Global Developments and Analysis: Weekly Monitor, 23 January - 29 January, 2023

Economic

China’s debt-based interest payments top a trillion yuan for first time, raising concerns about financial risks

Interest payments on local government debt in China exceeded a trillion yuan for the first time last year as Beijing called for enhanced efforts to steady the economy, and analysts say public debt in the world’s second-largest economy could continue to surge to an all-time high in 2023. Local governments had to pay a total of 1.12 trillion yuan (US$165 billion) in interest on bonds in 2022, up from 928 billion yuan in 2021, according to data released by the Ministry of Finance on Jan 29. And a total of 3.67 trillion yuan worth of local government bonds will mature in 2023, according to financial data provider Wind. The data, released by the Ministry of Finance, reflects the growing pressure of debt repayment among local governments. But since regional authorities often also borrow heavily off-budget, the overall debt to gross domestic product (GDP) could, in practice, be considerably higher than official data. China’s debt-to-GDP ratio in the third quarter of 2022 rose from 273.1 per cent at the end of the second quarter to 273.9 per cent, or 0.8 percentage points, according to data released last year by the National Institution for Finance and Development.A total of 7.37 trillion yuan worth of local government bonds were issued in 2022, down from 2021’s 7.49 trillion yuan, Ministry of Finance data showed. Click here to read... [2]

US-China clash at WTO, highlighting divisions ahead of Antony Blinken visit

China has stepped up accusations that the United States is breaking trade rules and bullying other countries, signalling potentially tense negotiations when the US Secretary of State visits next month. The criticism was levelled by China’s ambassador to the World Trade Organization (WTO) on Jan 27, when the Geneva-based organisation reviewed disputes including several cases launched against the US. The rebuke by Li Chenggang shows the division between the world’s two largest economies is still large, despite hopes of a thaw after it was announced that US Secretary of State Antony Blinken would visit China in February, while a team of US Treasury officials led by Janet Yellen could also make a trip to Beijing. At the WTO meeting, Li rebuked the US for its unilateralism, breaking international trade rules and disrupting global supply chains, according to the state-owned Xinhua News Agency. On Jan 30, Xinhua blasted the Biden administration for justifying protectionism with national security laws, adding its WTO appeals would meet a dead end and only trigger “public anger”. The US is the biggest violator of international trade rules, accounting for about two thirds of WTO disputes, Xinhua said, and it was responsible for paralysing the organisation’s dispute settlement mechanism in 2019. Click here to read... [3]

China's spending on R&D hits 3 trln Yuan in 2022

China's total expenditure on research and development (R&D) amounted to nearly 3.09 trillion yuan (about 456 billion U.S. dollars) in 2022, up 10.4 percent year on year, according to the National Bureau of Statistics (NBS). After deducting price factors, China's R&D spending in 2022 rose 8 percent year on year, said the NBS. China's total spending on R&D accounted for 2.55 percent of its gross domestic product last year, up 0.12 percentage points from the previous year. Investment in basic research stood at 195.1 billion yuan last year, up 7.4 percent year on year, accounting for 6.32 percent of the total R&D spending, the data showed. Click here to read... [4]

China says ready to normalize cross-border travel

Beijing said Jan 30 it stands ready to work with all countries to facilitate normal cross-border travel a day after lifting visa issuance restrictions on Japanese citizens that had been imposed in protest of Tokyo's tighter border controls for travellers from China. Chinese Foreign Ministry spokeswoman Mao Ning said at a press conference that Beijing is "against politicizing" COVID-19 responses and expressed regret over South Korea's recent decision to extend its restrictions on issuing short-term visas for travelers from China through Feb. 28.Japan, South Korea and several other countries have strengthened border controls for travellers from China, which reopened its borders and scrapped quarantine measures on Jan. 8, amid fears over widespread COVID-19 infections in the country. On Jan. 10, Beijing halted visa issuances for Japanese and South Korean travellers, criticizing the entry restrictions on visitors from China as "discriminatory." Mao said Jan 30 that Beijing hopes Seoul "will remove" the policies "as soon as possible." Japanese Chief Cabinet Secretary Hirokazu Matsuno indicated at a news conference in Tokyo on Jan 30 that Japan will keep its stricter border controls targeting those traveling from China for the time being, saying the government will "flexibly" deal with the situation. Click here to read... [5]

