A Vietnam Syndrome for Burma? – The Irrawaddy
December 21st, 2010
http://www.irrawaddy.org/highlight.php?art_id=20355
HANOI—One thousand years old this year, Hanoi’s streets remain decorated with thousands of the gold-starred red flags of the resistance. Nominally a socialist republic, the country’s economy has in fact adapted the post-Deng economic model of China, applied with a Vietnamese touch.
Looking across the Red River, Hanoi. (Photo: Simon Roughneen)
Now a focus for Western investors such as Intel, Boeing, Microsoft, Apple and many more, Vietnam has seen spectacular economic growth since the Đổi Mới system was introduced, and particularly since the normalization of relations with the US in 1995. Membership of the World Trade Organization came in 2007, another boost for the latest addition to Asian Tiger ranks and adding to the growing incentives for foreign multinationals to invest.
According to economist Suiwah Leung, “During the last two decades, the country has had an average FDI/GDP ratio of 5.9 percent; the highest among many Asean countries during their respective periods of rapid growth from the mid-1970s to mid-1990s.”
In his August 2009 meeting with Burma Prime Minister Thein Sein, US Sen. Jim Webb, who fought in the Vietnam War and has worked on America’s relations with Asian countries for many years, said that the Vietnam experience was one that Burma could look to. (more…)
Thai films: in need of a (tax) break
December 8th, 2010
http://blogs.ft.com/beyond-brics/2010/12/08/thai-films-in-need-of-a-tax-break/
Despite the help of Aung San Suu Kyi and Bill Clinton, the Thai film industry is struggling. Luc Besson’s Dans la Lumiere – a biopic about the life of Aung San Suu Kyi, the Burmese opposition leader – is being filmed in Thailand and Clinton passed through to shoot a cameo role in the Hollywood movie The Hangover II, part of which is set in Thailand.
However, the celebrity support has not stopped a decline in Thai film-making, with producers going elsewhere in the region for their locations and tax-breaks. (more…)
Tough on graft, kind of – The Diplomat
December 8th, 2010
http://the-diplomat.com/2010/12/08/asia-gets-tough-on-graft-kind-of/
Thursday marks UN Anti-Corruption Day. There’s plenty of it to be worried about, reports Simon Roughneen from Bangkok.
Despite the supposed global nature of the economic crisis, a number of countries in Asia have managed to maintain robust enough growth rates to make the whole thing feel more like a Western story. But while the resource sector in energy-hungry China and the construction sector boom of new roads and high-rise buildings across the continent suggest the region should be well on its way to slashing poverty, there’s a potentially major obstacle to continued rapid growth: these booming sectors are chronically corrupt.
Speaking at the recent International Anti-Corruption Conference in Bangkok, Prof. Paul Collier said that increased corruption could undermine the opportunity for many of the about 900 million Asians living on less than $1.25 a day to climb out of poverty. ‘Commodities and construction are the two most corrupt sectors on earth,’ said Collier, a professor at Oxford University and author of The Bottom Billion.
Export worries after Thai rate rise – Financial Times
December 3rd, 2010
http://blogs.ft.com/beyond-brics/2010/12/03/export-worries-after-thai-rate-rise/
When Thailand’s central bank governor, Prasarn Trairatvorakul, was appointed in July, he said that the country’s interest rate would be lifted to 2 per cent from 1.25 per cent by the end of the year. So, from a longer-term perspective, Wednesday’s surprise interest rate hike should have been expected.
But the move did cause a stir. It represented a hedge against inflation concerns: prices rose 2.8 per cent in November, making real interest rates are negative. However, given that low interest rates haven’t deterred an influx of foreign capital into Thailand, the government fears that higher rates will push up the currency even further – hurting exports.
“We are concerned about the impact from the rate increase at a time when the economy has started to slow down,” said finance minister Korn Chattikavanij. The IMF expects Thai growth to be 7.5 per cent this year, led by strong exports, before slowing to 4 per cent in 2011. (more…)
Why Thailand invests in Burma – Financial Times
December 3rd, 2010
http://blogs.ft.com/beyond-brics/2010/12/02/why-thailand-invests-in-burma/
There is some confusion over whether Thailand or China is the biggest source of foreign investment in Burma. But it’s clear that Thai interest is gathering pace: the Saha Group is the latest Thai cash-rich business to enter the hermetic south-east Asian country, announcing a plan to open 25 stores there by 2012.
And Burma offers more than just a untapped market. For Thai businesses, the country also offers respite from the environmental and other corporate standards that exist at home.
The Thai prime minister, Abhisit Vejjajiva, heard as much last month, when he visited the Map Ta Phut industrial estate (pictured), in south Thailand. Seventy-six projects on the estate remain closed, after a court ruling regarding residents’ complaints about leukemia and cancer rates in the area. A business lobby group is unhappy – and handed Abhisit a letter, outlining its grievances over the government’s handling of the case.
Compare that to Burma. where there’s little chance of a court intervening so forcefully. (more…)
Surprise Thai interest rate hike – Financial Times
December 1st, 2010
http://blogs.ft.com/beyond-brics/2010/12/01/snap-surprise-thai-rate-rise/#more-161051
Central bankers like to keep the markets guessing and the Bank of Thailand is no exception. In a surprise move it raised its key interest rate by 25 basis points on Wednesday to 2 per cent and hinted at more increases to come.
