Author: Yanrui Wu, UWA

After three decades of rapid growth, the Chinese economy is now at a crossroads, heading towards the next phase of development. While China’s economic growth has indeed been phenomenal, it has also been resource intensive and environmentally damaging.

For high growth to be sustained in the coming decades, the role of technological progress has to be boosted. This can either occur through technology transfer flows from abroad, or through indigenous innovation. While the former has been widely discussed, the latter has largely been under-documented. Read the rest of this entry »

Author: Aidan Foster-Carter, Leeds University

Kim Jong-il headed to China at the end of last month less than four months after his last visit. This timing was the more surprising since it meant he missed Jimmy Carter. The former US president arrived in Pyongyang to secure the release of a US prisoner Aijalon Mahli Gomes: a 30 year old black Bostonian, who had taught English in South Korea and was arrested in January when he apparently walked into North Korea from China to preach the Gospel. For this act of trespass the DPRK Central Court sentenced him on April 6 to eight years’ hard labour and a fine of 70 million won (about US$490,000 at the official rate). In July Gomes had reportedly attempted suicide.

There is a double déjà vu here. Gomes seemed to be copying his friend and fellow Christian human rights activist Robert Park, a Korean-American who pulled the same stunt a month earlier on Christmas Day 2009. The DPRK unexpectedly released Park after only 43 days. Read the rest of this entry »

Authors: Sherry Tao Kong, Xin Meng and Dandan Zhang, Australia National University

The global financial crisis (GFC) reduced export orders sharply and led to a decline in China’s economic growth.  As China’s exporting industries are labour intensive and most likely to employ rural migrants, it was widely believed that the GFC has had significant negative impacts on the employment and/or wages of rural migrants.

Reflecting this, at the height of the crisis, laid-off Chinese migrant workers protested outside closed factories and millions lamented lost jobs and embarked on journeys home. Read the rest of this entry »

Author: Ashima Goyal, IGIDR

Change is afoot in the area of Indian financial regulation. A Delhi-based body (the proposed Financial Stability and Development Council) is set to supplant existing the existing regulator, the High-Level Coordination Committee. This follows a series of committee reports that sought to shift power away from Reserve Bank of India (the RBI) towards market development.

These twin shifts are a mistake. They ignore the performance of the RBI during the global financial crisis. They also place greater power in the hands of elected officials, which is problematic. Read the rest of this entry »

Author: John D Conroy, FDC

Enthusiasm for microfinance has surged since Professor Yunus and his Grameen Bank shared the Nobel Peace Prize in 2006. APEC Finance Ministers will be asked to adopt an initiative on ‘financial inclusion’ when they meet at Kyoto in November. Unfortunately, this coincides with a wave of financialisation in the ‘micro-lending’ sector of the industry, a phenomenon Yunus deplores. As events unfold, micro-lending may come to provide an uncomfortable analogy, in terms of credit ‘bubbles’ and systemic damage, with ‘sub-prime’ home mortgage lending. APEC should avoid endorsing negative aspects of financialised microcredit.

Thinking about financial services for the poor has evolved since the 1980s, when Yunus pioneered micro-lending. Read the rest of this entry »

Author: Jane Golley, ANU

In the three decades since Deng Xiaoping declared that China’s economic development would necessarily involve some people becoming rich before others, inequalities have risen steadily across (and within) China’s provinces and regions.

To some extent, this outcome has been the natural consequence of market forces in a large developing economy; the historical and geographical advantages of the east ensured industrialisation would occur there first. Deng’s Open Door Policy and Coastal Development Strategy compounded these advantages with a range of preferential policies explicitly promoting the development of the eastern region. Read the rest of this entry »

Author: Carlyle A. Thayer, UNSW@ADFA

If China has made the running in Southeast Asia on the basis of soft power over the last decade, the tide now seems to be turning and the United States is re-engaging with smart power. The United States has signed the ASEAN Treaty of Amity and Cooperation; President Obama has attended the first ASEAN-United States leadership summit (and will host the second meeting in the US this year); Secretary Clinton has not only attended two ASEAN Regional Forum meetings in a row, but offered US good offices to help settle diplomatically one of the pressing security issues in Southeast Asia, the South China Sea dispute. In sum, Secretary Clinton has turned the multilateral table on China. The United States is back and engaged in Southeast Asia working with the support of regional states.