U.S. Fightback In the Middle East Continues With Huge Chevron Deal

After an extended period of reduced engagement in the Middle East and a refocusing inwards on itself, which allowed China and Russia to exploit the resultant power vacuum, there have been several signs recently that the U.S. has decided that now is a good time to take up where it left off a few years ago. In the energy sector, there have been several high-profile deals in regions of great geopolitical sensitivity in recent weeks that have been made by U.S. companies or companies of countries alongside the U.S. in its sphere of influence. The latest one is Chevron’s discovery of a potentially huge offshore gas field in Egypt that, according to comments last week, is due to be fast-tracked by Chevron and its partner in the site, Italy’s Eni. Chevron and Eni, which each hold a 45 percent stake in the 1,800 square kilometre (sq.km) Nargis offshore area concession (with Egypt’s Tharwa Petroleum Co. holding the remaining 10 percent stake), announced that they have made a new gas discovery in the concession, focused on the Nargis-1 well. The state-owned Egyptian Natural Gas Holding Company (EGAS) stated in the past few days that the precise quantity of reserves in the well were being evaluated but that it was working with Chevron, Eni and Tharwa to begin production as soon as possible. Click here to read... [6]

Norway Sees Oil and Gas Tax Revenue Triple to Record $89 Billion

Norway expects to receive a record $89.5 billion (884 billion Norwegian crowns) in oil and gas tax revenue for 2022, triple the previous record in 2021, thanks to soaring gas prices last year, the Norwegian Tax Administration said in an estimate on Jan 26. The administration has revised up its estimates for the petroleum tax revenue by 20% from an earlier projection, and the latest figure implies the oil and gas tax revenue has tripled from the previous record year, 2021. The high natural gas prices drove the record tax revenue from petroleum companies which “have never been anywhere near as high as it is now,” the Norwegian Tax Administration’s director Nina Schanke Funnemark said. In the previous record year of 2021, Norway’s petroleum tax revenue was $30 billion (295 billion crowns), the administration said. Norway, Western Europe’s largest oil and gas producer, has benefited a lot from the spike in oil and gas prices since the Russian invasion of Ukraine in February last year. Most of Norway’s government revenues from oil and gas go into the $1.34 trillion Government Pension Fund Global, commonly known as Norway’s oil fund, which is the biggest sovereign wealth fund in the world. Earlier this week, Norway said it would offer up to 92 new blocks for hydrocarbon exploration in the new round of licensing in mature areas. Click here to read... [7]

Russia becomes Iran’s biggest investor – official

Russia has become Iran’s largest foreign investor, Fars news agency reported on Jan 29, citing the country’s deputy finance minister, Ali Fekri. According to the official, Russia “had brought some $2.7 billion worth of investment to two petroleum projects in Iran’s Western province of Ilam in the past 15 months.” The figure accounts for some 45% of the total foreign investment attracted by Tehran over the period, Fekri noted. The UAE, Afghanistan, Türkiye and China were also among Iran’s biggest investors in the reporting period. However, Fekri noted that Beijing had notably reduced spending in 2022. “China has invested nearly $185 million in Iran over that period, which we are not happy with given the amount of negotiations and meetings we had,” he stated. According to Fekri, Tehran had set a target of $10.2 billion in direct foreign investment for the 15 months to December last year. It failed to reach this goal, having secured only $5.95 billion. Iran and Russia boosted cooperation throughout 2022 in an effort find ways to bypass Western sanctions imposed on both countries. The two nations sealed a number of agreements expanding trade and concluded contracts on the joint construction of gas pipelines. Total trade turnover between Moscow and Tehran surged by 15% last year, reaching $4.6 billion. Click here to read... [8]

Russian electricity exports to Asia surge

Russian energy giant Inter RAO boosted electricity supplies to China and Mongolia to record volumes last year, the company’s CEO Boris Kovalchuk said on Jan 25. Power exports from Russia to the EU were stopped last year. At that time, Inter RAO reported that consumers could not pay the company for the supplied electricity due to Western sanctions imposed on Russia. “We completely stopped commercial supplies [of electricity] to the countries of the European Union starting June 2022. At the same time, we have substantially increased exports to China and Mongolia,” Kovalchuk said at a meeting with Russian Prime Minister Mikhail Mishustin. He added that the company set a “historic maximum” in 2022 for electricity deliveries to these countries. Earlier, Energy Minister Nikolay Shulginov stated that power supplies to China and Mongolia saw a significant jump last year. “We can talk about the growth of eastbound [electricity] exports, that is, total exports to China and Mongolia have increased by 20%, and there will be an uptick of about 16% to China by the end of the year,” the minister said. The Russian energy giant supplies electricity to China from the Far Eastern Amur region under a long-term “cash and carry” contract. Click here to read... [9]

