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21 MAY 2012

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CAPTURES

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CARI

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ISSUE 77

China Dispute Threatens Philippine Industries Philippines, China

The Philippines’ dispute with China over territorial claims in the South China Sea is exacting an economic

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toll on key Philippine industries, including tourism and agriculture.

while Philippine fruit exports to China are being scrutinised after Chinese quarantine authorities found a batch of bananas infested with insects 43 fruit companies were informed their exports will not be accepted, even though Philippine banana exporters have no problems in markets with stricter requirements, such as Japan The standoff could hurt the Philippines’ progress in building business ties with China, which is now the country’s thirdlargest trading partner, said Ramon Ang, president and chief operating officer of conglomerate San Miguel Tensions began on 8 April when Filipino sailors attempted to arrest Chinese fisherman that Philippine authorities said were poaching protected marine species Why it matters: Tension between China and the Philippines has not impacted trade until now The Wall Street Journal (16 May 2012)

Chinese tour groups have cancelled trips,

Malaysia and Indonesia Agree to Form Parliamentary Caucus Sticking Points

Malaysia, Indonesia Malaysia and Indonesia agree to form a parliamentary caucus to deal with bilateral issues. The Malaysia-Indonesia Parliamentary Causus will allow parliamentarians from both countries to discuss thorny issues before they escalate to the point of souring bilateral ties, says Minister in the Prime Minister’s Department Mohamed Nazri Aziz

Malaysian cabinet ministers were encouraged to frequently keep in touch with their Indonesian counterparts The setting up of the caucus was in reaction to the shooting of three Indonesian criminals in Port Dickson in March, adds Mohamed Nazri Borneo Post (17 May 2012)

Death of migrant workers in Port Dickson (March 2012) Indonesia’s threat to re-impose maid moratorium following more incidents of abuse (March 2012) Malaysia-Indonesia border incursion in West Kalimantan (2011) Rape and torture of an Indonesian housemaid (2010) Alleged arrest of three Indonesian fisheries officers by Malaysian marine police (2010) Moratorium on Indonesian maids being employed in Malaysia following cases of abuse (2009 to 2011)


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India’s investment loss is ASEAN’s gain

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Putin’s return

firms Russia –

ASEAN, India

ASEAN ties ASEAN, Russia President Vladimir Putin’s return as the Russian leader will impact ASEAN more than ever and it is imperative to dwell on what Russia has in store for the region, wrote Kavi Chongkittavorn of the Nation.

Southeast Asian countries are swallowing an outflow of money from India, as foreign investors lose patience with its policy paralysis and slowing growth, and aim instead for more promising emerging markets such as Indonesia. Two provisions put forward in India’s federal budget to tax indirect investments

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and combat tax evasion accelerated an outflow of funds While the provisions were later put on ice, the prospect that such a tax could be proposed in India sent some investors to park funds in Jakarta and other Southeast Asia capitals Corruption scandals and high inflation have also added to India’s woes CNBC (16 May 2012)

Thailand M&A poised for takeoff in 2012

China and the US are concerned about rebalancing their power in the region, while Russia is keen on redistributing power Putin will host the Asia Pacific Economic Leaders Meeting later this year in Vladivostok and is scheduled to attend the upcoming Asia Europe Meeting in Vientiane in October and the East Asia Summit in Phnom Penh in November Russia wants to attract foreign investment, especially from ASEAN and its dialogue partners to the country’s remote Siberia and the Far East region Why it matters: Moscow is very interested in the expansion of the Master Plan of ASEAN Connectivity that would link South Asia and Southeast Asia with Northeast Asia and its own vast northern frontier The Nation (14 May 2012)

Thailand

Mergers and acquisitions (M&A) in Thailand may reach US$20 billion, driven mainly by the planned launch of the Asean Economic Community in 2015. Healthcare, hospitality, auto parts and energy sectors will be attractive targets

for foreign investors, says Kitipong Urapeepatanapong, chairman of Baker and McKenzie’s Bangkok office The increase in M&A activities include more investments by foreign companies in Thailand, as well as Thai companies expanding abroad

Revisions to Thailand’s laws on M&As also helped spur deals In the first four months of 2012, foreign direct investments in Thailand increased by 44% from THB,108.03 billion to THB155.5 billion Bangkok Post, The Nation (10 May 2012)

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.


