Fortnightly Review & Analysis: ASEAN, Indo-Pacific, East Asia, Japan & China (Vol 2 Issue XIV)

July 16 - 31, 2017

ASEAN

Qualifying “Malayness” in Singapore and Malaysia

Questions over what makes a person a bona fide Malay has been thrust into the limelight in Singapore ahead of upcoming presidential election reserved specially for candidates from the minority community. This has led to a squabble within the Malay community on whether those who have stepped up to run in the polls are of Melayu Asli (Original Malay) stock. Observers say the debate could hurt harmony within the Malay community, which makes up 13.4 per cent of the Lion City’s resident population of 3.93 million people. The issue surfaced because of the mixed ethnic lineage of two people who have so far declared their interest in running in the reserved election. The 62-year-old marine sector executive Farid Khan Kaim Khan is listed as a Pakistani, while businessman Mohamed Salleh Marican, 67, is an Indian Muslim.

In neighboring Malaysia, where Malays are in the majority, the question of “Malayness” is not just an occasional hot button issue – it is at the heart of national politics. Malays and tribes people on the island of Borneo together make up two thirds of the country’s 31 million people and enjoy privileges in business and education on account of the fact that they are indigenous to the country, or bumiputra (sons of the soil). Earlier this fortnight, Prime Minister Najib Razak revived the debate by suggesting the country’s one million Indian Muslims could be granted bumiputra status. While Singapore’s constitution employs an inclusive approach in defining Malays – those who consider themselves part of the ethnic group and are accepted as such by the community are accepted as bona fide Malays. However, Malaysia’s supreme law considers a person to be Malay only if he or she “professes the religion of Islam, habitually speaks the Malay language and conforms to Malay custom”.

Trump Administration Underlines Concerns on Myanmar’s Engagement with North Korea
Ambassador Joseph Yun, a Special US Envoy, visited Myanmar to underline continuing US worries over North Korean links that date back to Myanmar’s decades of military rule. The Myanmar government maintains that it has broken off the links with North Korea since the new quasi-civilian dispensation came to power in 2011. The visiting Special Envoy met Aung San Suu Kyi and the army chief Senior-General Min Aung Hlaing. A US Spokesman said that “It was an opportunity to message that any engagement with North Korea, particularly military engagement, is counterproductive to trying to end this threat that North Korea poses to the region and to the globe”. US Special Envoy’s trip to countries in the Asia Pacific region has been as a response to North Korea’s July 04 intercontinental ballistic missile.

Kyaw Zeya, permanent secretary at Myanmar’s Ministry of Foreign Affairs, insisted Myanmar no longer had military ties with Pyongyang and was complying with UN resolutions banning such links. The US State Department official say that Myanmar authorities did not explicitly deny that some vestiges of the previous North Korea relationship remained but said, “those ties are not what they were in the past.” In the past Pyongyang has been known to send missile experts and material for arms production to Myanmar.

Gen Min Aung Hlaing said that “We only have friend countries, there is no enemy country for us,” and further stated that he wished to see a nuclear-free Korean peninsula and have good relations with militaries all over the world.

Duterte Extends Martial Law to Year End

On July 22, the Philippine Congress voted to extend President Rodrigo Duterte’s declaration of martial law in the south until the end of the year to defeat Islamist gunmen. In a special joint session of the House and the Senate, legislators overwhelmingly backed Duterte’s bid to have martial law remain in force in the Mindanao region until December 31. Duterte first imposed 60-day martial rule – the maximum period allowed by the constitution – in Mindanao on May 23 shortly after the gunmen, waving the black flags of the IS group, occupied parts of Marawi. While the military said only about 60 gunmen were left in a 49-hectare area of Marawi, Duterte insisted he needed martial law powers to rebuild the city and ensure the war did not spread elsewhere. The vote was largely a foregone conclusion as Duterte enjoys majorities in both houses of Congress. But opposition lawmakers dragged out the debate, questioning why martial law was needed for the whole of Mindanao when the fighting was limited to only one city.

A slide presentation accompanying Duterte’s request compared the Marawi crisis to the IS takeover of the Iraqi city of Mosul. Marawi itself could now become a magnet for foreign fighters in Iraq and Syria, it said. Most of the militants’ leaders remain at large, the presentation added, while about 90 of the gunmen have slipped past security cordons and could link up with other armed groups in the region to mount similar wide scale attacks. At the hearing, defense and security officials justified the extended martial law, saying that aside from Marawi, Islamist militants were planning attacks in other parts of Mindanao. They said almost a thousand pro-IS militants, holding 23 hostages, were still active elsewhere in the south. The issue of martial law remains sensitive in the Philippines, decades after the late dictator Ferdinand Marcos put the country under military rule for part of his 20-year term.