U.S. secures deal with Netherlands, Japan on China chip export limit: Bloomberg

The United States has secured a deal with the Netherlands and Japan to restrict exports of some advanced chip-making machinery to China in talks that concluded on Jan 27, Bloomberg reported, citing people familiar with the matter. The agreement would extend some export controls the United States adopted in October to companies based in the two allied nations, including ASML Holding, Nikon Corp and Tokyo Electron, the report said. Officials from the Netherlands and Japan were in Washington discussing a wide range of issues in talks led by White House national security adviser Jake Sullivan. John Kirby, the White House national security spokesperson, earlier said the officials were talking about issues that are "important to all three of us." "And certainly the safety and security of emerging technologies is going to be on that agenda," he told reporters. A source familiar with the talks said restricting exports of semiconductor manufacturing equipment to China was among the topics. Getting the Netherlands and Japan to impose tighter export controls on China would be a major diplomatic win for U.S. President Joe Biden's administration, which in October announced sweeping restrictions on Beijing's access to U.S. chip-making technology to slow its technological and military advances. The Dutch foreign ministry and a spokesperson at Japan's Ministry of Economy, Trade and Industry declined to comment. Click here to read... [10]

Memory-Chip Makers Face a Prolonged Price Slump

Memory-chip prices, which dropped steeply over the past year, are expected to keep falling in the first half of 2023, putting more pressure on an industry that has already cut investments and jobs. Average prices for the two main types of memory chips used in everyday electronics—from smartphones to personal computers and TV sets—are projected to experience double-digit percentage declines this quarter, industry analysts say. That comes after prices dropped by more than 20% in the last three months of 2022 from the previous quarter, according to analyst data. Memory-chip makers, many saddled with large inventories, have also issued grim outlooks as the slump in demand for gadgets persists after a pandemic boom. Micron Technology Inc.,SK Hynix Inc., Western Digital Corp. and Tokyo-based Kioxia Holdings Corp. have unveiled plans to reduce their investments aimed at capacity expansion or to lower output to address a supply glut that is getting worse. Last month, Micron Technology said it would cut jobs and spending for the year to reduce costs after reporting a loss in its most recent quarter. Memory chips are considered a bellwether for the semiconductor industry because they are largely commoditized and sensitive to shifts in supply and demand. Samsung Electronics Co., the world’s largest producer of memory chips, reported Jan 31 that its operating profit for the October-to-December quarter dropped 69% from a year earlier. Click here to read... [11]

Report: Myanmar opium cultivation surges 33% amid violence

The production of opium in Myanmar has flourished since the military’s seizure of power, with the cultivation of poppies up by a third in the past year as eradication efforts have dropped off and the faltering economy has led more people toward the drug trade, according to a United Nations report released Jan 26. In 2022, in the first full growing season since the military wrested control of the country from the democratically elected government of Aung San Suu Kyi in 2021, Myanmar saw a 33% increase in cultivation area to 40,100 hectares (99,090 acres), according to the report by the U.N. Office on Drugs and Crime. “Economic, security and governance disruptions that followed the military takeover of February 2021 have converged, and farmers in remote, often conflict-prone areas in northern Shan and border states have had little option but to move back to opium,” said the U.N. office’s regional representative Jeremy Douglas. The overall value of the Myanmar opiate economy, based on U.N. estimates, ranges between $660 million and $2 billion, depending on how much was sold locally, and how much of the raw opium was processed into heroin or other drugs. “Virtually all the heroin reported in East and Southeast Asia and Australia originates in Myanmar, and the country remains the second-largest opium and heroin producer in the world after Afghanistan,” Douglas said. Click here to read... [12]

Peru Protests Hit Mining Sector and Impede Exports

After nearly two months and dozens of deaths, Peru’s political upheaval is battering industries that once powered one of Latin America’s fastest-growing economies. Amid violent antigovernment protests that show little sign of easing, foreign-owned mines that have made Peru the world’s second-biggest copper producer have halted operations. Hotels and restaurants in the tourism hub of Cusco are nearly empty, leaving thousands of people without work as demonstrators battle police on streets normally full of tourists. On the southern coast, farmers say they can’t transport crops to the U.S. and China as protesters choke off roads. Protests have caused about $1.3 billion in damage to infrastructure and lost production, according to President Dina Boluarte’s administration. A majority of Peruvians say the protests have had a big impact on their economic livelihoods, according to a Jan 29 poll by the Institute of Peruvian Studies. The Lima Chamber of Commerce estimates that 1.1 million jobs could be lost. “The outlook is not good,” said Alonso Segura, a former finance minister. “If this continues, we might even experience a recession.” Peru’s crisis underpins the costs of growing political instability in Latin America that is fuelled by anger over corruption, weakening economies and grinding inequality, economists say. Click here to read... [13]

