|Asia News Digest
Thailand Restricts Foreign Ownership
Despite loud protests from the international financial community, Thailand has implemented its planned restriction of foreign ownership of Thai firms to 50%, local press reported Jan. 9. The Thai cabinet has approved a plan to stop the common practice of foreign firms circumventing the 50% limit on foreign ownership through nominee domestic firms under their control (and other means). Overseas investors have a year to disclose their holdings in Thai companies and a further 12 months to pare their stakes to less than 50%, measured by voting rights. Local joint venture partners, known as nominees, have 90 days to disclose their stakes and 12 months to comply with the revised rules, he said.
Commerce Minister Krirkkrai Jirapaet later said that retailers, insurers, banks, and brokers were exempt from the proposed changes to the foreign ownership laws. This follows the mid-December implementation of currency controls, requiring hot money coming into the country (i.e., money not tied to specific investments) to deposit 30% of the total for a year, aimed at stopping currency speculation. Hot money is now fleeing the country, but neither that nor the deadly terror bombing of Bangkok New Year's Eve has stopped the continuing clampdown on the speculators. It is a risky game.
Japan Urges India To Join the NPT
Japan's top government spokesman, Chief Cabinet Secretary Yasuhisa Shiozaki, on Jan. 10, refused to acknowledge India as a nuclear weapons state, demanding the South Asian nation join the nuclear non-proliferation treaty (NPT), AFP reported from Tokyo. Shiozaki also urged India to abandon its atomic weapons program, denying a report published earlier by the daily Yomiuri that Tokyo was considering acknowledging India's nuclear status.
"We will continue to seek the admission of India into the NPT as a non-nuclear weapons state," Shiozaki said, and added that Tokyo will carefully study details of the U.S.-India nuclear agreement signed last December by the US Congress.
Shiozaki's statement is a setback for the Manmohan Singh government in India. Prime Minister Manmohan Singh was recently in Tokyo seeking Japan's support in the commercial nuclear energy generation program. There was also a discussion of bringing in the Japanese Prime Minister Shinzo Abe to New Delhi at an early date to push the collaboration through.
Killings in India's Assam Resemble the Khalistanis
Insurgents in India's northeastern state of Assam have killed more than 65 migrant workers over the Jan. 6-7 weekend. While killings are continuing and panic-stricken Hindi-speaking migrant workers are fleeing the state, the Congress Party-led Manmohan Singh government is doing virtually nothing. The killers have been identified as members of the United Liberation Front of Asom (ULFA), a well-organized group seeking secession and operating from the border areas with Bangladesh for almost two decades. Their present targets are the migrant workers on tea plantations.
In the 1980s, a similar secessionist movement but in Punjab state, called the Khalistani movement, had landed heavy body blows to the Indian Republic and helped eliminate its then-Prime Minister Indira Gandhi. Their tactic was to terrorize the migrant workers by butchering them while they were being transported to the farm fields in this agriculturally prosperous and manpower-short state. The Khalistani movement had many patrons in the West, but it was run through the ever-willing bordering nation of Pakistan.
Afghan Heroin Floods U.S. Cities, Despite DEA Denials
Despite denials from the U.S. Drug Enforcement Administration, local authorities report that more Afghan heroin is coming to the U.S., five years after the Bush Administration toppled the Taliban in Afghanistan, the Miami Herald reported Jan. 6. The surge comes as Afghanistan's opium production has soared like never before. Today, according to many official sources, such as the UN, almost 90% of the world's opium is made from poppies grown in Afghanistan.
U.S. DEA spokesman Steve Robertson denies the reports, saying, "We are not seeing any increase being reflected in our intelligence." However, internal drug enforcement reports indicate that the U.S. authorities are seizing more Afghan heroin at U.S. ports and from low-level dealers in American cities. Their reports wholly contradict the DEA denials.
The local drug enforcement authorities were also backed by Rep. Mark Kirk (R-Ill), who represents the suburbs north of Chicago. Kirk said the Bush Administration had been slow to respond to indications that more Afghan heroin is flowing into the United States. U.S. law enforcement officials have told him privately that Afghanistan's share of the American heroin market is growing, he said.