Southeast Asian States Vow Cooperation on ‘Growing’ Militant Threat

Representatives from four Southeast Asian nations, Australia and New Zealand met in the Indonesian city of Manado on July 29 to develop a response to the increased danger posed by IS, highlighted by the ongoing battle to occupy the southern Philippines city of Marawi by militants owing allegiance to the group. The battle has sparked alarm that as IS suffers reversals in Iraq and Syria, it is seeking to create a stronghold in the region, buttressed by Southeast Asian fighters returning from the Middle East and other militants inspired by the ultra-radical group and the Marawi conflict. The meeting was co-hosted by Indonesia and Australia. The other participants were Malaysia, the Philippines, Brunei and New Zealand.

Describing the regional threat from Islamist militants as growing and rapidly evolving, a joint statement by the participants called for enhanced information sharing, as well as cooperation on border control, de-radicalization, law reform and countering Islamists’ prolific use of social media to plan attacks and lure recruits.

Indo-Pacific

China& Philippines Discuss Joint Exploration in the South China Sea

Chinese Foreign Minister Wang Yi and his Philippine counterpart, Foreign Affairs Secretary Alan Peter Cayetano, held discussions on joint exploration in South China Sea at Manila on 25 Jul 17. Cayetano said the two countries must work together to safeguard peace and ensure stability in the South China Sea. He also stressed the need to cultivate a peaceful environment in the South China Sea. The Chinese foreign minister said that in waters where there is overlapping of maritime rights and interests, if one party goes for unilateral development, the other party will take the same actions, and that might complicate the situation. That might lead to tensions, and as the result, nobody might be able to develop the resources, Wang said. Earlier President Duterte, in his second State of the Nation Address on 24 Jul 17, said that the West Philippine Sea issue is a matter that has to be tackled “sooner or later.” When asked to elaborate on his statement, Duterte said the two countries’ joint exploration activities may be similar to a “joint venture”. The Foreign Affairs Secretary, Alan Peter Cayetano, also gave an assurance in a press briefing that the Philippines will not lose even a “single inch” of territory to China if ever it proceeds with its joint exploration deal, and added that any agreement would be in conformity with the Constitution and laws of the Philippines.

China is very clearly exploiting the current Filipino President’s enchantment with the Asian giant’s investment wherewithal to douse any embers of Filipino resentment in the ongoing dispute and lay the ground for future assertions of its claims. Any joint exploration will provide China with huge leverage as the Philippines has neither the technical capability nor the financial muscle to back such a joint exploration venture. While the Philippine government is obviously concerned about a domestic backlash to any such deals with China in the current scenario, the President’s statements make it clear that the administration is slowly inoculating his domestic constituency towards acceptance of an increasing Chinese role in the development of the Philippines. It is therefore only a question of ‘when’ rather than ‘if’ China encloses the Philippines in its economic embrace as it attempts to assert its claims in the South China Sea.

Russia – China ‘Joint Sea 2017’

The Russian and Chinese navies conducted a joint exercise code-named "Joint Sea 2017" from 22 - 28 July 17 in the Baltic Sea. The Chinese fleet consisted of one destroyer, one frigate, one supply ship, ship-borne helicopters and marines while the Russians fielded a frigate, fixed-wing aircraft, helicopters and marines. The exercise involved two tactical assault groups, consisting of mixed warships from the Chinese and Russian fleets, which conducted a string of joint exercises, including ship-to-sea firing by secondary guns, air defense, landing and inspection, maritime search and rescue, dry cargo replenishment and shipwreck relief. On completion of the exercise, both the participants took part in a fleet review in St Petersburg on 30 Jul 17.

The bilateral naval exercise between the two countries is an annual feature which is conducted in both the Baltic Sea as also in the Pacific Ocean. It represents the increasing military cooperation between the two countries which goes beyond just military sales. The scale of the joint naval exercise over the past two years has seen increasing complexity in the type of drills conducted showing the high level of understanding as also interoperability between the two navies. Such cooperation creates the impression of a possible alignment in the strategic outlook of the two countries. India needs to guard against such a possibility, especially as it concerns its most reliable strategic partner, Russia.

