China courts friends in region; for others a show of strength

Chinese Premier Wen Jiabao (L) poses during the family photo at the 15th ASEAN-China summit meeting at the Peace Palace in Phnom Penh, November 19, 2012. Also in the picture is Cambodia's Prime Minister Hun Sen. REUTERS/ Samrang Pring

PHNOM PENH/BEIJING (Reuters) - When U.S. President Barack Obama and more than a dozen leaders arrived in Cambodia for a regional summit meeting this week, only one of them was feted with banners strung from the venue gates.

"Welcome Prime Minister Wen Jiabao!" one proclaimed. "Long live the People's Republic of China!" read another.

As the leaders left, the green-and-white banners were still festooned outside Phnom Penh's Peace Palace, a fitting reminder of China's powerful and growing clout as Beijing uses its influence - and money - to win friends and frustrate those uneasy about its sweeping territorial claims and rising military strength.

"Some states are easily swayed by money. If they see cash, they easily throw away their principles," said one Asian diplomat at the East Asia Summit, which included heads of state from 10 Southeast Asia countries and counterparts from the United States, China, Japan and other Asia-Pacific nations.

"China has been throwing its weight around and buying the loyalties of some Asian states."

A prime example is Cambodia, whose prime minister, Hun Sen, helped China to notch up a succession of diplomatic victories at the summit. China stalled debate on a resolution of maritime disputes in the South China Sea, rebutted attempts by Southeast Asian nations to start formal talks on the issue and avoided any rebuke from Obama over territorial ambitions. Commentators declared China a clear summit winner.

A closing statement by Hun Sen, this year's chair of the 10-member Association of Southeast Asian Nations (ASEAN), made no mention of the South China Sea, another victory for China's attempts to prevent multilateral talks on the dispute.

China has poured investments and loans into Cambodia in recent years, becoming its biggest trade partner and bilateral creditor. Cambodia's debt to China now totals at least $4.7 billion, about a third of its economy.

The price of that largesse has become clear this year, say analysts, as Cambodia has used its powers as ASEAN chair to restrict debate over the vexed issue of China's maritime claims, dividing the group and infuriating U.S. ally the Philippines.

The 45-year-old ASEAN group has been built on a foundation of unanimity and unity, but that has unravelled as it struggles to cope with its biggest security challenge. In July, a meeting of the region's foreign ministers broke down in unprecedented acrimony and failed to agree a communique for the first time.

This week's ASEAN meetings again deteriorated into bad-tempered sniping and came close to a breakdown when Hun Sen adopted a draft statement saying there was a consensus not to "internationalise" the South China Sea dispute beyond ASEAN and China.

The Philippines, which sees its alliance with the United States as a crucial check on China's claims at a time when Washington is shifting its military focus back to Asia, made a formal protest to Cambodia and succeeded in having that clause removed from the final statement.

China then poked fun at Manila's assertion that there had been no consensus. Eight out of 10 leaders had agreed not to internationalise the dispute, meaning there was a consensus, said Qin Gang, a Chinese foreign ministry spokesman.

"I suggest that people when attending the EAS (East Asia Summit) meetings have to be very good at mathematics," he said.

"That's 10 minus two, so which is bigger?"

NAVAL BUILDUP

Beijing claims a vast U-shaped line around the South China Sea that brushes up against the coasts of the Philippines, Vietnam, Brunei and Malaysia. The area is thought to hold vast, untapped reserves of oil and natural gas, and naval flashpoints between Chinese vessels and the Philippine and Vietnamese navy have become increasingly common.

Hopes for a diplomatic resolution within the ASEAN-China framework look bleak in the next two years as tiny Brunei and then Myanmar take up the chairmanship of the group.

Cambodia, like fellow "Mekong" countries Laos and Myanmar, has been rapidly pulled into China's economic orbit through rocketing trade and investment ties.

It has become customary for Chinese officials to arrive in Cambodia bearing "gifts", such as the $100 million investment that Wen announced on his arrival this week to build the emerging country's biggest cement plant. China has moved nimbly to set up free trade deals with Southeast Asia nations and has played a dominant role in financing and building big infrastructure projects in Laos, Cambodia, and Myanmar.

After the summit, Wen visited Thailand where he signed an understanding to buy rice, which should strongly lift Beijing's standing with a government that is a close ally of the United States. Bangkok has built up record stockpiles of 14 million tonnes of milled rice after a populist programme to pay farmers more for their crops made exports unprofitable.

If diplomatic efforts stall, China's options to back its claims with force if needed are steadily growing with a military budget that outstrips the combined spending of Southeast Asia.

