Author: Hitoshi Tanaka, JCIE
North Korea’s nuclear weapons program has posed a clear danger to peace and stability in East Asia for the past two decades. North Korea’s recent acts, including its July 2006 missile tests, October 2006 and May 2009 nuclear tests, and April 2009 ‘satellite launch,’ coupled with its insistence that it would never return to the Six-Party Talks, clearly demonstrate that circumstances have now devolved into a crisis.
The current North Korea nuclear crisis is significantly more serious than that which occurred in 1994. Not only is North Korea’s nuclear program now far more advanced, its two nuclear tests represent clear violations of its past commitments to denuclearize. There is a narrow—and rapidly closing—window of opportunity in which the international community has a chance to prevent North Korea from becoming a nuclear state. Beyond the obvious harmful effect that a nuclear-armed North Korea would have on regional stability, the international community’s failure to stop its nuclear program would also deal a significant blow to the Nuclear Nonproliferation Treaty (NPT) regime and potentially encourage other states to follow North Korea’s example. The damage would be particularly pronounced in the wake of US President Barack Obama’s celebrated speech in Prague this past April in which he called for ‘a world without nuclear weapons.’
Read more…
Author: Suman Bery, NCAER
Buy on the rumour, sell on the news seems to me the best explanation of the stock market’s swoon during and after the finance minister’s Budget speech yesterday. It was a reaction which surprised me at the time and continues to do so.
As I listened to the Budget speech I found few negative surprises and several positive ones. Accordingly in penning this column, I find myself both attempting to evaluate the Budget (or more accurately the Budget speech), and trying to understand and explain the negative market reaction.
What did I like about the speech? Most of all, I thought it provided a clear and coherent structure for the issues facing the finance minister, and the priority and sequencing accorded to these.
Read more…
Author: Shiro Armstrong
When Kevin Rudd was elected Prime Minister in November 2007, many in Japan (and Australia) worried about the prospect of Australia shifting its diplomatic focus from Japan to China.
Rudd’s fluency in Mandarin and his long-time links to China brought out the insecurity in those who thought Australia’s increasing political engagement with China would come at the expense of its relationship with Japan, as if this were a zero sum game. Many of those critics see Japan’s relationships with the United States and Australia as a counter-balance to China.
This of course got worse when Rudd did not visit Japan on his first official tour abroad as the newly minted Prime Minister, whereas China featured prominently on his itinerary. The fury was bordering on panic and the oversight was widely reported as a diplomatic snub. Was this panic justified? Right after the election, key cabinet ministers such as Trade Minister Simon Crean and Foreign Minister Stephen Smith visited Japan in January 2008. Since then Kevin Rudd has made a couple of trips, including an important and significant trip to Hiroshima.
In addition to Rudd’s trips, 9 ministers in the Rudd government have visited Japan, for a total of 13 trips.
Read more…
Author Peter Drysdale
The economic and political effects of the global economic crisis are still unfolding. Interestingly, when the Great Depression hit the industrial countries in the late 1920s and 1930s, Japan was one of the least affected industrial powers, in economic terms (see my earlier piece). Unemployment rose only slightly (to a measured high of just over 6 per cent compared with 33 per cent in Australia), industrial production dipped briefly, exports surged in a rapidly contracting world market and growth resumed its high pre-war long term trend of over 4 per cent in real terms. This did not mean that Japan was spared of a huge political back-draft from the Depression. The retreat of discarded casual workers back to poverty in rural communities became the seed-bed of a huge political convulsion that saw the ascent of the militarists and Japan’s headlong rush towards the disaster of the Pacific War. Anthony Garnaut’s subtle and important piece today, on the origins of the upheaval in Xinjiang in the travails of the casual Uighur workforce in Guangdong, is a sober reminder of the complicated political and social transformation that Chinese leaders have to manage today, beyond the looking-good macro-economic numbers. This is a huge challenge for China. It is a challenge that the rest of the world needs to understand in all its subtlety and from which it cannot dissociate itself.
Author: Sunny Tanuwidjaja, CSIS, Jakarta
Quick counts show that Susilo Bambang Yudhoyono and Boediono won the election with a landslide with around 60 percent of support, followed by the Megawati Soekarnoputri-Prabowo Subianto pair with around 27 percent of votes, and Jusuf Kalla (JK)-Wiranto winning around 13 percent of votes.
