Oct 1-15, 2017

ASEAN

Myanmar Peace Process - An Update

Myanmar Army chief Snr-Gen Min Aung Hlaing urged all of the country’s ethnic armed groups to sign the nationwide ceasefire agreement (NCA) in a speech on 15 October marking the second anniversary of several groups. The number of NCA signatories has not increased since an initial eight ethnic armed organizations (EAOs) signed the accord two years ago. More than a dozen EAOs—some of whom helped draft the NCA—have shown little interest in signing the pact. Meanwhile, clashes continue in Myanmar’s northeast involving the Ta’ang Nationalities Liberation Army, Arakan Army, and Kokang’s Myanmar National Democratic Alliance Army—all of whom the Tatmadaw refuses to accept as peace partners. Daw Aung San Suu Kyi, who heads the National Reconciliation and Peace Center that the government was “ready to welcome” non-signatories to the NCA. The next peace conference is slated to be held in November 2017.

Rohingya Issue acquires another Dimension

Ethnic Arakanese, largely Buddhists who form the majority in central parts of the state, have formed committees in several districts that have enforced some restrictions and penalties against the Rohingyas. It is also being said that about 250,000 Muslims living in central Rakhine, an area not directly affected by a military offensive against militants who attacked security forces in the northern part of the state in late August, have been facing many kind of difficulties. For instance, local Buddhists have set up committees that have prohibited communications with the Muslims, ostensibly to prevent conflict.

UN Secretary-General Antonio Guterres has said that “The failure to address this systematic violence could result in a spillover into central Rakhine, where an additional 250,000 Muslims could potentially face displacement. They are outnumbered by Rakhine communities, some of whom have engaged in violent acts of vigilantism against their Muslim neighbors.”

Duterte Orders Police halt Anti-drug Operations in Philippines

Amidst falling ratings and unprecedented scrutiny of police conduct, Philippines President Duterte issued a memorandum on October 10 ordering police to “maintain police visibility, as a deterrent to illegal activities”, while restricting operations to the Philippine Drug Enforcement Agency (PDEA) “as sole agency”. This was “to bring order to the operation against illegal drugs, thus pinpointing precise accountability”, the document said. The order could blunt the intensity of the crackdown, since the drug enforcement agency has only a fraction of the manpower of the 190,000-strong police. Duterte’s war on drugs has been controversial from the very beginning, since it allegedly involved the extrajudicial killing of suspected drug peddlers and users. The anti-drug operation (Oplan Tokhang) has already killed 7,000 persons, but some human rights groups speculate that the number of drug-related killings could reach 12,000 if one includes the unreported cases. In August 2017, there was tremendous public outrage when the CCTV footage post-killing of a 17-year-old student by the police during a Tokhang-related arrest in Manila came to light showed the teenager being dragged by the police.

According to the latest Pulse Asia survey report released on October 13, Duterte’s overall approval stood at 80 percent and trust ratings at 80 percent. The survey results contrasted with the Social Weather Stations survey released on October 15 that said Duterte’s approval ratings plunged to 48 percent from 66 percent in June, while his net trust rating fell to 60 percent from 75 percent. Post the new memorandum, National police chief Ronald dela Rosa said police could now focus efforts on catching mysterious gunmen who were assassinating drug users, to disprove allegations by human rights groups that police were behind such killings. Police say they have killed 3,900 people in their anti-drugs operations over the past 15 months and deny allegations by activists that many of those were executions.

Thailand to hold Elections in 2018

Earlier this fortnight, Prime Minister Prayuth Chan-ocha became the first prime minister of Thailand to visit the White House in 12 years on October 3. US President Trump had extended the invitation to PM Prayut in late April. In August, Prayut also had trade and regional security talks with US Secretary of State Rex Tillerson, the highest ranking US official to visit Thailand since the 2014 coup. A joint statement issued after the meeting said Trump welcomed Thailand’s commitment to hold “free and fair elections in 2018”. The unexpected announcement caused a commotion back in the Thailand, where PM Prayuth initially rowed back and said only that a specific date would be announced in 2018. He also said that Trump did not ask about political developments during their encounter. The junta has defended its takeover and its new charter – Thailand’s twentieth since 1932 – as necessary to curb the political unrest that has rocked the nation for over a decade.

Analysts expect political activities to resume slowly after the funeral of King Bhumibol Adulyadej this month. “Prayuth wants to delay the election but he knows that after the King’s cremation there will be pressure for an election,” said Kan Yuenyong of the Siam Intelligence Unit think tank, “This announcement for the election in November next year will act to reduce that pressure, because if not, there could be chances for protests.” November 2018 is the most precise date that has been given till now for elections since the 2014 military coup. PM Prayuth had promised immediately after his May 2014 coup to return power to civilians within 18 months. That date has repeatedly slipped, and even after a new voting analysts say there will be limits on democracy under the junta’s new charter.