As China ushered in a new generation of leaders this month, outgoing President Hu Jintao made a pointed reference to strengthening China's naval forces, protecting maritime interests, and the need to "win local war."

"We should make active planning for the use of military forces in peacetime, expand and intensify military preparedness, and enhance the capability to accomplish a wide range of military tasks, the most important of which is to win local war in an information age," Hu said.

Besides the South China Sea, China is embroiled in a dispute with Japan, also a close U.S. ally, over islands in the East China Sea.

China's stance is that it is not trying to become an offensive naval power, but wants to secure its energy imports and boost development of maritime natural resources, which are expected to represent 10 percent of its economy by 2015.

But it is also wary of being encircled as the United States refocuses its military clout on Asia in what Obama has called a "pivot" back to the region as wars in the Middle East wind down.

"It is absolutely (a buildup)," said Ruan Zongze, deputy director of the China Institute of International Studies, the think-tank of the Chinese Foreign Ministry.

"No matter what kind of narrative you use, the reality is that America in the past three years has been putting greater emphasis or focus on the west Pacific. That raises a lot of questions for China."

China launched its first aircraft carrier in September, increasing its ability to project forces deeper into "blue-water" maritime territory. Bought from Ukraine ostensibly to use as a floating casino, the Chinese navy spent years refurbishing the carrier, which is undergoing sea trials. It also test-flew two types of stealth fighters this year, the second one last month - a smaller, more maneuverable model believed to be designed to be deployed on an aircraft carrier.

"China has ambitions to become the premier military power among its regional peers, and a serious threat to U.S. maritime primacy in the Asia Pacific," said Sam Roggeveen, an Asian defence analyst with the Lowy Institute in Sydney.

Roggeveen added that if China were to deploy more than one carrier and equip them with high-performance stealth fighters, "it would become the pre-eminent regional maritime power, with the ability to coerce neighbours in disputes in which the U.S. prefers not to get involved".

 By Stuart Grudgings and Terril Yue Jones
(Additional reporting by James Pomfret and Manuel Mogato in PHNOM PENH; Editing by Jason Szep and Raju Gopalakrishnan)

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Asean nations feud over South China Sea

ASEAN plans world’s largest trading bloc in Asia, the Regional Comprehensive Economy Partnership (RCEP) and the U.S. Secrecy in Trans-Pacific Partnership (TPP)

The leaders of Asean have succeeded in persuading their top trading partners to start negotiations on the Regional Comprehensive Economic Partnership (RCEP) to create the world’s largest trading bloc.

Cambodian Prime Minister Hun Sen formally launched the negotiations on the RCEP during the Asean Summit and Related Summits yesterday at a meeting at the Peace Palace in the western part of Phnom Penh.

The leaders of the 10-member regional grouping and their six major trading partners agreed to create a trading bloc that will comprise more than three billion people and with a combined GDP of US$15 trillion, roughly equal to that of the US.

Asean also launched the US-Asean Expanded Economic Engagement initiative, aimed at expanding trade and investment ties with the US and smoothing a path for the Trans-Pacific Partnership.

Trade Minister Gita Wirjawan said that plans for the RCEP would be welcomed by world leaders from Australia, India and the US as an amazing tool of economic integration that might become the benchmark for other regions.

“The spirit is not that of a zero-sum game. The economic integration of other regions is complementary to the economic integration among [Asean] member countries,” Wirjawan told The Jakarta Post on the sidelines of the event.

“Many Asean member nations are conducting bilateral talks that are just fine, because they are complementary [to the RCEP],” Wirjawan said.

The minister has previously said that the RCEP would “rewrap” five current free trade agreements (FTAs) with Asean’s six major trading partners, China, Japan, India, South Korea, Australia and New Zealand.

Asean’s FTA with Australia and New Zealand covers both nations.

Wirjawan said that the prospects for the RCEP were currently brighter than of the Trans-Pacific Partnership (TPP) free trade agreement touted by the US, as Asean already had FTAs in place, albeit mostly on goods and tariffs, with most of the nations involved.

The RCEP will expand upon existing FTAs to include agreements covering services and investment.

Asean is currently in discussions to expand its FTA with India, which it expects to complete in time for the Asean-India Commemorative Summit next month in India. Similar negotiations will follow with Japan.

Earlier in the day, there was a global dialogue between Asean leaders with the heads of world financial institutions, including Asia Development Bank President Haruhiko Kuroda, IMF Managing Director Christine Lagarde, World Bank Managing Director Caroline Anstey, UN Conference on Trade and Development Secretary-General Supachai Panitchpakdi and World Trade Organisation Director-General Pascal Lamy.

