Commentary: Will the ‘China factor’ become an election issue in Indonesia?

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INDONESIA’S INDUSTRIAL AMBITIONS

On its part, Jokowi’s government maintains a positive view about future bilateral relations with Beijing.

In December 2023, Erick Thohir, as ad interim Coordinating Minister of Maritime Affairs and Investment (during minister Luhut Panjaitan’s spate of ill health), stated at the fourth Indonesia-China Business Partnership meeting in East Nusa Tenggara that the government appreciated the role of Chinese investors who had become industrial pioneers, laying the foundation of the downstream industry and helping to develop remote regions in Indonesia.

Thohir pointed out that under the bilateral strategic partnership that started in 2013, several important achievements, including the Jakarta-Bandung High-Speed Rail and work on Indonesia’s green energy transition, had been made. He added that Indonesia-China cooperation would be lasting, as it was built based on mutual trust and mutual benefit.

During the Jokowi administration, there is no doubt that China’s investment and economic role in Indonesia has grown, which matches Indonesia’s ambitions for a push in its industrialisation through infrastructure and downstreaming industry.

Nevertheless, China’s domination in the nickel industry in Indonesia is a cause for concern. One repercussion in the climate of decoupling has been on access to Western markets. In fact, Indonesia’s nickel products have no access to the US market, partly due to this “China factor”.

It is important to note that Indonesia has been trying to invite larger investments from Western countries but the latter are currently distracted by domestic concerns, the Ukraine war, and the Gaza crisis. Their appetite for open international trade and investment has been weakening.

Conversely and opportunistically, China has won partners and expanded its economic influence, particularly in Africa and Southeast Asia. According to official data, as of the third quarter of 2023, China and Hong Kong were the second and third largest investors in Indonesia after Singapore, with total investment reaching US$3.5 billion.

While the China factor will not likely be a controversial election issue in 2024, Indonesia still needs to carefully manage existing public apprehension concerning China’s growing economic role, especially when Indonesian lives are at stake.

The new administration taking over from Widodo will need to continue diversifying Indonesia’s economic cooperation, including with Australia, Canada, and New Zealand, the Middle East and Africa.

Leo Suryadinata is Visiting Senior Fellow, ISEAS – Yusof Ishak Institute and Adjunct Professor at S Rajaratnam School of International Studies at NTU. Siwage Dharma Negara is Senior Fellow and Co-coordinator of the Indonesia Studies Programme, and the Coordinator of the APEC Study Centre, ISEAS – Yusof Ishak Institute. This commentary first appeared on ISEAS – Yusof Ishak Institute’s blog, Fulcrum.

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Commentary: Taiwan’s 2024 election results show China isn’t voters’ biggest concern

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In the run-up to the election on Saturday (Jan 13), China placed restrictions on Taiwan exports of petroleum products to the mainland covered by the cross-strait Economic Cooperation Framework Agreement to increase pressure.

Alongside these developments were continuing Chinese military activity near Taiwan, including the launch of a satellite and at least several surveillance balloons. There was also alleged pressure on tycoon Terry Kuo to withdraw his candidacy in the presidential race to force an electoral alliance between the TPP and KMT, which came on top of alleged efforts to discredit the DPP on social media.

Such activity was a continuation of developments from before the election campaign period. They combined to create a sense that pressure from China is a constant rather than a variable. This normalisation of the challenge from Beijing reduced the electoral effects of pressure from China.

NEUTRALISATION OF CHINA AS AN ISSUE

A third related observation is that the neutralisation of China as an issue in Taiwan’s electoral politics may point to a shift in Taiwan political landscape. The KMT’s performance in the legislative election was led largely by its local factions, which focus on service delivery and constituency issues.

DPP and TPP supporters tend to identify more with Taiwan and feel more distant from China, even if this translates into different substantive policy preferences. Chinese political pressure and economic uncertainty are further accelerating Taiwanese businesses’ relocation and diversification from China, which is consistent with broader global trends.

Taiwan foreign direct investment (FDI) to Southeast Asia has been growing in recent years and outstripped FDI to China in 2023. These trends mean that direct pro-Beijing appeals may be facing a diminishing market in Taiwan politics.

For the KMT, which has been a key bridge to Taiwan for the Chinese Communist Party (CCP), they may need to decide if they want to continue being the Chinese Nationalist Party or a party for Taiwanese.

