South Koreans protest US Terminal High Altitude Area Defense (THAAD) missile deployment


https://www.youtube-nocookie.com/embed/knkmDTsGTYA

  • South Koreans protest US missile deployment
  • People from Seongju county hold the national flags of South Korea and banners to protest against the deployment of the Terminal High Altitude Area Defense (THAAD), during a rally in Seoul, capital of South Korea, on July 21, 2016. More than 2,000 people from Seongju county, where one THAAD battery will be deployed, gathered at a square in Seoul for a rally on Thursday, to protest against the deployment of THAAD. (Xinhua/Yao Qilin)


    South Koreans protest US missile deployment

  • South Koreans protest US missile deployment. Thousands of South Koreans from Seongju county gathered in Seoul to protest against the government’s decision to deploy a U.S.-built THAAD missile defense unit in their home town. People from Seongju county hold the national flags of South Korea and banners…

“Stop the deployment! NO THAAD! NO THAAD! NO THAAD!” Protesters said.

“The way that the government made the decision completely on their own, without talking to residents first, is completely wrong. We are here to express the people’s anger living in Seongju,” Protest organiser Seok Hyeon-Cheol said.

“The missile deployment site is right in the middle of a city that has around 20,000 people. I can see it when I open the door of my house, the door of my house! And I can see it from my living room. That is why we strongly oppose the THAAD deployment. We oppose it for our children, and their children — for the future of our county, for our health, and our right to live,” Protester form Seongju County Kim An-Su said.

The protest follows a raucous standoff last week between residents and the country’s prime minister, Hwang Kyo-ahn, who was pelted with eggs and plastic bottles and trapped inside a bus for several hours when he visited the county to explain his decision to deploy the missile system there.

South Korea’s President Park Geun Hye has called for people to support the government’s plans. She said the move was “inevitable” because of a growing threat from the DPRK. South Korea’s defense ministry says the country’s THAAD missile system will become operational before the end of 2017.

A senior official of Seongju county (2nd L, front) attends a rally to protest against the deployment of the Terminal High Altitude Area Defense (THAAD) in Seoul, capital of South Korea, on July 21, 2016. More than 2,000 people from Seongju county, where one THAAD battery will be deployed, gathered at a square in Seoul for a rally on Thursday, to protest against the deployment of THAAD. (Xinhua/Yao Qilin)

People from Seongju county hold the national flags of South Korea and banners to protest against the deployment of the Terminal High Altitude Area Defense (THAAD), during a rally in Seoul, capital of South Korea, on July 21, 2016.

People from Seongju county hold the national flags of South Korea and banners to protest against the deployment of the Terminal High Altitude Area Defense (THAAD), during a rally in Seoul, capital of South Korea, on July 21, 2016. (Xinhua/Yao Qilin)

People from Seongju county hold banners to protest against the deployment of the Terminal High Altitude Area Defense (THAAD), during a rally in Seoul, capital of South Korea, on July 21, 2016. More than 2,000 people from Seongju county, where one THAAD battery will be deployed, gathered at a square in Seoul for a rally on Thursday, to protest against the deployment of THAAD. (Xinhua/Yao Qilin)

HAAD poses real threat to security of China

https://www.youtube-nocookie.com/embed/rhlxr6BRv4E

A Terminal High Altitude Area Defense (THAAD) interceptor is launched during a successful intercept test, in this undated handout photo provided by the US Department of Defense, Missile Defense Agency. [Photo/Agencies]

What has historically been ours is ours. Even if others say it is not. That is why, annoying as it is, the Philippines-initiated South China Sea arbitration is actually not worth the limelight it is being given.

It is time for Beijing to get down to real, serious business. It has bigger issues to attend to, the most imperative of which is the anti-missile system being deployed on its doorsteps. Because, while it was coping with the worthless arbitral award from The Hague, Washington and Seoul finalized their plan for the deployment of the US’ Terminal High Altitude Area Defense missile system in the Republic of Korea.

The arbitral ruling, which is null and non-executable, will have little effect on China’s interests and security in the South China Sea. But not THAAD, which is a clear, present, substantive threat to China’s security interests.

The installment of the US system in the ROK should be of far greater concern to Beijing, and warrants a far stronger reaction. Or should we say retaliation?

The ROK has legitimate security concerns, especially with Pyongyang constantly threatening nuclear bombing. With that in mind, Beijing has been adamant about de-nuclearization of the Korean Peninsula, and worked closely with Seoul and Washington in implementing and upgrading United Nations sanctions, and appealed tirelessly for restarting the Six-Party Talks.

But Seoul has brushed aside Beijing’s security interests while pursuing those of its own.

Washington and Seoul did claim that THAAD would be focused “solely” on nuclear/missile threats from the Democratic People’s Republic of Korea, and would not be directed toward any third-party nation. But THAAD far exceeds such a need. Besides the far more credible threat from Pyongyang’s artillery, short-range and lower-altitude missiles is simply beyond the system’s reach.

