An Asian situation

It is eyes on Asia and eyes on those who are thinking about Asia

On Sunday 4 September, China will host its first G20 summit of leading nations (and only the second to be held in Asia) and the spotlight will fall across the region.

President Xi Jinping will want to make a good show of it. The worries over China’s volatile markets that sent jitters across the world earlier in the year remain. The fears over slowing growth in the world’s second-biggest economy have not gone away.

The start of next week will also see legislative elections in Hong Kong amid bubbling unease in the special administrative region over Beijing’s influence and oversight.

There will be lots of Asian leaders at the G20 summit from South Korea’s female president Park Geun-hye to Indonesia’s charismatic Joki Widodo. Someone who has been feeling the pressure is Japanese prime minister Shinzo Abe, whose latest economic stimuli are failing to impress the markets.

China has also invited the Thai and Singaporean prime ministers and Bounnhang Vorachith, the Laotian president, who is the current head of the Association of South East Asian Nations.

Outgoing US president Barack Obama will be saying his farewells at his last G20 get-together. During his tenure he made much of what he called his “pivot to Asia”. Will this ‘pivot’ survive after the November presidential election in the United States?

If she wins, will Obama’s Democrat colleague Hillary Clinton row back from this position, maintain the policy or enhance it? If Republican challenger Donald Trump takes the White House, how will or should Asian countries react?

When it comes to hardline leaders – and going by much of his recent rhetoric around illegal immigrants, many Americans expect Mr Trump to be exactly that sort of commander-in-chief – the new president of the Philippines appears to be heading up the Asian contenders at the moment.

Rodrigo Duterte revels in the high bombast of fiery speeches – take his threat to pull out of the United Nations, for example – but he is delivering on a promise to crack down on drug gangs. In fact, more than 700 people have died in police operations this summer, and the public are roaring their approval in high ratings for the new leader.

There are also continuing tensions between several countries over who owns which reefs and islets in the South China Sea but Beijing will want to avoid such cartographical arguments as the cream of international leaders touch down on Sunday.

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Trading standards

As Iran journeys back from isolation, Asian nations stand ready to engage

When Iran was welcomed cautiously back into the international fold in January, some were expecting a flood of suitors in front of Tehran’s door, while others thought the path back from exile might be a bit stop-start.

And while there have been business deals with some Western nations, such as France signing off an order for Airbus aircraft, it has been Asian nations that have been best-placed to improve, restore and underline trade agreements and mutual policies between themselves and the Islamic Republic.

Today, Tehran confirmed it had seen a 13% increase in oil exports to Asia, off the back of its energy market unshackling.

India and South Korea led the way in Iranian imports, picking up the slack after drops in crude purchases for China and Japan.

But even before international sanctions were relaxed earlier in the year, those four Asian countries mentioned above maintained their oil imports from Iran.

India, most of all, is brimming with infrastructure companies licking their lips at the chance to get involved in the re-opening Iran.

Its tech firms and place as the world’s biggest open-market democracy give it a unique position in the region.

And it has just announced annual growth for 2015/16 of 7.6%, outstripping the other so-called BRIC nations of Brazil, China and Russia and underlining its growing economic strength.

So with continued upward GDP expansion and the unbuttoning of business regulation in India, coupled with a change of policy towards Iran, has seen the 2014 Narendra Modi administration embed itself firmly with an old trading partner that is now seen by others in the world in a fresh light.

The times they are a-changin’

So when policies change or when governments are voted out and replaced, it is not just that specific country which sees the results internally. A new president or a lessening of sanctions can breathe new life into dusty agreements or encourage fresh engagement from different actors pursuing new angles.

Across the other side of the Pacific Ocean, the ongoing fade of the ‘pink left’ governments in Latin America has sparked possible new directions when it comes to trade.

The nascent, business-friendly presidential administration of Mauricio Macri in Argentina has been making tentative steps as an observer within the Pacific Alliance – a group of four Latin nations that is based on free-trade.

Argentina may not be a Pacific Rim country but it shows the fluidity of blocs and the alternating  popularity of regional partnerships when it comes to a change of government.

Under previous leader Cristina Fernández, protectionism was the bedrock for Argentinian trade and she called as her acolytes fellow leftists in Brazil, Venezuela, Ecuador and Bolivia.