Wirjawan said that the leaders agreed that Asean had shown itself to be resilient amid the global financial crisis, becoming a model for other economic zones.

“Also discussed were efforts to face financial crises, such as the Chiang Mai Initiative pool of funds, which has been increased from $120 million to $240 million,” Wirjawan said.

Another important decision that was made during meetings and summits in Cambodia between November 15 and 20 was to start additional talks on implementing the Asean Economic Community on Dec. 31, 2015, to aid member nations in their preparations.

Asean’s leaders also adopted the Asean Human Rights Declaration, despite critics who said that the document was not up to universal standards of human rights protection, promotion, monitoring and enjoyment.

At the end of the closing ceremony, Hun Sen presented the gavel to Brunei Darussalam Sultan Hassanal Bolkiah to mark the handover of Asean’s rotating chair from Cambodia to Brunei starting on January 1.

Bolkiah said it would be the fourth time that Brunei would hold Asean’s chair, and that the nation had chosen a motto of “Our People, Our Future Together” for Asean for 2013.

Asean Secretary-General Surin Pitsuwan of Thailand also brought to an end to his term. He will be replaced by Vietnamese deputy foreign minister Le Luong Minh, who has been endorsed by Asean’s member nations.
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An alternative to US President Barack Obama’s Trans-Pacific Partnership, the 16-member Regional Comprehensive Partnership (RCEP) is the newest concept for an economic union between ASEAN and six major trading partners, China, Japan, India, South Korea, Australia and New Zealand.

The RCEP is supposed to be a trading bloc that will comprise more than three billion people with a combined GDP of $20 trillion, or almost one-third of the global economy. Officials hope to have the talks concluded by the end of 2015.

Source: Investvine
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Association of Southeast Asian Nations

The First ASEAN summit was held in February 1976 in Bali.

The most recent 21st Summit was held from November 18-20, 2012 in Phnom Penh, Cambodia
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Video: ASEAN agenda


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Video: Opening Ceremony of the 21st ASEAN Summit


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Trans-Pacific Partnership

On November 12, 2011, the Leaders of the nine Trans-Pacific Partnership countries – Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam, and the United States – announced the achievement of the broad outlines of an ambitious, 21st-century Trans-Pacific Partnership (TPP) agreement that will enhance trade and investment among the TPP partner countries, promote innovation, economic growth and development, and support the creation and retention of jobs.

INCREASING AMERICAN EXPORTS, SUPPORTING AMERICAN JOBS

President Obama announced in November 2009 the United States’ intention to participate in the Trans-Pacific Partnership (TPP) negotiations to conclude an ambitious, next-generation, Asia-Pacific trade agreement that reflects U.S. priorities and values. Through this agreement, we are seeking to boost U.S. economic growth and support the creation and retention of high-quality jobs at home by increasing American exports to a region that includes some of the world’s most robust economies and that represents more than 40 percent of global trade. The Obama Administration has been working in partnership with Congress and consulting closely with stakeholders around the country to ensure TPP addresses the issues that American businesses and workers are facing today, and may confront in the future.

The Trans-Pacific Partnership Framework

The United States, along with Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, and Vietnam are working to craft a high-standard agreement that addresses new and emerging trade issues and 21st-century challenges. The agreement will include:

• Core issues traditionally included in trade agreements, including industrial goods, agriculture, and textiles as well as rules on intellectual property, technical barriers to trade, labor, and environment.

• Cross-cutting issues not previously in trade agreements, such as making the regulatory systems of TPP countries more compatible so U.S. companies can operate more seamlessly in TPP markets, and helping innovative, job-creating small- and medium-sized enterprises participate more actively in international trade.

• New emerging trade issues such as addressing trade and investment in innovative products and services, including digital technologies, and ensuring state-owned enterprises compete fairly with private companies and do not distort competition in ways that put U.S. companies and workers at a disadvantage.

Leading Asia-Pacific Regional Integration Initiative

The TPP is the most credible pathway to broader Asia-Pacific regional economic integration. After nine rounds of negotiations, the nine countries made solid progress and have now achieved the broad outlines of an agreement. During their meeting on the margins of the APEC meeting in Honolulu, the TPP Leaders agreed to seek to conclude the agreement as quickly as possible and instructed their negotiators to expedite their work. The nine countries also welcomed the interest expressed by other countries in joining the agreement and will begin bilateral processes with these interested countries to discuss their readiness and ambition to meet the standards and objectives of the TPP. Once these bilateral processes have concluded, all current Parties will decide on inclusion of new members by consensus.

