SBC: January 2013

Jan 30, 2013

Singapore - Manila deals a clever hand with knock-on effects on Asean

In the past year, China and the Philippines have been fighting a war of words over disputed islands in the South China Sea, and Asean unity on the issue has come under pressure.

Last week, Manila surprised observers when Foreign Secretary Albert del Rosario handed Chinese Ambassador Ma Keqing a note notifying Beijing it was seeking international arbitration to declare Beijing's moves in the oil-rich waters as "unlawful" under the 1982 UN Convention on the Law of the Sea (Unclos).

"The Philippines has exhausted almost all political and diplomatic avenues for a peaceful negotiated settlement of its maritime disputes with China," Rosario said last Tuesday at a news conference. On the surface, the attempt looks like a long shot. China has repeatedly said it has "indisputable sovereignty" over islands in the South China Sea and its adjacent waters. Beijing prefers bilateral talks to resolve the dispute, and for other claimant states not to internationalise the issue.

More importantly, China had in 2006 excluded itself from dispute settlement mechanisms available under Unclos. This relates to issues pertaining to maritime delineation, historic bays and military activities. Hence, China will not be compelled to participate in the arbitral tribunal.

But if one examines Manila's case, as detailed in a 21-page note verbale with notification and statement of claim released last Tuesday, the Philippines does have some tricks up its sleeve.

The document states that Manila is not asking the tribunal to decide on which country enjoys sovereignty over the islands, nor a delimitation of any maritime boundaries. And Manila did not raise any subjects China has excluded from arbitral jurisdiction.

Instead, the Philippines is calling on the tribunal to decide on a major issue - whether China's so-called nine-dash or nine-dotted line claim to nearly the entire South China Sea is lawful.

Within the maritime area encompassed by the nine-dash line, China has also laid claim to, occupied and built structures on certain "submerged banks, reefs and low tide elevations that do not qualify as islands under Unclos but are parts of the Philippine continental shelf", Manila's statement said. These features include Mischief Reef, which China occupied in 1995. China also occupied what the Philippines calls Scarborough Shoal last June.

By asking the tribunal to decide on the legality of China's nine-dash line under Unclos, the Philippines has essentially dealt a clever hand - China might have to clarify the extent and basis for its nine-dotted line claim.

This is something that many analysts have been calling for. Singapore's former senior minister S. Jayakumar said in 2011 that China should clarify its "puzzling and disturbing" nine-dotted lines map, since it had no apparent basis under Unclos and could be interpreted as a claim of all maritime areas within those lines.

By seeking China's participation before the tribunal, Manila has also changed the dynamics of its dispute with Beijing, which has persisted since 1995.

Speaking to The Straits Times on condition of anonymity, a legal expert said that Manila's submission might even compel China - which has largely been leery of settling territorial disputes in international fora - to change its mind.

Beijing would be wise to seek expert counsel before it decides whether to participate or even challenge the tribunal's jurisdiction, he said. "Beijing's initial reaction is likely that it would not participate. But if they seek expert advice, they will find it is a more complex decision than they first thought," the expert said.

Even if China doesn't participate, a decision by the tribunal in Manila's favour would put it on higher legal and moral ground, says Professor Carl Thayer at the University of New South Wales.

Dr Ian Storey, a senior fellow at the Institute of Southeast Asian Studies, said that China is facing a lose-lose situation.

"If it ignores the submission, then it will leave itself open to criticism that it does not adhere to international legal norms. If it decides to argue its case before the tribunal, it will have a very difficult task of justifying the legality of the nine-dash line and its claims to 'historic rights' within the limits of that line - and it might lose," he said.

An Asean diplomat who requested not to be named agreed.

"If they don't fight the tribunal's jurisdiction, it might embolden other claimants in the South China Sea dispute. If they do fight and win, they could lose in the court of international opinion," the diplomat said.

Analysts also noted that the Philippines has prepared its case well by recruiting top American lawyer Paul Reichler. He is a giantslayer in the realm of public international law, and became famous in 1984 when he won Nicaragua's case against the US over its paramilitary activities in Central America.

In 2008, he also joined a legal team acting on behalf of Georgia, after Russia had invaded the country that year. He managed to secure a historic ruling from the International Court of Justice, which ordered both Russia and Georgia to halt ethnic cleansing in Russian-occupied Abkhazia and South Ossetia while Georgia's case against Russia was being heard.

As the legal expert put it: "He is a wise choice. He has done David versus Goliath before."

China has 30 days to decide whether it would nominate an arbitrator to the tribunal. The Philippines has already nominated Judge Rudiger Wolfrum, a former president of the International Tribunal for the Law of the Sea, as a member of the tribunal.

Going forward, Manila's submission last Tuesday has significant knock-on effects on Asean.

Asean has been working with China on a legally binding Code of Conduct for the South China Sea. But Manila's latest move might affect Asean's centrality in the dispute. This will become even more pertinent as and when Vietnam - which is challenging China over the Paracels chain - decides to go the same arbitration route as Manila. It does look like the Philippines has scored a minor coup in its dispute with China.