Now the new leader wants to move his country in his preferred direction and that seems to be by nudging up to Mexico, Colombia, Peru and Chile’s integrated club.

Talk to the hand

There are few neighbourly relations between rival countries in Asia

What are the most successful negotiating techniques and where does face-to-face rhetoric come up short?

There are some particular cases in Asia that can show us the antagonisms and stumbling blocks in mutual talks between border rivals.

The Korean peninsula has seen its fair share of back-and-forth demands and conversations. When North Korea and South Korea get together it is normally set against a backdrop of military tensions and civil complaints. It was no different this time.

Both sides had traded artillery fire and Pyongyang put itself in a ‘quasi-state of war’. The South dusted off it border loudspeakers and blared out propaganda and K-pop over the frontier.

So when the aides came to the table to talk, it was on normal, unstable ground with a simmering strain on relations. After marathon negotiations, an agreement was reached and both sides backed down, a laudable agreement and a satisfactory temporary outcome to what had become a dangerous battle of rhetoric, music and shells.

Temporary – because these two nations still have not come to any firm peace agreement for the 1950-53 conflict. That ended in a truce, not a peace deal, and they are still technically at war.

Further west across the other side of the continent there is another infamous case of anxious neighbours. Where India and Pakistan are concerned it is no real surprise when any talks between the two rivals founder.

Constantly looking over their nervous nuclear shoulders, the two countries have once again hung up the phone – this time over peace talks which were meant to be held between the respective national security advisers.

There are examples of regional rivals across Asia and the situation around Iran is of interest. With the Saudis staring dagger-eyes across the Gulf, and the ayatollahs simply returning the glares of mutual distrust, these are two countries that do not get on.

In their positions, representing the powerbases of the two major denominations of Islam, they ought to do better as regards their dialogue duties, areas where they could be more engaged actors in regional and religious disputes.

Iran has been doing a lot of talking lately, but not with its neighbours. The six world powers that reached an agreement with the Islamic Republic over its nuclear programme have achieved a lot and have cautiously brought a pariah state in from the cold. An example to nearby nations of how to deal with a troublesome neighbour through successful, international chinwagging.

Dragons that breathe ice

The strange ways that China’s authorities deal with stock markets and snow

When two of your major share indices are running riot, what is the best way to deal with them?

The Shanghai and Shenzhen exchanges have been all over the place in 2015, reaching seven-year highs, then racking up weeks of record lows, and it has caused Beijing something of a headache.

Like the thick flocks of starlings swaying and bunching on a wing’s flinch, the millions of individual investors in those indices seem to charge in and then flee on pieces of news that scare them and then entice them. This sends the markets dizzy: the Shanghai Composite has had more than $3tn wiped off its value and has suffered huge daily and weekly crashes over the last month. But then again its overall value is up 75% year-on-year.

So how to deal with these market jitters? China has something called the Securities Regulatory Commission which has decided the best way to sort out all these fickle stocks backed by margin traders is to wade in and prop up the market.

A series of measures were introduced including a ban on short-selling, the suspension of trading in more than 2,000 shares and a massive cash injection into money markets.

It is a massaged manipulation of the markets and risks sending out the wrong signals back home (to investors who may interpret a false stability) and abroad (to fellow economies worried about the combined size and whimsical nature of the country’s public face in markets).

This economic volatility did not manage to derail the arrival of a second Olympic and Paralympic Games to the capital. Beijing’s Winter 2022 campaign narrowly to beat its one rival in the voting process – Kazakhstan’s Almaty – but questions have already been raised over the worrying lack of snow in the location where the ski and snowboard events will take place.

And as we have seen with the stock markets, the Chinese authorities have no qualms rolling out some eyebrow-raising measures to deal with a problem in the country. And when you are awarded a Winter Olympic Games in a city that has dry winters and no snow there can be no more assured way of dealing with the issue than to fire huge waves of fake flakes all over the mountain.

Beijing will not be the first to use artificial snow: Russia turned to it last time out in 2014 for use in the Black Sea resort of Sochi where the Games were held. And if Dubai can manage to have a novelty winter sports industry and Russia can host a working Olympics then there is no reason that Beijing 2022 cannot be a successful games. But bringing snow to the mountains is one thing, and inspiring a new generation of artificial winter sports enthusiasts is another.