American Competitiveness in the Asia-Pacific

The TPP is a key element of the Obama Administration strategy to make U.S. engagement in the Asia-Pacific region a top priority. The huge and growing markets of the Asia-Pacific already are key destinations for U.S. manufactured goods, agricultural products, and services suppliers. As a group, TPP countries are the fourth largest goods and services export market of the United States. U.S. goods exports to the broader Asia-Pacific totaled $775 billion in 2010, a 25.5 percent increase over 2009 and equal to 61 percent of total U.S. goods exports to the world. U.S. exports of agricultural products to the region totaled $83 billion in 2010 and accounted for 72 percent of total U.S. agricultural exports to the world. U.S. private services exports totaled $177 billion in 2009 (latest data available), 37 percent of total U.S. private services exports to the world. America’s small- and medium-sized enterprises alone exported $171 billion to the Asia-Pacific in 2009 (latest data available).

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Video: Trans-Pacific Partnership negotiated in secret


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Video: Dennis Kucinich discusses the secrecy of the Trans Pacific Partnership
Dennis Kucinich (Democrat) is a member of the U.S. House of Representatives from Ohio’s 10th district
October 18, 2012 before the elction of the U.S. President took place on November 6, 2012


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Sources: Novan Iman Santosa The Jakarta Post

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Schools to create 'Asian leaders' in Asian Century

This picture taken on July 23, 2012 shows 53 students from 14 countries holding hoops with their fingers as part of a cooperation learning exercise at a class of the International School of Asia, Karuizawa (ISAK) at Japan's mountain resort town Karuizawa in Nagano prefecture, central Japan. -- PHOTO: AFP 

KARUIZAWA, Japan (AFP) - Asia may be driving growth in the world economy but a Japanese businesswoman behind an innovative new school believes the region is over-reliant on Western-style leadership.

Lin Kobayashi believes Asia is over-reliant on Western-style leadership (AFP/File, Shingo Ito)

Ms Lin Kobayashi hopes her foundation outside Tokyo will help change that by breeding a wave of political and business leaders - but with what she sees as a more "Asian" way of thinking.

Building work on the International School of Asia, Karuizawa (ISAK) began in September. The launch of classes, all taught in English, is planned for 2014 making it Japan's first international boarding high school.

Ms Kobayashi, 38, a former investment analyst at Morgan Stanley, said the school will bring together students from a wide range of cultures and socio-economic backgrounds, with scholarships for poor students funded by donations.

Lin Kobayashi hopes her foundation will help to breed a wave of political and business leaders (AFP/File, Shingo Ito)

But she said she wasn’t aiming to simply rival elite schools such as  Britain’s Harrow or Dulwich College, which have set up Western-style campuses  in places such as China, Hong Kong and Thailand.

And she added she wanted to change what she sees as an assumption in Asia  that it was preferable to seek out education systems in which Western-style  leadership was taught.

“Asia is already at the centre of the world’s economy, but is still relying  on Western-style leadership that thinks charisma is only to be found in a loud,  top-down approach,” said Kobayashi, formerly of the Japan Bank for  International Cooperation and also the UN Children’s Fund in Manila.

“I think we need Asia-oriented leaders who value consensus and harmony and  can combine that with deep background knowledge about the complicated history  and diverse cultures of Asia.”

— Regional history —

The foundation has so far collected 1.5 billion yen ($19 million) in  donations and private funding to cover initial costs, while inviting prominent  business figures to come on board as advisors.

In July it opened its third annual 10-day summer school, with 53 students  from 14 countries. The course cost 300,000 yen.

Kobayashi said the school will place particular emphasis on regional  history, a subject that divides a continent where narratives differ widely from  country to country and are at the root of various territorial stand-offs.

Tensions have recently flared between Japan and China in a row over  disputed islands in the East China Sea, with trade between the two countries  looking set to suffer. The relationship was worth well in excess of $300  billion last year.

“We don’t teach one-sided history. It is important to learn about diversity  of historical perspectives and the multi-ethnic structure of the region,”  Kobayashi said, adding that she wanted to bring in teachers from many different  backgrounds.

Lzaw Saw Nai, a 14-year-old student from Myanmar who joined this year’s  summer school, said he was “very much interested in leadership”.

“We have political and many other problems in my country,” he said. “I feel  I should do something, but first I need to learn. So, I came here.”

Tareq Habash, 13, from Palestine, said: “My country is in need of leaders  who can understand the need of the country and not just for what they want for  themselves.”

