BANGKOK, January 31 -- As Asean chair this year, Thailand must enhance the region’s cooperation amid growing US-China tensions that threaten to go beyond mere trade conflicts, international-relations experts said at a peace forum in Bangkok.
“The tension between China and the US is unlike the tension between the US and the Soviet Union during the Cold War,” said Yan Xuetong, chief of the Institute of International Relations at Tsinghua University. He is also secretary-general of the World Peace Forum in Beijing. Yan was speaking at a forum titled “An Uneasy Peace: China in a Divided World”, where he addressed the changing geopolitical dynamic between China and the US, and what that entails for Asean. “Instead of focusing on military accumulation, ideological conflicts and nuclear threats, competition between the superpowers China and the US will be in the realms of economics and technology,” Yan said, calling the rivalry an era of “uneasy peace”.
The economic dispute between the two countries is only one aspect of the conflict and will be followed by technological tensions, he added, citing the recent arrest of Huawei’s CFO, Meng Wanzhou, in Canada. Thanks to President Donald Trump’s “America First” foreign policy, the US has been playing a smaller role in international politics, retreating from regions such as Asean. However, China lacks the capacity to take the United State’s place in international politics, which now leaves Asean members with the manoeuvring ground to take charge of their region’s management, Yan said.
The international relations expert agreed that Asean has been presented with an important opportunity to drive forward the cohesive integration of the region during the apparent geopolitical power vacuum.
Yan further suggested that while Trump’s inward-looking foreign policy has led to a general decline in multilateral relations around the world, the Asean region is an exception. Multilateral negotiations such as the Regional Comprehensive Economic Partnership (RCEP), the Free Trade Area of the Asia-Pacific (FTAAP) and the Lanchang-Mekong Cooperation (LMC) are still promising, he said. Other participants agreed that there was a window for Asean multilateral cooperation to grow. “For this reason, Thailand’s position as Asean chair is extremely important, as it will set in motion the necessary diplomatic and trade initiatives to cope with the changing world order,” said Kavi Chongkittavorn, senior fellow of the Institute of Security and International Studies (ISIS) Thailand, and former chief editor at Myanmar Times. One of Thailand’s most ambitious goals as the chair is to conclude the RCEP negotiations, which has been going on for seven years. If successful, RCEP will be the largest multilateral trade deal in history, between the 10 Asean member countries and China, India, Japan, South Korea, Australia and New Zealand.
The key challenge for Thailand in negotiating the RCEP agreement will be to bind together China and India, the two superpowers that have conflicting interests, Kavi added. “Completing the RCEP is not just significant for Thai trade, but it is also symbolic of Thailand’s commitment to push forward the notion of ‘Asean Centrality’,” he said later in an interview on the sidelines of the forum. According to the Department of Trade Negotiations, the US-China trade war has made Thailand and other countries in the region determined to conclude the mega-trade pact’s negotiations by the end of this year. Kavi believes that even though the negotiations have been dragging on for the past seven years, RCEP will finally be concluded in 2019 under the current external pressures.
“Our handling of the RCEP will say whether Asean is still relevant in the geopolitical field as a region. It will also improve Thailand’s image internationally for being able to reconcile opposing interests of various superpowers into a single mega-trade pact,” he said. However, Yan has a more sobering view of the RCEP negotiations. “Due to the sheer size of the deal and the conflicting interest of the economic powerhouses involved, the chances of concluding RCEP by the end of this year are slim, as are other regional negotiations that will be set in place,” he said. “However, Thailand must keep the dialogue on issues such as RCEP on the table during its chairmanship to ensure that the region remains as one entity and that cooperation in the region continues to progress gradually.”
SHANGHAI, January 31 -- Foreign investors are piling into Chinese stocks after a dismal 2018 for the country’s equity market.
They’ve bought 52 billion yuan ($7.8 billion) of A shares via trading connects in Shanghai and Shenzhen this January, putting it on course to be the biggest month for inflows since the second exchange link with Hong Kong opened in late 2016, Bloomberg calculations based on trading turnover show. “Funds are flowing back to emerging markets after the U.S. Fed slowed the pace of rate hikes. A shares are showing cheap valuations and a possible fundamentals recovery on the back of government stimulus,” said Vincent Hsu, a Taipei-based fund manager at Fuh-Hwa Securities Investment Trust Co.
Foreign buying of China's A shares hit record in January
More than $2.3 trillion was wiped from China’s stock markets last year, as the Shanghai Composite Index plunged 25 percent and the Shenzhen Composite Index tumbled 33 percent, their worst performances since the financial meltdown a decade earlier. Even then, foreign investors weren’t dissuaded: they bought net 294 billion yuan of A shares in 2018.