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Myanmar insurgents virtue signaling to China

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The unprecedented “Operation 1027” resistance offensive launched in late October 2023 continues to make advances on Myanmar military positions in northern Shan State.

Hundreds of ruling State Administration Council (SAC) bases have fallen or been abandoned to the rolling onslaught of the Three Brotherhood Alliance (3BA) comprised of the insurgent Myanmar National Democratic Alliance Army (MNDAA), Ta’ang National Liberation Army (TNLA) and the Arakan Army (AA).

The major towns of Hsenwi and Kutkai, both north of the main SAC-controlled (for now) city of Lashio, have fallen along with Namshan and Namtu.

The Kokang enclave capital of Laukkai has been recaptured after 15 years, and in a flourish of civil war theater, the towns of Hopang and Panglong have been “taken” by the alliance and handed over to Myanmar’s largest non-state armed group, the United Wa State Army (UWSA).

Today’s report of a “cease-fire” brokered by China between the SAC and 3BA may take the momentum out of the offensive, or like similar talks in recent weeks, do little to shape events on the ground in northern Shan state and hardly impact on armed conflict in so many other areas of Myanmar, especially as fighting rages in Rakhine state and the Karenni and Sagaing regions.

Yet in many respects, Operation 1027 has already achieved many of the long-standing aims of the MNDAA, as outlined in a recent New Year public message from its commander Lieutenant General Peng Deren, who is also the General Secretary of the group’s “political wing”, known as the Myanmar National Justice Party (MNJP).

The statement is a detailed and intriguing addition to the quixotic area of insurgent communications and strategic messaging, at times virtue signaling, to multiple audiences. Unlike the Myanmar language version, the original Chinese referred to the offensive as “Operation 1027 Hurricane (Jùfēng)”, which appears to be a designation almost totally absent from most media coverage of the past several weeks.  

MNDAA commander Peng Deren has a message for Beijing. Image: X Screengrab

But it suggests that the Chinese version of Peng’s speech has slightly different audiences (an official English version was not released), although a major factor was clearly contributing to a major Chinese crackdown on cyber-fraud scam centers. 

Peng claimed the operation had seized 250 “large and small (SAC) military strongholds…blocked several large-scale reinforcements”, accepted some 1,000 surrendering troops, claimed five border crossings, forcibly closed down 300 ‘electronic fraud dens’ (Chinese organized crime-run scam call centers) and sent back 40,000 “fraudsters to return home and surrender.”

As is well established by now, a prime objective of Operation 1027 was to close down the border scam centers. “The harm of electronic fraud to human society is comparable to that of drugs, and is far more severe and profound than a new coronavirus epidemic!” (emphasis in original) the Kokang leader stated amid reports of horrific mistreatment of captives, including the massacre perpetrated in the so-called “1020 Crouching Tiger Villa Incident” in Laukkai a week before Operation 1027.

Peng further alleges that the SAC military junta spirited away by helicopter, at exorbitant prices for a seat, leaders of the scam centers to KK Park near Myawaddy on the Myanmar-Thailand border, “the largest electronic fraud park in Southeast Asia.”

Yet the MNDAA commander also cast the operation in national anti-regime terms. As Peng argued, “Our party and our army conform to the trend of civilization of the times and bravely serve as the pioneers of Myanmar’s national democratic revolution. ‘Operation Hurricane’ made me very gratified to see the support and response of democratic fighters and revolutionary organizations across the country, and achieved unprecedented brilliant results for ethnic armed forces.”

The link to the Kokang site which carried the message has since been removed from Facebook as it does not comply with their “Community Standards”: the social media company de-platformed the 3BA and their nominal ally the Kachin Independence Organization (KIO) in February 2019 for being “dangerous organizations.”

Given how pivotal the northern ethnic armed organizations (EAOs) have become to the course of the anti-SAC struggle, Meta/Facebook should reconsider this decision and render primary communications messaging from these groups more readily available.

The 3BA has translated many of their general statements in the past, including after Operation 1027 was launched, but Peng’s New Year’s message was more candidly detailed than the alliance’s usual messaging.

Yet the MNDAA, at least for the past 14 years and likely since its formation in 1989, is neither (ethnic) “Myanma” (Bama) or “national”, and certainly not “democratic.”

