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acts of alleged corruption and improperly issuing decisions that favored former president Gloria Macapagal-Arroyo. The trial, the first of its kind against a high-ranking judge, is the latest effort in an anticorruption campaign waged by President Benigno Aquino, who blames his predecessor for a decade of corruption scandals that eroded public trust in the government and held back foreign investors.

• Philippine government and MILF make progress during peace talks. The Philippine government and the Moro Islamic Liberation Front (MILF) ended peace talks January 11 in Kuala Lumpur with the next round of talks planned for February. Mohagher Iqbal, chief MILF peace negotiator, and Marvic Leonen, representing the Philippine government, issued a joint statement saying “both parties clarified their positions, tentatively identified areas of common ground, and agreed to consult with their principals on outstanding issues.” The Philippine government has said it expects to reach a final peace agreement within three months.

• Major Catholic procession takes place without incident. Millions of Roman Catholic devotees marched in Manila’s Feast of the Black Nazarene procession January 9 without incident, despite a terror alert issued by President Benigno Aquino the day before. Defense Secretary Voltaire Gazmin said the threat, involving possible bombings by two groups of Muslim militants from the country’s south, prompted police to raid several suspected terrorist hideouts in the Manila area, but without results. About 15,000 policemen and hundreds of army troops were dispatched to secure the three-mile parade route.

• UN condemns killing of journalists in the Philippines. Irina Bokova, director-general of the United Nations Educational, Scientific and Cultural Organization (UNESCO), condemned the recent murders of journalists in the Philippines and called on authorities to investigate the crimes thoroughly. “Journalists who cover news in the Philippines should be able to work safely in order to provide citizens with free information and nourish an informed debate,” Bokova said in a statement January 10. Filipino radio commentator Christopher Guarin was murdered January 6, making him the 150th journalist murdered in the Philippines since 1986.

• U.S. and Philippines to hold bilateral strategic dialogue. The Philippines and the United States will hold their second bilateral strategic dialogue in Washington beginning January 26. The two-day forum will prepare for ministerial meetings planned in March and are part of an effort to update the military partnership of the two countries. The first strategic dialogue,

Millions of Filipinos marched in Manila’s Feast of the Black Nazarene on January 9, despite a terror alert issued by the government. http://www.flickr.com/photos/incrediblethots/5352855997/

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held in Manila last year, was described by Philippines foreign secretary Albert del Rosario as a “clear manifestation of both countries’ resolve to enhance relations.”

indonesia

• Indonesia enacts ASEAN-Australia-New Zealand Free Trade Agreement but vows to defend domestic industries. Indonesia became the final ASEAN nation to fully enact the ASEAN-Australia-New Zealand Free Trade Agreement January 10, nearly two years after the agreement was signed. Domestic business opposition to the agreement was overcome only with assurances from Minister of Agriculture Suswono that domestic products in local markets would be protected with nontariff barriers imposed on foreign goods. Australia’s 2011 ban on live cattle exports from Indonesia has elicited a retaliatory ceiling on cattle exports so that more cattle are available for the domestic market.

• Suzuki will invest $780 million to expand production in Indonesia. Japanese auto manufacturer Suzuki will invest $780 million to upgrade two factories and build a third plant near Jakarta to triple its annual production capacity in Indonesia to 150,000 car engines. The investment is part of Suzuki’s strategy to increase sales in the Southeast Asian market. Indonesia’s domestic automobile market is dominated by Toyota, which is also expanding its production facilities there.

• Third bird flu death in three months makes officials jittery. A 24-year-old man died January 7 from H5N1 avian influenza in Jakarta after apparently contracting the deadly virus from domesticated birds near his home. Two children died from the virus in Bali in October. Avian influenza has a mortality rate of 60 percent in known cases and Indonesia has seen 150 deaths from the virus since 2003—the most among countries in the region.

• Islamist mob attacks Home Affairs Ministry. Members of the hard-line Islamic Defenders Front (FPI) hurled rocks and eggs at Indonesia’s Home Affairs Ministry January 12 to protest the ministry’s decision to review regional laws banning the sale and consumption of alcohol. After the incident, a group of FPI leaders apologized for the attack, but the ministry vowed on January 13 to “evaluate” the FPI as well as another hard-line group, the Islamic People’s Forum.