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MYANMAR MONITOR

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Both Koreas woo ASEAN ASEAN, South Korea, North Korea

Economy The US government announced 17 May it would ease sanctions against Myanmar in various sectors of the economy, including energy, mining, and financial services. Sanctions were suspended, not revoked, and the move still holds back US companies from moving forward in some key sectors in Myanmar. US Secretary of State Hillary Clinton said the US would retain its arms embargo against the country. Centre for Strategic and International Studies (18 May 2012)

Total foreign investment in Myanmar was valued at US$240 million in the first quarter of 2012. The major recipient of foreign capital was in oil and natural gas industries. Other sectors include, livestock and fisheries, transport and communications, industrial estate, agriculture, construction and other services. Since 1988, of the 31 countries and regions investing in Myanmar, China led with US$13.947 billion accounting for 34.5% followed by Thailand with US$9.568 billion. Xinhua (15 May 2012)

Politics US Republican senator, John McCain, called on the Obama administration to further suspend sanctions on Myanmar. President Thien Sien, McCain noted, was sincere about reforms and is making progress. The Senator said proper investment would hasten the reform process and reduce the military control of the economy and government. Bangkok Post (15 May 2012)

During South Korean President Lee Myung-bak’s visit to Naypyidaw, President Thein Sein affirmed that Myanmar would no longer purchase weapons from North Korea. Thein Sein also indicated Myanmar was committed to the UN Security Council resolution on the ban of activities linked to the North Korean long-range missile programmes.

South Korean President Lee Myungbak left Myanmar with a pocketful of business agreements and plans to open an ASEAN diplomatic mission in Jakarta, while a senior North Korea official headed to Singapore and Indonesia. Lee offered to expand cooperation to Myanmar in energy, resources development and infrastructure construction, extend grants and development loans and carry out a string of programmes to share South Korea’s economic development experience South Korea will open an ASEAN diplomatic mission in Jakarta in July 2012 Kim Yong-nam, North Korea’s secondhighest ranking official, visited Singapore and Indonesia in what has been termed the most high-profile official to travel overseas since Kim Jong Un took over as leader in December

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Peter Chou, Chief Executive Officer of the Taiwan-based electronics company, HTC Corporation, revealed that he was born in Myanmar. He told an audience of young IT enthusiasts in Mandalay that he was born in Myanmar’s second-largest city and studied there before emigrating to Taiwan over 30 years ago. Chou indicated his return was to reunite with family and friends and not for business. The Irrawaddy (16 May 2012)

UPI, Chosun Ilbo, Bangkok Post (16 May 2012)

Singapore tops world bank logistics study

Singapore Singapore topped the World Bank’s third biannual study of logistics performance, beating rival Hong Kong, which came in second overall. The index measures how easy and inexpensive it is to move goods through a country based on several criteria, including the quality of ports and rail, competence

of transport companies, the ability to track goods, and prevalence of bribe solicitation The report notes Indonesia has a long way to go in terms of “dwelling time” at its main port of Tanjung Priok where in 2011, containers sat around on average for six days in port, compared to one day in Singapore and four days in Malaysia Wall Street Journal (16 May 2012)

Logistics Performance for ASEAN Countries GLOBAL RANK

The New York Times (15 May 2012)

Social

Indonesia has maintained good relations with the country since 1961 Why it matters: Competition is expected to heat up among China, Japan, Korea and the US for more access to ASEAN economies. North Korea may be trying to curb its reliance on China by reaching out to other countries in Asia

ASEAN COUNTRIES Singapore

2012

2010

1

2

Malaysia

29

29

Thailand

38

35

Philippines

52

44

Vietnam

53

53

Indonesia

59

75

Cambodia

101

129

Laos

109

118

Myanmar

129

133

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.


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World Bank To Monitor AEC Progress

ASEAN The World Bank will provide advisory services to ASEAN to strengthen its capacity to monitor progress towards achieving regional economic integration by 2015. ASEAN will embark on systematic monitoring of the region’s integration with the ASEAN Economic Community (AEC) Monitoring and Evaluation Capacity Building Programme This collaboration would also provide ASEAN with appropriate recommendations to address gaps which may hinder the timely implementation of the AEC, said Lim Hong Hin, Deputy Secretary-General of ASEAN for the AEC ASEAN Secretariat (16 May 2012)

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ASEAN Launches Drawing Contest

ASEAN The ASEAN Secretariat has organised a drawing contest to commemorate the group’s 45th Anniversary on 8 August 2012. The “ASEAN Drawing Contest” will be held from May to July 2012 at national level, and then regional The theme of the contest is “ASEAN: One Community, One Destiny” and is open to

all young nationals from the ten ASEAN members for ages 6 to 18 Selection will be based on the number of “likes” received by the drawings on Facebook Winners will receive a cash prize of US$500 and certificates signed by the ASEAN Secretary General ASEAN Secretariat (10 May 2012)

Editorial Team: Angela Goh, Manissa van Geyzel, Han Fang Rong, Chayut Setboonsarng, Lore Kin Nyung Consultant Editor: Tunku ‘Abidin Muhriz Designer: Iqbal Hakim DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

CARI Captures Issue 77 (21 May 2012)  

Captures is CARI’s weekly news monitoring report, each time presenting the top 10 stories affecting ASEAN

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