The Kokang enclave has been an isolated hive of illicit enterprise since 1989 when the MNDAA was formed out of factions of the imploding Communist Party of Burma (CPB) by Peng Deren’s father, the colorful drug trade personality Peng Jaisheng.

An anti-military guerilla and opium merchant, the older Peng created a semi-autonomous enclave, legally guaranteed by the 2008 constitution, until his ousting by the army in 2009 (personally led by SAC leader Senior General Min Aung Hlaing).

Myanmar military commander-in-chief, Senior General Min Aung Hlaing, attends a military exercise at Ayeyarwaddy delta region in Myanmar, February 3, 2018. REUTERS/Lynn Bo Bo/Pool
Myanmar military commander-in-chief, Senior General Min Aung Hlaing has history in Kokang. Photo: Asia Times Files / Reuters / Lynn Bo Bo / Pool

Peng Jaisheng’s funeral in 2022 in another China-Myanmar border enclave called Mong La was a guerilla’s gala of A-list veteran and new-wave rebel leaders: many who led Operation 1027 and post-coup resistance forces such as the Karenni National Defense Force (KNDF) were in attendance.

The MNDAA conducted a major offensive in 2015 to wrestle control of Laukkai away from their bitter rivals who expelled the Peng family 15 years ago: “the Four Big Families…in Kokang Old Street” heavily involved in the call center scams according to Peng’s statement.

In one of northern Shan state’s most surreal conflict incidents, the MNDAA raided several casinos in Laukkai in March 2017, reaping an estimated US$73 million according to an investigation by Ann Wang in the South China Morning Post.

Far from “justice” or “democracy”, the MNDAA’s struggle is largely predicated on restoring its monopoly on criminal enterprise in Kokang Another post-1027 reality is the centrality of China to the gravity of the northern theater of Myanmar’s post-coup civil war.

It is still a matter of speculation what role China played in the preparation for the offensive, but the synchronicity of a Chinese official call-center crackdown and an anti-SAC military operation against the Myanmar army with multiple interlocking agendas for all the EAOs involved was almost certainly within Beijing’s tolerance zone.  

Absent from Peng’s messaging seems to be the West, whose capitals were shaken from their analytical stupor of conflict stagnation in Myanmar to the possibility the revolution might be won after all – albeit by groups not in the traditional diplomatic orbit of the United States or Europe.  

The Sinophobic saber-rattling from some quarters of the American foreign policy establishment, those not consumed with Gaza, Ukraine and containing China, is also out of step with many of the Myanmar resistance forces and the network of loose alliances that the 3BA represents.  

Many resistance groups quietly express concerns over being caught in the middle of a new Cold War between Beijing and Washington. Bashing China for predominantly US political agendas, therefore, is counterproductive, if not hypocritical, to supporting the anti-SAC resistance 

If Peng’s allegations that Chinese gangsters were spirited away by helicopter to the Thailand-Myanmar border scam centers, then it behooves American officials to consider listing the local warlord Saw Chit Thu and the Kayin State Border Guard Force (BGF) that provides protection for these border zones and has been involved in various illicit rackets over the years.  

Chit Thu in Border Guard Force uniform in a 2014 file photo. Photo: Facebook

Western humanitarian assistance is urgently needed and much appreciated in many parts of Myanmar. Despite manifold difficulties, a great deal of health and livelihood aid is navigating around SAC restrictions. Money for redevelopment and stabilization of the northern borderlands such as Laukkai, Muse and the territory north of Lashio will not come from Western donors.  

China is a repressive dictatorship and its interest in Myanmar is purely transactional and exploitative, but its immediacy is forcing nearly all anti-SAC forces to engage in complex bargaining with Beijing. 

The anti-coup National Unity Government (NUG) has launched into its own virtue signaling to China strategy, releasing a ten-point China strategy on January 1 that in part vowed to safeguard legitimate Chinese investment in Myanmar.  The statement was criticized for being formulaic, dull and obvious, and an approach that should have been pursued in mid-2021 soon after the NUG was formed.

But it was roundly ridiculed for confusing the “One China Principle” (that Taiwan is an inalienable part of China) and the “One China Policy” (one that doesn’t take a position on the issue). In its zeal to emulate the 3BA approach to Beijing, the NUG may have overstretched its tone. Peng Deren struck a difficult balance, absent of any genuine sincerity, pretty much just right. 