— “Free-thinking” —

Kobayashi said she hopes potential future leaders of Japan, a place where  politics is often criticised for its lack of talent, will also benefit.

“Japanese education does not do enough to train people to lead,” she said,  adding that this was something the country desperately needed in a region  increasingly dominated by a rising China.

In the wake of defeat in World War II, Tokyo fashioned an education system  that prized uniformity.

While observers say this was one of the things that helped drive the  miracle of recovery, they also argue that uniformity is now hampering progress,  amid calls for strong, free-thinking leaders who can drive the country forward.

Yoshiaki Nomura, an expert in leadership education at Osaka University,  said the idea of the new Asian school was timely.

“I think a curriculum that will foster a new elite is needed,” said Nomura.

"We have learnt a lot about classic theories of Western leadership, but I often  feel that what we need in Asia may be different.”

Jun Nakahara, associate professor of higher education at the University of  Tokyo, agreed that leadership is not always an innate quality but rather “something you have to learn about”.

But he said on-the-job experience may be more valuable than classroom-based  learning.

“They have to provide students with opportunities for practical experience  in which they can exercise their own leadership,” he said.

He added that the school could be a ground for future networking  opportunities but that it would “take some time” before it enjoyed the kind of  influence of its established rivals in the West.

Sources: AFP/NST/Asia News Network

China's manufacturing growth quickens 13-month high

(Reuters) - China's vast manufacturing sector saw expansion accelerate in November for the first time in 13 months, preliminary results from a factory survey showed, a sign that the pace of economic growth has revived after seven consecutive quarters of slowdown.

The China HSBC Flash Manufacturing Purchasing Managers Index (PMI) rose to a 13-month high of 50.4 in November, the latest indicator of recovery in the real economy after data showing solid credit growth, firmer exports and rising industrial output in the previous month.

A sub-index measuring output rose to 51.3, also the highest since October 2011.

"This reflects that conditions for smaller firms, especially exporters, are looking up," said Li Wei, a Shanghai-based economist for Standard Chartered. "The consensus in the market is already for a small, gradual improvement."

An uptick in key economic activity indicators in October, following encouraging signs in September, cemented the view of many analysts and investors that a rebound in the world's second largest economy gathered momentum as it entered the fourth quarter, thanks to a raft of pro-growth policies rolled out by the government over recent months.

China is currently shuffling its senior officials after the seven top leaders of the ruling Communist Party were selected at a congress last week. The new appointments should end months of uncertainty in the highest ranks, although economic policy is not expected to change abruptly in the near-term.

Even before the congress, the central bank had moved to ease liquidity by pumping short-term cash into money markets rather than resorting to the interest rate cuts or reduction in banks' required reserve ratios that many investors had expected.

STEADY THROUGH YEAR-END

This month's PMI reading above 50 is likely to be seen as a turning point by the market, particularly if it is born out by the final reading due on December 1 and by official indicators.

Asian shares extended gains slightly after the data to stand up nearly 1 percent on the day and the Australian dollar, sensitive to demand from the biggest customer for Australia's resources, rose as far as $1.04.

"This confirms that the economic recovery continues to gain momentum towards the year-end," Qu Hongbin, chief China economist at index sponsor HSBC, said in a statement accompanying the data.

"However, it is still the early stage of recovery and global economic growth remains fragile. This calls for a continuation of policy easing to strengthen the recovery."

With a one-month exception in October 2011, the HSBC PMI -- which largely reflects the private manufacturing sector -- has remained stubbornly below the 50-point level separating accelerating from slowing growth since June 2011.

Unlike the patchy results seen in previous months, in November almost all the sub-indices in the HSBC survey concurred in showing an improving economy.

The one exception was a fall in the sub-index measuring output prices, demonstrating that manufacturers are still struggling with overcapacity and relatively weak domestic demand.

That could also reflect the weight in the survey of exporting firms, which have less ability to raise sales prices, said Standard Chartered's Li.

Indeed, China's exporters are increasingly squeezed by rising domestic costs and competition from new international suppliers, Zhou Haijiang, head of Chinese textile exporter Hodo Group, told reporters this month.

"Not only Western countries manufacture industrial goods, but also a lot of developing countries including former socialist countries who now have market economies are all exporting, thus creating a global surplus that cannot be changed," Zhou said.

"Because of this it is hard to raise sales prices, everyone is selling and it is hard for manufactured goods prices to rise. In some cases prices have even fallen."