Japan Policy calls for new reactors at plants where shelf life is issue

The government is backtracking on the issue of where to build new nuclear reactors. It is now set to limit construction of new facilities at sites where a reactor has reached the end of its operating lifespan, retreating from its original proposal made last month that did not question where they would be built, sources said. The change in the draft basic policy, which is aimed at weaning Japan off fossil fuels and making greater use of green energy, was made in response to safety concerns voiced by lawmakers in Komeito, the junior partner in the ruling coalition led by the Liberal Democratic Party. The initial proposal did not mention restrictions on facilities. That left open the possibility that an electric utility could add a new reactor to a plant of its choice if it decides to decommission an aged unit at a separate site. Komeito, which has many members wary about continued reliance on nuclear energy, called for the draft basic policy to use wording suggesting the constrained use of nuclear power. The government intends to seek Cabinet approval for the basic policy to achieve its so-called green transformation by the end of February by removing potential stumbling blocks to its timetable, the sources said. But opposition to the change in the revised draft proposal has also arisen from a pro-nuclear group of LDP lawmakers. Click here to read... [14]

Chat GPT-connected companies like Buzz Feed see stock volume surges in enthusiasm over Open AI

Companies tied to artificial intelligence services recorded some of their highest trading volumes on record this month, amid a frenzy of interest in the Chat GPT tool, which generates conversation-style interactions. Buzz Feed Inc, C3.ai Inc, Sound Hound AI Inc, and BigBear.ai Holdings Inc are among the stocks that have all seen massive jumps in volume, along with dizzying swings in their share prices. BigBear.ai soared nearly 65 per cent on Jan 30, with trading volume that was more than 2,100 per cent of its daily volume over the past three months. Last week, Microsoft Corp said it was investing US$10 billion in Open AI, the maker of Chat GPT, and Buzz Feed announced plans to use OpenAI to help with content creation. Over the weekend, Bloomberg News reported that the China-based search company Baidu Inc is planning to roll out an artificial intelligence chatbot service similar to Chat GPT. The developments have made AI-related stocks hugely popular with investors. Buzz Feed shares soared more than 300 per cent last week, and trading volume topped 438 million shares. Volume is above 485 million for the month, compared with its monthly average of less than 25 million shares. Among other stocks, C3.ai has seen more than 72 million shares trade hands this month, the most since June, while voice AI software company Sound Hound AI Inc has seen about 64.5 million shares change hands, almost three times its monthly average. Click here to read... [15]

China e-retailer JD.com ending sales in Thailand, Indonesia

Chinese online retailer JD.com Inc. is closing its consumer e-commerce services in Indonesia and Thailand amid intense competition in Southeast Asia. The e-commerce service will stop taking orders Feb. 15 in both countries and shut down in March, according to announcements Monday on the two websites. JD.com said in a separate statement it would develop its cross-border supply chain business that serves Southeast Asia and other global markets. The company operates or manages warehouses or industrial parks in Vietnam, Malaysia and Indonesia. E-commerce vendors in Southeast Asia have been squeezed by intense competition, including from JD.com's Chinese rival, Alibaba Group. JD.com reported a profit of 6 billion yuan ($800 million) in the quarter ending in September on sales of 243.5 billion yuan. That was an improvement from a loss of 2.8 billion yuan on sales of 218.7 billion yuan in the same period a year earlier. JD.com's foreign operations and other "new business" accounted for just over 2 percent of total sales, the company said. (AP) Click here to read... [16]

Strategic

Blinken visit unlikely to fix US-China differences, but Russia a possible area of progress: analysts

Washington and Beijing are too far apart on most outstanding bilateral issues for their relations to improve appreciably when US Secretary of State Antony Blinken meets his Chinese counterparts this weekend, with Russia likely to be the only front for possible progress, US analysts said on Jan 30.Allegations of Chinese support for Russia’s war against Ukraine, tariffs, human rights, US export restrictions and cooperation on climate change are all poised to appear on the agenda, each with significant obstacles to potential breakthroughs Jude Blanchette, Freeman Chair in China Studies at the Washington-based think tank Centre for Strategic and International Studies, stressed there should not be “many expectations” of any “significant breakthroughs” from the trip. But he added this was not a “bad thing” given how far the relationship had deteriorated over the last five years. Blinken’s visit was mainly about “re-establishing the undergirding of the relationship and putting in place some procedures and mechanisms to be able to manage through the tensions”, Blanchette said. However, differences over Taiwan present the sharpest areas of disagreement owing to assessments of a possible armed conflict across the Taiwan Strait, making Blinken’s trip crucial in offsetting military rhetoric with diplomacy, said Michael Swaine, a senior fellow at the Quincy Institute, a Washington think tank. Click here to read... [17]