David Scott Mathieson is an independent analyst working on conflict, humanitarian and human rights issues

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Indonesia, Philippines draw together vis-a-vis China

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MANILA – “The Philippines is an important partner of Indonesia,” declared President Joko Widodo during a high-profile visit to Manila, one of his last major diplomatic trips before stepping down from office later this year.

“Many Indonesian defense equipment products are purchased by the Philippines and investment there is also quite significant,” the two-term leader added before leaving for Manila as part of a broader regional tour.

Though Jakarta billed Widodo’s trip as an exercise in proactive trade diplomacy, the visit to Manila clearly had a defense dimension. Shortly before Widodo’s trip, his foreign minister, Retno Marsudi, met her Philippine counterpart, Enrique Manalo, in Manila to discuss bilateral cooperation including on regional crises such as the South China Sea disputes.

The top Indonesian diplomat made it clear that her country is “ready to work together with all ASEAN member states, including the Philippines” to finalize the long-running negotiations over a Code of Conduct in the South China Sea.

In one of its final acts as the outgoing chairman of ASEAN, Indonesia corralled foreign ministers from across the region to issue an unprecedented stand-alone statement on the maritime disputes amid growing concerns over a potential military confrontation between the Philippines, a founding bloc member, and China, a major trading partner of association members.

Recognizing the limits of ASEAN, which operates on a de facto unanimity-based decision-making process, regional leaders are doubling down on bilateral and minilateral cooperation on sensitive geopolitical issues.

Widodo’s trip to Manila came shortly before Philippine President Ferdinand Marcos Jr’s own planned to visit Vietnam, another key ASEAN state with contested claims in the South China Sea, to upgrade bilateral relations.

The ultimate aim is to create a robust set of partnerships among core Southeast Asian states in order to more effectively preserve regional peace and security as well as uphold a semblance of “ASEAN centrality.”

Delicate balancing act

In his final years in office, Widido successfully placed Indonesia on the global geopolitical map through subtle yet proactive diplomacy.

As the president of the influential Group of Twenty (G20) nations in 2022, Southeast Asia’s most populous nation flexed its diplomatic muscle by organizing a vital summit between US President Joe Biden and Chinese paramount leader Xi Jinping in Bali.

This went hand in hand with Indonesia’s efforts to mediate the conflict in Ukraine by maintaining robust communication channels both with Russia, which attended the G20 events, as well as key European capitals.

Worried about the fallout of the conflict on global food and energy markets, Indonesia corralled fellow emerging powers to pressure Russia not to target the transport of vital commodities out of Ukraine’s Black Sea ports.

Its successful G20 presidency set the tone for Indonesia’s rotational chairmanship of ASEAN the following year. “ASEAN unity is needed to formulate the way forward,” Widodo declared during the first major ASEAN meeting in 2023 on the island of Labuan Bajo, emphasizing the need for more decisive action.

Indonesian President Joko Widodo has raised his nation’s diplomatic game. Image: Facebook

At the same time, however, he acknowledged that intractable issues such as the crisis in Myanmar “must not hinder the accelerated development of the ASEAN community, because this is what we have been waiting for.”

Widodo underscored the importance of greater intra-ASEAN coordination while also acknowledging the limits of cooperation under a consensus-based decision-making process.

If anything, Indonesia expressly emphasized the importance of economic growth and connectivity as the central theme of its ASEAN chairmanship. Nevertheless, Widodo introduced two important elements vis-à-vis the South China Sea disputes.

First, it advocated for the first-ever, all-ASEAN naval drills in the North Natuna Sea, an energy-rich area that partly overlaps with China’s expansive nine-dash line claim over the majority of the South China Sea. Predictably, Beijing-leaning member states cried foul, warning that the drills threatened to provoke regional tensions vis-à-vis China.

Intent on pressing ahead with the all-ASEAN exercises, however, Indonesia slightly adjusted the location of the drills, to the South Natuna Sea, and eschewed any “live-fire” exercises. The five-day non-combat drills saw key regional states such as Malaysia and Singapore in attendance, setting a new bar for intra-ASEAN naval cooperation.