Analysts expect no further cuts to interest rates this year or next after back-to-back cuts in June and July, and only one more 50 basis point cut to banks' required reserve ratios (RRR) in 2012 after three since late 2011 that have freed an estimated 1.2 trillion yuan for new lending.

Chinese banks are on course to make new loans worth more than 8.5 trillion yuan ($1.4 trillion) in 2012, expansionary versus the 7.5 trillion of new loans extended in 2011 and above the 8 trillion yuan that sources told Reuters back in February was the target for 2012.

Total social financing aggregate, a broad measure of liquidity in the economy, weakened to 1.29 trillion yuan in October, down from 1.65 trillion yuan in September, but still remained on track to hit a record 14 trillion yuan this year.

China also opened many previously-closed sectors to private investment with a view to funding new infrastructure projects and supporting economic growth without piling on more debt that local governments can ill-afford.

Although analysts expect fourth quarter GDP growth to outpace the 7.4 percent seen in the third quarter, full-year expansion for 2012 is expected to be the slowest in 13 years.

By Lucy Hornby, (Editing by Alex Richardson)
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What’s the intention of Obama’s visit to Asia?

From Nov. 18 to Nov. 20, U.S. President Barack Obama visited Thailand, Myanmar and Cambodia, and attended the 4th ASEAN-U.S. Leader’s Meeting and 7th East Asia Summit in Phnom Penh, Cambodia. It is his first diplomatic visit after the reelection, and he has become the first sitting U.S. president to visit Myanmar.

A woman takes a photo of a wall painting created by Myanmar graffiti artists to welcome President Obama in Yangon, Myanmar on Saturda(Photo: AP)

The three-day visit reflects Asian strategies of the Obama administration in the second term, which can be summarized into one focus, dual purposes and three pillars.

One focus refers to that Obama will promote the “rebalance” strategy in Asia during his second term. Southeast Asia is the focus of the Obama administration’s “rebalance” strategy. In other words, the U.S. will devote more political, economic, military, security and strategic resources to Southeast Asia in the course of shifting its strategic focus back to Asia Pacific.

Dual purposes mean that the United States, on the one hand, maintains dominance in Asia Pacific and, on the other hand, benefits from rapid economic development in Asia Pacific. The U.S. has for long been worried that the rise of emerging powers like China will squeeze its strategic room in Asia Pacific, its allies in the region might be alienated and it might be excluded from economic integration of Asia Pacific. Obama’s visit to Asia is designed to achieve the dual purposes mentioned above.

Three pillars are strengthening existing alliance, expanding new partnership and benefiting from the multilateral mechanisms. In Thailand, Obama highlighted the significance of traditional allies. Under the disguise of democracy, human rights and freedom, Obama tried to develop new partnership to expand the U.S. presence and influence on Southeast Asia in Myanmar. To achieve the end, the U.S. phased out political, military and economic sanctions against Myanmar, and claimed to provide an aid of 170 million U.S. dollars. In Cambodia, the U.S. attended the East Asia Summit, 4th ASEAN-U.S. Leader’s Meeting and Trans-Pacific Partnership Summit to secure a foothold in the Asian multilateral mechanisms.

Furthermore, the Obama administration is making slight adjustments to the “rebalance” strategy. He attached proper importance to economy and culture during his visit since the United States has received criticism for overplaying the military and security issues, as well as ill-disguised hostility against China.

The Obama administration is playing trick in the “rebalance” strategy. But, Man proposes, God disposes. The “God” refers to the regional and global trends. Those who bow before it survive and those who resist perish.

Read the Chinese version: 奥巴马亚洲之行的小九九, source: Jinghua Times, author: Jia Xiudong

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Politics and religion just don’t mix

I READ “Keep faith out of politics” (Sunday Star, Nov 11; related post: Don't mess religion with politics!) with great interest. As you rightfully said “religion and politics, that’s a potent mix to be explosive”.

My name is Joseph Sta Maria, 50, and I am a member of the Portuguese community in Malacca. Having once been involved in politics, I can understand how dangerous it is for religion and politics to be mixed.

But sadly, many leaders of the Roman Catholic Church and churches from the various Protestant denominations seem to be getting carried away with their political beliefs and cloud this with their religious obligations.

While it is all right for them to support any political party as individuals even if the policies of the parties that they support go against the grain of their religious beliefs, preaching politics from the pulpit instead of spreading the word of God is a gross perversion and can be the biggest sin they are committing.

I am deeply saddened that the Church has been dragged into the political debate in the country.

The Church must always remain apolitical and priests and pastors must confine themselves to preaching the gospel and help provide spiritual guidance to their flock.