Following two earlier quarter-point hikes in the summer, the move hardly comes as a big shock but it signals that officials are somewhat more concerned about inflationary risks than they were three months ago – and than investors had thought. The Thai bhat rose on the news and later traded 0.43 per cent up on the US dollar at 30.04.
Wellian Wiranto, HSBC Southeast Asian economist based in Singapore, told beyondbrics that the move “was a surprise to us”. (more…)
Chinese walls in Hong Kong – ISN
November 16th, 2010
In the run-up to the Communist Party plenum which ended 18 October, there was much anticipation that the authoritarian-ruled economic giant would announce some new political departure – especially after Prime Minister Wen Jiabao intimated in the weeks leading up to the conference that some reform might be necessary to maintain the ruling party’s legitimacy. Wen told CNN in a 7 October interview that China “should not only let people have freedom of speech” but “must create conditions to let them criticize the work of the government.”
Hong Kong's skyline at night (Photo: Simon Roughneen)
These astonishing comments perhaps generated more enthusiasm than was appropriate, and for China watchers the eventual conference outcome was a disappointment – though perhaps no surprise given the government’s shrill reaction to the awarding of the 2010 Nobel Peace Prize to jailed dissident Lia Xiaobo, whom Beijing regards as a criminal. (more…)
ASEAN sups with Chinese ‘devil’ – Asia Times
November 3rd, 2010
HANOI – China’s rise has altered the dynamics within the Association of Southeast Asian Nations (ASEAN) and across Asia, as was on display at recently concluded
US Secretary of State and Vietnamese Foreign Minister witness signing of Boeing-Vietnam Airlines deal (Photo: Simon Roughneen)
summits meetings in Hanoi. Chinese naval expansion and increasingly assertive claims to disputed maritime areas in the East and South China Seas has prompted Japan, South Korea, Vietnam and others to reaffirm their enthusiasm for America’s security umbrella after some ambivalence in recent years.
Japan and India, China’s main Asian rivals, are increasingly looking to each other, and to Southeast Asia, as a hedge against China’s rise, which has taken a hard turn in recent months. Prime Ministers Naoto Kan and Manmohan Singh met after the Hanoi summits, which were overshadowed by the mud-slinging coming from the Chinese and Japanese delegations.
“Prime Minister Kan was keen to understand how India engages China,” India’s foreign secretary, Nirupama Rao said after that meeting. As well as increasing ties with Japan, India’s slow-to-action ‘Look East’ policy, which has brought the self-proclaimed world’s largest democracy into disrepute over its feting of the Myanmar junta, is likely to be enhanced in coming years, as highlighted in the statement issued after the India-ASEAN summit. (more…)
Intel’s new Vietnam plant showcases Asia’s rise – Sunday Business Post
October 31st, 2010
http://www.sbpost.ie/news/world/intel-deal-highlights-vietnams-rise-52584.html
Simon Roughneen in Hanoi – Like much of Asia, Vietnam’s economy is vaulting clear of the global slowdown, with growth for 2010 projected to beat the 5% recorded last year, and the opening of what is computer chip maker Intel’s largest plant highlights the country’s emergence as an investment target for multinationals.
Intel president and chief executive Paul Otellini joined Vietnam’s Deputy Prime Minister Hoang Trung Hai at the opening, with Hai saying the new facility “supports our goal of accelerating economic transformation led by technology-intensive industries”.
Lenin statue in central Hanoi (Photo: Simon Roughneen)
While the new Vietnam operation will not directly affect Intel’s Irish base in Leixlip, it highlights the longer-term challenges posed to smaller, inward-investment oriented western economies, by lower-cost emerging economies in rapidly-growing Asia, particularly as education and income levels increase. Intel recently announced record global quarterly revenues of €7.95billion, driven partly by growth in emerging markets, the company said. (more…)
Tapping into the summit drip-feed – RTÉ World Report
October 31st, 2010
http://www.rte.ie/news/player.html?worldreport#programme=World%20Report
Hands over cameras and ‘back-off’ glares and growls made it a drip-feed for journalists in Hanoi covering the Asia-Pacific meetings over the past few days.
Hillary Clinton arrives in Hanoi for the East Asia Summit (Photo: Simon Roughneen)
There was plenty happening however, even if information was slow to come out. Stakes were high, with the US and China clashing over a number of long-running issues, such as the value of the Chinese renminbi, control of the South China Sea, North Korea, and more recently, Japan.
Arriving late to the show, American Secretary of State Hillary Clinton was on the end of Chinese anger once more, with Beijing claiming she took Japan’s side in a territorial dispute over a group of islands in the East China Sea. China recently overtook Japan to become the world’s second biggest economy, behind the United States.
This comes after China and Japan clashed over Tokyo’s arrest of Chinese sea captain near the islands, which prompted street protests and threats to boycott Japanese businesses in China. Beijing then stopped exports to Japan of so-called rare earth minerals, which are vital to the production of hi-tech communications and electronic goods. China currently dominates the world market in rare earths, meaning that Japan, and other countries, may seek alternative sources.
One possibility is summit host Vietnam, which Japan says has some of the minerals underground. The Hanoi Government, like many others in southeast Asia, is doing its best to balance between the US and China. Though economically-linked to and in some ways dependent on China, Vietnam has moved closer to the US in recent months, with the former enemies now sharing naval intelligence. (more…)