Limited exercises

Indonesia’s second important intervention was the stand-alone ASEAN statement issued in the final hours of 2023, in which regional foreign ministers expressed their “concern [with] the recent developments in the South China Sea that may undermine peace, security and stability in the region.”

Crucially, they expressed “unity” as well as “solidarity” with the Philippines in what ASEAN foreign ministers described as “our maritime sphere”, thus subtly rejecting any suggestion that China or any major power should dominate the South China Sea basin.

Jakarta’s interventions were music to Manila’s ears. After all, at least two regional leaders had earlier publicly expressed skepticism about the Philippines’ increasingly assertive stance against China in the disputed waters under the Ferdinand Marcos Jr. administration.

This had only reinforced well-entrenched views in the Philippines about ASEAN’s ineffectualness and seeming pro-China leaning.

During his visit to Manila, Widodo discussed the latest developments in the South China Sea with his Filipino counterpart.

”President Widodo and I had a fruitful and honest discussion on regional events of mutual interest such as the developments in South China Sea and ASEAN cooperation and initiative,” Marcos Jr said in a joint press conference with his Indonesian counterpart in Manila.

“The Philippines and Indonesia affirmed our insistence on the universality of UNCLOS, which sets out the legal framework that governs all activities in the oceans and in the seas,” he added, emphasizing the alignment of views between the two founding ASEAN members.

Indonesia is also pushing for tighter bilateral security cooperation with the Philippines. Under the Joint Commission for Bilateral Cooperation (JCBC), which was concluded in 2022 and is led by Philippine and Indonesian foreign ministers, the two sides aim to implement a series of vital cooperative initiatives, including joint border patrols and counter-terrorism exercises.

The two sides are also doubling down on their maritime security cooperation. The Philippines has been a top client for Indonesia-made warships, namely the Strategic Sealift Vessels (SSVs) BRP Tarlac and BRP Davao Del Sur.

The two neighbors are also weighing another major defense deal in the sale of six light aircraft from state-owned PT Dirgantara Indonesia to the Philippine Air Force.

A Philippine Air Force FA-50 fighter jet prepares for takeoff at Clark Air Base. Credit: Handout

By proactively engaging the Philippines, Widodo has sought to not only overcome deficiencies under the ASEAN mechanism but also set the bar higher for both his successor as well as this year’s rotational ASEAN chairman, Laos, on regional maritime cooperation issues.

For his part, Marcos Jr has not only welcomed closer strategic partnership with Indonesia but is also intent on doubling down on burgeoning ties with Vietnam, which shares Manila’s concerns about China’s rising assertiveness in the South China Sea.

Later this month, the Filipino president is expected to visit Hanoi in order to finalize new maritime security cooperation agreements and project a more united front within ASEAN.

While the regional body has often been paralyzed by indecision amid major crises, key member states are actively tapping new spaces for bilateral cooperation among themselves.

Follow Richard Javad Heydarian on X, formerly Twitter, at @Richeydarian

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PBOC playing cool and calm as deflation specter rises

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As 2024 gets underway, reasons to worry about China’s economy are almost too numerous to count: sub-trend growth, a deepening property crisis, falling exports, record youth employment and deflationary pressures.

As investors try to control the inclination to panic, it’s quite striking who isn’t: People’s Bank of China Governor Pan Gongsheng.

One expression of this calm is the PBOC’s avoidance of taking any assertive easing steps in recent months. An equally important one is the PBOC’s taking direct aim at recent yuan weakness.

By setting the daily reference rate for China’s currency at the widest gap to estimates since November, Pan pushed back at traders’ suspicions that Beijing might be angling to engineer a weaker exchange rate to boost exports. Nothing arguably would spur Chinese economic growth faster than following the Japanese yen’s downward trajectory.

The fact that Pan won’t pull the competitive devaluation trigger to boost exports, which newly released 2023 statistics show posted their first full-year decline since 2016, makes many wonder what the governor knows about the Chinese economy’s outlook that isn’t transparent to markets.

China’s exports shrunk 4.6% year on year, a reflection of economic weakness in its top trading partners. Exports to the US slipped by 6.9% in December from a year earlier, while shipments to the EU dipped 1.9%. Trade with regional partners including Japan, South Korea and Southeast Asia also fell.

Yet the idea that things might not be as dire as global investors fear is worth exploring given the conflicting signals emanating from Asia’s biggest economy.