Russia Boosts China Trade to Counter Western Sanctions

Trade between China and Russia boomed last year, providing a lifeline to Russia’s beleaguered economy and showing the limits of Western sanctions, according to a new report. Moscow boosted imports of technologies critical to its war in Ukraine including semiconductors and microchips from China, the report by the D.C.-based nongovernmental organization Free Russia Foundation said. China’s increased purchases of Russian exports, driven by energy sales, more than offset the declines from major Western trading partners including the U.S., U.K. and some European Union countries. “As the U.S., EU, the U.K. have all scaled back operations with Russia, China has emerged, by a wide margin, to be Russia’s most important trade partner,” the report says. Based on 40 million entries of customs records obtained by the Free Russia Foundation, the report offers a granular view of Russia’s trade, which was obscured after the imposition of Western sanctions. In April, Russian customs authorities suspended their monthly publication of data on exports and imports, among other statistics, saying at the time that it wanted to avoid “incorrect estimates, speculations and discrepancies in terms of import deliveries.” Its January 2022 data are the latest available. China has become a supplier of some key technologies that can have a military purpose despite the Western sanctions. China sold $3.3 million worth of unmanned aerial vehicles, or drones, to Russia last year, according to the data. Click here to read... [18]

Japan boosts Global South ties with eye on China and Russia

The Japanese government is strengthening relations with countries in the Global South, seeking a common front against Russia and China amid seismic shifts in the international security landscape. "For the entire international community to cooperate in addressing the multiple issues the world faces, the G-7 will unite and strengthen engagement with the so-called Global South," Prime Minister Fumio Kishida said in a major policy speech Jan 23. While lacking an established definition, the Global South generally includes such regions as Southeast Asia, Africa, and South and Central America. The term has been used recently instead of "Third World," which referred to countries that did not take sides in the Cold War. The Group of Seven's share of the world's gross domestic product has fallen from 66% in 1990 to around 45% as India and other Global South countries have enjoyed remarkable economic growth. Kishida also touched on the issue in his state visit to Washington on Jan. 13, saying that "if the Global South, holding integral places in the international arena, turn their back, we will find ourselves in the minority and unable to resolve mounting policy issues." His intentional repeated use of the term "Global South" owes largely to changes in the global security environment. Amid Russia's invasion of Ukraine and China's maritime expansionism, the Global South has become an increasingly crucial part of the international security picture. Click here to read... [19]

U.S., Germany poised to send tanks to Ukraine

The United States and Germany are poised to provide a significant boost to Kyiv's war effort with the delivery of heavy battle tanks to Ukraine, sources said, a move Moscow condemned as a "blatant provocation".Washington was expected to announce as soon as Jan 25 that it will send M1 Abrams tanks and Berlin has decided to dispatch Leopard 2 tanks, the sources said, a reversal in policy that Kyiv has said would help reshape the conflict. Ukrainian President Volodymyr Zelenskyy again pressed Western allies to provide their most modern battle tanks, saying in his nightly video address that "discussions must be concluded with decisions". Germany and the United States have until now held back on providing heavy armour, wary of moves that could give the Kremlin reason to widen the conflict. Moscow has warned that supplies of modern offensive weaponry to Ukraine will escalate the war, with some Russian officials warning that Kyiv's allies were leading the world into a "global catastrophe". Moscow has now repeatedly said that it is fighting the collective West in Ukraine. The possible deliveries of battle tanks by Washington to Ukraine would be an "another blatant provocation" against Russia, Anatoly Antonov, Russia's ambassador to the United States, said on Jan 25. Click here to read... [20]

Joe Biden says no F-16s for Ukraine as Russia claims gains

Ukraine’s defence minister was expected in Paris on Jan 31 to meet President Emmanuel Macron amid a debate among Kyiv’s allies over whether to provide fighter jets for its war against Russia, after US President Joe Biden ruled out giving F-16s. Ukraine planned to push for Western fourth-generation fighters like F-16s after securing supplies of main battle tanks last week, an adviser to Defence Minister Oleksiy Reznikov said on Jan 27. Asked at the White House on Jan 30 if the United States would provide F-16s, Biden told reporters: “No”. But France and Poland appear to be willing to entertain any such request from Ukraine, with Macron telling reporters in The Hague on Jan 30 that “by definition, nothing is excluded” when it comes to military assistance. In remarks carried on French television before Biden spoke in Washington, Macron stressed any such move would depend on several factors including the need to avoid escalation and assurances that the aircraft would not “touch Russian soil”. He said Reznikov would also meet his French counterpart Sebastien Lecornu in Paris on Jan 31.In Poland on Jan 30, Prime Minister Mateusz Morawiecki also did not rule out a possible supply of F-16s to neighbouring Ukraine, in response to a question from a reporter before Biden spoke. Click here to read... [21]