Manila took many by surprise when it tabled its "well-written" submission last week, the Asean diplomat said. "To be honest, overall expectations of the Philippine diplomatic service are low. But what they did do is to listen to good legal advice. The submission was written by someone who really knew his job. They have stunned us by being so together on this case."

William Choong

The Straits Times

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Thailand - Thailand sees big jump in mergers, takeovers

M&A transactions involving Thai corporations have grown by leaps and bounds from an average of US$3.7 billion per year, hitting a record $18.7 billion last year, according to UBS Research.

Driving the deals were strong financial foundations and cheap financing costs. Despite export woes, listed companies showed combined net profits of 560 billion baht in the first nine months of last year, slightly up from 556.9 billion baht in the same period a year earlier.

Interest rates are kept low almost globally and Thai corporations are positioning themselves for Asean integration in 2015. It was a welcome trend, especially for Thai banks, the research house added.

Panop Ansusinha, head of investment banking at Kasikornbank, said the strong baht was also helping to spur mergers and acquisitions by Thai firms, which see a need to go abroad as the home market is becoming mature.

Te M&A outlook should remain bright this year. Thai Beverage's recent takeover of Fraser & Neave alone is valued at over 300 billion baht, so M&A deals this year must definitely be higher than 2012, he said.

Large conglomerates like PTT, Siam Cement Group and Banpu will continue to be the leaders in acquiring businesses in Asean and beyond while medium-sized companies mostly in consumer products, services and retailing can focus only on Asean.

Local banks will see growing loan demand for M&A activities mainly from medium-sized companies, while foreign banks would play a bigger role in helping large companies in financing bigger deals beyond Asean, he said.

Kittiya Todhanakasem, first senior executive vice president of Krungthai Bank, said local banks were assisting local companies by spotting targets for them, as some do not know what opportunities were out there. It would then depend on the Thai companies if they were interested in pursuing a deal.

"M&A opportunities are vast out there, but the scale may not be as big as the deals involving ThaiBev or Charoen Pokphand Group," she said.

For medium-sized companies the motive was organic growth, which meant strengthening production capacity, rather than "inorganic growth" or diversification.

fee income

Limiting Thai banks' capability is their limited experience in overseas M&A. They can get involved only when the deals are not complicated. While they can help advise on financing structure and risk management, it is foreign banks that have the expertise to offer comprehensive services because of their global network.

At Krungthai Bank, M&A deals in the pipeline involve only local companies. Besides M&A, its investment banking unit has to rely on the initial public offering (IPO) business, which is expanding fast thanks to the recent spike in the stock market. Many companies are now planning to seek a listing on the Stock Exchange of Thailand to benefit from inflows to the market.

Kasikornbank's investment banking unit, set up last June to help amplify non-interest income, also focuses on the equity market, particularly IPOs and property fund launches. Fee income from investment banking should grow by 30-35 per cent within three years.

Last year, companies raised 20 billion baht through IPOs but the positive market environment may boost business this year. The bank plans to assist five to six companies in raising about 20 billion baht through IPOs this year. This convinced it that total IPOs this year would surge to 100 billion baht.

"Yet, importantly, the political situation will determine the size of both M&As and IPOs," Panop said.

*US$1=29.9 baht

Sucheera Pinijparakarn

The Nation

Vietnam - Vietnam trade with Russia reaches US$3.6b

Bilateral trade between Vietnam and Russia hit a record high of more than US$3.6 billion last year, according to the Ministry of Industry and Trade.

Both countries maintained an upward trend in their trade exchange despite the negative impact of the global economic slowdown last year.

Vietnamese exports rose more than 32 per cent to $2.3 billion, while Russian exports also increased 16 per cent to $1.3 billion. The figures were exclusive of oil trading.

The main Vietnamese exports to Russia are textiles and garments and agricultural and fishery products. Russia exports petrol, steel, fertiliser and machinery to Vietnam.

Vietnam and Russia hope to achieve $7 billion in bilateral trade by 2015 through expanding various trade channels and strengthening trade in the sectors of science-technology, education and training and tourism.

Domestic trade officials expected that Vietnamese exports to Russia would surge significantly after Russia lowers import taxes on Vietnamese agricultural products by 30-50 per cent in the next three to four years.

The move is one of the trade commitments that Russia made when it became a member of the World Trade Organisation (WTO). Import taxes on clothes, leather items and seafood will also fall.

Moreover, tariffs could fall to zero on other goods if Vietnam and the customs unions of Russia, Belarus and Kazakhstan sign a Free Trade Agreement. The two sides will start talks over this FTA in the first quarter of 2013 and aim to sign it two years later.

The two countries' bilateral trade turnover reached $1.98 billion last year, an increase of 8.1 per cent from 2010.

Russia is ranked 23rd of the countries that invest in Vietnam. Most of the investment is in the fields of mining, processing, manufacturing, banking and telecommunications.

Russian investors recently agreed to implement several major investment projects in Vietnam, including a titanium slag plant, a power generator manufacturing plant and a hotel complex.

