SINGAPORE — More than 300 people have been diagnosed with the Zika virus in Singapore this year, while the figure for Thailand has reached 200. Though the numbers of Zika cases in other Asian countries remain in the single digits, outbreaks in these two trade and tourism hubs could take a heavy economic toll. Such impacts are already being felt in Latin America. The spread of Zika there has resulted in around 1,800 cases of microcephaly, and the World Bank estimates that Zika could result in losses of around $3.5 billion to Latin American economies, or 1% of gross domestic product in tourism-dependent ones. In Asia, the main impact is likely to be felt in Singapore, which will host a Formula One Grand Prix race from Sept. 16-18. The event attracts not only regional motor sports fans but also corporate guests attending business meetings during the race week. The current Zika outbreak is the first ever in the city-state. Though it has not sparked any panic yet, the rapid spread of infection has reminded many residents of the SARS crisis of 2003, which saw economic activity contract 4.2% in the second quarter of that year. China, Singapore’s biggest source of tourists, issued an alert on Sept. 7 urging visitors to Zika-affected countries to take precautions against mosquito bites.
JAKARTA — Maritime piracy attacks in Asia fell by more than two-thirds in the first half of 2016 compared to a year ago, suggesting that regional efforts to reduce the number of incidents are making headway amid a global decline in the number of ships seized or ambushed. Even so, Indonesia remains a hotspot that in the first half of the year saw about one quarter of all piracy attacks reported worldwide take place in its waters. In addition, the waters between Malaysia and Indonesia remain dangerous because of kidnappings by the Abu Sayyaf terrorist group, which recently executed two Canadian hostages and is holding at least 10 more for ransom. “A search on our database shows 141 incidents [worldwide] this year until Sept. 5,” said Natasha Brown, an official at the International Maritime Organization, a United Nations agency. There were 223 incidents in the comparable period of 2015, indicating “a downward year on year trend,” Brown told the Nikkei Asian Review. The International Maritime Bureau, part of the International Chamber of Commerce, also reported that pirate attacks were down significantly in 2016 compared with a year ago, with only 98 attacks worldwide in the first six months of 2016 — the lowest in 21 years.
JAKARTA — The Indonesian government is requiring individuals or entities that want to take part in its new tax amnesty program to dissolve any shell companies they own overseas. The move comes as the central bank warned that assets declared and repatriated under the amnesty will fall short of targets. The new finance ministry decree, containing the latest technical details of the tax amnesty law, says that if the person only partially owns an overseas shell company then they must relinquish their stake in the relevant country. They are also given an option to relocate the company to Indonesia and register it as a local entity. “This regulation is for special purpose vehicles […] that don’t actively run businesses,” said Astera Primanto Bhakti, a Finance Ministry official. The tax office estimates that there are at least 2,500 offshore companies whose assets actually belong to Indonesians, but which were not declared as such. The majority of these companies were allegedly established to evade Indonesia’s tax laws.
JAKARTA — Concern is growing in Asia about the spread of the Zika virus, with a recent outbreak in Singapore followed by cases in Malaysia, the Philippines, Thailand and Vietnam. There is no vaccine or treatment for the virus, which usually causes only mild fever, rashes and red eyes in infected adults but can lead to a birth defect called microcephaly if a pregnant woman is infected. The spread of Zika in Latin America has led to about 1,800 cases of microcephaly and resulted in several prominent athletes refusing to participate in the recent Olympic Games held in Brazil. In February, the World Health Organization declared Zika, which can be spread sexually but is mostly mosquito-borne, a global public health emergency. In Asia, the threat of the virus spreading around the region is causing concern for hundreds of millions of people already on guard against dengue, malaria and other conditions spread by the same mosquitoes that carry Zika. With almost 300 Zika cases reported in recent weeks in Singapore, a trade hub and city-state that is home to significant migrant worker populations from across Asia, the fear is that Zika will spread rapidly throughout the densely populated region.
