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Widodo defies controversies to form ‘solid team’ – Nikkei Asian Review

Luhut Panjaitan, Indonesia's newly appointed maritime affairs oversight minister, is accosted by press covering the inauguration of new ministers in Jakarta on July 27 (Photo: Simon Roughneen)

JAKARTA — There is a sense of urgency in Indonesian President Joko Widodo’s appointment of new members to his Cabinet — notably in the selection of the high-profile managing director of the World Bank, Sri Mulyani Indrawati. Indonesia’s economic growth has been slower than expected, infrastructure development — intended to leverage the economy — has been sluggish, while tax revenue is falling short of ambitious targets. Poor coordination among ministries has been partially blamed for hampering many important infrastructure projects. In the meantime, Widodo’s new flagship policy to boost tax revenues to finance development projects — a tax amnesty — is progressing very slowly. It is against this background that Widodo announced on Wednesday his new Cabinet lineup — which includes major changes in the economic team. “I want all the ministers, all heads of government institutions to work faster, to work more effectively, in a team that is solid and is supportive to one another,” Widodo told a Cabinet meeting less than two hours after nine new ministers were sworn in.

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Malaysia’s 1MDB woes deepen with US lawsuit – Nikkei Asian Review

Malaysia Prime Minister Najib Razak and wife Rosmah Mansor awaiting ASEAN heads of government at the ASEAN and related summits in Kuala Lumpur on Nov. 22 2015 (Photo: Simon Roughneen)

JAKARTA — bad penny keeps turning up, as the old saying goes. And so it goes for Malaysia’s Prime Minister Najib Razak, who has spent more than a year trying to fend off allegations that around $700 million was stolen from troubled state development fund 1Malaysia Development Berhad and diverted into his bank account. The prime minister first said he did not take money “for personal gain,” then said he received a $681 million donation from Saudi Arabia — the latter claim eventually backed in April by the Saudi foreign minister. Malaysian law enforcement agencies ruled that Najib has nothing to answer for, but foreign counterparts are hunting for billions of dollars of 1MDB money allegedly laundered through jurisdictions such as Singapore, Switzerland and the U.S.

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South China Sea arbitration ruling brings no closure to regional disputes – Nikkei Asian Review

Chinese Premier Li Keqiang and Malaysian Prime Minister Najib Razak heading for the signing ceremony of the ASEAN community on Nov. 22 2015 (Photo: Simon Roughneen)

JAKARTA — The international tribunal decision against Beijing’s claims to much of the South China Sea has provoked a mixed response in the region, with indications that it may tone down some rivalries while sharpening others. Most revealingly, after years of acrimony with China over rival claims in the disputed waters, the Philippines initially took a conciliatory tone, inviting China to bilateral talks over the matter. Despite a jubilant reaction from his countrymen following the July 12 ruling, which was overwhelmingly in favor of Manila, the normally strident new President Rodrigo Duterte said he would not “flaunt” the decision. Instead, he reiterated his desire to improve relations with China, his country’s biggest source of imports. “War is not an option,” Duterte said. “So, what is the other side? Peaceful talk.” Despite Duterte’s muted response, China has refused to compromise — insisting that any talks must exclude mention of the tribunal’s verdict. The tribunal, convened at the Permanent Court of Arbitration in The Hague, suggested that Chinese naval maneuvers in waters around islands near the Philippines are illegal. Yet Beijing has continued to block Filipino fishermen from working around Scarborough Shoal, 190km off the Philippine coast and 800km from mainland China.

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Tribunal’s blunt ruling against China fuels South China Sea tensions – Nikkei Asian Review

New Philippine President Rodrigo Duterte campaigning in Angeles City on March 19 2016 ,  prior to the May 9 2016 elections (Photo: Simon Roughneen)

TOKYO/JAKARTA — China’s claims to historical rights in the South China Sea have no legal basis, an international tribunal at The Hague ruled on Tuesday. In the first international ruling on artificial islands and military facilities built by Beijing in the disputed waters, the tribunal sided with the Philippines, flatly denying China’s historic claim to the “nine-dash” line, which encompasses most of the sea. A panel of five judges at the Permanent Court of Arbitration in The Hague in the Netherlands also noted that no maritime feature claimed by China along the Spratly Islands constitute a fully entitled island, and therefore cannot generate an exclusive economic zone or a continental shelf. The tribunal, established under the United Nations Convention on the Law of the Sea, said there was “no evidence” China had historically exercised exclusive control over the waters in the South China Sea or its resources. Moreover, the tribunal said any historical rights “were extinguished” when the U.N. convention established EEZs.