The Koreas

North Korea: Second ICBM Test

North Korea conducted another Inter Continental Ballistic Missile Test (ICBM) this month on July 28 after an earlier one on July 4. South Korea’s Joint Chiefs of Staff said the test launch reached an altitude of about 3,700 kilometer, which is almost 1,000 kilometer higher than the July 4 test. Overall the North Korean flight data was similar to assessments by the US, South Korea and Japan. David Wright, a physicist and co-director of the global security program at the Union of Concerned Scientists, said that if reports of the missile’s maximum altitude and flight time are correct, it would have a theoretical range of at least about 6,500 miles. That means that a wide swath of the US, including Los Angeles and Chicago are now in range of North Korean weapons, depending on variables such as the size and weight of the warhead that would be carried atop such a missile in an actual attack. Further, earlier this fortnight the Washington Post reported that as per new assessments by US officials, there is great worry of North Korea being able to launch a nuclear-capable ICBM as early as next year. Meanwhile, the US in response flew two B-1B bombers over the Korean peninsula in a show of force. The US Missile Defense Agency also mentioned that a Terminal High Altitude Area Defense, or THAAD, system located in Kodiak, Alaska, had been successfully tested.

The US Ambassador to the United Nations, Nikki Haley, stated that the US is dropping efforts to work with China on a new UN Security Council resolution against North Korea following Pyongyang’s latest missile test. She suggested Beijing will need to take up any further diplomatic challenges aimed at shutting down North Korea’s nuclear weapons program. Haley’s comments represent a U-turn after she announced earlier this fortnight she was seeking China’s support for a new resolution aimed at isolating North Korea. The change in tack follows a similar change in tone from Donald Trump who lambasted the Chinese government for doing too little to rein in its neighbour and traditional ally. Beijing has been cautious about squeezing North Korea too hard given concern it could spark a messy collapse of his regime and a refugee crisis on China’s border. It also worries that such a development could lead to a beefed-up US military presence in the area.

South Korea: Moon’s Turn About on North Korean Policy

South Korean President Moon Jae-in, called for the relaxation of limits on its missile arsenal, hours after the North conducted another ICBM test. South Korea needs approval from the US to build more powerful missiles under the terms of their bilateral security treaty. The requested new missiles, in addition to being able to strike deep into the North, would also pressurize China to restrain Pyongyang because the missiles would be able to hit Chinese territory as well. Most notably, Moon also ordered his aides to immediately begin consultation with the United States to "temporarily" deploy four additional launchers of the THAAD system. The order was issued during an emergency National Security Council (NSC) session, presided over by the President. The order was considered a surprise as Moon had pushed back the deadline by introducing stricter environmental reviews on the site to ease the concerns of locals, who expressed fears over rumoured health hazards linked to the system's radar. Also earlier during his election campaign, Moon had said that Seoul should reconsider the THAAD deployment because it angered China, South Korea's biggest trade partner, which sees the system as a security threat.

On July 6, Moon had reaffirmed his commitment to dialogue in a speech in Berlin days after the July 4 test launch by North. He then came back to Seoul to propose military and Red Cross talks between the rivals. But the North kept ridiculing Moon's comments and ignoring his talk proposals before conducting its second ICBM test. A combined live-fire exercise also took place near the East Sea on July 29 morning between the Korean Army and the Eighth US Army (EUSA), during which the former fired two Hyunmoo-2A ballistic missiles and the latter launched two missiles from the Army Tactical Missile System (ATACMS). The US also flew two B-1B bombers under the command of US Pacific Air Forces to the Korean Peninsula.

Japan

Japan’s Economy Show Signs of Recovery

Japan's factory output rose in June, while unemployment fell to 2.8 percent, as a recovery in global demand helped drive growth in the world's third-largest economy. The Japanese Ministry of Economy, Trade and Industry (METI) reported on July 31 that factory production in June rose 4.9 percent over a year earlier and 1.6 percent from the month before. Consumer demand in Japan picked up in June with the payment of half-yearly bonuses. Labor conditions were tight, with the number of job offers to applicants at a 43-year high of 1.51. But inflation, which was reported earlier, remained flat. METI said output growth was driven primarily by production of transport equipment, chemicals and electric machinery. Major drags on overall production came from the electronic parts and devices, other manufacturing and iron and steel segments.