• Nike to pay $1 million in back wages to workers. The union representing 4,500 workers at a Nike shoe factory in Banten Province announced it won

Suzuki is investing heavily in Indonesia in the hope of gaining a better market share in Indonesia and other Southeast Asia nations where automobile ownership is still low. http://www.flickr.com/photos/devilarts/247338454/

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a $1 million out-of-court settlement from Nike. Workers were unpaid for 600,000 hours of overtime and other alleged workplace problems. While Indonesian labor activists were emboldened by the message sent to other manufacturers, Nike pointed to the agreement as an indication of its commitment to fair labor practices at its facilities around the globe. Labor protections in Indonesia are described as inadequate by Oxfam Australia, although an agreement was achieved last year between labor and industry groups guaranteeing greater collective bargaining rights.

vietnam

• Activist sent to “drug rehabilitation” for participation in anti-China demonstration. Activist Bui Thi Minh Hang was sent to a “drug rehabilitation center” November 28 for two years for her role in a protest a day earlier against Chinese claims in the South China Sea. The decision was criticized January 5 by the U.S. Embassy in Hanoi. Human Rights Watch, which has worked to bring international attention to the drug rehabilitation facilities where prisoners engage in forced labor, called on the European Union to demand that Vietnam reform its detention policies during a bilateral dialogue on January 12.

• Second wave of bank mergers to continue consolidation of Vietnam’s banking sector. Three beleaguered Vietnamese banks merged to become the new Saigon Bank on January 1 in a prelude to further mergers expected throughout 2012. Vietnam’s government kicked off a reorganization of the country’s banking sector at the end of last year after several years of growing concern over the industry’s exposure to bad loans. The government also sought throughout 2011 to stabilize the nation’s currency and tame inflation, which hovered near an annual rate of 20 percent. Analysts expect that only two-thirds of Vietnamese banks will still exist after the industry is restructured.

• Vietnam seeks answers from China in disputed territory fishing incident. Vietnam’s Maritime Administration sought clarification from China January 11 on the role of a Chinese commercial fishing ship in the sinking of a Vietnamese fishing boat in disputed territory. The Vietnamese boat was struck by an unidentified vessel January 8 and its sailors were rescued by the Chinese ship the next day. After the crew was transferred to Vietnamese authorities, the captain sent a letter indicating that he believed the Chinese ship was responsible for the accident.



• Authorities cull 2,500 chickens to halt bird flu spread. Vietnam’s government announced January 12 that the animal health department in the southern province of Tien Giang culled more than 2,500 chickens that tested positive for the H5N1 strain of bird flu. About 450 chickens were also recently culled in nearby Hau Giang Province. Indonesia and China are also addressing fears of outbreaks of the bird flu in their countries. Vietnam has had 53 confirmed deaths from the H5N1 virus since 2003.

• Mekong Delta attracts almost $10 billion in FDI. The amount of foreign direct investment in Vietnam’s Mekong Delta provinces has reached nearly $10 billion. Vietnam’s Foreign Investment Agency announced January 5 that there are now 611 operating FDI projects in the region, most in processing and manufacturing industries. The agency said there is a focus on improving infrastructure, developing services, supporting industries, and boosting administrative reforms and human resource training.

mekong river

• Four Chinese cargo ships and Myanmar patrol boat attacked on Mekong River. Four Chinese cargo ships and a Myanmar patrol boat were attacked at Wan Pung Port in Myanmar January 4, less than a month after a joint force of Chinese, Thai, Lao, and Myanmar police had begun patrolling the Mekong River. No injuries were reported but the incident will shake confidence in the safety of the river where 13 Chinese sailors were killed in October 2011. More than 3 million tons of cargo have been transported on the river since 2001, generating more than $4.8 billion in revenue.

south china sea

• Philippines protest December sightings of Chinese ships in disputed waters. The Philippines’ Department of Foreign Affairs protested sightings of Chinese vessels December 11 and 12 near the Escoda Shoal, which the Philippines considers part of its territorial waters. The “intrusions of the Chinese are clear violations” of regional and global accords, Foreign Affairs Secretary Albert del Rosario said in a statement to the Chinese Embassy’s chargé d’affaires January 5. The two countries met to exchange views on the South China Sea and other issues at Foreign Ministry consultations in Beijing January 14.