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Opposition concedes defeat in Australian poll – Nikkei Asian Review

Lining up to vote in Strathfield in western Sydney on July 2  (Photo: Simon Roughneen)​

MELBOURNE/SYDNEY — Malcolm Turnbull is set to continue as Australia’s prime minister after opposition leader Bill Shorten on Sunday conceded defeat in the national election — eight days after voters went to the polls. Shorten’s announcement came as Turnbull’s conservative Liberal-National party coalition inched closer to the minimum seats required — 76 out of 150 — to govern in its own right. However, the coalition may still need the support of independents and minor party members if votes yet to be counted contribute to it falling short of that majority. “I respect that Mr Turnbull has won government — be it a minority government or a majority of one or two seats,” Shorten said on Sunday. That was still the question as Turnbull declared victory about an hour later. With votes still to be counted, it remained unclear whether the coalition would secure a majority. With around 80% of the votes counted on Sunday, the Australian Electoral Commission had the coalition ahead in 76 seats. Turnbull had used the days prior to shore up support from crossbenchers. Three out of the five elected had agreed to back the coalition when it came to supply and confidence matters, a move that effectively ended talk of Shorten leading a minority government or Australians being forced back to the polls. “It looks like he [Turnbull] will cross the 76 seat threshold and, even if not, he has support from a couple of independents,” said John Warhurst, emeritus professor of politics at Australian National University.

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Annual trafficking report spreads dismay and relief in Asia – Nikkei Asian Review

Protesting at the US embassy in Yangon on April 28, monk asks the new Myanmar government to say that Rohingya are not citizens of the country (Photo: Simon Roughneen)

SYDNEY — The U.S. government’s latest annual Trafficking in Persons report, published on June 30, generated the usual mix of dismay and relief among countries named. In Asia, countries including Myanmar responded angrily to their downgrading in the influential rankings, which can affect their standing as U.S. trade partners among other aspects of their ties with Washington. The Philippines — despite, as the report noted, having a “significant problem” of sex trafficking — was upgraded to the top tier of countries for its efforts to counteract trafficking. The list, which this year rated 190 countries — two more than last year — includes countries which the state department says “fully meet the Trafficking Victims Protection Act’s (TVPA) minimum standards,” a level attained by only two other Asian countries, South Korea and Taiwan. The Obama administration’s “Asia pivot,” an attempt to enhance diplomatic and commercial ties with the world’s most economically dynamic region and to counter the growing sway of China, saw a thawing of ties with Myanmar. As well as relaxing most of its economic sanctions on the country, the U.S. quickly lifted Myanmar out of the bottom tier of its trafficking rankings under the quasi civilian government of former President Thein Sein. But the 2016 report saw Myanmar demoted to Tier 3, the bottom rank, alongside countries such as North Korea and Sudan.

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Australia waits on election outcome – Nikkei Asian Review

Australian Prime Minister Malcolm Turnbull speaks to members of the Liberal Party in central Sydney in the early hours of July 3. (Photo: Simon Roughneen)

SYDNEY and MELBOURNE — Australians may not know for a few days the results of their July 2 national election, following one of the tightest polls in the country’s history. Prime Minister Malcolm Turnbull expressed confidence early on Sunday morning — hours after voting ended — that he would be returned as leader after a closely fought campaign that saw a swing away from his Liberal Party-led coalition toward the opposition Labor Party. But analysts warned of the prospect of a hung parliament, in which no single party or alliance would hold an absolute majority. It was unclear by the time vote-counting was halted early on Sunday morning whether the ruling Liberal-National coalition could win the minimum 76 lower house seats it requires to form a ruling majority. Even so, Turnbull told a gathering of his party faithful in Sydney that he had “every confidence that we will be able to form a coalition majority government,” and said that despite gains for the opposition Labor Party, the opposition “has no capacity in the parliament” to lead the next administration. Turnbull’s speech came soon after rival Bill Shorten, the Labor leader, told his party in Melbourne that final results may not be known “for some days to come.” Even if Labor could not regain control of government, which it last held in 2013 before being trounced by the Liberal-National party coalition “there is one thing for sure: the Labor Party is back,” he added.