Enthusiasm for Chinese equities is picking up further now that the general mood is improving -- the Shanghai and Shenzhen benchmarks have advanced 3.3 percent and 1.3 percent in January, respectively. Along with Beijing’s plans to loosen lending and boost the economy, occasional signs of progress in U.S.-China trade talks have helped.
LONDON, January 31 -- Brexit hasn’t even happened yet, but it’s already causing massive damage to the U.K. auto industry. Now industry leaders are warning of “permanent devastation” if the country crashes out of the EU without a deal.
The U.K.’s car industry trade association released a scary set of statistics on Thursday, showing a near-halving of fresh investment during 2018, to $772.6 million. It also noted a fall in production of 9.1% to 1.52 million units—the lowest output in five years—though this was also partly down to regulatory uncertainties and economic slowdowns at home, in China and the EU. The investment drop is no surprise. We are now just under two months away from Brexit and the U.K. is yet to agree on a deal with the EU. Due to intransigence on both sides, the odds of a no-deal Brexit are steadily rising, opening up the possibility that trade and supply chains between the U.K. and EU will face massive disruption after March 29th. This would devastate the British car industry, the Society of Motor Manufacturers and Traders (SMMT) warned, as it begged the government to avoid a no-deal scenario.
According to the body, no-deal would put two-thirds of the U.K.’s global auto trade at risk. This is partly because the country gets preferential trade terms with countries like Canada and Turkey because it’s part of the EU club. “Time has almost run out to guarantee continuity of any of these arrangements before Brexit,” the SMMT warned. “With fewer than 60 days before we leave the EU and the risk of crashing out without a deal looking increasingly real, U.K. Automotive is on red alert,” said SMMT chief executive Mike Hawes. “Brexit uncertainty has already done enormous damage to output, investment and jobs. Yet this is nothing compared with the permanent devastation caused by severing our frictionless trade links overnight, not just with the EU but with the many other global markets with which we currently trade freely.”
The SMMT attributed the production drop to “declining consumer and business confidence,” as well as uncertainty about what the future will hold for diesel policy and taxation. The U.K. exports just over 80% of the cars it produces—with more than half of those going to the EU—and output for overseas markets fell by 7.3% in 2018. Domestic output fell by 16.3%. “Given the global headwinds, the challenges to the sector are immense,” said Hawes. “Brexit is the clear and present danger and, with thousands of jobs on the line, we urge all parties to do whatever it takes to save us from ‘no-deal’.”
Jaguar Land Rover, the U.K.’s biggest car manufacturer, said last week that it would be halting production for a week in April, shortly after the Brexit date, as it anticipates disruption that will affect its car and engine plants.
"Gains in financial, energy stocks help SET index rise"
BANGKOK, January 31 -- Thai shares rose to a near eight-week closing high on Thursday after gains in the energy and financial sectors.
Vietnam and Malaysia shares dropped but other Southeast Asian markets were in the green on the Federal Reserve's dovish outlook. The Fed kept rates at 2.25 % to 2.5 % on Wednesday as widely expected, which are well below historical averages. The US central bank also discarded its promises of "further gradual increases" in interest rates, and said it would be "patient" before making any further moves amid signs of global economic slowdown and a damaging trade war with China. Rising US borrowing costs in 2018 had led to massive capital flight from emerging markets, prompting regional central banks to hike rates to reduce the rate differential and combat a stronger US dollar. "Markets clearly like the newly dovish Fed, which had exceeded expectations for dovishness in the midst of a positive output gap and tight labour market," Mizuho Bank said in a client note.
The Stock Exchange of Thailand index added 9.13 points or 0.56% to 1,641.72, in turnover worth 57 billion baht. Kasikornbank topped the most active stock. KBANK jumped 7 baht or 3.63% to 200 baht, Bangkok Bank gained 4 baht or 1.90% to 215 baht and Siam Commercial Bank closed at 133 baht, up 2 baht or 1.53%. PTT Plc added 25 satang or 0.52% to 48.50 baht and PTT Global Chemical ended 50 satang or 0.74% higher to 68 baht.
Indonesian shares jumped 1.1%, boosted by financial and industrial stocks. The index rose 5.5% in January in its third straight monthly gain. Bank Central Asia and Unilever Indonesia gained about 2% and 1.9%, respectively. An index of the country's top 45 liquid stocks climbed 1.5% to its highest since April 2018.
Philippine shares closed 0.3% higher after gaining as much as 1.5% earlier in the session. The benchmark stock index pared its gains after the central bank said January annual inflation is likely to settle within a range of 4.3% to 5.1%, above its target of 2-4% for 2019. Surging inflation had dented consumption and put pressure on the peso in 2018, prompting Bangko Sentral ng Pilipinas to hike its benchmark rate five times. The Philippine stock index added 7.3% in January, in its sharpest monthly gain since March 2016.