Korea-Japan summit unlikely to be held before March

A summit between President Yoon Suk Yeol and Japanese Prime Minister Fumio Kishida is unlikely to be held before March, officials said Jan 30, as the two countries negotiate a solution to the issue of compensation for forced labor victims. Speculation has been widespread that Yoon could pay his first visit to Japan as president next month for a summit with Kishida. The visit would be timed to coincide with an agreement between the two countries on how to settle the issue of compensation for Korean victims of wartime forced labor during Japan's 1910-45 colonial rule. "There's no plan in place for President Yoon to visit Japan next month," a key presidential official told Yonhap News Agency. A different senior official also expressed skepticism about a summit taking place before March, saying, "There's still more work to do in terms of persuading the victims and negotiating the details with Japan." Relations between Seoul and Tokyo have frayed since Korea's Supreme Court issued rulings in 2018 that ordered Japan's Nippon Steel and Mitsubishi Heavy Industries to pay compensation to the Korean forced labor victims. Japan maintains that all issues of compensation were settled under a 1965 treaty that normalized bilateral ties after Japan's colonial rule. Click here to read... [22]

Turkish elections: A referendum on Erdogan’s republic

With President Recep Tayyip Erdogan setting voting day for May 14, Turkey’s polarized political landscape is braced for the most critical, dramatic elections in the country’s history. Coinciding with the republic’s centennial, the choice of nearly 53 million voters feels existential: They will decide whether or not to approve – in final terms – Erdogan’s drive toward an extremely centralized system of government, or, to put it more simply, one-man rule. The presidential and parliamentary elections must be seen as a decision on the nature of how the country is administered. For the fragmented opposition camp, the immense challenges it faces appear to work in favour of Erdogan and his ruling alliance. The chances are that despite Turkey being entombed in a deep economic crisis, he may well win again. The elections are in essence a referendum about ending or maintaining a one-party rule that has lasted for two decades. Erdogan and his Justice and Development Party (AKP) have won consecutively 13 elections and three referendums in that period, cementing a sense of invincibility. This has paved the way for a slow-motion power grab in which Erdogan has seized control of key institutions of state, subordinated the judiciary and media to the executive, and spread a blend of Islamism and offensive nationalism within society. Click here to read... [23]

Myanmar invited to Asian military meeting co-chaired by US

The Myanmar military, which seized power in a coup two years ago, has been invited to take part in a regional military meeting co-chaired by Thailand and the United States. The five-day ASEAN Defence Ministers’ Meeting Plus (ADMM-Plus) Experts’ Working Group on Maritime Security is due to start on February 20 and will also include “table top” exercises. Myanmar Now, an independent online publication focusing on Myanmar which reported the invitation on Jan 30, said it had received leaked documents showing the theoretical drills were designed to address search and rescue, piracy, and the smuggling of drugs, weapons and people. Lieutenant Colonel Martin Meiners, a spokesperson for the US Department of Defense, told Myanmar Now that the Myanmar military had been invited in accordance with ASEAN protocols. “Attendance at ASEAN forums is determined by ASEAN member states,” Meiners told the outlet. As well as the 10 members of the Association of Southeast Asian Nations (ASEAN), the meeting will include representatives from dialogue partners Australia, China, India, Japan, New Zealand, Russia, South Korea, and the US. ASEAN has struggled with how to handle Myanmar amid the ruling generals’ failure to deliver on a plan that was supposed to end the violence triggered by the February 1, 2021 coup, and create the conditions for dialogue. Click here to read... [24]

Blinken urges calm, reaffirms ‘ironclad’ US support for Israel

US Secretary of State Antony Blinken has called for “calm” and “de-escalation” between Israelis and Palestinians while reiterating Washington’s “ironclad” commitment to Israel. In a joint news conference with Israeli Prime Minister Benjamin Netanyahu in Jerusalem on Jan 30, Blinken reaffirmed that the administration of US President Joe Biden will push forward with normalisation efforts between Israel and Arab states, to “integrate” the country into the region.In his first visit to Israel and the occupied Palestinian territories since Netanyahu’s far-right government took office late last year, the top United States diplomat also heaped praise on the US-Israel alliance. “It’s important that the government and people of Israel know America’s commitment to their security remains ironclad,” Blinken said. “That commitment is backed up by nearly 75 years of United States support. America’s commitment has never wavered; it never will.” His trip comes amid an eruption of violence between Israelis and Palestinians, with the Israeli military conducting near-daily, deadly raids in the occupied West Bank. Last week, Israeli forces killed 10 Palestinians in the West Bank, including nine in the Jenin refugee camp. A day later, a Palestinian gunman fatally shot seven Israelis in a settlement in occupied East Jerusalem. On Jan 30, Blinken paid tribute to the Israeli victims without mentioning Palestinians killed by Israel. Click here to read... [25]