Many have said that SBY’s achievements as president, his charisma, and his style, which are considered by many as presidential, are the key factors in explaining this landslide. However, we should not forget that the result of this election is also a function of the other two candidates.
Considering that the goal of JK and Mega was to make this election go to a second round, we can say that Mega’s team has done their job while JK’s has failed. The failure of JK and his team to get adequate support to push this presidential election into a second round is due to several factors.
Read more…
Author: Nina Hachigian, Center for American Progress
By all accounts, planning for the Group of 8 Summit-polooza in Italy was disastrous. Complex logistics were one problem. After Prime Minister Silvio Berlusconi decided to allow PR considerations to trump sanity and move the location of the summit to earthquake-stricken L’Aquila, tremor measurements and evacuation plans dominated the news coverage.
Another cloud was Berlusconi the man, who has been plagued by multiple scandals, the most recent involving very young women with very few clothes. But the underlying trouble is the G-8 itself. The world simply needs a different set of countries at the high table of global governance to tackle today’s challenges.
Read more…
Author: Anthony Garnaut, Melbourne University
A video of lethal, apparently racially-motivated, bashings, which triggered an official investigation that uncovered no ‘racist’ motives, that in turn sparked off deadly rioting, arson and looting, which all ended with a downtown curfew imposed by a hefty police presence. It might sound like a page from LA’s recent history, but this was the sequence of events on Sunday in Urumqi, the capital of China’s Xinjiang region, when a vicious riot grew out of what had been a peaceful demonstration that afternoon calling for a fresh investigation into the provocative video. In Urumqi we do not yet know how the police and armed forces restrained the mob, we do not know whether the sounds we hear on the video of the peaceful demonstration were in fact gunfire (because the Chinese media stated that the demonstrators were armed only with knives and clubs), and we do not know how many of the 156 people killed on Sunday were victims of either mob or state violence.
Read more…
Author: Scott Snyder, Asia Foundation
Given North Korea’s history of crisis escalation, it should have been apparent that the ‘Dear Leader’–Kim Jong Il–would not abide the prospect of being ignored by a new American President who has pursued a strategy of continuity, containment, and incrementalism. In fact, North Korean never gave the President a chance to reach out before acting provocatively by conducting a second nuclear weapons test as well as more missile tests. This highlights the need for a proactive US policy toward the Korean peninsula and Northeast Asia.
In the face of North Korea’s stream of hyperbolic nuclear threats, President Obama’s Rose Garden June 16th press conference with South Korean President Lee Myung-bak gave the impression that North Korea had exhausted its threat capacity. The President argued that the US should calmly and firmly break North Korea’s past pattern of bad behavior, but North Korea is unlikely to respond well to such an approach.
Read more…
Author: David G. Timberman
The re-election of Indonesian President Susilo Bambang Yudhoyono (known in Indonesia as ‘SBY’) to a second five-year term is a positive development for Indonesia. With the election over, the question becomes, can SBY and Indonesia ‘up their game’? For Indonesia to achieve its potential as one of the world’s largest middle income countries, it will need to ratchet up the pace and scope of reform.
The election was Indonesia’s second direct presidential election and, as with the first, it was largely devoid of controversy or violence. Indonesian voters once again demonstrated their sophistication, with about 60 per cent (based on early, unofficial ‘quick counts’) voting for a leader they feel is honest and who has brought tangible improvements to their lives. The April parliamentary elections and Wednesday’s presidential election continue a process of evolution of political parties in Indonesia– a process marked by the decline of Soeharto-era parties and the inability of Islamic parties to expand their appeal beyond about a quarter of the electorate.
However, two aspects of the elections were less positive.
Read more…
Author: Andrew W. Shoyer, Sidley Austin LLP
The cap-and-trade program takes effect in the United States in 2012.
Soon after enactment, the President must notify other countries that it is US policy to address climate change through international agreements, request that other countries take appropriate measures to limit their GHG emissions, and indicate that imported goods may be subject to international reserve allowance requirements beginning in 2020.
U.S. producers in carbon- and trade-intensive industrial sectors will get free allowances (in the form of rebates) for 2012 through 2025, and rebates will phase out from 2025 until 2035.