Viet Nam News

Cambodia - French, Lao, Thai, Vietnamese leaders to attend Cambodia's royal cremation

The prime ministers of France, Laos, Thailand and Vietnam will attend next week's royal cremation in Cambodia along with senior political, royal and military figures from across the region, the Ministry of Foreign Affairs and International Cooperation said.

Norodom Sihanouk, former King of Cambodia, died in October last year in Beijing at the age of 89.

The ministry said King Norodom Sihamoni and Queen Mother Monineath would receive in separate audiences French Prime Minister Jean-Marc Ayrault, Japan's Prince Akishino and Jia Qinglin, chairman of the National Committee of the Chinese People's Consultative Conference.

At the same time, Prime Minister Hun Sen will meet separately with the French, Japanese and Chinese dignitaries as well as Lao Prime Minister Thongsing Thammavong, Thai Prime Minister Yingluck Shinawatra and Vietnamese Prime Minister Nguyen Tan Dung. Hun Sen will also meet Philippine Vice President Jejomar Binay.

Foreign Minister Hor Namhong will meanwhile meet with Brunei Development Minister Suyoi Osman, Singapore Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam and Indonesian Political, Legal and Security Affairs Minister Djoko Suyanto.

The foreign minister will also meet South Korean Presidential Chief of Staff Ha Kum-Loul and Australian Lieutenant-General John Sanderson, the military commander of UNTAC forces in Cambodia 20 years ago.

The ministry said Myanmar Senior Minister Tin Naing Thein would also attend the cremation which is scheduled to take place on Monday next week, three days after the royal funeral procession this Friday.

Rasmei Kampuchea Daily

Cambodia - Hun Sen’s Battle for Middle Earth

Cambodia has certainly endured its share of turbulent times. Its long-serving Prime Minister Hun Sen will soon go to the polls. The Diplomat profiles him here.

PHNOM PENH – Cambodia has never enjoyed the kind of political clout its neighbors Thailand and Vietnam have been able to assert on the international stage. This issue does not sit well with Prime Minister Hun Sen, who wants to see his country’s standing improve significantly.

But the key to raising Cambodia’s stature is Hun Sen’s own success. After 28 years in power, he is by far the region’s longest-serving elected leader.

His autocratic style and a pronouncement that he would like to stay in power until he is 90 has won Hun Sen stately comparisons with Singapore’s Lee Kuan Yew from his friends…and less flattering parallels with Zimbabwe’s Robert Mugabe by his critics.

With the recent passing of Cambodia’s former monarch Norodom Sihanouk — a constant political and royal figure in Cambodian life for the last 70 years — and the bullying of opponents out of electoral prominence, the 60-year-old premier now stands alone.

He likes to remind Cambodians and foreigners alike that only he controls the military and the police, and that the stability he delivered after ending three decades of war in 1998 has underpinned the economic growth that is raising living standards across the country.

That assumption of control gnaws at human rights activists and civil society groups who squarely blame Hun Sen for the ills that have afflicted Cambodia during the last 15 years of peace.

And there are many.

Corruption, electoral-related violence and a culture of impunity among the politically connected and well-heeled has created a rift between his government and the overwhelming majority of Cambodians whose daily lives are still dictated by a hand-to-mouth existence.

The killing of a high profile environmentalist and the jailing of a broadcaster for 20 years in 2012 raised the tempo on Cambodia’s human rights violations, which was a major focus during last November’s visit by Barack Obama — the first trip to this country by a sitting U.S. president.

“Hun Sen does get blamed for every ill that blights this country but how much he really knows about what his subordinates do and what he does about it — or what he does not do about it -– remains tightly guarded,” said one long-term observer.

A Pagoda Boy with a Puritan Streak

Prudish with a famous temper, Hun Sen was born in August 1952, the third of six children in central Cambodia. At age 12 he moved to Phnom Penh to study while living in a pagoda, a common practice for impoverished children who come in from the countryside to study.

A few years later, when the Khmer Rouge were in the ascendancy, he became a foot soldier and rose to the rank of deputy regional commander as the ultra-Maoists seized control of the country in 1975 and embarked on their bloody reign of terror. He married Bun Rany, a field nurse, a year later in a mass ceremony.

Under Pol Pot, the communists divided the country into sections and Hun Sen was deployed to the Eastern Region of Democratic Kampuchea, as it was called during the Khmer Rouge era, an area near the Vietnamese border that had largely escaped the massive purges and executions. He lost his left eye during a firefight and says his sight is now limited to 200 meters.

As the death toll mounted, so did Khmer Rouge defections. The eastern zone of what was then Democratic Kampuchea was targeted by Communist leaders, prompting Hun Sen to flee to Vietnam where Hanoi was tiring of Pol Pot’s cross-border incursions and was assembling a force of troops opposed to the Khmer Rouge.

The Vietnamese-backed offensive was launched over Christmas 1978 and was completed two weeks later. The Khmer Rouge was pushed into the country’s isolated northwest from where they maintained a low-level civil war for the next two decades.