Qatar Emir’s Visit to Malaysia

The Emir of Qatar, Sheikh Tamim bin Hamad Al Thani undertook a state visit to Malaysia from October 15-16 at the invitation of Yang di-Pertuan Agong Sultan Muhammad V. Sheikh Tamim was accompanied by several cabinet ministers, senior government officials and a business delegation. It was Sheikh Tamim’s first state visit to Malaysia since he ascended to the throne on June 25, 2013 as the eighth Emir of Qatar. The last state visit by the Emir of Qatar to Malaysia was by his father Sheikh Hamad bin Khalifa Al Thani in 2009. Malaysia and Qatar enjoy close relations in various key areas including political, economy and social affairs. In 2016, Qatar was ranked as Malaysia’s 40th largest trading partner with total trade of US$ 566 million. Total exports were recorded at US$ 150 million while total imports were US$ 416 million.

The statement issued by Malaysian Ministry of Foreign Affairs said this visit will provide an opportunity for leaders of both countries to discuss bilateral issues and exchange views on issues of common interest. It added that Sheikh Tamim will be accorded a state welcoming ceremony at Parliament House on October 16. During his visit, Sheikh Tamim will have an audience with Yang di-Pertuan Agong Sultan Muhammad V and Prime Minister Najib Razak. The emir’s visit to Malaysia comes nearly eight months after visit by Saudi Arabia’s King Salman at the end of February, the first by a Saudi king in more than a decade. Malaysia has had friendly relations with both Qatar and Saudi Arabia, putting it in a tough spot following the breakdown of ties between Qatar and the Arab states. Sheik Tamim’s visit to Malaysia will be followed by visit to Singapore and Indonesia.

Indo-Pacific

South China Sea: US Operations on Freedom of Navigation Churning up a Storm

The US guided missile destroyer USS Chafee entered territorial waters near China's Xisha Islands in South China Sea (SCS) on October 10 to enforce freedom of navigation (FON) without prior notice. China reacted by dispatching a frigate, two J-11B fighters and one helicopter. A senior official from the US has stated that the Pentagon and the US Pacific Command have greater autonomy over such military operations under President Trump than it did during the Obama administration. US Pacific Fleet Commander Scott Swift has said that the Fleet has planned for conduct of over 900 ship days of operations this year in the SCS.

Although the Korean Peninsula had become the focus of international attention in the past few weeks, the latest FON operations by US Fleet shows that the SCS dispute is still the primary security issue in the Asia-Pacific region. Ahead of President Donald Trump’s visit to Asia next month, the South China Sea is likely to become even more restless. During former President Barack Obama's regime, the US Navy carried out only four such operations. This was already the fourth since President Trump took office in January. In August, the USS John S. McCain had entered the waters within 12 nautical miles of Meiji Reef, part of the Nansha Islands.

In the next few months, the US can be expected to carry out one or two more such operations. President Trump is ratcheting up military deployment prior to his visit to Vietnam and ASEAN Summit in Philippines. One of the reasons could be to showcase the US commitment to allies in safeguarding the security of the SCS. The visit of the US President is often used as policy signaling. The other reason could be to influence China-ASEAN negotiations over the Code of Conduct (CoC) for the SCS. In August, China and ASEAN had reached a deal on a framework for the Code and the next step will be to flesh out the specific terms. Some experts feel that the US could launch an Asia-Pacific maritime code of conduct with Japan, India and Australia.

The renewed impetus of FON operations by the US once again raises hope for rule of law, peace and stability in SCS.

The Koreas

North Korea: US emphasizes Diplomacy on Resolving Tensions

On October 15, US Secretary of State Rex Tillerson said diplomatic efforts with North Korea will continue as long as they possibly can despite the saber-rattling. "Those diplomatic efforts will continue until the first bomb drops," Tillerson said on CNN's State of the Union. Tillerson emphasized that despite statements on Twitter that suggest diplomacy won't work, prioritizing diplomacy in trying to curb North Korea's nuclear ambitions is President Trump's preferred avenue. Tillerson during his address mentioned, "The President has also made clear to me that he wants this solved diplomatically. He is not seeking to go to war." Several weeks ago, Tillerson announced from Beijing that he had direct lines of communication with North Korea and was seeking to cool tensions between North Korea and the United States. Shortly after Tillerson's comments, Trump took to Twitter to say he thought Tillerson was "wasting his time" trying to negotiate with North Korea.