What we are seeing instead are sermons slanted towards one side of the political divide and the spreading of political hate against the other.

There appears to be blatant support to political leaders of questionable morality or a tendency to “close one eye” when it comes to their misdeeds and political shenanigans.

I can proudly say that my ancestors brought the Catholic faith to this part of the world, particularly to Malacca, in the 15th century from which it spread to the region.

As such, I feel I am qualified to give an opinion of the present position of some of the Catholic churches.

As custodians of the Catholic faith, the Malacca Portuguese community will take the lead in urging all Catholic churches to stop allowing politicians from using the premises and its congregation as a means of wooing votes for the next general election.

It is sad that some church grounds are been used by irresponsible people to spew partisan hate to the congregation.

As Catholics, we should never have allowed this to happen.

As for the leaders of the church, they must be made aware that they are taking a big risk by throwing their support behind any political party.

As you pointed out, politics and religion must never be mixed especially in Malaysia where religion is a matter, which can raise sentiments to boiling point.

If anything goes wrong, the Malacca Portuguese community will hold these errant leaders of the church responsible.

As the adviser of the Malacca Portuguese village community, I wish to remind all churches to be mindful of the possible consequences and the irreparable damage to the religious harmony that we have been enjoying all these decades.

I reiterate that the Church is a house of worship and it must never be allowed to be misused by politicians whether they are from the BN or the Opposition for the repercussions would be very serious.

I believe there are many people like me who object strongly to churches being used by politicians but are too afraid or just don’t want to raise their objection to their pastors and church leaders knowing that their objections will be shot down.

I urge all those who agree with me to come out loudly and clearly to do justice for their religion and their belief.

This paragraph from the Bible, Mark 12:17 clearly shows Christians the difference between politics and religion: Then Jesus said to them: “Give to Caesar what is Caesar’s and to God what is God’s.” And they were amazed at him.

JOSEPH STA MARIA Malacca

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US Fiscal Cliff poses threat to economy worldwide!

Falling off the fiscal cliff would have a global economic impact, analysts say

The so-called "fiscal cliff" has been on the horizon for two years, but now the 31 December deadline is almost here.

Now that the presidential election is over it is hoped that policymakers will knuckle down to find a solution.

US fiscal cliff may hamper Malaysian economy, says economist

KUALA LUMPUR: Malaysia could experience a slower economic growth of between 3% and 4% next year if the US fiscal cliff kicks in by next January, OCBC Bank Bhd's economist Gundy Cahyadi (pic) said.

“It's going to create a huge impact if this were to happen. The fiscal cliff will create a recession in the US where its economy will likely contract by 0.5% and this may lead to a bigger than expected recession in the eurozone. The spill over effects may lead to global trade falling quite significantly.

“On the whole, we expect a growth of between 3% and 4% for next year,'' he said at a press briefing on OCBC's regional and global economic outlook for 2013. Fiscal cliff involves the simultaneous move to increase tax and spending cuts to reduce budget deficit.

He said on the whole OCBC was projecting the country's gross domestic product (GDP) for next year to be at 5.2% year-on-year, adding that at this juncture, the risk posed by the fiscal cliff was expected to be limited as the US government might finalise a new deal.

Gundy said the economic growth would be supported by Malaysia's investment growth, which was more than 20% for the first three quarters of this year, and strong positive momentum in private consumption growth.

However, he added the 20% investment growth would not recur next year but it would still expand by close to double digit, at least in the first half of 2013 as the Government was expected to continue ramping up infrastructure overhaul currently in progress.

The main risk to the bank's projection he said was the possible slump of global demand, especially as exports remained a main drag to Malaysia's growth in 2012.

External demand had continued to be a large drag on the country's economy, he said, noting that in terms of nominal value and its contribution to GDP growth, net exports were at a record low in the third quarter of this year.

Exports growth had been sluggish throughout the year, he said partly on the back of commodity price correction, and falling exports earnings would not only affect growth directly but would have negative spillover effects to households' spending behaviour.

There may be further pressure from the recent slump in crude palm oil prices which could be quite detrimental given the commodity boom seen in the past several years had led to a spike in investment in palm oil related industries, Gundy added.

On inflation, he said OCBC expected it to trend higher next year to about 3% from the likelihood of below 2% this year.

BY DALJIT DHESI The Star/Asia News Network

Related

Asean nations feud over South China Sea

PHNOM PENH - Southeast Asian leaders feuded on Monday over how to handle tense maritime territorial disputes with China, overshadowing talks at a regional summit meant to strengthen trade and political ties.