Hun Sen was rewarded and fast-tracked through the ranks of the Vietnamese-installed government, becoming foreign minister in 1979 and the world’s youngest prime minster in 1985 at age 33.

In the 1980s, he survived at least three attempts on his life and was a constant target for assassination by the Chinese-backed Khmer Rouge and Western-supported insurgencies that had coalesced along the Thai border and put aside their intense loathing of the ultra-Maoists to fight a common enemy — a Vietnamese-sponsored regime.

It was a battle that lasted until 1989 and the end of the Cold War. A United Nations intervention aimed at building a democracy followed Vietnam’s withdrawal and Hun Sen then took the biggest gamble of his political career, convinced he would win the 1993 election. But when he lost, his mean streak emerged.

Hugely embarrassed, he refused to accept the results. Through his Cambodian People’s Party (CPP), he maintained control of the military and a 100,000-strong bureaucracy forcing the UN — which had failed in its mandate to disarm the warring parties — to negotiate.

A cohabitation government was formed with Prince Norodom Ranariddh of the royal Funcinpec Party as First Prime Minister and Hun Sen as second.

Prince Ranariddh tapped into the wealth of support commonly reserved for his father and the agreement was only struck after King Sihanouk intervened and sponsored negotiations. The King also bestowed on Hun Sen the title of “Samdech”, meaning “Lord”.

But the alliance was a disaster from the start. Hun Sen used his forces to oust Ranariddh in 1997 and won violence-marred elections a year later. In similar fashion, Hun Sen rounded up the Khmer Rouge, amid mass defections, and finally ended decades of war in late 1998.

Only then could the marathon efforts to put Pol Pot's surviving henchmen on trial for war crimes begin.

Over the next decade Hun Sen’s political opponents were handled with ruthless efficiency, while the prime minister maintained a public face of respectability, as peace took root. Opposition leader Sam Rainsy still lives in self-imposed exile in France.

During this period, Hun Sen ended illegal television broadcasts by pornography channels. In routine crackdowns on the capital's risqué nightlife, he ordered women to wear dresses with hems below the knees. Bars were closed and at times he even banned Western music and dance.

Hun Sen holds the UN responsible for introducing AIDS into Cambodia during the early 1990s and is prone to exaggerating his golf handicap. More than 300 schools bear his name and he loathes being referred to as a former Khmer Rouge cadre. Like many others, he had little choice but to join.

The Push for Strategic Influence

In recent years, Hun Sen has played a rough game of international diplomacy. He has pushed Cambodia firmly within China’s sphere of influence, providing a buffer between U.S. ally Thailand and Vietnam, a traditional enemy of both Cambodia and China.

He recently signed a military deal with Beijing. The Asahi Shimbun reported that "Cambodia will use part of a $195 million loan from China to buy 12 of its military helicopters and boost its tiny fleet…"

This was not quite what Western nations had in mind when they first reappeared in Cambodia alongside the UN with generous offers of aid. However, Hun Sen says he tires of Western carping over Cambodia’s human rights record and claims Chinese aid and soft loans arrive with no strings attached.

That is questionable. Last year, as Phnom Penh took its turn as chair of the Association of South East Asian Nations (ASEAN), Cambodia acquiesced on regional unity and backed Beijing over its stand on the South China Sea.

This split ASEAN like never before and brought Cambodia into direct opposition with fellow members the Philippines, Vietnam, Malaysia and Brunei, which have competing maritime claims with China in the disputed seas.

Such a stand raised Cambodia’s diplomatic profile but proved costly in terms of relations with its nearest neighbors, prompting reminders that the last time China held such sway over Cambodian foreign policy was during the dark days of the Khmer Rouge.

As a result, Cambodia is walking a political tightrope. This has the added dimension of Washington’s rebalancing of power into East Asia. Further complicating matters is the record of Hun Sen’s government, which includes long-standing accusations of corruption and excessive use of violence. Indeed former King Sihanouk had long charged that the government’s addiction to easy money had made Cambodia dependent on donors.

Hun Sen’s greatest asset — as even his opponents acknowledge -– was that he secured what this country needed most–peace. But Cambodia’s dark past is now consigned to the history books. If Hun Sen truly is in control then he needs to combat corruption, end the culture of impunity and punish those who have committed horrendous crimes of their own in more recent years.

Luke Hunt

http://thediplomat.com

Jan 29, 2013

Myanmar – Myanmar secures generous debt relief

WASHINGTON - Nearly 20 of the world's largest creditor countries have announced that they will be cutting nearly half of Myanmar's total foreign debt, worth some US$6 billion.

Those countries, which include the United States, United Kingdom and several members of the European Union, are part of the Paris Club, a group of 19 of the world's largest donors. On Monday, the group stated that its members were aware of Myanmar's "exceptional situation" and had agreed to a 50% cancellation of arrears and a seven-year grace period for the remainder.

On the sidelines, Norway and Japan came to separate agreements to cancel additional debts amounting to around $4 billion. President Thein Sein, who has overseen more than two years of contested political and economic reforms in Myanmar, had reportedly made debt relief a priority for his administration.

