BANGKOK: According to Thai Prime Minister Srettha Thavisin, the central bank’s price increases have had no positive effects on the economy and should be avoided by low-income individuals and small companies. Thailand trails local rivals with growth projections of approximately 2.4 percent last time, short of the 2022 target, accordingContinue Reading
Political pundits predict that three Constitution Court decisions this quarter and the possible release of former prime minister Thaksin Shinawatra in February may have a significant impact on the nation’s political scenery for months to come. The year has off to an amazing start.
Saksayam Chidchob, secretary-general of the Bhumjaithai Party, is accused of hiding assets and using a candidate to conceal possession of an organization that won numerous government construction projects. The court is expected to rule on this case on January 17.
When the situation was accepted by the court on March 3 of last year, Mr. Saksayam, a former transport secretary, was removed from his position as secretary. Following the opposition’s grilling of him over the alleged use of a candidate to hold shares in an upcoming censure discussion in July 2022, some opposition Members asked the court to act on his position.
Pita Limjaroenrat, a former leader of the Move Forward Party ( MFP), is scheduled to be decided by the court on January 24. He is currently the main opposition party’s advisory chairman.
Until the court rules on his internet shareholding in a media company, he is barred from performing his MP responsibilities. Mr. Pita does gain his MP position if the court determines that he ran for office while aware of his ownership of shares in the now-defunct broadcaster iTV.
The judge will then act on a case that could possibly result in the MFP’s dissolution on January 31. The MFP’s approach to Section 112 of the Criminal Code, also known as the der guess law, is being questioned by the court regarding whether it attempted to topple the constitutional monarchy.
Pita’s situation is more serious than his.
In Mr. Saksayam’s event, observers claim that if the court rules against him, it will have an impact on the Bhumjaithai Party, which is currently the second-largest coalition group.
Mr. Saksayam, the group’s secretary-general, is one of its most powerful figures, and if he loses, it may be necessary to change its technique by changing the inner dynamics and power structures of the group.
According to spectators, the decision in Mr. Pita’s advertising share-holding situation may have far-reaching ramifications that go beyond just his own political career.
If the judge laws against the original MFP head, Stithorn Thananithichot, an analyst at King Prajadhipok’s Institute, warned the Bangkok Post that it might also compel those in authority to reevaluate their political methods.
The opposition group will need to choose a new leader for the upcoming general election if Mr. Pita loses his MP reputation. He acknowledged that it might be challenging to find one as well-liked as Mr. Pita.
After the Future Forward Party was dissolved for accepting 191.2 million ringgit from an illegal origin and its chief Thanathorn Juangroongruangkit, who is now the president of the Progressive Movement, was given a social restrictions, Mr. Pita rose to the position of party chief.
Under Mr. Pita’s leadership, the MFP grew stronger rather than weaker, and it easily won the general election in May of last year. The group received 152 House seats and up to 14 million seats.
Mr. Stithorn speculates that Mr Pita’s reputation may have also peaked, and if he enters elections once more, it will be simpler for rivals to predict his next move.
Eyes on the liberal head, Stithorn
However, if Mr. Pita is absent, the MFP’s adversaries will probably encounter confusion and risk when dealing with a new chief. He noted that it is more difficult to make plans when they are unsure of the candidate for the position.
Regarding the MFP case, observers tend to concur that it wo n’t lead to the dissolution of the party and that, in the event that the court renders a negative decision, it might only order the policy to be abandoned.
Theerayut Suwankesorn, who brought the case before the court, claimed last month that his complaint did not request the dissolution of the group. The complaint sought to force the group to stop acting in a way that might offend the king.
Thaksin’s end
All eyes will be on Thaksin in February to determine whether he will gain from the Department of Corrections ‘ ( DOC ) regulation, which permits the detention of prisoners outside of prison.
After 15 times of self-imposed captivity, Thaksin, 74, who is well-liked by the ruling Pheu Thai Party, returned to Thailand on August 22 of last year and was given an eight-year prison term.
Nevertheless, he spent that evening at the Police General Hospital after being transported it from Bangkok Remand Prison for medical reasons. He has since stayed it with a number of illnesses. A royal forgive was given to him, reducing his sentence to a time in jail.
The DoC and the government denied the DOC’s say that the legislation was revived specifically to assist Thaksin in avoiding serving out his remaining term. Thaksin appears to meet the requirements for early release, which state that those who qualify may become serving one-third of their word and the jail term cannot be longer than four years.
Even though he has n’t spent a day behind bars, the former premier will have served one-third of his commuted one year in prison by the time February rolls around.