The relatively upbeat data are a rare piece of good news for Prime Minister Shinzo Abe's administration as it weathers a dip in public approval ratings amid allegations over nepotism and abuse of influence. In its updated World Economic Outlook earlier in July, the IMF too cited its expectations of slightly higher growth in Japan this year to 1.3 percent from a forecast of 1.2 percent in April, citing stronger first-quarter growth buoyed by private consumption, investment and exports. Its forecast for Japan's 2018 growth was unchanged at 0.6 percent.

GSDF Chief Resigns, Defense Minister to Step Down over South Sudan Allegations

South Sudan controversy started in December 2016, when the Japanese Ministry of Defense said it could not fulfill an information disclosure request for logs covering the Ground Self Defense Forces’ (GSDF) activities in July 2016 because the logs had been discarded. The logs allegedly described tense situations in the fledgling African country and their disclosure at the time could have adversely affected the government's push to continue the troop deployment and assign a new, and possibly riskier, security role during the UN mission. Later the ministry reversed its explanation in February saying that the information had been found on a computer of the Self-Defense Forces (SDF) Joint Staff Office, and it would disclose a part of it. But speculations were rife that top SDF officials reportedly already knew that the GSDF had the data from the beginning.

The report by the Inspector General’s Office of Legal Compliance (IGO) was announced on July 28. Though Defense Minister Tomomi Inada was cleared of involvement in the alleged cover-up of the existence of daily activity logs of Japanese troops in South Sudan, she stepped down the same day. Inada, an Abe protégé who shared his conservative views and had been suggested as a possible future premier, had already been expected to be replaced in a likely cabinet reshuffle in early August to help Abe rebuild his ratings. Foreign Minister Fumio Kishida will now double as defense minister. GSDF Chief of Staff General Toshiya Okabe prior to the release of the IGO report had already indicated of his intention to resign and take responsibility. Okabe became GSDF head in July 2016 after serving as commander of the Northern Army. He was considered a favored candidate to succeed Admiral Katsutoshi Kawano as Joint Staff chief of staff, the highest uniformed officer in the SDF.

Entry into Force of the India-Japan Nuclear Cooperation Agreement

The exchange of diplomatic notes for the entry into force of the “Agreement between the Japan and the India for Cooperation in the Peaceful Uses of Nuclear Energy” took place in New Delhi, India on July 20 between Mr. Kenji Hiramatsu, Japanese Ambassador to India, and Dr. Subrahmanyam Jaishankar, Foreign Secretary, Ministry of External Affairs of the Republic of India. Accordingly, pursuant to the provisions, the agreement entered into force on July 20, 2017. This Agreement was signed at Tokyo on November 11, 2016, and was approved in the Japanese Diet on June 7, 2017. The Nuclear Cooperation Agreement provides the necessary legal framework for the realization of cooperation between Japan and India in the field of the peaceful uses of nuclear energy.

China & Taiwan

7th Meeting of BRICS High Representatives for Security Issues at Beijing

On 28 July 2017, the 7th meeting of Brazil, Russia, India, China and South Africa (BRICS) representatives for security issues was held in Beijing. Chinese State Councilor Yang Jiechi chaired the meeting and representatives from South Africa, Brazil, Russian and India were present at the meeting. Yang Jiechi highlighted the role played by the BRICS countries in political security. Xi Jinping held a group meeting with the representatives.

On the sidelines, Yang Jiechi met the representatives of South Africa, Brazil and India separately. He exchanged views on bilateral relations, international and regional hotspot issues and multilateral affairs, and expounded China's principle and stance on relevant bilateral issues and major issues. Amongst all, the ‘one-on–one’ meeting between Indian National Security Advisor Ajit Doval and his counterpart is the most important one. India and China are embroiled in a stand-off at the Doklam area and both the leaders are special representatives of the India-China border mechanism. According to Xinhua, during the meeting “bilateral issues and major problems” were discussed. Possibly, the stand-off at Doklam between Chinese and Indian troops was discussed. This was the first high-level meeting since the India-China standoff at the Doklam area and gave both sides an opportunity to discuss the issue face to face.

Xi Jinping Inspects Parade to Mark the 90th Anniversary of the People’s Liberation Army

China held a military parade to mark the 90th anniversary of the People’s Liberation Army (PLA), which was founded on 1 August 1927. Xi Jinping wore his army uniform, as commander in chief of the PLA and inspected the parade from the back of a jeep. More than 12,000 service personnel from the army, navy, air force, armed police as well as the newly formed rocket force and strategic support troops, took part in the parade at Zhurihe military training base. In his speech during the event, Xi Jinping reviewed the PLA’s history of development and urged them to build the PLA into an elite military force capable of defending itself and ensuring world peace.