The Paris Club move comes just a day after the World Bank and the Asian Development Bank (ADB) came to a separate agreement to restructure close to an additional $1 billion that Myanmar owed the institutions. This deal, made possible by a substantial "bridge loan" from Japan, will give the country economic breathing room as it works to emerge from decades of international isolation and almost nonexistent economic and social development.

The deals follow on an agreement signed last month stipulating that Myanmar would adhere to conditionalities set by the International Monetary Fund (IMF). Together, the accords signed in recent days clear up, at least temporarily, almost three-quarters of Myanmar's total foreign debt.

Estimated by the IMF at around $15 billion, that debt load has been described by some economists and diplomats as one of the most significant impediments to the new government's plans for reforms and development.

Among other things, the new agreements will allow Myanmar leeway to engage in new program through the World Bank, which had been constrained in the extent to which it could engage with the country. Last week, the World Bank approved a new credit, worth $440 million, aimed at strengthening the country's macroeconomic climate - and beginning to pay back the Japanese government's bridge loan.

Future saddling

Myanmar received significant foreign financing during the 1980s, but that was largely halted following a brutal crackdown on civil liberties that began in 1988. By the end of the 1990s, the military government, amidst broad stagnation and increasingly isolated on the international stage, essentially stopped paying its foreign debts.

As the past two years of reforms have taken hold, however, international donors and multinational companies have begun to re-enter the country; the World Bank Group re-opened Yangon offices in August. Yet the fact that Myanmar will now again be fully integrated into the international framework strikes some as overly quick - and the terms of the new agreements as overly generous.

"These agreements allow large amounts of new lending before any investigation has been made into how past loans did and did not benefit the people of Burma [as Myanmar is also known]," Tim Jones, a policy officer with the Jubilee Debt Campaign, an international anti-debt advocacy group, said on Monday.

He also noted that the new World Bank and ADB deals, which simply restructure rather than cancel Myanmar's debts, will allow the government once again to engage in borrowing from these institutions.

"None of these deals save Burma any money now, but they commit future governments to making payments on debt they inherit," he says. "This support for a military dictatorship could bind the hands of a hoped-for future democratic government."

Indeed, for all of the changes of the past few years, Myanmar's government is still dominated by the military, with President Thein Sein himself a former general. And despite suggestions of significant factionalization within that force, it is far too early for many in and out of the country to believe that the Myanmarese military is in any way reformed.

"It is incredible that Burma gets billions of dollars of debt relief when its biggest spending is on the military," Anna Roberts, executive director of Burma Campaign UK, said on Monday. "Burma's leaders should be on trial in The Hague, not getting special deals on debt relief."

Unnecessary exception

The "specialness" of the new deals is of particular interest. Over the past decade, the international community has made some progress in consolidating a set of principles by which it should deal with foreign debt amassed by developing countries.

"If two developing countries have the same amount of debt, we'd like them to get the same deal," David Roodman, who researches aid and debt relief at the Center for Global Development, a Washington think tank, told IPS. "But according to the norms that have been developed, Myanmar didn't meet those requirements. So this agreement not only is an exception to those rules but undermines the rules-based approach more generally."

In evolving discussions over the past 10 years, the international community has agreed to define eligibility for debt relief based on the sustainability of debt levels - the ratio of debt to gross domestic product (GDP), for instance, or the ratio of debt to exports.

Yet Roodman says that while the agreed level for debt to GDP is 30%, Myanmar's debt stands at just 18% of GDP, almost half of the stipulated requirement. Likewise, the level for debt to exports has been agreed at 100%, while Myanmar's stands somewhat lower at 85%.

"Further, the IMF has done some scenarios through modelling on the likely course of exports and GDP in coming years in Myanmar," he says, "and they found that the debt load, if anything, is going shrink."

The key to understanding the Paris Club decision, then, might have to do less with development than with foreign policy. From this perspective, while foreign governments may be successfully jockeying for position with Myanmarese officials, they may be losing valuable leverage that could still be required down the road.

Notably, Myanmar still owes around $2 billion to China, the military's closest ally for decades and a key reason many Western countries may be prioritizing relations with Myanmar today. In a blog post, Roodman notes that opposition leader Aung San Suu Kyi has in the past urged foreign governments to suspend rather than end economic sanctions.

The "threat of easy reinstatement, in her judgment, would spur further reform," he writes. "The analogous step in the debt dance was to refinance defaulted loans rather than cancel them. Just as sanctions can be permanently abolished later, so can debts."

Carey L Biron

http://www.atimes.com

Myanmar - Suu Kyi meets South Korea’s first female leader

SEOUL, South Korea (AP) — Both women lost their fathers to gunshots. Both also overcame that tragedy and rose to political prominence in countries where men dominate decision-making, buoyed in part by the legacies of their fathers.

Aung San Suu Kyi, the opposition leader whose 2010 release from house arrest signaled the beginning of Burma’s transition from decades of military rule, met Tuesday in Seoul with Park Geun-hye, who takes office next month as South Korea’s first female president. Details were not immediately available.