It does seem that no matter how damaging a situation may appear – be it wild swings on the stock markets or alpine sports in a desert – the country’s rulers believe they can overcome any hurdles with fanciful measures that in reality only offer short-term relief.

Humility is the best policy

Joko Widodo, the Indonesian president, is an able successor to Uruguay’s José Mújica, widely seen as the world’s most humble leader

A student takes a selfie with Indonesian President Widodo (Reuters)

A student takes a selfie with Indonesian President Widodo (Reuters)

The quiet man sitting on his haunches in a farmer’s field. The casually dressed father taking selfies at his son’s graduation. Joko Widodo took office six weeks ago and the president of Indonesia likes nothing more than going for an impromptu walkabout. He is the first person to lead his country who is not from the military or the elite and he uses his commoner’s background as a plus-point.

Mr Widodo campaigned for the presidency on the back of a ‘man of the people’ tag and he certainly is a man amongst the people, worrying his minders as he chats to residents on wanders through markets.  Once a furniture salesman in the family business, he is now in charge of the world’s biggest Muslim country, where 250m inhabitants are spread across 18,000 islands.

A country that is far away from Indonesia in geography, size and population is Uruguay. It is a tiny nation of 3.4m people, sandwiched between two muscly neighbours in Argentina and Brazil. Indonesia dominates its next-door nations, sprawling all over South East Asia. It is the biggest economy in the region with GDP last year of $868bn, towering over Uruguay’s output of $55bn.

But these differing places do have something in common: a down-to-earth president who shies away from the trappings of power. To call José Mújica, the president of Uruguay, modest is an understatement. In the five years he has led his country he has shunned the presidential residence, choosing to stay in his small farmstead outside the capital with his wife and three-legged dog. He dresses in a relaxed manner, far more comfortable in jeans and an open shirt than a pin-stripe suit.

José Mújica outside his garage on his farm (Reuters)

José Mújica outside his garage on his farm (Reuters)

Widodo is also at ease in his home clothes, admitting he only really wears white shirts and practical shoes, often stopping on his walkabouts, or blusukan, to buy local market clothes. Both men have forgone official transport, too. The Uruguayan drives an old VW Beetle and he flies economy class when taking to the skies.

His Indonesian counterpart recently declined to use the presidential plane flying to Singapore. Mújica is affectionately known as “Pepe” and the shared down-to-earth image of the two men is further underlined by the fact that almost everyone knows the Indonesian leader by a nickname as well, in his case “Jokowi”.

There are distinctions between the two countries. Mújica has overseen the legalisation of gay marriage and marjiuana in Uruguay. The use of cannabis is illegal in Indonesia and parts of the country have introduced sharia law, under which homosexuality is a criminal offence.

Jokowi is only getting started but José Mújica is on his way out. Tábare Vázquez will replace the understated man in power in Montevideo on 1 March next year. But though Pepe is leaving office, he won’t have to change desks, as he’ll still be sitting at the little cottage table he’s always sat at, in his humble home. Meanwhile, 9,400 miles away in Indonesia, Jokowi appears to be a willing follower carrying Mújica’s humble mantle.

Coral politics

The Maldives have elected a new president – after three previous attempts failed

How many elections does it take to choose a president in the Maldives? Four, apparently, after a destabilising campaign of annulled ballots, cancelled votes and political grand-standing from all sides. On Saturday 16 the final election produced a result that has been accepted by the victors and the defeated and can hopefully bring some calm back to the tiny country after 18 months of political unrest. Abdulla Yameen is the new man in charge but his empowerment comes after a nervy period dating back to February 2012 when the Maldives’ first democratically-elected leader, Mohammed Nasheed, stepped down after street protests followed the sacking of a top judge.

The upheaval was not officially seen as a coup, but the resulting election that culminated in the vote last week was a catalogue of strange electoral management:

7 September: Nasheed, who was imprisoned during the one-party rule that ended in 2008, won this vote with 45%, but that result was scrapped by the Supreme Court over voter list irregularities.

9 November: A re-run of the first go. This time around, Mr Nasheed actually increased his share of the vote from 45% to 47% but it was not enough for an outright victory.