Vietnam shares ended 0.6% lower, while Malaysian shares retreated from early gains to close flat.
FORT WORTH, January 31 -- The Royal Netherlands Air Force rolled out its first operational F-35A during a ceremony at Lockheed Martin’s Fort Worth, Texas, facility that at times resembled a rave rather than a corporate ceremony.
The RNAF expects to acquire 37 F-35As, and it already received two operational test aircraft in 2013 that are now flying at Edwards AFB, Calif. The jet that rolled out Wednesday will ferry to Luke AFB, Ariz., for F-35A pilot training. It will then move to Leeuwarden AB, Netherlands, which will be a “huge driver for change for our air force and will have tremendous impact on the relevance of our Air Force as part of the coalition,” RNLAF Commander Lt. Gen. Dennis Luyt said at the ceremony.
So far, Lockheed has delivered more than 360 F-35s, which are flown by 10 nations and at 16 bases worldwide, according to the company. Five services have declared initial operating capability, while two nations—the US and Israel—have used the jet in combat. The Lockheed facility hosted two Dutch DJs, along with massive screens and laser lights for a crowd of US and Dutch VIPs in military service dress and business attire, some with Dutch orange cowboy hats.
CARACAS, January 31 -- Venezuelan President Nicolas Maduro has said that a group of military deserters fled to Colombia in order to conspire to sow discord in the Venezuelan armed forces.
"A group of military deserters that became mercenaries for Colombian oligarchy are conspiring from Columbia to sow discord among [Venezuelan] armed forces," Maduro told servicemen before military drills on Wednesday. Venezuelan Defense Minister Vladimir Padrino Lopez said on Tuesday that Venezuelan military recognize Maduro as the only legitimate president of the country. On January 23 Venezuelan National Assembly Speaker Juan Guaido proclaimed himself as the country's acting president. Venezuelan President Nicolas Maduro has described it as a coup attempt and announced severing diplomatic relations with the United States. On January 29 the US Treasury announced imposing sanctions on PDVSA (Petroleos de Venezuela) oil and gas company and blocking $7 billion in assets.
Guaido was recognized as interim president by the Lima Group countries (except for Mexico), as well as by Albania, Georgia, the United States, and the Organization of American States. Several EU countries came forward with support for the Venezuelan parliament and expressed hope for new elections to resolve the crisis. Maduro was supported by Russia, Bolivia, Iran, Cuba, Nicaragua, El Salvador and Turkey. Belarus and China called for resolving all issues by peaceful means and spoke against any interference from the outside. The UN secretary general called for dialogue to resolve the crisis.
"SET index ends above 1,630 mark, leads SE Asian peers"
BANGKOK, January 30 -- Thai shares lead the stock markets in Southeast Asia on Wednesday, with PTT Exploration and Production Plc emerging as the top boost to the index.
The Stock Exchange of Thailand index recovered from early weakness to close at 1,632.60, up 8.55 points or 0.53%, in turnover worth 48 billion baht. PTTEP topped the most active stock after the company posted an 88.6% rise in full-year profit. PTTEP gained 2.50 baht or 2.11% to 121 baht, while Airports of Thailand Plc gained 1 baht or 1.5% to 69.75 baht.
Philippine shares recorded their worst fall in two weeks, as investors awaited a US Federal Reserve rates review and key Sino-US trade talks. The Fed is widely expected to leave rates unchanged on Wednesday, as policymakers had made it clear that they plan a "patient" pause in rate hikes. The central bank is taking a wait-and-see approach to further tightening in the face of a global economic slowdown, US federal government shutdown, trade tensions and waning business and consumer confidence. Adding to investor caution is the start of a crucial round of Sino-US trade talks on Wednesday and Thursday. Philippine shares fell as much as 1.7% on profit-taking before recovering partially to close 0.9% lower. "We are seeing sales of shares of companies with large institutional following, investors are now being cautious about what will happen in the US Fed meeting," said Rachelle Cruz, a research analyst at AP Securities in Manila. Cruz said a lot of funds from the profit-taking were invested in "third-liner stocks", with Premiere Entertainment emerging as one of the most actively traded stocks after a funding deal worth 15 billion pesos (US$286.67 million) with a Qatar-based investment management firm. Index heavyweights BDO Unibank Inc and SM Prime Holdings lost 2.4% and 1.5%, respectively, while Premiere Entertainment closed at its highest level since November 1997.
Malaysian shares fell 0.4%, dragged by utility and basic material stocks. Effects of the Sino-US trade war were seen with data showing Malaysia's exports to China, a major trading partner, contracted 0.5% annually in December, while shipments to the United States surged 13.5%.
Singapore shares closed 0.4% lower, with DBS Group Holdings and Singapore Press Holdings falling 1.2% and 2.4%, respectively.