• ASEAN and China hold talks on South China Sea. ASEAN ministers met with Chinese officials in Beijing for a three-day meeting from January 13 to 15 to discuss implementation of the 2002 Declaration on the Conduct of Parties in the South China Sea.

Vietnam has culled thousands of chickens in an effort to halt the spread of the H5N1 strain of bird flu. http://www.flickr.com/photos/jonohaysom/4881137370/

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singapore

• Singapore’s Kuo Oil hit by U.S. sanctions over Iran business. Singapore’s Kuo Oil Private Limited was one of three companies sanctioned by the United States January 12 for selling refined petroleum products to Iran. The sanctions, leveled under the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010, prevent Kuo Oil from receiving U.S. export licenses, U.S. Export-Import Bank financing, and loans of more than $10 million from U.S. financial institutions. The other two companies sanctioned were China’s state-owned Zhuhai Zhenrong Co. and United Arab Emirates-based FAL Oil Co.

• Government officials to accept large pay cuts. Singaporean prime minister Lee Hsien Loong has promised that he and other government officials will accept large pay cuts recommended January 4 by a committee established in May 2011 to review government salaries following the unprecedentedly narrow victory of the ruling People’s Action Party in last year’s national elections. Under the recommendations, Lee’s pay will drop 36 percent to $1.7 million, President Tony Tan’s 51 percent to $1.54 million, and the salaries of entry-level ministers will be set at $727,000.

laos

• Vietnam developer will build Laos’s first special economic zone. Vietnam’s Long Thanh Golf Investment and Trade Joint Stock Company has agreed to expand what is currently a golf course and real estate complex in Laos into the country’s first full-fledged special economic zone (SEZ). The deal was signed on the sidelines of the Vietnam-Laos Intergovernmental Committee held January 3–7. The SEZ will become the home for several Vietnamese foreign investment projects. Vietnamese investment in Laos totals $3.6 billion.

• Laos doubles share that foreigners are allowed to own in Laotian firms. The Lao Securities and Exchange Commission announced January 10 that the share that foreigners are allowed to own in publicly traded Laotian companies would be raised from 10 percent to 20 percent effective January 16. The announcement came just a day before the Lao Stock Exchange heard its first-ever opening bell January 11. The government hopes the $10 million endeavor will spur foreign investment.

Singapore’s prime minister Lee Hsien Loong, seen here at a May 2011 campaign rally, has vowed to accept large government pay cuts as part of ongoing efforts to make his ruling People’s Action Party more responsive to popular demands. http://www.flickr.com/photos/karenchen/5687140922/

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• Congress increases UXO-removal funding. The U.S. Congress recommended that the State Department nearly double annual funding for the removal of unexploded ordinance (UXO) in Laos, from $5 million to $9 million. The recommendation was included in a congressional conference report on the fiscal year 2012 budget that passed on December 23. The recommendation is not binding and the State Department has yet to release a final figure for UXO assistance. Laos is the most heavily mined country in the world, with large amounts of UXO left behind from the Vietnam War.

• Japanese demining machine arrives in Xiengkhouang. A demining machine made by Japanese tractor manufacturer Komatsu arrived in Xiengkhouang January 8. The $1 million machine, paid for by the Japan Mine Action Service, will help Laos move toward its goal of clearing 770 square miles of unexploded ordinance for agricultural use by 2020. As a result of the Vietnam War, Laos was left with as many as 80 million pieces of UXO.

ASEAN

• ASEAN Human Rights Commission adopts draft human rights charter. The ASEAN Human Rights Commission adopted a draft human rights charter during its 11th meeting in Siem Reap, Cambodia, on January 7. Om Yin Tieng, head of the Cambodian Human Rights Commission, said the commission will seek to finalize the charter by 2013.