The parade showcased the actual combat capability, confidence and strength of the Chinese army. It was the first time for China to commemorate Army Day with a military parade since 1949 and also the first time Xi Jinping reviewed troops in the field. Officially, the parade was to celebrate the 90th Anniversary of the PLA but it also highlighted Xi Jinping consolidated authority over the PLA. On the other hand, it also demonstrated PLA’s pledge towards Xi Jinping. In 2015 September, China held a massive parade to commemorate the 70th Anniversary of the Second World War where Xi Jinping announced a reduction of 300,000 troops and other high-level organisational changes to the PLA. However, this year Xi Jinping did not make any major policy announcement related to the PLA’s organisation.

Live Fire Drills in Tibet
The PLA conducted live-fire exercises in Tibet. The exercise was conducted by a ground combat brigade of the PLA Tibet Regional Command and involved scenarios such as rapid deployment, multi-unit joint strike and anti-aircraft defence. The PLA Tibet command guards the Line of Actual Control of the India-China border along several sections connecting the Tibetan region. Additionally, in June, China had tested a light battle tank near the Indian border and on 10 July, Tibet’s mobile communication agency conducted a drill in Lhasa. The members of the agency practiced setting up a temporary mobile network to secure communications in an emergency. The exercise was essentially defensive.

The exercise effectively tested the brigade’s joint strike capability on the plateau. The exercises are an attempt to reassure the Chinese population about the combat readiness of its troops and restore their confidence in Chinese troops. The drill aims to pass on the message that China is prepared for a war and they are ready to prevent an actual battle.

First US-China Comprehensive Economic Dialogue

The first US-China Comprehensive Economic Dialogue (CED) was held in Washington. The US Secretary of the Treasury Steven Mnuchin, US Commerce Secretary Wilbur Ross and Chinese Vice Premier Wang Yang participated in the dialogue. The dialogue ended in a dead lock with no joint statement, no media briefing and no new announcements.

The CED was established by President Trump and President Xi in April 2017 to enable the two countries to address trade and investment issues. It is one of the four mechanisms set up by the two leaders. In April, US-China launched a 100–day action plan to improve trade relations. The action plan was initially successful. China received its first shipment of beef in 14 years and assured to buy US liquefied natural gas and open its financial service sector to US companies. Eventually, the US turned critical, as China failed to provide assistance in combating the nuclear threat from North Korea. Earlier, Donald Trump had tweeted, “While I greatly appreciate the efforts of President Xi & China to help with North Korea, it has not worked out.”

Although there was no joint statement, reportedly, the US asked China to do more to reduce its trade surplus with the US and open its market for agriculture, financial services and data flows. A statement issued by the Chinese delegation only said both sides would promote cooperation in the manufacturing sector, improve communication about macro-economic policies, as well as cooperating in the financial sector and its supervision.The reason for the deadlock is not clear. Apparently, the US-China relations are entering rough patch as is evident in the deadlock.

The US Backs Taiwan’s Observer Status at the World Health Assembly

The U.S. House of Representatives introduced a bipartisan bill, proposing to restore Taiwan’s status as an “observer” at the World Health Organisation (WHO) and at the annual meeting of the World Health Assembly (WHA). The bill is aimed at improving U.S. efforts to ensure Taiwan’s participation in the WHO and WHA. Earlier, at the 70th session of the WHA, Taiwan was denied membership as the permanent observer. Taiwan is not a United Nation member but had been a WHA observer since 2009. In 2009, under the Ma Ying- jeou government (KMT), Taiwan was granted observer status at the WHA on accommodations from China as cross-strait relations were warming. China has often hindered Taiwan’s participation in the international organisations like the International Civil Aviation Organisation and WHA.

This is the second major step taken by the US in a month to strengthen US-Taiwan engagement. Last fortnight, the US State Department announced the arms sales package worth USD 1.4 billion to Taiwan. The Taiwan Relations Act (TRA) of 1979 is the cornerstone of US-Taiwan relationship. The issue of Taiwan is one of the primary areas that affect US-China relations, by supporting Taiwan’s in WHA; the US is trying to signal that the US-China relationship is not going to be smooth.