"Iraqi suspects ordered detonator, downloaded bomb-making instructions and tested explosive powder"
BERLIN, January 30 -- German authorities arrested three suspected Islamic extremists on allegations they were planning a bombing attack, and searched properties in three states in connection with their investigation.
Federal prosecutors said Iraqis Shahin F. and Hersh F., both 23, and Rauf S., 36, were taken into custody in an early morning raid by a police SWAT team in the area of Dithmarschen, near the border with Denmark. In addition, searches were carried out of other residences in northern and southwestern Germany of people linked to the three main suspects but not currently to the bomb plot. The two younger men are suspected of preparing a bomb attack and violating weapons laws, and Rauf S. is alleged to have aided them. Their last names were not given in line with German privacy laws.The men appear to have been in the early stages of planning, and had not yet built a functioning bomb nor decided upon a target for attack, prosecutors said in a statement.
Prosecutors allege Shahin F. and Hersch F. decided in late 2018 to “carry out an attack motivated by Islamic extremism in Germany.” There are indications that they sympathized with Islamic State, but a direct link to the extremist group or others is currently under investigation. In December, Shahin F. downloaded “various instructions” on how to build a bomb, and ordered a detonator from a contact person in Britain, prosecutors said. Its delivery, however, was stopped by British law enforcement agencies.
TOKYO, January 3 --Detained auto tycoon Carlos Ghosn believes his arrest and the charges against him are the result of a “plot and treason” at his former employer Nissan Motor Co.
The daily quoted Ghosn as saying he had “no doubt” that the charges against him were motivated by Nissan executives opposed to greater integration of the firm with its French alliance partner Renault SA. The interview, the first Ghosn has given since his stunning arrest on Nov. 19, was conducted at the Tokyo detention facility where he has languished ever since. The 64-year-old has been denied bail several times, with the court considering him a flight risk and concerned that he could attempt to destroy evidence. But he again stressed that he “won’t flee. I will defend (myself),” according to the Nikkei. “All the evidence is with Nissan and Nissan forbids all employees to talk to me,” he added.
Even his own lawyer has said it is unlikely he will be released before a trial, which could take up to six months to organize given the complexity of the case.
Ghosn faces three separate charges, all of which he denies. He stands accused of underreporting his income between 2010 and 2015 to the tune of ¥5 billion and continuing to do so for a further three years. In total, Ghosn is suspected of having failed to report around ¥9 billion of his pay. He also stands accused of a complex scheme to try to pass off personal foreign exchange losses to Nissan and using company funds to reimburse a Saudi contact who put up collateral for him. The executive, once feted for his turnaround of the struggling Nissan, has been removed as chairman of the carmaker as well as of Mitsubishi Motors. He resigned as chairman and chief executive of French company Renault. He told the Nikkei that there was a plan to “integrate” the three companies but insisted it was intended to ensure there would be “autonomy under one holding company.”
TOKYO, January 30 -- China opened a maritime rescue center on one of its man-made islands in the disputed South China Sea on Tuesday, state-run media reported, as Beijing seeks to reinforce its claims in the strategic waterway.
China’s Ministry of Transport opened the rescue center on Fiery Cross Reef, which is also claimed by Taiwan, Vietnam and the Philippines, “to better protect navigation and transport safety in the South China Sea,”. It quoted the ministry as saying the center “will offer better support to maritime rescue operations in the southern part of the South China Sea” near the Spratly chain.
Beijing has built up a series of military outposts in the South China Sea, which includes vital sea lanes through which about $3 trillion in global trade passes each year. The Philippines, Vietnam, Malaysia, Taiwan and Brunei have overlapping claims. As part of what some experts say is a concerted bid to cement de facto control of the South China Sea, three of Beijing’s man-made islets in the Spratlys — Fiery Cross, Subi and Mischief reefs — all boast military-grade airfields. Recent reports have also said the islets, including Fiery Cross, have emplacements for missiles, extensive storage facilities and a range of installations that can track satellites, foreign military activity and communications. In a bid to offset concerns over the militarization of these islets, China has consistently said the facilities there are for defensive purposes and that the islands themselves are civilian and will provide navigational services to ships in the vicinity. But some observers have expressed concern that the moves could help boost Beijing’s claim of sovereignty over the islets. These moves have seen China build ecological conservation and restoration facilities and marine observation centers on Fiery Cross, Subi and Meiji Reefs. Xinhua has said that the facilities were “providing public services, including marine forecasts and disaster alarms, to the international society and passing vessels.”
In late July, China announced that it would permanently station a search-and-rescue ship at Subi Reef, the largest of China’s seven man-made outposts in the Spratlys and home to a lighthouse and extensive docking facilities. In October, another rescue ship was sent to the region to replace the vessel.