The leaders of the 10-member Association of Southeast Asian Nations had hoped to present a united front on the South China Sea row as they host Chinese Premier Wen Jiabao and US President Barack Obama for annual talks.

But that effort broke down just before Southeast Asian leaders were scheduled to meet Wen, amid divisions between Chinese ally Cambodia and the Philippines.

Cambodia, this year's ASEAN chair, said on Sunday that Southeast Asian leaders had agreed not to "internationalise" the disputes and would confine negotiations to those between the bloc and China.

The apparent deal would have been a victory for China, which has long insisted that it should only negotiate directly with rival countries and that the Philippines should not seek support from the United States.

However Philippine President Benigno Aquino on Monday publicly rebuked Cambodian Prime Minister Hun Sen, telling his fellow leaders no such consensus had been reached and he would continue to speak out on the global stage.

"The Philippines... has the inherent right to defend its national interests when deemed necessary," Philippine Foreign Secretary Albert del Rosario told reporters, quoting Aquino's comments to his fellow leaders on Monday morning.

The feud echoed unprecedented infighting at an ASEAN foreign ministers' meeting in Phnom Penh in July, which ended for the first time in the bloc's 45-year history without a joint communique.

The Philippines and Vietnam had wanted the communique to make specific reference to their disputes with China. But Cambodia, the hosts of the talks and a close China ally, blocked the moves.

ASEAN members Vietnam, the Philippines, Malaysia and Brunei, as well as Taiwan, have claims to parts of the sea, which is home to some of the world's most important shipping lanes and believed to be rich in fossil fuels.

But China insists it has sovereign rights to virtually all of the sea.

Tensions have risen steadily over the past two years, with the Philippines and Vietnam accusing China of increasingly aggressive diplomatic tactics to stake its claims.

Temperatures could rise again later Monday when Obama arrives in Phnom Penh to join the East Asia Summit, a two-day event also involving the leaders of Japan, South Korea, India, New Zealand and Australia.

Obama has previously angered China, and emboldened the Philippines, by calling for the rival claimants to agree on a legally binding code of conduct to govern their actions over the sea.

Analysts said he would likely repeat that call in Phnom Penh, as well as make comments highlighting the importance of freedom of navigation in the sea.

ASEAN officials had said they would push Wen during their talks on Monday to quickly start high-level, formal negotiations on a code of conduct.

But Chinese foreign ministry spokesman Qin Gang insisted that China wanted to continue with the current arrangement of lower-level talks on the issue. "We already have good discussions with ASEAN," Qin said.

Even with the South China Sea row festering, countries involved in the East Asia Summit were expected to focus on ways to expand economic ties.

ASEAN nations are set to officially launch negotiations on Tuesday for an enormous free trade pact with China, Japan, India, South Korea, Australia and New Zealand.

And despite their own territorial rows, China, Japan and South Korea are likely to hold talks in Phnom Penh on Tuesday aimed at kickstarting three-way free trade negotiations, according to Qin. - AFP

China opposes 'internationalisation' of sea row

Phnom Penh (AFP) Nov 19, 2012 - Chinese Prime Minister Wen Jiabao told Southeast Asian leaders Monday that negotiations to end territorial disputes in the South China Sea should only be held between claimant countries.

Wen stressed Beijing's position during a summit with the 10-member Association of Southeast Asian Nations (ASEAN) in the Cambodian capital of Phnom Penh, Chinese foreign ministry spokesman Qin Gang told reporters.

Qin said Wen quoted from a 2002 deal reached between ASEAN and China in which they agreed to limit negotiations to "directly concerned" countries.

Wen said that among the principles under the 10-year-old declaration is to "oppose the internationalisation of the issue".
"So Premier Wen quoted the principles... enshrined in the declaration," according to Qin.

ASEAN members Vietnam, the Philippines, Malaysia and Brunei, as well as Taiwan, have claims to parts of the sea, which is also believed to be rich in fossil fuels.

But China insists it has sovereign rights to virtually all of the sea.

Tensions have risen steadily over the past two years, with the Philippines and Vietnam accusing China of increasingly aggressive diplomatic tactics to stake its claims.

The Philippines has consistently sought wider help, such as from close ally the United States, in dealing with its more powerful Asian neighbour on the South China Sea issue.

The controversy of "internationalisation" flared again in Phnom Penh this week with the Philippines insisting it should not have to confine its negotiations to just with China.

US President Barack Obama, who arrived in Phnom Penh on Monday night for an 18-nation East Asia Summit, was also expected to raise his concerns over the South China Sea, which would anger the Chinese but embolden the Philippines.

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