Author: Suman Bery, NCAER

The East Asian countries responded with coherence and vigour to the weaknesses in their financial systems revealed by the crisis in 1997-98. This raises two issues. First, how important does that earlier agenda remain? Second, is it is reasonable to expect comparable alignment among the Asian members of the G20, particularly on the inter- related issues of global imbalances and the reform of the international monetary system?

Among the ASEAN+3 group of countries (the ASEAN 10, Japan, Korea and China), there is a well-established narrative on the 1997-98 financial crisis. Read more…

Authors: Hoe Ee Khor and Kim Song Tan, Singapore

The recent financial crisis has highlighted the need for fundamental reforms in the global financial system to make it more robust and resilient to shocks. Although the crisis resulted in a global recession and a sharp decline in global trade, its biggest impact was felt in Europe and the US, both of which experienced severe economic downturns and near collapse in their financial systems. Asian economies, on the other hand, were affected largely through the trade channel. Their financial systems have remained relatively unscathed. They have also been able to recover from the crisis much more rapidly than the West.

This difference helps to explain the muted response from Asia to the various proposals for financial reforms that have been put forward  for fixing the international financial system so far. Read more…

Author: Wendy Dobson, University of Toronto

The G20 Seoul Summit will be the first such global economic meeting to be hosted by a non-G7 country. In their continued focus on the significant agenda for collective action set at Pittsburgh in September 2009, leaders face a ‘Catch-22’. The tension and political uncertainties generated by subdued growth are weakening the collective will to cooperate on the policy changes needed to restore confidence and future growth.

To the continuing agenda—global recovery, rebalancing growth, financial regulatory reform and governance reform at the International Monetary Fund—the Korean hosts have added two new issues: financial safety nets and closing the development gap.

Read more…

Author: Frank Jotzo, ANU

The Copenhagen climate conference and subsequent developments have made it clear that a legally binding international climate agreement is out of reach for the time being. But the Copenhagen Accord outcome delivered on something that until then seemed unattainable: unilateral commitments by all major emitters to cut or constrain their greenhouse gas emissions over the next decade.

Whether this is a viable basis for global climate policy in the medium term depends on whether countries will follow through with domestic policies for implementation, and that in turn depends on whether countries’ targets are seen to be mutually compatible in their ambition. Reassurance that any one country is not going it alone is particularly important as we move into a ‘bottom-up’ approach to international climate policy, as Stephen Howes argued is inevitable.

Read more…

Authors: Mahendra Siregar and Tuti Irman, Republic of Indonesia

The unprecedented level of policy coordination by G20 countries in response to the global financial and economic crisis in 2008 was instrumental in preventing the worst economic downturn since the 1930s. It is still too early to say that the crisis is over, but at least we can safely say that it could have been much worse if the G20 had not acted swiftly. This success was the most important reason why the Summit of Heads of State or Government in Pittsburgh decided that from then on the G20 would be the premier forum for international economic cooperation—an historic decision from the perspective of global governance as well as the role of Asia in the global economy.

Does the G20 offer a new approach to global governance? Read more…

Author: Joel Rathus, Adelaide University

Early last Friday morning, the video taken by the Japanese Coast Guard of the 7 September collision between the JCG’s Mizuki and the Yonakuni and a Chinese fishing boat, the Min Jin Yu-5179 was leaked to youtube by a user known only as Sengoku38. There is no doubt that this is the real footage.

It is ironic that the characters forming the name of the Min Jin Yu refers to the start of the Warring States period in Chinese history. This connection has been picked up by the leaker of the footage, whose name ‘Sengoku38′ means ‘Warring States 38’. The 38 in the leaker’s name may refer to events during the Second Sino-Japanese War in 1938, a disturbing suggestion of a neo-nationalist agenda. Indeed, this name seems to symbolize the possibility that this incident will mark the start of an adversarial relationship rather than simply rivalry between China and Japan.

What does it show? Read more…

Author: Yoichi Funabashi, Asahi Shimbun

This month the Asia-Pacific region takes center stage in global diplomacy.

A Group of 20 summit meeting is being held in Seoul, followed by the Asia-Pacific Economic Cooperation forum summit meeting in Yokohama.

U.S. President Barack Obama is also scheduled to visit India, Indonesia, South Korea and Japan in November.