Continued Chinese bellicosity and diplomatic pique runs the risk of isolating China diplomatically and eroding the soft power gains of recent years. Read the rest of this entry »

Author: David Karl, Asia Strategy Initiative

After much criticism for appearing to neglect New Delhi while courting Beijing, the Obama administration is now moving to inject a sense of urgency and momentum into US-India relations. But just as bilateral affairs seem to have acquired new dynamism, differences over Afghanistan and Iran threaten to undermine positive developments.

There are several factors that explain India’s drop from Washington’s foreign policy priorities. Read the rest of this entry »

Author: Bill Durodié, Nanyang Technological University

Much of the discussion in the West about ageing populations also occurs in Asia. Yves Guerard, the Secretary-General of the International Actuarial Association, has compared these discussions to ‘climate change’; he sees the issue of an ageing population as a ‘big, immediate urgent problem’ that is largely ignored ‘because it’s inconvenient’.

But a recent report challenges this framing. Read the rest of this entry »

Author: Peter Drysdale

The enormity of the human tragedy visited upon the people of Pakistan by the massive flooding that has affected a huge part of the country is only now beginning to sink in to the international community. The stories coming out of the disaster zone provide daily witness to the scale of the human crisis that Pakistan confronts. UN Secretary General, Ban Ki Moon, was among the first to send out a plea for international help. Perhaps it has taken longer to comprehend the scale and impact of what has taken place in Pakistan than it did after the Indonesian tsunami or the Haiti earthquake, but the wellsprings of human compassion and generosity seem to have responded more slowly than in the case of these earlier disasters. That is bound to change as people around the world begin to understand.

Certainly in Australia there is at last a huge elevation in public awareness, sympathy and response to what has happened. Read the rest of this entry »

Authors: Mohsin Khan, PIIE and Shuja Nawaz, Atlantic Council, Washington

The floods in Pakistan have affected one-fifth of the country (an area roughly the size of England) and engulfed large parts of all four provinces—Punjab, Balochistan, Sindh and Khyber-Pakhtunkhwa (formerly the North West Frontier Province). The vast scope of the damage makes this a truly national disaster with long-term economic and political consequences. With waters still rising, it is far too early to assess the economic costs; a proper assessment will be made in time by the Government of Pakistan, assisted by the UN and the World Bank. But on the basis of early indicators, a preliminary and admittedly impressionistic view of the damage can be formed.

The immediate impact on the population is truly staggering—20 million people affected with 8 million in need of water, food and shelter; 1500-2000 killed; 4 million left homeless; and 15 million displaced. Read the rest of this entry »

Authors: Adil Khan Miankhel and Shahbaz Nasir, ANU

Pakistan is experiencing its worst natural disaster.  While the human toll of the disaster is bad enough, the collateral economic damage is catastrophic. Flooding is spread over all four provinces of Pakistan, affecting 20 million people, a population equal to Australia’s, and inundating a geographical area the size of England.

Louis-George Arsenault, director of emergency services for UNICEF, says the flood crisis in Pakistan is the biggest humanitarian crisis in decades. Maurizio Giuliano, a spokesman for the UN Office for the Coordination of Humanitarian Affairs (OCHA), says the flood is worse than the tsunami, the 2005 Pakistan earthquake and the Haiti earthquake. Read the rest of this entry »

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 the rest of this entry »

Author: Aurelia George Mulgan, UNSW@ADFA

Japanese politics is heading for a showdown on 14th September when the ruling Democratic Party of Japan decides its next leader and prime minister. The contenders are the present incumbent, Prime Minister Kan Naoto, and the secretary-general in the previous Hatoyama administration, Ozawa Ichirō. If Ozawa is successful, Japan will have had three prime ministers in a little over three months.

The media have been waiting breathlessly for Ozawa’s decision on whether or not he would run for the DPJ leadership. Read the rest of this entry »

Author: Tobias Harris, MIT

‘All political lives, unless they are cut off in midstream at a happy juncture, end in failure, because that is the nature of politics and of human affairs.’ — Enoch Powell

Returning to his familiar role as Ozawa Ichirō’s trusty factotum, former Prime Minister Hatoyama Yukio announced Thursday that he will be supporting Ozawa in a bid to unseat Prime Minister Kan Naoto in next month’s DPJ party leadership election. Read the rest of this entry »