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Australia on edge after close election – Nikkei Asian Review

Voting inside Crown St. school in downtown Sydney

MELBOURNE and SYDNEY — Australians were closely watching for results of their national election on Saturday night. Counting in the eastern states suggested a swing toward the opposition Labor Party after polls closed at 6 p.m. Eastern Standard Time. But as voting continued in the country’s west, results remained unclear, raising the prospect of a hung parliament in which no party would have an absolute majority. By 11:45 p.m. Sydney time, Prime Minister Malcolm Turnbull had not arrived at a governing party post-election event held at a posh Sydney hotel. Former Liberal Party Prime Minister John Howard spoke to media at the event, saying he was disappointed at seat losses in the election, but said “it is for the prime minister to speak on behalf of the coalition” regarding the overall election outcome. For much of the protracted, 55-day election campaign, Turnbull’s Liberal-National party coalition — which stormed to power at the 2013 election — was tipped to enjoy a narrow victory. But a late surge of support for Labor in opinion polls in the final days gave opposition leader Bill Shorten, a former trade union boss, reason to be optimistic.

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Tight Australia poll may give minnows balance of power – Nikkei Asian Review

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SYDNEY – On the eve of voting Australia’s July 2 national elections looks set to produce a hung parliament, raising the prospect of a raft of smaller parties and independents winning seats, and precipitating lengthy horse-trading before a government can be formed. By June 30, almost 2.5 million people had taken part in the early voting system set up for people unable to vote on July 2. One of those early voters, David Le, a 34-year-old banker, said that “in a time when the country is stable but the main political parties are not, people are going to look for alternatives.” “In common with much of the rest of the western world, there is a general skepticism about the ethics and morality of politics, and in Australia in particular the frequent deposing of prime ministers,” said John Warhurst. “What we are seeing in the opinion polls is increased votes for the minor parties, but often that’s used to cast a protest,” Albanese, told the Nikkei Asian Review. But Albanese, the shadow minister for infrastructure, transport, cities and tourism, conceded that possible gains for smaller parties remained “one of the great unknowns” of the July 2 election. He would not be drawn on whether a strong showing for the Greens and other independents could help Labor form a coalition. “We’re aiming to govern in our own right, 76 seats, that’s the aim.” Asked if he thought smaller parties would fare as well as opinion polls suggest, Prime Minister Malcolm Turnbull said: “Tomorrow the Australian people will tell us emphatically and decisively.”

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Brexit could affect result of Australian election – Nikkei Asian Review

Shadow treasurer Chris Bowen of the Australian Labor Party speaking at press conference in Sydney on June 27 (Photo: Simon Roughneen)

SYDNEY — Most of Australia’s politicians believe that Britain’s June 23 vote to leave the European Union will have little direct impact on Australia’s resource-rich economy, but that does not mean Brexit is being ignored, less than a week before what looks set to be closely-fought national elections. Prime Minister Malcolm Turnbull made a clear effort to play down any potential fallout from the Brexit controversy on Australia’s election and the country’s ties with the U.K. Speaking immediately after the U.K. referendum result, he said the U.K.’s departure from the EU would “have little direct economic impact in the short term as 3% of our trade is with the U.K. and our financial system is not reliant upon the pound sterling. What we see, though, is some short-term volatility on our share market and in the currency market.” Speaking in Sydney on June 27, shadow treasurer Chris Bowen of the opposition Australian Labor Party said that although Brexit could see sharp swings in global financial markets, the consequences would be for the short term and relatively mild. “I would regard the impact of Britain leaving the EU as much less intensive [than] the events of 2008,” Bowen said, referring to the global financial crisis.

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