The meeting between two of the most prominent women in Asia spotlights a tragic coincidence in their family history: Suu Kyi’s father, Gen. Aung San, was killed by assassins in 1947 while Park’s, President Park Chung-hee, was assassinated by his intelligence chief in 1979.

Both women have benefited from their late fathers’ reputations. Even as she has blazed her own political trail, the 67-year-old Suu Kyi represents to many of the voters who sent her to parliament last year a link with her father, a legendary independence hero. Park, who is 60, enjoys strong support among older South Koreans with memories of the rapid economic growth during her father’s rule.

Suu Kyi’s trajectory, however, has been one of a dissident, while Park has built a political career as a ruling party lawmaker owing much to her father, a dictator who took power in a 1961 coup and ruled South Korea with an iron fist until he was killed 18 years later.

“Park carries family baggage that sets her away from the image of the pro-democracy movement, while Suu Kyi stands on the other side as an icon of democracy,” said Lee Shin-hwa, a professor of political studies at Korea University in Seoul.

Democracy has firmly taken root in South Korea since the death of Park’s father and a peaceful transfer of power more than a decade later. Burma, with a reformist government in place but the military still in the background, is nurturing a fragile democracy.

The meeting between Suu Kyi and Park will be the latest in a series of high-profile exchanges between their countries, including reciprocal visits last year by South Korean President Lee Myung-bak and Burma’s President Thein Sein, both heading delegations keen on bolstering economic cooperation. Thein Sein also promised Lee in May that his country would no longer purchase arms from North Korea, a foreign policy shift welcomed by Seoul.

Lee’s visit was the first by a South Korean leader since 1983, when North Korean agents bombed a delegation visiting Burma, killing 17 South Koreans and four others but missing then-President Chun Doo-hwan.

During her five-day trip, Suu Kyi is scheduled to attend the opening of the Special Olympics, a biennial global event that South Korea is hosting in the alpine town of Pyeongchang for the first time, organizers of her trip say. The 1991 Nobel Peace Prize laureate will then receive a human rights award in the city of Gwangju, where a 1980 uprising was crushed with deadly force by the then-military government.

AP News

China - China urged to face Philippines at UN tribunal

MANILA, Philippines (AP) — A senior U.S. lawmaker says China should agree to face the Philippines before a U.N. arbitration tribunal to resolve the two Asian countries’ territorial rifts peacefully and avoid a crisis in the region.

The Philippines announced last week that it was bringing a case before a U.N. arbitration tribunal to challenge China’s claims to virtually the entire South China Sea, including potentially oil-rich areas. China has not responded clearly, but one of its diplomats has pressed Beijing’s demand that rival claimants resolve the disputes through one-on-one negotiations.

Rep. Edward Royce, R-Calif., chairman of the House Foreign Affairs committee, told The Associated Press on Tuesday that it’s best for China to agree to the international arbitration to avoid a possible “crisis which roils the markets or creates uncertainty” in the region.

AP News

Thailand - Are the Rohingya involved in violence in Thailand’s Deep South?

Over the last month Thailand has detained at least 800 Rohingya, a persecuted Muslim minority from Burma. The international community were concerned they would be deported, but for now the Thai government has relented and stated they will not deport the Rohingya.

The government will allow the UNHCR to interview the Rohingya, Thailand will provide them with shelter for 6 months, and assured that they would be treated humanely.

However, the possible role that the Rohingya may play in the insurgency in southern Thailand has been raised. The Bangkok Post on January 16, 2013:

The government plans to consult with the United Nations High Commissioner for Refugees (UNHCR) before deciding on the status of nearly 850 detained Rohingya migrants, Prime Minister Yingluck Shinawatra says.

The government will not return or relocate the Rohingya migrants for the time being, Ms Yingluck said after Tuesday’s cabinet meeting.

…

Ms Yingluck said some of the migrants might join the southern insurgency rather than seek asylum in a third country.

The Nation on January 18, 2013:

Chalerm said he had no concerns that the Muslim Rohingyas would get involved with the insurgency in the deep South. “What is problematic is their [possible] future illegal entry into Thailand in the long term. This is a very delicate matter and Thailand needs to protect its interests while not violating human rights,” he said

Fellow AC blogger Francis Wade blogged on Yingluck’s comments. Key excerpt:

Thai Prime Minister Yingluck Sinawatra indulged in some loaded conjecturing yesterday when she warned that the 840-plus Rohingya in detention in Thailand “might join the southern insurgency rather than seek asylum in a third country”. The men, women and children in question were found in Songkla’s Sadao district over the course of several raids last week on smuggling dens run by human trafficking rackets.

…

The Prime Minister’s statement, apparently unsubstantiated, is a reckless one, based mainly on the hackneyed assumption that any disenfranchised Muslim is automatically a terrorist threat. It risks directing anti-Muslim sentiment at the Rohingya, who are in Thailand in part to escape that branding.