Concurrently, there was another flip flop by President Trump as he mentioned to reporters at the White House on October 13 that he is open to negotiations with North Korea over its nuclear program. Trump characteristically stated that "We're going to see what happens with North Korea…. That's all I can say. We're totally prepared for numerous things. If something can happen where we negotiate, I'm always open to that. But if it's going to be something other than negotiation, believe me we are ready, more so than we have ever been." Tillerson's comments came a day before the latest US-North Korea military exercises off the Korean Peninsula, which Pyongyang claims are rehearsals for a US-led invasion. The US says the drills are defensive in nature. The exercises will include at least 40 naval vessels, and both of the countries' air forces. Those drills will include the USS Ronald Reagan aircraft carrier, two guided missile destroyers, and elements of the US Army, in addition to the air force presence.

South Korea: Renewal of Currency Swap Agreement with China

South Korea and China agreed to extend their currency swap deal worth 64 trillion won (US $55 billion), Bank of Korea Governor Lee Ju-yeol told reporters in Washington on October 12. South Korean Minister of Strategy and Finance Kim Dong-yeon and Bank of Korea Governor Lee Ju-yeol are in the US capital for the meeting of G-20 finance ministers and central bank governors, as well as the annual meeting of the International Monetary Fund and the World Bank. The announcement came three days after the currency swap deal expired. A currency swap is a tool for defending against financial turmoil by allowing a country beset by a liquidity crunch to borrow money from others with its own currency. Some South Korean analysts had voiced concerns that the diplomatic tension between Seoul and Beijing could jeopardize the currency swap agreement. China has taken a series of economic retaliations against South Korea to protest Seoul's decision to station US anti-missile system, THAAD, on its soil.

Sung Tae-yoon, an economist at Yonsei University, said the swap does not mean an immediate beginning of improved relations, nor an imminent end to the conflict as projected. "The conflict is still out there. It would be too rash to assume the swap deal would end the dispute for both sides," Sung said. Only the Korean government made the official announcement on the renewal, while China did not even bother to disclose the $56 billion deal. There was no signing ceremony for the yuan-won swap this time, like in 2014 when they agreed to expand and extend the deal.

China's agreeing to the renewal is more of a signal to Korea that it is Seoul's turn to help maintain relations. "It is not in the interest of China to see its relations with Korea deteriorate. Its swap renewal, however, is a signal, winking to Korea that it is now Seoul's turn to do something about it that can justify Chinese reason to maintain the deal and improve relations," said Kim Man-gi, a professor of Chinese business at Sookmyung Women's University.

Japan

Elections Campaigning: An Update

Shinzo Abe, in his first official campaign speech in Fukushima city emphasized the need to renew his mandate to tackle a “national crisis” stemming from North Korea’s nuclear and missile threat and the demographic time-bomb of Japan’s fast-ageing population. Abe, who is also president of the ruling Liberal Democratic Party (LDP), mentioned that the snap election was to gauge opinion on his plan to change the use of additional revenues from the hike in the consumption tax rate from 8 percent to 10 percent in October 2019. Abe plans to use the additional revenues to make day care and kindergarten free.

Current Tokyo metropolitan governor, Yuriko Koike began election campaigning with her maiden address in front of JR Ikebukuro Station in Tokyo. The governor, who will not run in the election said trust in politics had been hurt by the scandals surrounding Moritomo Gakuen and the Kake Educational Institution, two education-related organizations with connections to Abe or his wife, Akie. Koike said it was nonsensical to call a snap election only to change the use of the additional tax revenues and called for a postponement in the tax hike.

The Liberal Democratic Party is on track to win a comfortable majority in the October 22 Lower House election while Kibo no To (Hope) continues to lose steam despite initial interest, an Asahi Shimbun survey showed October 12. However, it is unclear if the LDP will add to its pre-election strength of 284 seats. But the survey indicated that the party as of now should easily surpass 200 in single-seat constituencies and could match the 68 seats it secured in the proportional representation portion of the 2014 Lower House election. Yet the election results could change drastically depending on the large percentage of undecided voters. More than 40 percent of respondents said they have yet to pick candidates for single-seat constituencies, and nearly 40 percent have not selected a party for the proportional representation portion of the election.

In another Asahi Shimbun survey, 63 percent of candidates running in the October 22 Lower House election favor constitutional revision. In particular, overwhelming majorities of candidates competing under the banners of the ruling LDP, Kibo no To (Hope) and Nippon Ishin (Japan Innovation Party) favor amending the Constitution. All candidates from the Japanese Communist Party (JCP) and Social Democratic Party were opposed. The JCP is running 243 candidates, the second most behind the LDP.