• ASEAN and India sign agreement on tourism cooperation. ASEAN and India signed a Memorandum of Understanding (MOU) on tourism cooperation during the ASEAN Tourism Forum held in Manado, Indonesia, January 8 to 15. Tourism between ASEAN and India has increased substantially, with the number of ASEAN tourists traveling to India increasing by 63 percent from 2009 to 2010 and the number of Indian tourists to ASEAN increasing by 10 percent from 2010 to 2011.

cambodia

• Judges at Khmer Rouge trials argue in public. Swiss Khmer Rouge trial judge Laurent Kasper-Ansermet issued a statement January 9 that he was unable to provide updates on the progress of investigations because his Cambodian counterpart, You Bunleng, would not agree to it. You Bunleng accused his colleague of trying to conceal his comments from Cambodian officials by releasing them on a national holiday. The two judges are

Clearance teams from UXO Lao risk their lives uncovering unexploded ordnance. The U.S. Congress recently increased funding for UXO removal in Laos to its highest level ever. http://www.flickr.com/photos/oxfam/5168222451/

http://www.flickr.com/photos/oxfam/5168222451/

http://www.flickr.com/photos/oxfam/5168222451/



supposed to be working together in the trial of the Khmer Rouge’s three most-senior surviving leaders, due to resume January 17.

brunei

• Ulu Tutong dam progress delayed. Brunei’s development minister announced January 5 that the $85.4 million Ulu Tutong dam project is two months behind its construction schedule. When completed, the dam will help address Brunei’s water insecurity, and it could be used for hydroelectric generation in the future. The project manager hopes to make up some of the lost time nearer to the dam’s expected April 2014 completion date.

timor-leste

• UNHCR closes its office in Timor-Leste. The UN High Commissioner for Refugees (UNHCR) officially closed its Dili office January 12 after 12 years in operation. UNHCR helped resettle 220,000 refugees displaced by violence following Timor-Leste’s declaration of independence from Indonesia in 1999, and helped 150,000 people recover from election-related violence in 2006. Timor-Leste president Jose Ramos-Horta said the closure was a positive sign that the country had overcome the humanitarian problems of its early years. ■

Looking Ahead


• “Year of the Dragon” begins January 23. Chinese New Year, or Lunar New Year, will be celebrated January 23 across East Asia and in countries with large Chinese populations around the world. Also known as the Spring Festival, the holiday is the most important in the traditional Chinese calendar. This New Year will inaugurate the “Year of the Dragon.” An annual Chinese New Year parade will be held January 29 from 2:00 p.m. to 5:00 p.m. in Washington’s Chinatown on H Street, N.W., between 6th and 8th Streets.

• Lecture on investing in Asia at Georgetown University. The Asian Studies Program, Global Human Development Program, and Landegger Program in International Business Diplomacy at Georgetown University will host a lecture February 3 on investment strategies in Vietnam, China, and India with Rebecca Fannin, author of Startup Asia. The event, entitled “Startup Asia: Top Strategies for Cashing In on Asia’s Innovation,” will be held in Georgetown’s McCarthy Hall, McShain Lounge, from 12:00 noon to 2:30 p.m. Please RSVP here.

• “The Singapore Conference @ CSIS” on February 8. The CSIS Southeast Asia Program will host an all-day conference on the U.S.-Singapore relationship on February 8 from 8:30 a.m. to 6:30 p.m. The event will bring together members of Singapore’s cabinet, senior Singaporean and U.S. officials, and experts in the areas of trade, security, intelligence, foreign policy, and education. The program will be held in the B1 Conference Center at CSIS, 1800 K Street, N.W. Please RSVP here by Monday, February 6, 2012. If you have questions or need assistance, please contact the Southeast Asia Program. ■

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southeast asia from the corner of 18th & k streets CSIS Southeast Asia Program contributors:

Ernest Bower, Senior Adviser and Director Murray Hiebert, Senior Fellow and Deputy Director Gregory Poling, Research Assistant Sakari Deichsel, Researcher MeiLee Dozier, Researcher Blake Berger, Researcher

This newsletter is published by the Southeast Asia Program at the Center for Stra-tegic and International Studies (CSIS) in Washington, D.C., a private, tax-exempt institution focusing on international public policy issues. CSIS’s research is non-partisan and nonproprietary. CSIS does not take specific policy positions; accord-ingly, all views, positions, and conclusions expressed in this publication should be understood to be solely those of the author(s).

© 2012 by the Center for Strategic and International Studies. All rights reserved.

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