Economics, Politics and Public Policy in East Asia and the Pacific
Author: Joel Rathus, ANU
The global financial crisis forced East Asian nations to get serious about regional architecture.
As global trade entered a precarious decline during the height of the crisis in 2008–09, one of the obvious areas of focus for East Asia was trade regionalism, aimed at making East Asia a more efficient production network and, over time, a final market in its own right. Read more…
Author: Joel Rathus, ANU
In early May, the ASEAN +3 Finance Ministers met in Hanoi and reached an agreement on two important issues in the development of the Chiang Mai Initiative (CMI).
Firstly, they appointed Wei Benhua to be the first director of the ASEAN+3 Macroeconomic Research Office (AMRO). Read more…
Author: Joel Rathus, ANU
This weekend (21-22 May) the leaders of China and Korea are hosted by Japan for the Fourth Trilateral Summit, the first such Summit since the triple disaster of 11 March.
As a part of this visit, Wen Jiabao and Lee Myung-bak will travel to Fukushima to demonstrate their nation’s continuing support for the plight of the Japanese quake victims and Japan’s reconstruction. Read more…
Author: Joel Rathus, ANU
Australian Prime Minister, Julia Gillard, will visit Japan from 20 to 23 April, a visit which includes a summit with her Japanese counterpart, Naoto Kan.
In the aftermath of the earthquake-tsunami-radiation triple disaster faced by Japan, this is not a time for pushing forward particular deals that Australia now seeks in the Japan-Australia relationship. Read more…
Author: Joel Rathus, ANU
The emergence of the G20 as the premier body for international economic coordination represents a major challenge for Japan. It was not immediately obvious that Japan would embrace this new forum which calls into question and has officially usurped the role of Japan’s preferred body for economic cooperation, the G8.
Rather, Japan is attempting to keep the G20 as the de facto junior partner to the G8. Japan’s chief but not sole concern is that the G20 will place China in a position which is not just formally equal in terms of status to that of Japan but actually equal in terms of influence too. Read more…
Author: Joel Rathus, Adelaide University
While the worst of the Global Financial Crisis may have passed, in East Asia the economic pressures are still mounting. Regional economies are struggling with inflation, asset bubbles and now increasingly volatile exchange rate movements. One mechanism which might aid the regional economies to coordinate their exchange rate policies, to fend off currency speculation and assist with reigning in increasingly problematic ‘hot money’ flows is the Chiang Mai Initiative Multilateralisation (CMIM).
However, getting Japan and China to agree has proven difficult – especially on the issue of contribution and (therefore) voting weight. This is important because these two are both required to effectively bankroll the CMIM. Read more…
Author: Joel Rathus, Adelaide University
Japan’s Foreign Minister Maehara Seiji was in Canberra last week on his first formal visit to Australia. Although only on the ground for 24 hours, Maehara reached two significant understandings with Australia. The first is a commitment from Foreign Minister Rudd on security of supply of so-called ‘rare earth’ metals. The second is an agreement with Trade Minister Emerson to re-vitalise the Free Trade Agreement negotiations which have been struggling for years. Yet Japan’s renewed interest in economic partnerships with Australia reflects more than simply shared values and mature relations. Rather, they are a part of Japan’s diversification strategy targeting China.
That Japan is pursuing Australia as a part of a diversification strategy is most easily seen in the agreement regarding rare earth metals. 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: Joel Rathus, Adelaide University
Sino-Japanese relations have entered a dangerous new era. Previously, Japan was willing to take an unobtrusive and patient approach to China. But last month’s less than diplomatic arm wrestle over the fate of the arrested captain of a Chinese fishing boat in disputed territory in the East China Sea may have effectively ended Japan’s ambivalence toward China.
For better or worse, the only real chance for Sino-Japanese relations to become the fulcrum for a new East Asian century has resided with the DPJ, as opposed to the more almost cynical policy of the LDP which, when in power, promoted an East Asian regionalism excluding China. Read more…
Author: Joel Rathus, Adelaide University
On August 25, Japan’s Foreign Minister Okada announced the transfer of 100 diplomats from offices and duties in the developed nations to assignments on emerging economies.
The shift in focus away from traditional western powers towards countries like India, South Africa, Brazil and Turkey will be brought about through the creation of an ‘Emerging Countries Bureau’ at the Ministry of Foreign Affairs. Read more…
Author: Joel Rathus, Adelaide University and Meiji University
In November of last year, President Barack Obama pledged that he would be a ‘Pacific president.’ While the audience in Suntory Hall may have wondered about what exactly that statement meant, few in attendance doubted the sincerity or conviction of the president. As relationships between the US, ASEAN and China have been re-drawn, especially since the latest series of ASEAN-hosted diplomatic meetings in Hanoi, the meaning of a Pacific president is starting to become clearer. Three sites of change in particular warrant special mention; the East Asia Summit, the South China Sea and the Korean Peninsula. In all three cases, the United States and ASEAN states are becoming closer, while China is finding itself distanced from the decision-making process.
The early 21st century phenomena of China-ASEAN relations being closer than the US-ASEAN partnership appears to be reversing itself. Read more…
Author: Joel Rathus, Adelaide University
The declaration of the Chiang Mai Initiative Multilateralisation (CMIM) in December last year required an important political decision on a seemingly innocuous number. This decision concerned each country’s contribution and ‘multiplier’ (which determines the amount a country can access in relation to their contribution). Built around a three-tier system, the multiplier determines where countries stand as either suppliers or borrowers of resources. This determines whether a country is a rule giver or a rule taker for the CMIM as a whole.
Countries with a multiplier of one cannot extract more from the CMIM than they contribute. Read more…
Author: Joel Rathus, Adelaide University
Since its inception on the sidelines of the ASEAN Plus Three (APT) summit over a decade ago, China-Japan-Korea trilateral cooperation has deepened significantly.
The trilateral cooperation is an important development in regional politics and economics. But the way in which it will affect an East Asian economic community remains uncertain. Read more…
Author: Joel Rathus, Meiji and Adelaide Universities
There appears to be a perception gap between Australia and Japan over the significance of whaling to the overall relationship – and it needs to be closed. In various media, Australian writers have identified the whaling issue as problem of great significance. By contrast, in the Japanese media the whaling issue is not seen as serious (see top 30), and has not been linked to the state of the bilateral relationship overall.
What, then, is the Japanese attitude towards the dispute around whaling?
Author: Joel Rathus, Meiji and Adelaide Universities
On March 24 the agreement reached in May of 2009 at the ASEAN Plus Three Finance Ministers Meeting (ASEAN+3-FMM) in Bali and signed in December of last year on the ‘Chiang Mai Initiative Multilateralization’ (CMIM) agreement will come into effect. While this will represent the first successful regionalist project of the ASEAN+3 grouping, transforming a complex network of Bilateral Swap Agreements (BSAs) into a single, uniform facility to help with managing regional financial crises, the CMIM is best understood (even after 10 years of negotiations to get to this stage) as only a good start.
The CMIM as an institution has a great deal to offer the region. But what are some of its problems? Read more…