There is also widespread speculation that the DoC’s rules will persuade his younger girl and ex-prime secretary Yingluck Shinawatra to think about leaving his self-imposed exile.
Yingluck, 56, was given a five-year prison term on the cost of neglecting his duties while participating in the rice-pledging program, which resulted in losses totaling at least 500 billion rmb, some of which were caused by corruption. She was just cleared of misconduct, though, for the 2011 transfer of Thawil Pliensri, the secretary-general of the National Security Council at the time.
Legal expert and former deputy prime minister Wissanu Krea-ngam said last month that while Yingluck could ask for a royal forgive like her brother, she would first need to go back to Thailand and deal with the legal structure there. Typically speaking, observers believe that she will probably act similarly to her brother.
Political scientist Phichai Ratnatilaka Na Bhuket from the National Institute of Development Administration ( Nida ) claimed that Thaksin’s alleged VIP medical care outside of prison and eagerly anticipated release in February have rendered the Pheu Thai Party a sitting duck.
According to Mr. Phichai, the ruling party is attempting to avoid being directly involved in the controversy by appointing Deputy Prime Minister and Energy Minister Pirapan Salirathavibhaga to oversee the Ministry of Justice ( MoJ), which was previously overseen by Somsak Thepsutin.
He claimed that the nomination of Mr. Pirapan, a part of another party, to oversee the MoJ has strengthened rumors that Thaksin is meddling in secret affairs while the party does not want to appear to be acting in the interests of one specific person or its own.
” Mr. Pirapan must take into account the political reality of his party and its chances in the upcoming polls, even though he does n’t have the same ties to Thaksin as Mr. Somsak.” He suggested that his group might be more inclined to support Pheu Thai.
Pheu Thai is a sitting bird, says Phichai.
additional important focus details
The ruling party’s top priorities this year are the 10, 000 bass digital pocket scheme and contract rewrite, which are expected to rule the political landscape.
The Pheu Thai Party will have its hands tied with the digital wallet program and contract article in March and April, according to Jade Donavanik, a legal expert and former adviser to the charter writing panel.
All Thais 16 years of age and older who earn less than 70, 000 ringgit per month and have fewer than 500, 00 bank deposits are eligible to participate in the modern wallet plan, which aims to distribute 10,000 Baht to them.
Its application is still a mystery despite being estimated to cost 500 billion ringgit and being scheduled for release in May. The Council of State is looking into the legality of the government’s plan to apply for loans to finance the system.
The policy act is still up for debate because a vote is necessary to draft an entire document. According to him, the government has not yet decided how many elections on the contract amendment will be held or what the questions would be.
When the military-appointed Senate’s term expires in May, another significant growth is expected to take place, according to Mr. Jade.
200 members of the new Senate may be chosen from a variety of social and professional organizations. Cross-voting will be used to reduce stop votes and candidate collusion during the district, municipal, and federal levels of the elections.
The process, according to Mr. Jade, is meant to prevent politicians from interfering with the process, but it is unclear how successful it will be in preventing parties from influencing or ensuring a Senate that is truly independent and official.
Jade: Fixing the stasis charter
There can never be fairness if your loved one is not returning, and no amount of time served may bring Reeva back, according to a statement made by the Steenkamp family attorney on Friday. June Steenkamp added that her only wish was to be permitted to live in peace followingContinue Reading
ACTIVITIES IN PRESENCE The training this week come after a quarter of anxious skirmishes between China and the Philippines over disputed islands in the region, during which Chinese ships and Chinese vessels collided and fired water cannons at Philippine boats. According to one expert, Beijing wanted to make the SouthContinue Reading
AUKUS, a security alliance between the US, UK, and Australia, is speeding up its nuclear submarine software to fill in infrastructure, human resources, as well as technology-sharing practices.
The US Navy plans to teach 30 American sailors on how to fix its Virginia-class vessels using the submarine sweet Emory S Land in Australia this summer, according to a report by Defense News from soon December.
According to the report, the training will aid in the establishment of a nuclear-powered attack underwater maintenance capability at the American Australian naval base HMAS Stirling.
The AUKUS nuclear submarine program consists of three phases: first, the US and UK will operate submarines out of Stirling, Australia, then Australia will buy and use US-built and used Virginia-class submarines, and finally, it will build and operate its own nuclear attack submarine ( SSNs ).
At Pearl Harbor in Hawaii and Barrow in Furness in England, American soldiers, sailors, and government residents involved in AUKUS are already receiving training from the US Navy in nuclear submarine-related things.
