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Have the US and its allies in Asia reached a tipping point in their relations with China? The question posed by US China scholar, David Lampton, in a speech in Shanghai in March looks disturbingly prescient after a whirl of diplomatic and security offensives in recent weeks in the region.
The US and Japan substantially upgraded their defence alliance in a high profile summit meeting in Washington earlier this month. Japan, in turn, held its first naval exercises with Vietnam and the Philippines in the South China Sea. This week, the US announced (and then later denied) it would station B-1 bombers in northern Australia, also with an eye on balancing China in the region.
Then, just in time for John Kerry’s weekend visit to Beijing, the Pentagon made it known it was contemplating limited military options in the form of naval patrols and surveillance flights in contested areas in the South China Sea to reinforce its opposition to Chinese actions. Read more
Once Indonesia has finally got through counting the votes and has separated the two presidential candidates, it will have a new leader. That puts the nation of 250m people in good company. In Asia, in the last 18 months, countries with approaching a total of 3bn inhabitants – including China, India, Japan and South Korea – have changed their leadership. Even the Thais have a new man in charge, though he had to organise a coup to get there.
One country that has not altered its leadership is the Philippines. Benigno “Noynoy” Aquino, has been president for four years. By the standards of his perennially disappointing country of nearly 100m people, his time in office has been a roaring success. Growth has stabilized above 6 per cent, inflation is low and debt and budget deficits have been brought under firm control. The economy is even creating jobs – something it has sorely lacked for years – in the booming outsourcing sector. Call centres in the Philippines employ more people than ones in India. Ratings agencies have responded to improving macroeconomic conditions, upgrading sovereign debt to investment grade. Philippine conglomerates have started investing significant sums at home. Read more
By Gideon Rachman
Atlanta coined the catchphrase that it was the city that was “too busy to hate”. During the past 30 years, the countries of Asia have informally adopted that slogan and transferred it to a whole continent. Since the end of the 1970s, the biggest Asian nations have forgotten about fighting each other – and concentrated on the serious business of getting rich. The results have been spectacular. But there are now alarming signs that East Asia’s giants are pursuing dangerous new priorities, and diverting their energy into angry nationalism and territorial disputes.
By Gideon Rachman
Ukraine is a distraction. Syria is a distraction. For believers in America’s “pivot to Asia”, the centre of Barack Obama’s foreign policy must remain the region of the future – Asia. The pivoters will be delighted that this week – despite a raging crisis with Russia – the president is embarking on a four-nation tour of Asia, beginning in Japan.
By Gideon Rachman
The official theme for this year’s World Economic Forum is predictably bland – “Reshaping the World”. But the unofficial slogan will be “America is back”. Predictions that the US economy will grow by 3 per cent this year – added to worries about emerging markets – mean that Davos is likely to be bullish on America for the first time in years.
By Luisa Frey
♦ The Indonesian province of Aceh, devastated by the Indian Ocean tsunami in 2004, has become a model for reconstruction operations and might offer useful lessons for rebuilding the Philippines.
♦ Hairy crabs – delicacies which used to be one of China’s many currencies of corruption – are feeling the impact of new abstemiousness, reports FT’s Patti Waldmeir. After launching an austerity drive last year, Xi Jinping has announced further measures.
♦ China’s President, Xi Jinping, has admitted watching “The Godfather” and seems to have learned a lesson from it: “the art of amassing and applying power in a small, secretive circle of men”, according to The New York Times’ blog, Sinosphere.
♦ The New York Times also reports on the refugees who try to travel from Indonesia to Australia’s Christmas Island, hoping for better living conditions. More than a thousand have already died on the journey.
♦ After attacking immigrants, Dutch politician Geert Wilders and France’s Marine Le Pen have shifted their focus to the European Union. Both want to form a new Eurosceptic bloc and “fight this monster called Europe”, writes The Economist. Read more
A house by Tacloban airport (Getty)
By Amie Tsang and Luisa Frey
The Philippines is no stranger to natural disasters. But in just a few days, it has been transformed from emerging market star – its economy grew at annual rate of 7.6 per cent in the first half of 2013, faster than China – to a “state of national calamity”.
Typhoon Haiyan will cause inevitable damage to the country’s economy, but loss of output will be dwarfed by the devastating loss of life.
The Asian Development Bank estimates that losses from typhoons and earthquakes cost the Philippines around $1.6bn each year. The World Bank estimates the annual typhoon season typically shaves 0.8 percentage points off annual GDP growth. Read more
A survivor in Tacloban (NOEL CELIS/AFP/Getty Images)
Typhoon Haiyan, which swept through the central Philippines hurling makeshift homes and shacks through the air like so many matchboxes, should remind us of something pretty basic. The Philippines remains an extremely poor country.
In recent years, the southeast Asian country of nearly 100m people has deservedly gained the attention of investors. It has gradually shed its image as the basket-case of Asia and attracted serious inflows of foreign capital. Since 2010, it has had a president, Benigno ‘Noynoy’ Aquino, who has put in place the most credible administration in a generation.
Mr Aquino has made genuine, if imperfect, efforts to tackle endemic corruption, to improve infrastructure and to crack down on tax evasion. The economy has grown fast, expanding for 58 straight quarters. In the first half of this year, it grew 7.6 per cent, bucking a downturn in much of the region and challenging China as the fastest-growing Asian economy. Read more