Indications are that “the PBOC drew a line in the sand and defended the renminbi and, having defended key levels, the exchange rate now seems to be ticking higher,” says economist Louis Gave at Gavekal Research.

Gave adds that “simultaneously, most of the economic data seems to show that Chinese growth bottomed out in 2Q23. While China’s economy is hardly roaring back, the momentum is broadly, if meekly, pointing in the right direction.”

The implication here is that Pan is displaying confidence in efforts by President Xi Jinping and Premier Li Qiang to revive the economy without massive stimulus. And that the popular view that the property sector and other headwinds are a clear and present danger to China’s 2024 trajectory is overly negative.

The PBOC’s apparent calm also buttresses the view that China’s banking system is robust enough to withstand most shocks the global economy might send its way.

PBOC Governor Pan Gongsheng is exuding grace under pressure. Image: Twitter Screengrab

“We expect the authorities to continue a targeted credit allocation approach,” says analyst Elaine Xu at Fitch Ratings. This means “regulators guiding selected banks in channeling credit to strategic sectors, especially given the government’s focus on maintaining systemic stability and pushing forward risk resolutions at small and medium-sized banks.”

Yet Xi’s lack of bold stimulus comes with risks, including not least wider investor trust in the economy’s direction and management.

“The longer that China fails to show that it can recover, the likelihood that inflation expectations will decline in the West, as fears that China can export its deflation to the rest of the world through international trade will gain ground,” says strategist Thierry Wizman at Macquarie Bank.

The bigger implication is that “China’s deflation problem could be a welcome disinflationary restraint for the West,” Wizman notes.

Domestically, too, “the challenge for China’s economy in 2024 may be whether policies can mitigate deflation risks,” says economist Tommy Xie at Singapore’s Oversea-Chinese Banking Corp.

“If deflation risks persist longer than expected in 2024, China may resort to more aggressive easing measures such as interest rate cuts or restarting the Pledged Supplementary Lending program to expand the central bank balance sheet to boost aggregate demand.”

Odds are, Xi’s edict about not taking steps that encourage bad lending and borrowing decisions is trumping any desire at the PBOC to cut interest rates. Most likely, the PBOC remains linearly focused on using structural aid to accelerate Xi’s targets for “high-quality economic growth” over runaway stimulus.

“The possibility of broad easing has declined in the short term,” Zhao says.

Far from panicking, the PBOC is telegraphing something approaching confidence — one yuan fixing rate at a time. “The fix continues to convey PBOC’s desire for a stable yuan amid speculation of near-term monetary policy easing and fears of deflation,” analysts at Maybank write in a note. “Clearly, the central bank is not willing to loosen its grip on the yuan.”

The PBOC’s apparent avoidance of a race to the bottom on exchange rates with the Bank of Japan is also a favor to the global economy. A fresh currency war would destabilize the financial system, particularly amid what is expected to be a brutal election cycle in the US.

Nothing unites President Joe Biden’s Democrats and Republicans loyal to Donald Trump like a falling Chinese currency. It’s a trade-off, though, given the damage Chinese deflation would have on economies and multinational companies everywhere.

“No player is immune” to the forces of slowing Chinese growth, says Kevin Yin, analyst at JPMorgan Chase & Co.

There are risks, though, to Beijing not working faster to nip deflation expectations in the bud. The same goes for the slow pace of efforts to treat the root causes of China’s property crisis and create wider social safety nets to encourage consumers to save less and spend more.

“We think that officials are underestimating the extent to which China’s slowdown is structural in nature and won’t be so easily reversed,” says economist Julian Evans-Pritchard at Capital Economics.

Chinese policymakers seem unconcerned by growing signs of deflation. Photo: Facebook

Rather than target deflation, discussions in Beijing at the end of 2023 prioritized Xi’s belief that “technology self-reliance is more important” than ever, notes economist Ding Shuang at Standard Chartered. “I don’t see any signs of large-scale stimulus.”

This reform-over-stimulus crouch is a smart one in many ways. One of the top gripes about Xi’s 10-plus years at the helm is the slow pace of structural change, including reducing the role of state-owned enterprises to grow the private sector.

The lesson from Japan, though, is that once ingrained deflationary forces can be extraordinarily difficult to uproot. It hardly helps that China’s aging demographics is predisposed toward deflation as older people don’t tend to spend as much as younger generations.