A second group of American seafarers will be assigned to work on US submarines in 2024, and as part of their training, they will start performing repair at the Pearl Harbor Naval Shipyard, according to the report.
The US and Australian military joined Royal Navy personnel in Faslane in October 2023 to receive training on maintaining nuclear-powered submarines, according to the UK Ministry of Defense ( MOD ).
The US and Australian Submarine Support teams formed an Advance Verification Team ( AVT ) to improve their understanding of the industrial and maintenance skills required to manage and maintain nuclear-powered submarines, according to a UK MOD announcement.
Additionally, the UK MOD announced that AUKUS would receive an additional 4 billion pounds ( US$ 5.1 billion ), with money set aside for the design, development, and purchase of main long-lead aspects of the partnership’s first UK boats.
In terms of physical and human system, AUKUS also has a long way to go despite these collaborative efforts.
According to an article written by John Bruni and Pat Tyrell for the Australian Institute for International Affairs ( AIIA ) in August 2022, the question of whether any of the AUKUS submarines will be built in Adelaide, Australia, has not received much attention.
However, the American government has stated that it will make the country’s first SSN-AUKUS submarine by the end of the decade, and that the Royal Australian Navy will receive two locally-built ships in the first 2040s. The American government added that it started approving development for the future Submarine Construction Yard in Osborne, South Australia, in 2023.
Bruni and Tyrell emphasize that Australia needs to develop significant nuclear engineering expertise, intensive support and maintenance groups, nuclear regulatory authorities, and specialized crisis team in order to speed up the SSN-AUKUS system.
They even claim that in order to provide the very competent skills required for nuclear submarine repair, Australia’s universities will need to set up nuclear engineering facilities and establish a center for the field. Additionally, the American government needs to create infrastructure for the safe transportation of radioactive materials there.
Flinders University in South Australia and US and UK universities have entered into agreements to create specialized skills for the development of AUKUS nuclear submarines, according to a report by World Nuclear News in March 2023.
According to World Nuclear News, Flinders will be able to provide South American students with undergraduate and graduate programs thanks to the contracts. It mentions that Flinders University will collaborate with the University of Manchester, the head universities of the UK’s Nuclear Technology Education Consortium, on its doctoral-level research training and nuclear masters programs.
AUKUS’ advancement in nuclear submarine development and other delicate military fields may also be hampered by ability shortages in the marine shipbuilding industry and technology-sharing problems.
Paul McCleary and Cristina Gallardo write in a March 2023 issue of Politico that it will be difficult to get AUKUS operational for the long term due to the intricate alterations required in trade control regulations and growing worries that overworked US and UK ships may handle the workload.
Yet the combined naval shipping programs of the US and the UK, according to McCleary and Gallardo, cannot compete with China’s output.
They claim that maintaining AUKUS over the ensuing decades is based on a strong presumption of political commitment, sustained financing, and cohesion until the first steel for the SSN-AUUS is cut in about ten years.
McCleary and Gallardo draw attention to the possibility that US defense export controls from the Cold War may be out of date because they were originally intended to keep sensitive military technologies from falling into Russian hands.
Since the SSN-AUKUS will definitely heavily rely on US-made parts, they claim that the US needs to reconsider its export restrictions in order to permit the transfer of delicate nuclear propulsion technology within a reasonable period.
They mention that AUKUS Pillar Two solutions like artificial intelligence ( AI), electronic warfare, fast, and quantum technologies are subject to US military trade restrictions.
At the same time, AUKUS has sparked worries about the security bloc’s effects on local surveillance and strategic stability from a number of Southeast Asian nations.
Ian Storey and William Choong acknowledge that Southeast Asian nations have expressed worries about outside intervention, hands races, aggressive actions by major powers, and underwater intrusions in inland sea lanes in a report published in March 2023 by the ISEAS Yusof Ishak Institute.
While AUKUS officials have gone to great lengths to explain the defense bloc’s motivations and allay concerns from local states, Storey and Choong point out that big players like Malaysia and Indonesia are likely to continue to voice their reservations.
ReutersNorth Korea plans to launch three more spy satellites next year as part of efforts to ramp up its military, the country’s state media has said.
Last month Pyongyang put a spy satellite into space – and claims it has since photographed major US and South Korean military sites.
Setting out his aims for 2024, Kim Jong Un also said his dealings with South Korea would see “fundamental change”.
And he said he had no option but to press ahead with his nuclear ambitions.
Speaking at an end-of-year meeting of the ruling Workers’ Party of Korea, Mr Kim said unification with South Korea was now no longer possible. He said Seoul treats his country as an enemy.