A number of pressing issues will need to be tackled at those forums. Delegates must figure out whether a new international order can be created that would move from the framework established after World War II in which the Group of Seven advanced economies managed the world economy, to one that includes newly emerging economies such as China, India, Brazil, Turkey and South Africa. Read more…

Author: Peter Drysdale, ANU

Political tensions between China and its neighbours in the region may have been on the rise in the recent past but relations between the mainland and Taiwan have rarely been better. The conclusion of the Economic Cooperation Framework Agreement (ECFA) between Beijing and Taipei represents a significant step forward in deepening cross-straits economic relations and, more importantly, provides a surer economic and political base from which Taiwan can intensify its economic integration into the East Asian economy and its relations with partners in the region and around the world.

Trade between Taiwan and China has grown immensely with the opening for more direct trade and large scale Taiwanese investment  on the mainland. Read more…

Author: Shiro Armstrong, ANU

The Economic Cooperation Framework Agreement (ECFA) that Taiwan and China signed on June 29 this year is a milestone in relations across the Straits. It normalises economic relations between Taiwan and the Mainland. Up to this point, Taiwan has had discriminatory trade and investment policies towards China under the guise of political-security concerns that severely limited economic engagement across the Straits. These measures meant that Taiwan had effectively cut itself off from participating fully in the East Asian production networks.

Taiwan is now free to institutionalise economic relations with other important trading partners such as the US, Japan, EU, ASEAN and Australia. Is it in Taiwan’s best interest to now join the FTA game with partners around the region and around the world?

Read more…

Authors: Andrew Walker and Nicholas Farrelly, ANU

Thai politics has been out of the news since May 2010’s bloody crackdown on red-shirt protesters in central Bangkok. But any superficial tranquility hides the ongoing campaign by the government to neutralise their opponents and maximise the vote for Prime Minister Abhisit Vejjajiva’s Democrat Party at the election due next year.

The state of emergency declared in May has been wound back, but is still in force in Bangkok and in three strategic provinces outside the capital. Read more…

Author: Lex Rieffel, Brookings Institution

For most Americans and Europeans, the November 7 election in Burma is all about Aung San Suu Kyi. Or more precisely, why Aung San Suu Kyi and the party she led to victory in the 1990 elections have been stopped from participating in this one.

But for people in Burma’s ASEAN partner countries and in the other major Asian powers (China, India, Japan, South Korea), the election is about overcoming more than 50 years of lousy governance. Read more…

Author: Shinji Takagi, Osaka University

Reform of the International Monetary Fund has been a constant theme of all G20 summits since November 2008. Although the G20 has yielded some concrete results in coordinating macroeconomic policies and financial regulatory reform, the same thing cannot yet be said about the promised IMF reform.

In view of the role the IMF must play in the post-financial crisis world, the leaders at the first G20 Summit in Washington in November 2008 expressed a commitment to advance reform so as to increase the ‘legitimacy’ and ‘effectiveness’ of the IMF and instructed the finance ministers to review its mandate and governance. Read more…

Author: Evan Feigenbaum, Council on Foreign Relations.

In my ‘other’ life—as head of the Asia practice group at a political risk consulting firm—I’ve learned that at least some players in the financial markets tend to think vertically about trade conflict. In this view, trade tensions go up. Trade tensions go down. Indeed, trade tensions are pretty cyclical. And electoral cycles have a lot to do with the timing of trade-related tensions.

But a ‘vertical’ paradigm probably won’t apply to US-China trade relations much longer. I think it’s time we shifted to a more ‘linear’ view. In other words, US-China trade conflict isn’t going to go down. It’s going to straightline forward. But US-China trade tensions are, I think, going to be broadly manageable. Read more…

Author: Takatoshi Ito, Graduate School of Economics, University of Tokyo

The G20 includes more Asian countries than any other global grouping, and it is expected to be a good forum for Asian countries to press their agenda.

The G20 Summit was created out of the chaos of the global financial crisis. After Lehman Brothers  collapsed in September 2008, global financial markets went into a tailspin. Securities markets were frozen as buyers disappeared. Read more…

Author: K. Kesavapany, ISEAS

This is an article I wish I did not have to write. As an Asian, as a student of history, and as a person who spent a lifetime in the Singapore foreign service, I have waited for Asia to move to the centre stage of world affairs.

Asians have waited very long. Since the advent of colonialism destroyed ancient patterns of interaction among Asian countries, this continent has been at the mercy of historical trajectories that originated from beyond the region. Read more…