Kobe Steel Data Fabrication

On October 8, Kobe Steel admitted that data on the strength and dimensions was falsified on more than 20,000 tons of products shipped over a one-year period through the end of August. Kobe Steel, one of Japan's biggest corporations, was established in 1905 by Suzuki Shoten, a trading firm which was among companies that led Japan's industrial revolution in the late 19th century and the early 20th century. It is also known as the company at which Prime Minister Shinzo Abe worked in his twenties. Hit hard by the 1995 Great Hanshin-Awaji Earthquake which devastated the port city of Kobe and its vicinity, Kobe Steel became a symbol of restoration after overcoming the crisis. According to the company's website, Kobe Steel has a 50 percent world market share for wire rod products, a 40 percent world market share for built-up and solid crankshafts used in ship propulsion systems and half the Japan market share for aluminum panels used in engine hoods for vehicles. The company also makes casks for nuclear waste and other equipment used in both conventional and atomic power plants.

As per Japanese media reports, there is testimony that the falsification has been going on for more than a decade and concerns over long-term misconduct regarding quality control have begun to surface. Seven major Japanese car manufacturers, including Toyota Motor Corp., Nissan Motor Co., Honda Motor Co., Suzuki Motor Corp., Mazda Motor Corp., Mitsubishi Motors Corp. and Subaru Corp., have confirmed they have used the Kobe Steel products concerned. Kobe Steel products were also used in Central Japan Railway Co.’s Tokaido Shinkansen trains. According to the railway company, data on the strength of the aluminum parts that support wheels of bullet train cars was falsified. The company has conducted safety tests on the wheels and concluded they are strong enough to keep in use. There is also a possibility the products were used in aircraft parts by the US Boeing Co. Mitsubishi Heavy Industries Ltd., Kawasaki Heavy Industries Ltd., Subaru and IHI Corp. in defense equipment, including aircraft, missiles and armored vehicles. The products in question were also used on the H-2A No. 36 rocket, which was successfully launched on October 10.

Over the last few decades, ‘Made-in-Japan’ became a byword for industrial quality and reliability. Kobe Steel is the latest in a string of corporate scandals involving data tampering and other methods of cheating to tarnish the Japan Inc. quality stamp. In recent years, Japanese government's push to improve corporate governance is seeing greater disclosure of wrongdoing. But the root cause is more likely that Japanese manufacturers are failing modern compliance standards as they grapple with a shrinking domestic market and increased global competition on price.

China & Taiwan

The 19th National Congress of the Communist Party of China, 18 October 2017

The Communist Party of China (CPC), with over 89 million members holds its 19th National Congress from 18 October 2017. The meeting provides the Party with an opportunity to explicitly declare its policies and the path it will take in the next five years. The 19th Party Congress is particularly important because it is close to the goal of 2020 by which China has set its target of construction of well-off society. In addition, China is facing many domestic and International challenges.

At the Congress, Xi Jinping is likely to consolidate his power. Last year, Xi Jinping was titled as the “core leader”. This has already strengthened his position ahead of the Congress. During the 90th anniversary of the Chinese army, Xi Jinping inspected the parade in full army uniform, as commander in chief of the People’s Liberation Army. The parade highlighted Xi’s consolidated leadership over military. This year Xi Jinping might be elevated to the title of ‘chairman’. Xi Jinping is currently the party's general secretary, but not its chairman, a title Mao Zedong and his two successors, Hua Guofeng and Hu Yaobang, both held. He is also the head of the anti-corruption campaign. The composition and of the Standing Committee is also an important issue this time. Five out of seven members of the Politburo of Standing Committee are expected to retire.

The 19th Party Congress may amend the constitution of the Party. According to People’s Daily, the “amendment may include the key theories and strategic thought presented by a report to be delivered at the 19th CPC National Congress”. However, it remains to be seen if Xi Jinping will have his name ‘crowned’ in the party constitution as Mao Zedong and Deng Xiaoping did or he would follow Jiang Zemin and Hu Jintao who amended the party constitution to include their thoughts without their names directly attached.

Indian Defence Minister Nirmala Sitharaman visits Nathu La

Defence Minister Nirmala Sitharaman made her maiden visit to Nathu La border post in Sikkim. She interacted with Indian Army personnel, Indo Tibet Border Police (ITBP) and the Chinese soldiers along the border. After meeting the Chinese soldiers at the border she tweeted, “Acknowledged a row of Chinese soldiers from across the fence who were taking pictures on my reaching Nathu La.” Nathu La is 30 km from Doklam area. She could not complete her ariel survey of the Doklam plateau due to bad weather.