It appears to be the first time Mr Kim has said such a thing and marks an official change in policy – although in practice there has been little prospect of unification for some years, with no progress and little effort being made.
Relations between the two countries are in a poor state. Last month, following the spy satellite launch, Pyongyang ripped up a deal with the Seoul that was aimed at lowering military tensions.
North Korea also continued regular tests of its missiles throughout 2023 – and earlier this month fired its most advanced long-range missile, defying UN curbs.
The launch of the intercontinental ballistic missile – which has the range to reach the North American continent – drew immediate condemnation from the West.
Meanwhile North Korea is unhappy over South Korea ramping up defence cooperation with the US, after a US submarine armed with nuclear weapons arrived in its waters.
Speaking on Sunday, Mr Kim hit out at the US, saying, according to state media: “Because of reckless moves by the enemies to invade us, it is a fait accompli that a war can break out at any time on the Korean peninsula.”
He said South Korea had been transformed into a “forward military base and nuclear arsenal” of the US, and added: “If we look closely at the confrontational military actions by the enemy forces… the word ‘war’ has become a realistic reality and not an abstract concept.”
Mr Kim said 2024 would see more military development, including strengthening nuclear and missile forces and building drones.
“We must respond quickly to a possible nuclear crisis and continue to accelerate preparations to pacify the entire territory of South Korea by mobilising all physical means and forces, including nuclear force, in case of emergency,” he said.
SEOUL: North Korea plans to launch three more spy satellites in 2024 as part of efforts to ramp up its military, state media reported on Sunday (Dec 31). Pyongyang successfully put a spy satellite into orbit last month and has since claimed it was providing images of major United States andContinue Reading
BEIJING: China has expelled nine military officials from its parliament, including several generals of the army’s strategic missile unit, in a sweeping reshuffle following the appointment of a new defence minister. The decision, announced late on Friday (Dec 29) by the state news agency Xinhua came after a meeting ofContinue Reading
The large waves of foreign capital suddenly racing China’s way are raising a vital question for 2024: is sentiment toward Asia’s biggest economy swinging back toward positivity?
Investors will be and already are debating this very question now that China has racked up a nearly six-fold increase in foreign buying of bonds in November from October – 251 billion yuan (US$33 trillion) of inflows.
But here’s the better question:
What can Chinese leader Xi Jinping do to lean into the trend and broaden it?
The obvious answer is for the People’s Bank of China to keep doing what it’s done in recent months. Governor Pan Gongsheng’s team has been a study in restraint as other top central banks took decidedly activist approaches to 2023’s economic and financial uncertainties.
Despite the wreckage of Xi’s Covid lockdowns and China’s property crisis this year, the PBOC only cut official rates twice. It prioritized targeted liquidity to money markets to boost growth.
Granted, Chinese borrowing costs are already at record lows. But Pan’s determination to put yuan stability ahead of Japan-like bursts of extreme stimulus – even as deflation stalked the economy – is now paying dividends in the form of big bond inflows.
Of course, Team Xi displayed its own restraint in 2023, foregoing the massive stimulus jolts investors everywhere expecting.
But as 2024 arrives, it is high time for Xi’s government to accelerate moves to build more international and robust capital markets. It is equally important to internalize and heed warnings from Moody’s Investors Service.
On December 5, Moody’s downgraded Beijing’s credit outlook to negative from stable, citing “structurally and persistently lower medium-term economic growth” and a cratering property sector.
The good news, as Moody’s pointed out, is the “economy’s vast size and robust, albeit slowing, potential growth rate, support its high shock-absorption capacity.” The bad news is that headwinds hitting cash-strapped local governments and state-owned enterprises are “posing broad downside risks to China’s fiscal, economic and institutional strength.”
China wasn’t happy. The Finance Ministry acknowledged it was “disappointed” with Moody’s outlook cut. “China’s economy,” the ministry retorted, “is shifting to high-quality development, new drivers of China’s economic growth are taking effect and China has the ability to continue to deepen reforms and respond to risks and challenges.”
As such, Beijing officials called concerns about the country’s growth, fiscal trajectory and economic prospects “unnecessary.”
Yet Xi’s reform team, led by Premier Li Qiang, would be wise to internalize what Moody’s is saying and heed its warnings. The reason is that, fair or not, Moody’s is highlighting the broader conventional wisdom about China’s 2024.
Clearly, the 251 billion yuan jump in foreign bond inflows in November is an important ray of hope. At a minimum, it raises the specter that China can recoup 2022’s record outflows of 616 billion yuan (US$86.3 billion).