US military operation kills top ISIL leader in Somalia

The United States military has carried out an operation that killed a senior ISIL (ISIS) leader in northern Somalia, US officials said. A statement by Secretary of Defense Lloyd Austin on Jan 26 said Bilal al-Sudani, a US-designated ISIL leader in Somalia and “key facilitator for ISIS’s global network”, was killed in the operation. It added that the operation was approved by President Joe Biden earlier this week and carried out on January 25. “Al-Sudani was responsible for fostering the growing presence of ISIS in Africa and for funding the group’s operations worldwide, including in Afghanistan,” Austin said. There were no other details about the operation given, including how the US forces carried out the operation or even how many American soldiers were involved. US officials told reporters at a teleconference on Jan 26 that 10 of al-Sudani’s associates were also killed in the operation. “We had prepared for the possibility of capturing Sudani, but the hostile forces’ response to the operation resulted in his death,” the State Department said. In 2012 before he joined ISIS, al-Sudani was sanctioned by the US Department of Treasury for his role in facilitating financing for foreign fighters to travel to an al-Shabab training camp. Click here to read... [26]

US declares Wagner Group ‘transnational criminal organization’

Washington has designated the private military company (PMC) the Wagner Group a “significant transnational criminal organization,” the US Treasury Department said on Jan 26 as it unveiled a new batch of sanctions against Russia. The US accused the company founded by Russian businessman Yevgeny Prigozhin of being engaged in “an ongoing pattern of serious criminal activity” in both Ukraine, where the PMC is fighting with Russian troops, and several African nations. The Wagner Group poses a “transcontinental threat,” the Treasury statement read, adding that the PMC “has been involved in Kremlin-backed combat operations around the world.” It referred specifically to Russia’s military effort in Ukraine, as well as alleging that the group had “also meddled and destabilized countries in Africa” such as the Central African Republic (CAR) and Mali. Apart from the Wagner Group, the US also imposed sanctions on eleven other entities and six individuals, including those it suspects of supporting the PMC’s operations. The list includes Russia- and China-based technology companies and a UAE-based aviation firm, as well as several CAR-based security companies allegedly linked to the Wagner Group. A separate US sanction list also included in Jan 26’s batch of restrictions targets the Russian defence industry and includes a cargo airline, a drone producer, and several technology companies. Click here to read... [27]

Iran Ammunition Factory Hit by Blast

Iran said three drones caused an explosion at an ammunition factory in the city of Isfahan late Jan 28, amid fresh tensions with the West and Israel over Tehran’s military involvement in Ukraine and stalled negotiations to revive an international accord that limits Iran’s nuclear activities. Phone footage captured by several passersby in Isfahan and posted on social media showed what appeared to be a large explosion on the side of a building on a major street. “At around 23:30, an unsuccessful attack using micro-aerial vehicles was carried out on one of the Defense Ministry’s workshops,” the Defense Ministry said in a statement, adding that one drone had been shot down by air defences while two others had exploded. The ministry said the roof of one building had been slightly damaged, and that the explosion had caused no casualties. A local crisis-management chief, Mansour Shisheforoush, told state media that residents had reported “abnormal sounds” in three or four parts of Imam Khomeini Street, a main thoroughfare leading to the city center. Iranian authorities didn’t immediately assign blame for the blast. Iranian media also reported a large fire had broken out at an oil refinery in an industrial area outside the western city of Tabriz. It wasn’t clear whether the two incidents were related. Click here to read... [28]

Taiwan's Tsai unveils new cabinet in bid to regain lost ground

Taiwan President Tsai Ing-wen officially appointed former Vice President Chen Chien-jen as premier on Jan 27, signaling a major cabinet reshuffle designed to energize her government well before elections in 2024. "I have to say, once again: Premier Su, you have worked hard," Tsai said during a news conference, turning toward outgoing premier Su Tseng-chang, who nodded in return. "He is always on the front line, helping me to bear a lot of pressure, giving me more strength to focus on diplomacy, defence and cross-strait affairs, while laying a stronger foundation for Taiwan and creating a bigger international space for Taiwan." "Former British Prime Minister Churchill once said: 'Success is not final, failure is not fatal,'" Tsai noted. "In the face of changes and challenges, we will not pessimistically see difficulties, but grasp opportunities from difficulties." Su began serving as premier in 2019. The co-founder of the Democratic Progressive Party (DPP). He submitted his resignation along with that of his cabinet to Tsai earlier this month. Su had originally offered to quit after the November poll losses but was asked to stay on. The 75-year-old is the longest-serving DPP premier in history. Tsai said the new cabinet has four priorities: managing the post-pandemic reopening and recovery, reviewing social care, developing infrastructure and supporting small businesses, and strengthening Taiwan's position in global supply chains. Click here to read... [29]

