Southeast Asia from Somewhere Over the Pacific
March 29, 2010
Harvard’s Joe Nye published a commentary this week arguing leaders in China betting against the United States might be making a mistake. He is right. Nye implies some Chinese leaders may be trapping themselves in a jingoist rant ahead of the Party Congress in 2012 – every party member trying to outdo the other in terms of checking the box for strident nationalist credentials. Unfortunately, many in the US Congress may be in that same mode.
The chest-pounding over currency valuation, economic models and world leadership in Beijing and Washington is not welcome in Southeast Asia. Even as region is preoccupied with its own political dramas, it keeps a collective eye trained on the China-US dynamic because these two countries dominate national security priorities and comprise the largest markets and sources of foreign capital and technology for nearly every ASEAN country. “When elephants fight,” goes the old Kikuyu proverb, “it is the grass that suffers.”
The argument for US resiliency is based on the fact that democracy and particularly the American brand of that form of government provides for an inherent adaptability. History confirms the United States can change course when it is in trouble. Walt Whitman was so confident he declared, “Thunder on! Stride on! Democracy. Strike with vengeful stroke!” It may be that Vikram Pandit and Citigroup provide case in point this coming week as they prepare to pay the Treasury back in full -- nearly $8 billion – and exit the TARP. Down, but not out.
At the policy level, economists and partisans argue over whether passing the health care reform act this week was genius or suicide. For those who have waited patiently for the Obama Administration to clear this benchmark, including those who want to see trade as a priority, the fact health care is checked off the President’s to do list is important. The question is whether the new focus on jobs will include a presidential posture on trade including the political courage to make the case that growth is linked to trade – particularly in Asia which the IMF stated this week would grow at over 8.5% or twice the world’s rate in the coming years.
The Week That Was
- Prime Minister Abhisit Vejjajiva sat down with Red Shirt leaders including Jataporn Prompan this weekend in Bangkok. The talks did not yield immediate results, but it was a significant step by the Government in seeking to diffuse the protests that have been going on since March 12 in the country’s capital. The Red Shirts asked the Prime Minister to dissolve parliament and declare elections. The Prime Minister explained his concerns about moving in that direction without careful consideration. The stand-off in Thailand continues.
- In Burma, Aung San Suu Kyi indicated that she and her party, the National League for Democracy (NLD) are out for Burmese elections this year. After the ruling junta, the SPDC, published its elections laws two weeks ago, analysts and officials from concerned governments expressed their view that the guidelines presented a significant step backward. The NLD argued that the new Constitution does not allow empower elected officials. No date has been proposed for the elections, but any prospect for legitimacy seems to be undermined.
- According to the latest SWS Poll of March 19-22, the race for the Presidency in the Philippines continues to be a two horse race as Senator Benigno “Noynoy” Aquino III holds an 11 point lead over Senator Manuel “Manny “ Villar with 37 percent of voters’ preference compared to Villar’s 28 percent. Former President Joseph “Erap” Estrada received his best polling numbers since the start of the race with 19 percent potentially making him a major factor in the race. If Estrada threw his endorsement behind either candidate, he could have a decisive impact on the election. If he stays in the race, he would likely pull votes away from Manny Villar who is polling significant better than Aquino in categories C, D, and E (relatively poorer rural and urban voters). In Manila though, savvy election watchers note that last week saw the official launch of local campaigning – at the governor and mayor level. These campaigns officially can begin 45 days from election day and it is believed that the presidential candidate with the best nationwide political “machinery” can dominate in this period of the campaign. Many observers believe Villar has an edge in this area and note that candidates from current President Arroyo’s Lakas-KAMPI party have started to declare support for Villar, lending credence to earlier speculation that the Arroyo camp may favor Villar ahead of their own presidential candidate, former Secretary of Defense Gilbert “Gibo” Teodoro. In the Vice Presidential race, Senator Manuel “Mar” Roxas opened a more significant 20 point lead over Senator Loren Legarda receiving 45 percent of voter preference compared to her 25 percent. For the first time, former Manila mayor Jejomar “Jojo” Binay received over 20 percent of with 21 percent making him a contender in what is now a three way race.
- Despite their 11 percent lead, leaders of the Aquino campaign have expressed serious concern about the efficacy of the Commission on Election (COMELEC) plans to automate the election for the first time in Philippine history. They argue that the new automated system is not tested and could end up disenfranchising voters who may not get to vote due to the limited number of automated voting machines. They also claim that automation may allow for election fraud.
- In Vietnam, the Communist Party of Vietnam wrapped up its 12th Central Committee Conference paving the way for the 11th National Party Congress to be held in early 2011. Party General Secretary Nong Duc Manh said the CPV had achieved its goal of establishing Vietnam as a modern industrialized economy by 2010. Over the next ten years, he said Vietnam will focus on sustainable development and comprehensive renovation with the aim of “building a prosperous, equal and civilized nation, promoting democracy and considering human rights as a key factor in national development. “ It is expected that many new faces will be added to the Vietnamese government leadership after the Party Congress next year.
- A big step for Asian economic integration was made this week. On March 24, the Chiang Mai Initiative Multilaterisation (CMIM), a $120 billion currency swap facility involving the central banks and finance ministries of ASEAN, China, Japan and the Republic of Korea (ASEAN+3) and the Monetary Authority of Hong Kong, China, was put into effect. ASEAN Secretary General Dr. Surin Pitsuwan said, “The entry into force of the CMIM is a momentous event because the multilateral swap facility is the first regional financing arrangement created for ASEAN+3. It also demonstrates the region’s coordinated response to the global financial crisis, and our strong commitment to regional financial stability,” he added.
- Another step toward ASEAN regional security cooperation and integration was witnessed this week as the 7th ASEAN Chief of Defense Forces Informal Meeting (ACDFIM-7) took place in Hanoi. The meeting, a precursor to the ASEAN Defense Ministerial Meeting (ADMM) to be held in May. The military leaders discussed joint approaches to addressing non-traditional and trans-national security challenges, ranging from terrorist threats, piracy and disease to the impacts of climate change.
- President Obama nominated Robert "Skip" Orr as the next US Ambassador to the Asian Development Bank (ADB). Orr is currently the Chairman of the Board of the Panasonic Foundation, Board of Trustees member at JF Obirin University and member of the Board at the East West Center Foundation. He was President of Boeing Japan from 2002 - 2007.
The Week Ahead
The 16th ASEAN Summit will be held in Hanoi on April 8-9. The leaders of the ASEAN countries will review progress on their goals related to achieving an ASEAN Community by 2015 as laid out in the ASEAN Charter. Hot topics include how to react to Burma’s draconian election guidelines and managing concerns about the impact of the China ASEAN FTA.
- CSIS will host Malaysian Prime Minister HE Dato’ Seri Najib Razak for a seminar on US Malaysia relations, economic ties and the security cooperation at CSIS on April 14, 2010. Invitations will be sent shortly, but interest parties can pre-register at SoutheastAsiaProgram@csis.org
- Chinese Premier Wen Jiabao is preparing for his April visit to Indonesia. Indonesia has been among the most vocal of the ASEAN countries in expressing concerns about the impact of the China-ASEAN Free Trade Agreement (CAFTA) on its economy and companies.
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