China Offers $25 Billion for Infrastructure in Southeast Asia

Oct. 24 (EIRNS)—Coming just days after the historic agreement between China and Russia, in which China will invest in high-speed rail, port development, and other infrastructure development in Russia, China announced on Oct. 24 at the ASEAN+3 (Association of Southeast Asian Nations, plus China, Japan, and South Korea) meeting in Thailand that it is making $25 billion available for infrastructure development in the ten ASEAN countries. Of this, $10 billion was announced last April, in the form of a China-ASEAN Fund on Investment Cooperation, while an additional $15 billion is now being offered as credits to ASEAN nations, with an additional $40 million in aid to the poorest ASEAN countries.

The ASEAN nations have repeatedly made clear that the increasing aid and loans from China are the most welcome form of foreign support, as they come without the conditions on their economic and political policies which come with support from the West, undermining their sovereignty.

Premier Wen Jiabao issued a proposal for China-ASEAN cooperation, including, in addition to the infrastructure assistance, the lowering of tariffs on interregional trade, Chinese assistance in increasing the productivity of grain production, and environmental cooperation.

The ASEAN+3 will also expand to $120 billion, the pool of currency reserves first established as the Chiang Mai Initiative in 2000 to counter currency speculation and provide aid during natural disasters. China also pledged 300,000 tons of rice towards the planned ASEAN+3 Emergency Rice Reserve.

Although the Asian Development Bank (ADB) released a study revealing a state of denial regarding the global financial collapse, claiming that there will be a "V"-shaped world recovery "with developing Asia leading the way," China is not buying such dangerous euphoria. Wen told the ASEAN+3 Summit that, "Tackling the global financial crisis should remain the top priority for countries in the region at present."

Japan Airlines Workers and Pensions on the Block

Oct. 25 (EIRNS)—A unique bill is being prepared for the upcoming special Diet session to save Japan Airlines, or its creditors, from bankruptcy. The details of JAL's troubles and of the proposed bailout are mostly irrelevant, since they mirror similar situations at other major corporations around the world.

There are two items of particular interest in this bankruptcy rescue situation.

The deal, as it now stands, hinges on slashing already accrued, but not funded, pension obligations totaling 330 billion yen ($3.6 billion). As in the United States, companies were allowed to "fund" pensions with no more backing than the companies' future ability to pay.

This bailout maneuver has the unfortunate drawback of being illegal under the Japanese Constitution. "Corporate pensions have strong legal protection and are treated as credit obligations to employees in the same way as salaries. Therefore, lowering pension benefit levels could violate constitutionally guaranteed personal property rights," according to the Yomiuri Shimbun.

Therefore, a special law is being drafted for the Diet to provide a loophole allowing the pensions to be gutted—just in this special case. The idea is that the law will be so specific to the JAL case and its current emergency, that it can't be used as a legal precedent to rob other pensions. But, of course, it would be a moral precedent for other pension funds to be gutted.

Also, since a JAL rescue plan was put forward in late Summer, before the installation of the Democratic Party of Japan as the new government, and rejected as "too soft," the layoffs associated with the "rescue" have increased from 6,000 to 13,000. Seventy of the airline's routes are also being eliminated.

Mahathir Hits Tony Blair as War Criminal

Oct. 28 (EIRNS)—As European leaders hold polite discussions about whether or not Tony Blair should be anointed as Emperor of Europe, Dr. Mahathir Mohamad, former prime minister of Malaysia, and outspoken foe of such British toadies as George Soros and Al Gore, denounced Blair as a war criminal. Speaking at a conference in Kuala Lumpur, Dr. Mahathir said: "These people who have created war and killed so many people should be regarded as criminals, the people should not associate with them and should avoid them. Countries should take the same step." On Blair, he added: "We know he was in Sabah [Malaysia] for holiday, but he was actually invited to give a talk on justice—what does he know about justice? It is disgraceful that we should allow such a person to come to Malaysia and to talk about justice, it is ridiculous."