Author: Yoichi Funabashi

I was in Washington, DC recently while congressional hearings were held into the massive recalls announced by Toyota Motor Corp. I sensed that public sentiment in the United States was rapidly becoming critical of the auto giant, which is now a synonym with lemons.

An article published in the New York Times on February 21 under the headline, ‘Doubts raised on book’s tale of atom bomb’, drove home the point to me. The newspaper noted that the author of ‘The Last Train From Hiroshima,’ Charles Pelegrino, used quotes from an individual who falsely claimed he was a last-minute substitute on an observation plane that accompanied the Enola Gay on its mission to destroy Hiroshima by atomic bombing. An expert is quoted in the article as saying, ‘This book is a Toyota. The publisher should recall it, issue an apology and fix the parts that endanger the historical record.’ Read the rest of this entry »

Author: Ross McLeod, ANU

The visit of Indonesian President, Susilo Bambang Yudhoyono (SBY) to Australia, five months into his second five-year term, provides an opportune moment to take stock of Indonesia’s progress over the last few years. Like Australia, Indonesia has performed remarkably well in the face of the global financial crisis. Its annual economic growth rate fell from about 6 to 4 per cent, but has already accelerated again to well above 5 per cent. Inflation is only about 3 per cent, and the currency is strong. The budget deficit is small and well under control, as is public debt.

A number of factors have contributed to this good performance. Read the rest of this entry »

Author: Tobias Harris, MIT

On Wednesday, Ubukata Yukio, the deputy secretary-general, Tanaka Makiko, Koizumi Junichiro’s controversial foreign minister who joined the DPJ last year, and other DPJ Diet members proposed to Prime Minister Hatoyama Yukio and DPJ secretary-general Ozawa Ichiro that the party establish a new policy research arm to replace the policy research council that closed shop when the DPJ took power in September.

Once again showing that whatever the DPJ-led government’s shortcomings, it is entirely serious about centralising policy-making in the cabinet and neutering the ruling party, both Hatoyama and Ozawa were quick to reject the proposal. Read the rest of this entry »

Author: Ligang Song, ANU

China has succeeded in moving up the ladder of development through rapid growth in just three decades. The pace of China’s growth is not what is unique — Korea, Singapore and other economies in East Asia grew as fast in the 1970s and 1980s. What is unprecedented historically is its scale. The size of China’s population, market and geography, and the dynamism that flowed from economic reform and transformation are what define its impact on the rest of the world. Despite a still relatively low per capita income, the sheer size of the Chinese economy has made China a significant player in world production, consumption, trade and increasingly international finance and the environment.

The dynamics unleashed by Deng’s reform, the opening up policies and institutional changes have propelled continuous capital accumulation, productivity gains, trade and income growth on a scale the world has never seen before. Read the rest of this entry »

Last week Japan Airlines went into receivership. JAL is the stately matron of Asian flag carriers so while its struggles with high costs and overheads were familiar news to the heavily business-class patrons of the old dear, it came as a shock to most of us who had loyally racked up JAL Mileage Bank points over the years – even if they did evaporate if you did not use them rather quickly!

JAL may be a leader of sorts – a prototypical example of what’s wrong with the major established international airlines today – but what’s wrong with JAL is not untypical with the challenges facing a bunch of the majors all over the world. British Airways is in trouble and other European majors have already succumbed. As Christopher Findlay explains in this week’s lead, the international system of air transport regulation might have tried to suppress the highly competitive forces that have been shaping huge adjustments in the business, but that was a loser’s game. Read the rest of this entry »

Author: Christopher Findlay, Adelaide University

Readers who are members of the JAL Mileage Bank (JMB) are probably wondering now what will happen with their bank of points. The reconstruction of JAL certainly raises this question but also highlights some even bigger challenges in air transport today.

The international system of the regulation of air transport has tried to suppress a set of highly competitive processes. Market access rights are negotiated bilaterally, and routes limited mostly to carriers identified with the countries involved. Read the rest of this entry »

Author: Peter Yuan Cai, ANU

One of the hottest television dramas currently on air in China is called ‘Woju’, translated as snail home, alluding to the tremendous burden of carrying the dream of home ownership in China. The series has sparked a nationwide debate on the housing affordability issue. Newspaper editorials, online discussion forums and gossip around the dinner table are all about skyrocketing house prices and their impact on social stability, especially regarding the younger generations.

In a recent Green Book on housing development in China, published by the Chinese Academy of Social Sciences (CASS), many commentators argue that the housing affordability issue has reached a breaking point. Read the rest of this entry »

Author: Yoichi Funabashi

The rise to power of the Democratic Party of Japan (DPJ) after half a century of almost uninterrupted rule by the Liberal Democratic Party (LDP) could bring profound changes to Japan.