10 November: A run-off election called for this day was again cancelled by the Supreme Court, which is dominated by judges from the 1978-2008 one-party regime.

16 November: The run-off was set for this date and, although Mr Nasheed won the first-round, Abdulla Yameen secured 51.6% of the votes in the second-round ballot and thus landed the presidency.

Although Yameen is new to the hot-seat he comes from a dynasty that is infamously linked to the Maldivian presidency. His half-brother Maumoon Abdul Gayoom ruled the country for 30 years from 1978 in what has been criticised as a ‘dictatorial manner’ by rights groups. So is this a step backwards for the Asian archipelago? That is certainly the point of view that the defeated Nasheed takes, who fears sharia law is creeping into the Muslim nation and that the religious conservatism of the old guard could manifest itself again through the new leader. For his part, Yameen has pledged to get to work on trying to tackle the country’s high debt and lack of foreign currency reserves. Revised and reinvigorated economic policy would be welcome, but the new president would also like to see the death penalty implemented, a measure that is not such good news.

The mishandled lead-up to Saturday’s vote did not go unnoticed on the international stage. The Commonwealth threw the Maldives out of its disciplinary panel and the European Union hinted at a reaction if there was further unrest spilling out from another undecided or contested result. The other international side to the Maldives is its tourism sector, and nearly a million holidaymakers from across the world flew in last year.

Exactly how many honeymooning couples were aware or would have wanted to be aware of the political unrest is uncertain. What is undeniable is that their presence on the coral-fringed white-sand beaches and in the clear, green Indian Ocean waves is of the utmost importance to Malé. Tourism made up 38% of government revenue in 2012.

Abdulla got frosty with the EU foreign policy chief Catherine Ashton over her warnings, saying “We will decide our own affairs”. That may be true, but while Western powers might seem a nuisance with their cautioning and judgements, their nationals are more than happy to jet in for a spot of secluded snorkelling off one of the country’s beautiful atolls. Mr Nasheed has respected the result, saying “we have the opportunity to show citizens how an opposition party that is loyal to the state works”. Mr Abdulla must provide clear, focused respect on the path ahead, and lashing out at the foreign powers whose people come up with a vital portion of his government’s coffers is not the best way to begin.

Snowed under

Several countries with competing ambitions are involved in the CIA whistleblower’s escapade

Since arriving in Moscow yesterday, Edward Snowden has set yet another diplomatic ball rolling. The cobweb of international espionage winks and nudges seems to be growing daily. The US would like to see Mr Snowden back on home turf as soon as possible to answer charges of spying and communicating classified information, but he has, so far, managed to stay one step ahead of Washington.

He first fled to Hong Kong after leaking details of the questionable intelligence-gathering methods employed by the US secret services, for whom he used to work as an IT engineer. That brought China into the mix, and although Hong Kong has a separate legal set-up to the rest of the country, it did give Beijing the indirect chance to rub the US up the wrong way.

Mr Snowden has flown from China to Russia and he has submitted an asylum request to Ecuador. He was rumoured to have been leaving Moscow today on a flight to Cuba; a journey that was possibly only going via Havana on route to its final destination in Venezuela. Lots of countries are involved and all of them are defending Mr Snowden’s right to speak out. But why? It does appear that one of the major reasons for these nations defending the name of Edward Snowden is to employ this ruse a means to irritate the US. Certainly, the Latin American states involved are all members of the late Hugo Chavez’s leftist ALBA bloc, and love nothing more than having a go at what they see as an overbearing, bullying neighbour to the north.

There has been a lot of talk on this issue so far regarding human rights, freedom of expression and the right (or lack thereof) of governments to snoop on citizens. But it is interesting to look at the list in the paragraph above of the countries now involved in this escapade. Mr Snowden claims to be fighting for freedom of expression but China, Russia, Cuba, Venezuela and Ecuador have not been shy to suppress parts of the media that report on issues that they see as a bit too close to the ruling inner circles. The US may be wrong to think that all countries should deign to whatever arrest warrant it has issued for the latest Wikileaks-related secret data releaser. But, on the other hand, Mr Snowden may be wrong to think that a fair trial is a matter of regular, democratic order in places where restrictions on expression – the very issue at the heart of this case – have been all too common in recent years.