BP: Indeed for an ethnic group who have long been labelled as terrorists, in what DVB calls a disinformation campaign by the Burmese authorities, and more recently last year by Burmese nationalists, such loaded conjecture could lead to further speculation and create unease for Rohingya who make it Thailand. As it is the plight of the Rohingya receives little sympathy in Thailand so one wonders, was it really necessary to speculate? Fortunately, the PM’s speculation was a footnote in most stories in the Thai media with much greater focus being given to the change in government position to allow them to stay for processing by the UN or the government was going to strictly control the entry of the Rohingya in Thailand.

However, the PM’s speculation may have provided an opportunity for others to be more specific on the threat of the Rohingya’s involvement in the Deep South. The Nation:

Some Rohingya migrants arrested for illegal entry have confessed to being trained by insurgents to undertake attacks in the restive deep South, according to a highly-placed source in the Justice Ministry’s Forensic Science Institute.

The source said the men had entered Thailand through Mae Sot in northern Tak province and later moved to Sungai Kolok in Narathiwat in the far south. Their case was discovered in 2009.

“These two men confessed that they were trained by the RKK and later were sent back to carry out attacks in the southern border provinces. This is very worrying,” the source said.

In 2009, a number of Rohingya carrying Malaysian ID cards were arrested after having carried out attacks in the southern border provinces, according to the source. “But a case like this was not common,” the source said.

Authorities also found that some illegal immigrants had smuggled explosive substances from India, she said.

The source said it was possible the illegal immigrants got help from smuggling rings to transport them from border areas to other parts of the country. “Many Rohingya are smuggled to the coastal provinces of Satun and Ranong, and some of them are sent to Malaysia.”

A source at the Internal Security Operations Command (Isoc) yesterday denied having such information about Rohingya in Thailand.

BP: ASTV Manager and other Thai media outlets have on-the-record quotes from Dr. Pornthip, the head of the Central Institute of Forensic Science, stating the same thing. This is the first time BP has seen any mention of confessions although talk of explosives and the Rohingya is not new. Back in 2009 when the Rohingya were pushed back to sea, Dr. Pornthip fronted the media and linked the Rohingya to the insurgency in the Deep South, providing cover for the military to detain them as a threat to national security. At the time, she told Al Jazeera:

But according to a leading Thai forensics expert, “explosives residue” was found on one of the Rohingya boats that landed on Thailand’s Andaman coast in December.

Dr Porntip Rojanasunan, a forensic pathologist working for the ministry of justice, was asked by the Thai military to examine the contents of some of the boats, specifically to examine whether the refugees may be linked to fighters in the south, and if they held any objects that may be a “security threat”.

Explosives

“There were substances and chemicals found that can be used in explosives … there was actually quite a significant level,” she told Al Jazeera.

Asked whether the traces could be directly linked to the separatist movement in the south, she said: “I can only give the authorities what my results of the tests were.”

BP: As blogged in 2010:

No details are provided on what technology was used by Pornthip to detect explosive residue, but given she is one of the ardent supporters of the GT200 device* and was using the GT200 device just a few months before to confirm whether there was explosive residue at another event, shouldn’t we wonder whether the GT200 device was used here? Aside from the GT200 device was there are any other confirmation of explosive residue?

BP: The latest statement by Dr. Pornthip is more than just talk of explosive residue. There is talk of actual explosives and confessions. Four years have passed now and while prosecutions often take a long time so have those who confessed been prosecuted? Is there any other outside source that can corroborate what Dr. Pornthip is saying? So far haven’t seen one. Aside from the allegations above, BP does not recall any other evidence linking the Rohingya with the insurgency in Thailand’s Deep South.

BP sees three ways outsiders could be involved in the violence in Thailand’s Deep South into 3 categories: 1. Trainers; 2: Operators/implementers; and 3. Support personnel. No doubt there can be other possible categories.

1. Trainers

Over 10 years ago, Thai passports were reportedly been found at Moro Islamic Liberation Front (MILF), the largest Muslim separatist group in the Philippines, training camps. There are also reports of logistical support and training being provided by those in Indonesia and elsewhere from many years ago.

Reports of training and support in the past make sense though. This was before the resurgence 0f violence in 2004 or not long after when the capability of many insurgents in the Deep South was lacking. In the years since then, we have had bigger and more sophisticated bombs and the insurgents certainly possess a level of expertise in bomb-making which didn’t exist 10 years ago. With this expertise means, there is less need for outsiders unless they are providing more specific training.

What is the likelihood of Rohingya arriving by boat providing such training? Common sense would suggest “very unlikely. Why you ask? If they just wanted to enter Thailand, why risk doing so by boat? Many boats have been lost at sea, the trip is unsafe etc. If you are some expert, you wouldn’t risk coming by boat.

In fact, in the case that Pornthip is referring to from 2009, it involved entry from the North of Thailand via a land border crossing and not by Rohingya coming by boat. There seems a great difference, in BP’s opinion, of those who have arriving by boat vs someone arriving by land. To conflate the two in a risk assessment, would be unwise.

2. Implementers/Operators

By this, BP means those who will carry out attacks. How are the Rohingya going to integrate themselves with cells that operate in the Deep South? You have language problems, you have the fact that they look different and would no doubt come under suspicion from the authorities on their appearance, you have the lack of ties to others in the village, and general lack of trust of newcomers.