The visit came amid reports that China has strengthened its military presence at the Doklam and even started widening the existing road which is at a distance of around 12 km from the area of the conflict. The spokesperson of Ministry of External Affairs has also confirmed that, "We have seen recent press reports on Doklam. There are no new developments at the face-off site and its vicinity since the August 28 disengagement. The status quo prevails in this area. Any suggestion to the contrary is incorrect." India and China were embroiled in a stand-off in the Doklam area which eventually resulted in a mutual “expeditious disengagement” from both the sides.

China-US Law Enforcement and Cybersecurity Dialogue

China and the United States held their first Law Enforcement and Cybersecurity Dialogue (LE&CD). The dialogue was attended by Chinese State Councilor and Minister of Public Security Guo Shengkum, US Attorney General Jefferson B. Session III and Acting Secretary of Homeland Security Elane Duke. The issue of repatriation, counter-narcotics, cybercrime, and cybersecurity, and fugitives were discussed during the meeting. It is one of the dialogues established during the Mar-a-Lago meeting in April 2017.

It is an important forum for advancing bilateral law enforcement and cyber priorities between the two governments. Ahead of the meeting, the two sides also conducted several rounds of talks on anti-terrorism, counter-narcotics, cybersecurity, and immigration. There are many fugitives from China living in the US, who so far been outside the reach of Chinese law enforcement. Since June, the US law enforcement has handed over two criminal suspects to Chinese police, while the Chinese side has repatriated two wanted suspects listed on an Interpol red notice to the US. Notably, the issue of corruption and national security will be discussed at the 19th Party Congress.

The Central Commission for Discipline Inspection’s Eighth Plenary Session

The 18th Central Commission for Discipline Inspection (CCDI) of the Communist Party of China (CPC) held its Eighth Plenary Session. Reportedly, the meeting discussed and approved a work report to be submitted by the CCDI to the 19th CPC National Congress. Wang Qishan is the general secretary of the commission. A total of 119 members of the CCDI attended the meeting, and 12 attendees were also present as non-voting participants. In the meeting, the punishment of two senior official Li Gang and Qu Shuhui was discussed. The member also decided to remove Liu Shengjie.

Formed in 1978, the CCDI is responsible for supervision and inspection of the department affiliated to the party lines, principles, policies and resolutions in complying with China’s laws and regulations, and in implementing decisions of the State Council. Ever since Xi Jinping came to power he has been tough on the issue of corruption. During the 12 rounds of inspection by central inspection authorities since the 18th CPC National Congress in 2012, 277 Party organizations have been inspected, 16 provincial-level regions have been re-examined and flexible inspections of four institutions under the central authorities have been carried out. This is the first time the Party has successfully inspected all these entities within an administrative term. Reportedly, from 2013 to September 2016, 1.01 million officials have been investigated for graft.

Tsai Ing-wen’s Speech at the 106th National Day

On the 106^th National Day of Taiwan Tsai Ing-wen delivered speech titled “Better Taiwan”. She covered three aspects in her speech, fulfilling our commitments and accelerating reform, safeguarding Taiwan's democracy and freedom and finding Taiwan's place in the new international order. On the first aspect, she specifically talked about resolving concerns over the five shortages (referring to land, electricity, water, labour, and talent) under the private sector. On the second aspect, she mentioned that the cross-strait relations are an issue that affects the future of Taiwan. She said, “We have exerted maximum goodwill in order to safeguard the peaceful and stable development of cross-strait relations.” On the third aspect, she emphasized on the role played by the New Southbound Policy to forge closer relations and links with the neighbouring country in the region. As an outcome of the policy, Taiwan’s trade had increased by twenty percent. She also highlighted that Taiwan has ratified both the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights. Taiwan has completed Taiwan’s first ever voluntary national review of the United Nation Sustainable Development Goals.

Since Tsai Ing-wen became the President of Taiwan, the cross-strait relationship has become strained. Tsai does not support the one-China policy and has maintained ambiguity over the 1992 consensus. In her first national day speech she said, “We respect the historical fact that in 1992 the two institutions representing each side across the strait held a meeting.” She did not use the word “1992 consensus” because it refers to the one-China Policy. In fact, in her first national day speech, she used the word “country” more than twenty times instead of using the term island nation. Most recently, the new Taiwanese premier Willian Lai Ching-te said, “I am political worker who advocates Taiwan independence, but I am also a pragmatic pro-Taiwan independence theorist.” The Democratic Progressive Party led Tsai Ing-wen government stands for a Taiwanese identity. The Global times, called Tsai Ing-wen’s speech as "boastful and lacking in sincerity”.