JAKARTA – Unlike the imposing and often inaccessible buildings of the European Union in Brussels, ASEAN’s low-rise offices sit in the shadow of a partly constructed overhead railway in the southern part of Indonesia’s traffic-clogged capital. Nine months after the group’s 10 members established the ASEAN Economic Community, which aims to promote the free movement of goods, services, capital and labor, the headquarters symbolizes both ASEAN’s aspirations and its limitations. The EU was previously known as the European Economic Community, but ASEAN’s adoption of the “community” moniker does not mean it will emulate Europe’s radical, sovereignty-pooling measures, such as a common currency, central bank and free movement of labor. “The appetite to surrender sovereignty simply is not there,” said Jayant Menon, lead economist at the Asian Development Bank in Manila. “I don’t see a single currency coming into play in ASEAN, and I don’t see that as a bad thing.”
JAKARTA — Measures to boost Indonesia’s relatively small Islamic finance sector could help the government implement an ambitious infrastructure modernization program across the 13,000-island archipelago, according to the country’s recently appointed finance minister. A week after she was appointed finance minister by President Joko Widodo in a cabinet shake-up, Sri Mulyani Indrawati described Indonesia’s infrastructure development needs as “huge.” Indrawati was speaking at the World Islamic Economic Forum in Jakarta. After taking office in late 2014, Widodo pledged to improve Indonesia’s notoriously rickety infrastructure by building or improving dozens of ports, airports, power plants and roads. Total spending could reach around $500 billion — equivalent to more than half the country’s gross domestic product — an outlay that the government says it cannot fund alone. “I am sure there is the potential to develop instruments for financing based on Shariah (Islamic law), we will look at this, the need is there,” said Indrawati, who resigned from a senior World Bank role to rejoin the Indonesian government.
JAKARTA — Sri Mulyani Indrawati, Indonesia’s new finance minister, said on Wednesday that 133.8 trillion rupiah ($10 billion) will be cut from government spending this year in anticipation of a widening shortfall in tax revenue. The former World Bank Group managing director, who also served as finance minister from 2005 to 2010, was brought back into cabinet a week ago. “The President’s theme is strengthening credibility, confidence, and trust,” Indrawati told reporters on Aug. 3 following a meeting with President Joko Widodo and his economic ministers. A day later, speaking to reporters at the World Islamic Economic Forum in Jakarta, Indrawati said the finance ministry should use “all tools to improve the business climate”. “Job creation is not coming from the government — it is from the private sector,” the minister said.
JAKARTA — After deteriorating during the early part of President Maithripala Sirisena’s tenure, Sri Lanka’s relations with China appear to be on firmer footing as both sides continue to iron out differences over Chinese investments in the island country. “In most of the cases, we found we got better terms,” Kabir Hashim, Sri Lanka’s minister of public enterprise development, told the Nikkei Asian Review. He added that a few more Beijing-backed projects are currently under review. “In some cases we renegotiated the loans, in some cases the contracts had legal issues, which we cleared up,” Hashim said, without going into detail about specific projects. Under the previous president, Mahinda Rajapaksa, Sri Lanka forged close relations with China as Beijing’s economy boomed and China’s overseas economic reach grew rapidly during Rajapaksa’s decade in office from 2005.
JAKARTA — With investigations ongoing in several countries into the international financial activities of scandal-plagued state development fund 1Malaysia Development Berhad, Malaysian Prime Minister Najib Razak slammed “foreign intervention” as a threat to stability in peaceful Muslim-majority countries such as Malaysia and Indonesia. “We have seen the devastating results of foreign intervention in the Muslim world, often based on incomplete, wrong or partisan information,” Najib said, citing the U.S. invasion of Iraq in 2003 and the Arab Spring a decade later, a series of anti-government uprisings in Egypt, Libya, Syria and Tunisia, some of which had U.S. support. Najib has been under pressure over allegations that around $731 million received from 2011 to 2013 was diverted from 1MDB into his personal bank account in 2013 — a charge that Najib has denied, saying the money came from an unnamed Saudi Arabian donor.
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.