“The bond market remains bullish, and market rates will trend lower,” analysts at Guotai Junan Futures write in a note to clients.
Yet sustaining inflows at this pace requires bold policy upgraded to increase transparency and competitiveness.
In recent months, another mainland milestone came into focus: the yuan’s fast-rising share of global payments to the 3.6% mark. Although China still lags behind America’s 47% share by a healthy margin, it would be at Washington’s peril if the US ignored the nearly 2% jump in yuan use in the first 11 months of 2023.
This year, the yuan overtook the euro to become the second-most-used currency in trade, according to data from the Society for Worldwide Interbank Financial Telecommunication, or SWIFT. As of September, the yuan’s share of SWIFT payments hit 5.8%.
Some of this increase reflects China’s rising economic status; some reflects concerns about the health of the dollar as Washington’s debt tops US$33 trillion. And some reflects the work Xi’s government has done to internationalize the currency since 2016.
That was the year when the PBOC, then under Governor Zhou Xiaochuan, secured a place for the yuan in the International Monetary Fund’s “special drawing-rights” program. The yuan’s inclusion in the IMF’s exclusive club of reserve currencies, joining the dollar, euro, yen and pound, was a pivotal moment for Beijing’s financial ambitions.
Over time, Xi’s reformists took it out for a ride by increasing the channels for foreign investors to tap mainland stock and bond markets. Shanghai stocks were added to the MSCI index, while government bonds were included in the FTSE Russell benchmark among others.
As demand for the yuan surges, Beijing is tolerating a stronger yuan as rarely before. Arguably no policy would jolt Chinese growth faster or more convincingly than a weaker exchange rate. Yet Xi’s Ministry of Finance has avoided engaging in a race to the bottom versus the yen, earning it points in market circles.
Increasing trust among global investors, though, requires a clear and bold commitment to structural reforms. Topping Xi’s to-do list are:
The more Xi develops dynamic capital markets, the more foreign investors will send waves of capital China’s way. And the more willing mainland households will be to invest in stocks and bonds over real estate.
Another top priority is devising a broader network of social safety nets to encourage households to spend more and save less. This step alone would help recalibrate growth engines from exports and excess investment to domestic demand.
These reforms would go a long way to reducing the frequency of the boom/bust cycles that all too many investors associate with China and to change the subject from the regulatory crackdowns of the last three-plus years that started with Alibaba Group’s Jack Ma.
Here, Xi’s government did itself no favors this month with controversial new gaming restrictions. Although Beijing has throttled back a bit, investors fear a crackdown on the world’s largest mobile arena.
“Although we think the short-term selloff is likely to continue in the coming days, given investor frustration and negative readthrough to internet and general China equity regulation risk, we believe the share price reaction to the exposure draft is overdone,” says JPMorgan Chase & Co. analyst Alex Yao. “We expect a negative but insignificant impact on Tencent and NetEase’s gaming monetization.”
All this shines a bright spotlight on the big China reform question: Does Xi’s government need more stimulus to create space to shake up China’s economic model?
“For the past year and more, investors have been waiting for a different type of pivot in China: when the government finally gets serious about growth again,” says economist Andrew Batson at Gavekal Research.
Still, recent signals from Beijing “showed an attempt to find a new balance between growth concerns and broader objectives that top leader Xi Jinping has laid down, such as technological self-sufficiency and national security.”
Barton adds that a “recalibration would be welcome to investors.” He notes that “arguably the major issue afflicting economic policy in 2023 has been the government’s conviction that it could have its cake and eat it too. The hope was that a long-term drive to build high-tech industries and bolster the country against external threats could double as a short-term stabilization plan.”
“But that strategy suffers from a time inconsistency problem,” Batson says. “The favored growth sectors of the future, even big ones like electric vehicles, are simply too small today to offset the damage from the rapid decline in the property sector.
Batson adds that “the government has shown it’s happy to throw vast sums of money at ‘good’ sectors through industrial policy, but real economic stabilization requires broad-based support of aggregate demand – allowing the ‘bad’ sectors to get money, too. On this front, the language from [recent deliberations in Beijing] showed more willingness to deploy the traditional levers of fiscal and monetary policy.”
Even more important, though, is creating conditions necessary to ensure today’s capital inflows lead to tomorrow’s prosperity.
BEIJING: China’s defence ministry on Thursday (Dec 28) urged the Asia-Pacific to be on high alert as the United States steps up forward military deployment in the region, after reports of a US plan to revive a Pacific airfield that launched atomic bombings of Japan. The Chinese military is payingContinue Reading