Yet Pan’s PBOC may understand something the BOJ never did by sticking with two-plus decades of quantitative easing. The PBOC is going the other way by holding its monetary fire and projecting confidence that 2024 will be a better year for China than markets currently think.

Follow William Pesek on X, formerly Twitter, at @WilliamPesek

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Penang’s startup ecosystem receives recognition with Georgetown as 8th ranked city in Southeast Asia 

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Georgetown is 2nd highest-ranked city in Malaysia with KL at 4th spot
Supporting startup ecosystem part of plan to attract high-tech industries

In a statement, Digital Penang marked a significant milestone for Penang’s technology startup ecosystem as it received the “Outstanding Ecosystem among Medium-Sized Population Cities in Southeast Asia 2023” award from StartupBlink, a leading startup…Continue Reading

Stronger winds may bring breezier days to Singapore, but also danger from falling trees

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He told CNA938 on Monday (Jan 8) that the project was conceptualised as there has been a lack of such research specifically focusing on Southeast Asia.

Globally, higher temperatures and frequency of drought events have led to an uptick in the death of big trees, which are important to the ecosystem as they store most of the carbon emissions, said Asst Prof Lim.

“One of the main reasons we put together this research proposal is to try to understand whether or not this global process is also happening within Singapore,” he said.

“If the big trees die, they open up new spaces within the tropical forests. So in the short term, you might lose a lot of carbon and potentially diversity.”

He added that in tropical forests, like those in Singapore, various tree species are competing with each other for resources such as light and water.

“So whenever the climate changes in any way, there will always be winners and losers. There will be some tree species that might perform less well in the new environment, and some trees that will perform a little bit better,” he said.

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Srettha ‘just explained’ rate view to BoT

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‘No power to interfere’ in decisions, PM says after meeting with central bank chief

Srettha ‘just explained’ rate view to BoT
Prime Minister Srettha Thavisin speaks to reporters at Parliament prior to the budget debate in the House of Representatives last week. (Photo: Nutthawat Wichieanbut)

Prime Minister Srettha Thavisin says he “just explained” his views on interest rates but gave no orders during a highly anticipated meeting on Wednesday with the head of the Bank of Thailand.

“I have no power to interfere” in rate decisions, Mr Srettha told reporters after his talks with central bank governor Sethaput Suthiwartnarueput.

“The BoT is an independent organisation. I haven’t ordered. I just explained the situation.”

The talks came two days after Mr Srettha, who is also the finance minister, publicly urged the central bank to start cutting borrowing costs following months of negative inflation.

The discussions covered interest rates and the economic situation, Mr Srettha said. He acknowledged that the meeting was in no way an exercise to reduce the central bank’s autonomy. 

There was no immediate response from Mr Sethaput, but the BoT has scheduled a briefing on Monday to explain its policies. 

Mr Srettha said he explained to Mr Sethaput the current economic situation. Southeast Asia’s second-largest economy has been staging the region’s slowest recovery post-pandemic, while inflation has been in negative territory for three straight months through December amid signs of waning demand.

The baht was little changed on a day when most major Asian currencies were down versus the US dollar.

While Mr Srettha believes that cheaper borrowing costs are needed to boost credit demand, and in turn economic activity, the BoT has in the past maintained that the deflationary trend is a result of state subsidies, most notably for electricity and fuel, and is not an accurate reflection of falling consumption. 

The central bank paused its tightening campaign in November after eight straight rate increases totalling 200 basis points to a decade-high of 2.50%.

It will hold its next meeting on Feb 7 but so far has not signalled any readiness to start reducing interest rates.

“We maintain our forecast that the BoT will keep the policy rate on hold for the foreseeable future,” said Standard Chartered Bank economist Tim Leelahaphan. “However, we believe risks are increasingly skewed towards a cut in 2024.”

Mr Srettha also said on Wednesday that he would brief the central bank head about the government’s proposed economic stimulus programme at a separate meeting.

Mr Sethaput has expressed some reservations about the 500-billion-baht digital wallet programme, the cornerstone of the government’s stimulus plan.

The economy is forecast to expand by 3.2% this year, up from an estimated 2.5% in 2023, according to the World Bank. Mr Srettha wants to lift that pace to 5% during his term.

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