3. Support personnel

Now, for Rohingya who end up in the 3 southern border provinces, no doubt they would be looking to earn money to survive. Aside from the problems of integrating themselves and becoming known, it would make sense that any tasks given to outsiders would likely be menial tasks. Again though, what is the likelihood of being able to screen such people in advance? people once they arrived and one wonders what kind of screening upon arrival could help.

For 2 and 3, there may be isolated cases – now or in the future – of Rohingyas ending up “in the insurgency”, but again common sense would suggest that there will be few outsiders particularly the Rohingya who don’t have the same ethnic background as those in the Deep South and speak a different language. More importantly, those who end up involved would likely only do so after living in Thailand for many years. For such people, it would be difficult to screen upon arrival (they are unlikely to have phone numbers of cell leaders in their pockets as it is only once they arrive could they become acquainted with such leaders).

Overall, there may be some isolated cases. Some people from any ethnic group could be hired to smuggle weapons or explosives if the price is right. There is still no evidence that any Rohingya arriving by boat have become involved in the insurgency. Perhaps, the authorities should focus attention on actual, tangible threats….

btw, Saksith has a somewhat related post with some background.

Bangkok Pundit

http://asiancorrespondent.com

Cambodia - Strengthening Cambodia-China ties alarm ASEAN neighbors

On January 23, Moeung Samphan, Secretary of State at the Cambodian Defense Ministry, and General Qi Jianguo, deputy chief of staff of the People’s Liberation Army, signed a military cooperation agreement under which 12 Chinese-built Zhi-9 helicopters will be delivered to the Royal Cambodian Army. As part of the deal, the People’s Liberation Army will also continue to provide military training to the Cambodian military.

A previous agreement under which the PLA would continue to deliver military training to Cambodian armed forces was signed in May last year, while back in 2010 Beijing had donated 250 jeeps and trucks to Cambodia’s army.

China is not the only nation providing training to the Cambodian armed forces – the United States and Australia, among others, do the same – and the recent deal is obviously limited. It does, however, highlight the growing ties between Beijing and Phnom Penh.

According to the Council for the Development of Cambodia (CDC), China is now by far the biggest foreign investor in Cambodia. On its website, the Council shows that in 2011 Cambodia attracted $1.15 billion in Chinese investments, with an increase of 71 percent from $694 million a year earlier. From 1994 to 2011, Chinese investments totaled $8.866 billion dollars. By comparison, South Korea, the second biggest investor in the same period of time, stopped at little more $4 billion, less than China invested in 2008 alone.

Xinhua, China’s chief news agency, reports that Chinese investments have focused on “property development, mineral business and processing plants, motorcycle assembly factories, gold mining, rice mill and garment factories.”

Bilateral trade figures have dramatically improved, too. According to Xinhua, in 2011 bilateral trade between Cambodia and China amounted to 2.5 billion U.S. dollars, a staggering 73.5 percent increase from a year earlier.

Cozy relations with Beijing, however, have also put the Cambodian government under significant pressure, especially due to disputes over the South China Sea, whose islands are claimed in whole or in part by China, Vietnam, the Philippines, Malaysia, Taiwan and Brunei. The Cambodian government finds itself in an awkward position as other ASEAN countries, and especially Vietnam and the Philippines, see it as a close ally of the Chinese government ready to act to the detriment of their interests.

In July 2012, a clash occurred while discussing the Code Of Conduct, a document which was supposed to prevent conflicts among members. The participants could not find an agreement on whether to mention the South China Sea in the final communiqué, with Cambodia and the Philippines struggling with each other. As a result, for the first time in 45 years, no final statement was issued and, most importantly, the whole affair turned out to be lost chance to work on a set of rules to avoid future clashes.

In November last year, tensions again flared up during the ASEAN summit hosted by Cambodia in Phnom Penh. The Cambodian side argued that members had reached a consensus not to internationalize – read “not to call in outside power in general and the United States in particular” – the South China Sea issue, but Philippines authorities contended that such a point was never agreed upon. According to Reuters, Philippine President Benigno Aquino stated that “there were several views expressed [..] on ASEAN unity which we did not realize would be translated into an ASEAN consensus,” and added that “this was not our understanding. The ASEAN route is not the only route for us. As a sovereign state, it is our right to defend our national interests.”

Given such a background, it is not a surprise that the recent military deal attracted the media’s attention. The Bangkok Post, for one, has written that while there has not been any formal reaction from neighboring countries, “Hanoi [..] is likely to view the military training of the Cambodian army with major skepticism, if not outright opposition”. The article also contends that “for Thailand, any upgrade to the Cambodian army will almost certainly result in both increasing hostility from the ultra-nationalist ‘patriots’ involved in the dispute surrounding the Preah Vihear temple. There are likely to be calls from the military to upgrade Thai forces facing Cambodia, the only country with which Thailand has had armed conflicts in recent years.”

Michele Penna

http://asiancorrespondent.com