One change will surely be generational: the new leaders, including Prime Minister Yukio Hatoyama, will be the first with little memory of World War II. Read the rest of this entry »

Jon Fraenkel, ANU

Kevin Rudd has talked of the danger of a ‘coup culture’ spreading from Fiji across the Pacific, but nowhere else in the region has experienced anything similar to Fiji’s three coups. The Solomon Islands witnessed a coup back in June 2000, when Malaitan militants in cahoots with the Police Field Force over threw Bartholomew Ulufa’alu’s government. But there an elected government was back in charge within the month, and the constitution was never abrogated.

Other than that, you need to go back over a century to find another example of a coup in the Pacific. In Hawaii in 1893, American settlers overthrew the government of Queen Lili’uokalani, installing a government that was recognised by Washington several years later. Bill Clinton apologised in 1993. Only Fiji, Tonga and Papua New Guinea (PNG) have standing armies that might, in theory, carry out coups. Read the rest of this entry »

Author: Aurelia George Mulgan

The Democratic Party of Japan (DPJ) is putting on a show in its efforts to curb waste in Japan’s bureaucracy. No ministry was spared the scrutiny of the Government Revitalisation Unit (GRU) working groups which has publically reviewed government support of a large number of projects. Is it all a show or will the DPJ effect real change?

The Ministry of Health, Labour and Welfare (MHLW) had 40 projects screened [see Table 1 below], which was the most, followed by the Ministry of Education, Science and Technology (MEST) with 35, the Ministry of Agriculture, Forestry and Fisheries (MAFF) with 32 and the Ministry of Land, Infrastructure and Transport (MLIT) with 31 not far behind. Budget allocations to the MEST’s ‘independent administrative corporations’ (dokuritsu gyōsei hōjin) were particularly well scrutinised as was expenditure by MAFF ‘funds’ (kikin) and the MHWL’s ‘public interest corporations’ (kōeki hojin).

These figures are partly a reflection of the prevalence of different organisational types amongst the semi-administrative bodies connected to particular ministries. Read the rest of this entry »

Author: Rizal Sukma, CSIS

There is debate about whether the 2009 elections in Indonesia suggest a further decline of Islam in Indonesia’s politics. Many believe that Islam has become less significant in Indonesia’s politics.

Susilo Bambang Yudhoyono’s (SBY) Administration faces many challenges, but despite all the issues that confront the country, Indonesia’s democracy has displayed a degree of resilience. Read the rest of this entry »

Author: Tobias Harris

Amidst all the changes introduced by the Hatoyama government since it took office in September, it is easy to forget what may be the most revolutionary change of all: transparent government.

The most visible example thus far is the Government Revitalization Unit’s (GRU) comprehensive review of government spending programs, ably chronicled by Michael Cucek here and here. Read the rest of this entry »

Guest Author: Michael Cucek

For the past week the citizens of Japan have been the stunned witnesses of an unfamiliar phenomenon: a new regime addressing the excesses of its predecessor. In clockwork proceedings of subdued brutality, the grimly-named Government Revitalization Unit (GRU) has been reviewing the budgetary support of 447 programs, a fraction of the thicket of government supported programs that had proliferated over the fifty-four year rule of the Liberal Democratic Party (LDP).

For those watching the live webcasts or the excerpts broadcast on nightly television, the proceedings have been the first solid evidence that the government is serious about bringing change to Japan. Read the rest of this entry »

Author: Greg Lopez, ANU

The reforms in the United Malay National Organisation (UMNO) may be a step in the right direction. Already, there are detractors suggesting that the reforms are meaningless as corruption is entrenched in Malaysia. What is more serious is Malaysia’s democratic deficit which undermines the citizens’ basic democratic right to choose their representatives without fear.

Malaysia is a dysfunctional democracy. The opposition coalition — Pakatan Rakyat (PR Peoples/Citizens Coalition) is under siege from the ruling party Read the rest of this entry »

Guest Author: Milan Zavadjil, IMF Indonesia

By now it is well known that Indonesia is weathering the global financial crisis (GFC) better than most countries. This is usually explained by lower dependence on exports, as well as the stimulus provided through fiscal and monetary policies.

Nonetheless, there is another reason behind Indonesia’s strong performance. Cautious policies by Indonesia’s government, banks, corporations and households over the past decade have resulted in low debt levels and limited refinancing needs. This served the country especially well in late 2008 and early 2009, when liquidity tightened around the world. Read the rest of this entry »