Read more…
Author: Hadi Soesastro, CSIS, Jakarta
By now a number of Indonesian polling agencies have perfected their method to do quick counts of the election results. The public has accepted their counts as being close to the official final result. In just a few hours after the closing of the voting booths Indonesians have a pretty good idea of the outcome of an election. This happened on 9 April 2009 with the legislative elections and again on 8 July 2009, the day Indonesians cast their vote to elect their President and Vice President for the period 2009-2014. This is a remarkable development.
The final, official count will be known in only about 10 days to two weeks. But at about 4pm on the day of the election, just three hours after the booths were closed in western Indonesia, it was clear that the incumbent, Susilo Bambang Yudhoyono (SBY), was the winner. By about 6.30pm when the quick counts have covered 90 to 99 per cent of the sample, there was no doubt that SBY and his running mate, the economic technocrat Dr. Boediono, won the election in the first round. There is no need to have a second round like in 2004.
It is a landslide victory. Read more…
Author: Leonid Petrov, ANU
On the heels of the recent UN Security Council Resolution, which pursued tough new sanctions against the Democratic People’s Republic of Korea (DPRK) for blasting a long-range missile and detonating a second atomic bomb, North Korea has moved aggressively against the last remaining zone of inter-Korean economic cooperation, the Gaesong Industrial Complex (GIP).
On June 11, the North Korean Central News Agency (KCNA) announced the nullification of all contracts on rent, salaries and taxes adopted for industrial park in Gaesong. Pyongyang wanted the minimum monthly wage raised four-fold (from US$75 to $300) and demanded an immediate lump-sum land lease payment of 500 million.
Pyongyang asked Seoul to empty the industrial estate unless the money was paid. This notification came after the two Koreas were wrangling over the release of a South Korean worker who was detained by the North Korean authorities for alleged anti-DPRK statements and inciting and DPRK citizens to defect.
Read more…
Author: G.E. Anderson, UCLA
A few weeks ago, Chinese Premier, Wen Jiabao paid a visit to Geely’s automotive factory in Hunan Province. Despite the fact that Geely is not a state-owned enterprise, this visit is not all that surprising. State leaders all over the world pay visits to privately owned businesses from time to time.
In the photo below, standing behind Wen’s right shoulder is Li Shufu, founder, Chairman and controlling shareholder of Geely.
What makes Wen’s visit interesting, however, is the fact that Wen’s government itself directly and indirectly owns or controls several competing auto manufacturers. Wen also had some interesting things to say while there:
Read more…
Author: Tobias Harris
Asō Tarō and the LDP failed in the first of two electoral challenges that will precede the dissolution of the House of Representatives and the forthcoming general election.
Kawakatsu Heita, the DPJ-backed candidate in the Shizuoka gubernatorial election, defeated Sakamoto Yukiko, the LDP- and Komeitō-backed candidate, on Sunday, this despite a split in the DPJ vote in Shizuoka.
The DPJ, of course, feels the wind at its back as it looks to Sunday’s Tokyo assembly elections. Polls in advance of the Tokyo vote show that the DPJ may well succeed in becoming the largest party in the Tokyo assembly.
Mainichi has the DPJ leading the LDP 26 per cent to 13 per cent, another 6 per cent for Komeitō, and 43 per cent undecided. But 55 per cent of respondents said they would consider using their vote to judge the Asō government, which provides a hint to how those 43 per cent might vote Sunday. Yomiuri finds that the DPJ enjoys a similar lead over the LDP, 29.4 per cent to 16.9 per cent, with another 5.1 per cent for Komeitō. Asahi‘s poll also found undecideds leaning to the DPJ.
The DPJ has every reason to feel that its time has come.
Read more…
Author: Hal Hill, ANU
Indonesians go to the polls again this week.
It is almost certain that the incumbent, Susilo Bambang Yudhoyono (universally known as SBY), will be re-elected in this week’s presidential elections, together with his Australian educated running mate Boediono, if not in this round then in the September run-off.
There has been little international commentary on the campaign in this, the world’s third most populous democracy. This partly reflects the lack of fireworks, and low-key, scripted debates centred mainly on personalities rather than policies.
But it also reflects the country’s remarkably swift transition from authoritarian to democratic rule. Few outsiders appreciate that, notwithstanding the global financial crisis, these are comparatively good times for Indonesia. Read more…