NATO’s Stoltenberg in South Korea to deepen ties in Asia

NATO Secretary General Jens Stoltenberg arrived in South Korea on Jan 29, the first stop on a trip that will include Japan and is aimed at strengthening ties with the U.S. allies in the face of the war in Ukraine and rising competition with China.In the South Korean capital, Seoul, Stoltenberg met Foreign Minister Park Jin, and was expected to meet President Yoon Suk-yeol and Minister of National Defense Lee Jong-Sup. NATO is concerned about North Korea’s “reckless” missile tests and nuclear weapon program, while the war in Ukraine had ramifications for Asia, Stoltenberg told Park in remarks at the beginning of their meeting, citing suspicion that North Korea is providing military support to the Russian war effort. “This just highlights how we are interconnected,” he said. Both officials cited “shared values” between NATO countries and South Korea. “Given today’s unprecedented global challenges, we believe that solidarity among countries that share values of freedom, democracy, and rule of law is more important than ever,” Park said. Flying to Tokyo on Jan 30, the secretary general has meetings scheduled with Prime Minister Fumio Kishida and other Japanese officials. While NATO will remain focused on Europe and North America, its members are affected by issues around the world, Stoltenberg told South Korea’s Yonhap News agency in an interview. Click here to read... [30]

Russia rules out talks with Japan on fishing near disputed islands

Russia said on Jan 29 it will not hold annual talks with Japan on renewing a pact that allows Japanese fishermen to operate near disputed islands, saying Japan has taken anti-Russian measures. The islands, off the northern Japanese island of Hokkaido, are known in Russia as the Kurils and in Japan as the Northern Territories and have been at the core of decades of tension between the neighbours. "In the context of the anti-Russian measures taken by the Japanese government ... the Russian side informed Tokyo that it could not agree on the holding of intergovernmental consultations on the implementation of this agreement," the RIA state news agency reported, citing Russia's foreign ministry. Japan, a major U.S. ally, imposed sanctions on dozens of Russian individuals and organisations soon after Russia launched its invasion of Ukraine on Feb. 24 last year. On Jan 27, it tightened sanctions on Russia in response to Russian air attacks on Ukrainian cities. Russia in June suspended the 1998 agreement that allowed Japanese boats to fish near the islands and Japan's chief cabinet secretary on Jan 23 told a news conference that Japan would demand that Russia engages in the annual talks so this year's fishing operations could begin. Click here to read... [31]

Health

North Korea locks down capital city over ‘respiratory illness’--report

Authorities in the North Korean capital Pyongyang have ordered a five-day lockdown due to rising cases of an unspecified respiratory illness, Seoul-based NK News reported on Jan 25, citing a government notice. The notice did not mentioned COVID-19, but said that residents in the city are required to stay in their homes through the end of Jan 29 and must submit to temperature checks multiple times each day, according to NK News, which monitors North Korea. On Jan 24, the website reported that Pyongyang residents were appeared to be stocking up on goods in anticipation of stricter measures. It is unclear if other areas of the country have imposed new lockdowns. North Korea acknowledged its first COVID-19 outbreak last year, but by August had declared victory over the virus. The secretive country never confirmed how many people caught COVID, apparently because it lacks the means to conduct widespread testing. Instead, it reported daily numbers of patients with fever, a tally that rose to some 4.77 million, out of a population of about 25 million. But it has not reported such cases since July 29. State media have continued to report on anti-pandemic measures to battle respiratory diseases, including the flu, but had yet to report on the lockdown order. Click here to read... [32]

China’s Portrayal of Smooth Covid Exit Leaves Scientists Wanting More Data

China published a raft of data this week in an effort to show the peak of its Covid-19 wave has passed, though public-health experts continue to question whether Beijing has been transparent enough to enable them to accurately assess the situation. Chinese health authorities said that the daily number of Covid-19 deaths in hospitals topped out at around 4,300 in early January, and by the middle of the weeklong Lunar New Year holiday that ended Jan 27 was down nearly 80% from that level. The number came in an official Chinese Center for Disease Control and Prevention report that also showed a sharp drop in infections and serious illness caused by Covid. The data lend support to China’s message that it has weathered the most difficult period since its abrupt early-December scrapping of strict Covid controls—in effect for three years—and that its transition to living with the virus has been smooth and orderly. While some leading epidemiologists agreed that infections in China had mostly likely peaked, they said the figures were too incomplete to judge the full impact of the policy reversal, an issue that the World Health Organization also raised. Numbers released earlier this month indicated that hospitalizations and clinic visits had peaked around the start of the year. Click here to read... [33]