China Begins Shipping Oil Up the Mekong
The first two shipments of oil, 300 tons altogether, left Chiang Rai in Thailand heading for Yunnan Province in southern China, Asia Times reported Jan. 9. The Chinese cleared out the rapids along the Laotian section of the Mekong last year, turning the river into a navigable route for travel and transport. The current plans call for 1,200 tons of oil to be shipped per month, but China is asking Thailand, Myanmar, and Laos to allow a fivefold increase.
This is the second route in the works for China to avoid shipping its oil supplies through the Malacca Straits, which they fear could be blocked by the U.S. in any potential conflict over Taiwan. The second is a pipeline being constructed from Sittwe in Myanmar, on the Bay of Bengal, through Mandalay, the Shan State, and into Yunnan.
British-Backed Insurgents Sue for Peace in Myanmar
The Karen, a largely Christian sect which is the last armed force still fighting the government, and the "last hope" of the Western forces trying to break Myanmar and prevent the unity of East, Southeast, and South Asia, may be ending its insurgency, AFP reported Jan. 8. "This is something we really want to do. After fighting for 57 years, there is no solution," said Col. Nerdah Mya, the son of the historic KNU (Karen National Union) leader, who died a few weeks ago. "It is time to see each other, solve our problems and make a change."
The Karen have sent a delegation to Yangon, where informal agreements were signed in 2003 and 2004 but not finalized. They are the last significant force to end the foreign-sponsored insurgency after 57 years, starting immediately after the British granted independence in 1948 on conditions that prevented national unity, by granting the right to independence to all the hill tribes and ethnic divisions. The British thus kept the border regions ungovernable, in order to run drugs and terrorist operations against the Chinese, Indians, and Thais. With all the region's nations now backing Myanmar's sovereignty against the U.S.-British "outpost of tyranny" nonsense, it appears that the Karen are choosing peace.
South Korean Household Debt Triples in Three Years
Household debt in South Korea has tripled during the past three years, the Korean Herald reported Jan. 8. As of the end of last September, it stood at about $500 billion, which is also three times the amount recorded at the end of September 1997, or two months before the Asian financial crisis hit Korea. Housing loans, drawing out equity from inflated house values (as in the U.S.), are largely responsible for the ballooning household debt. Floating rates apply to almost all of the property-backed loans, while the central bank is being pressured to raise interest rates to siphon off excess liquidity, portending a collapse. Moreover, disposable income relative to interest payments has been declining.
China Vulnerable to World Economic Slowdown
China is not immune to a world economic slowdown, especially if the U.S. economy goes, according to the UN World Economic Situation and Prospects 2007 report, released Jan. 8. The over-20% rise in Chinese exports since its accession to the WTO five years ago, is largely based on processing industries, which produce some 60% of China's exports.
China is especially vulnerable to a U.S.-led global slowdown, the report said. Were U.S. house prices to "dive," economic growth in China would drop to just 5% next year, rather than the potential of over 9%. China's big vulnerability is unemployment, which would obviously greatly increase if growth slows.
Call To Speed Up Beijing-Shanghai Railway Project
China's railway minister called for speeding up preparations to build the planned Beijing-Shanghai high-speed railway. Minster for Railways Liu Zhijun said Beijing would invest 256 billion yuan ($32.8 billion) in railway construction in 2007, part of which would go to the high-speed project, Xinhua reported Jan. 9. The funding is a 65% increase over 2006. The high-speed project was to have been launched last year, but this did not occur. It is still planned that the major part of the rail line, for 300-kph trains, would be completed by 2010. China will also start producing the locomotives for the railway.
China raised its investment in railways 76% in 2006, to 155.3 billion yuan ($19.9 billion). It now has 76,600 kilometers of rail lines, the highest in Asia and third in the world.
However, China will need another 1 trillion yuan ($128 billion) to fund the railway projects already being built and those to begin before end-2007.