While it will deliver a limited security guarantee to the ROK, THAAD’s X-band radar will substantially compromise the security interests of China and Russia, no matter how the United States shrouds its purpose.

Yet having made such a beggar-thy-neighbor choice, Seoul has in effect turned its back on China. By hosting THAAD, it has presented itself as Washington’s cat’s-paw in the latter’s strategic containment of China. All rhetoric about friendship is meaningless lip service with the deployment of THAAD.

Beijing must review and readjust its Korean Peninsula strategies in accordance with the latest threat from the peninsula, including its ROK policies.

That does not mean forsaking its commitment to de-nuclearization, or UN resolutions. But Beijing must concentrate more on safeguarding its own interests, both immediate and long-term.

Source: China Daily Updated: 2016-07-15

China can counter THAAD deployment

https://www.youtube-nocookie.com/embed/QTVgIJT1DaY

The US and South Korea on Friday announced their decision to deploy the Terminal High Altitude Area Defense (THAAD) missile system on the Korean Peninsula.

Apart from monitoring missiles from North Korea, THAAD could expand South Korea’s surveillance range to China and Russia and pose serious threat to the two countries.

Though South Korea claims it can reduce the surveillance range, the country cannot make the call as the system will be controlled by US forces in South Korea, and such cheap promises mean nothing in international politics.

We recommend China to take the following countermeasures.

China should cut off economic ties with companies involved with the system and ban their products from entering the Chinese market.

It could also implement sanctions on politicians who advocated the deployment, ban their entry into China as well as their family business.

In addition, the Chinese military could come up with a solution that minimizes the threat posed by the system, such as technical disturbances and targeting missiles toward the THAAD system.

Meanwhile, China should also re-evaluate the long-term impact in Northeast Asia of the sanctions on North Korea, concerning the link between the sanctions and the imbalance after the THAAD system is deployed.

China can also consider the possibility of joint actions with Russia with countermeasures.

The deployment of THAAD will surely have a long-term and significant influence. South Korea will be further tied by its alliance with the US and lose more independence in national strategy.

North Korea’s nuclear issue has further complicated the situation on the Korean Peninsula, but the country’s possession of nuclear weapons also results from outside factors.

The biggest problem of the peninsula’s messy situation lies in US’ Cold-War strategy in Northeast Asia, and its mind-set of balancing China in the region. Neither Pyongyang nor Seoul could make their own decisions independently, as the region’s stability and development are highly related to China and the US.

The whole picture of the situation on the Korean Peninsula could not been seen merely from the view of Pyongyang and Seoul. China’s relationship with North Korea has already been affected, and ties with South Korea are unlikely to remain untouched.

China is experiencing the pains of growing up. We have to accept the status quo of “being caught in the middle.”

China should neither be too harsh on itself, nor be self-indulgent. Being true to itself, China will fear no challenges

Source: Global Times Published: 2016-7-9

Britain steps backward as EU faces decline: chaos but no negative impact, a windfall for children studying in UK


Britain steps backward as EU faces decline

The UK voted to leave the EU, with the Leave supporters beating Remain by 51.9 percent to 48.1 percent. The slight victory is likely to have opened a Pandora’s box in Europe, pushing the continent into chaos.

A lose-lose situation is already emerging. The British pound fell 10 percent at one stage on Friday. The euro fell 3 percent.

David Cameron announced he would quit as British prime minister. Scotland may start a new independence referendum.

There are also calls in the Netherlands and France for a similar exit referendum.

The UK is just over 300 years old. In its heyday it was known as an empire on which the sun never set, with colonies all over the world (Britain was the former imperial power – whose military forces repeatedly invaded China in the 19th century – and the rising Asian giant, now the world’s second-largest economy)

Now it is stepping back to where it was.

Britons are already showing a losing mind-set. They may become citizens of a nation that prefers to shut itself from the outside world.

The Leave advocates had been calculating whether their pensions were guaranteed or migrants were encroaching on their neighborhood. Bigger topics such as the country’s aspirations or its global strategy were overlooked.

Britain has been a special member of the EU. It has not joined the eurozone, nor adopted the Schengen agreement. France and Germany have been resentful of Britain’s half-hearted presence in the EU. In a sense, Britain’s exit may be a relief for both sides.

However, such relief is in effect a major setback for European integration. Such setbacks don’t happen in good times. Britain’s exit reflects the general decline of Europe.

The world’s center used to lie on the two sides of the Atlantic. Now the focus has shifted to the Pacific. East Asia has witnessed decades of high-speed growth and prosperity. Europe stays where it was, becoming the world’s center of museums and tourist destinations. Unfortunately, Europe is also close to the chaotic Middle East. Waves of refugees flood into Europe, coinciding with increasing terrorist attacks.

Europe is not able to resolve the problems it is facing. The public are confused and disappointed and extremism is steading.

The Leave grouping beat out the Remain supporters by only 4 percentage points, which could have resulted from some temporary reasons. Is it really fair to decide Britain’s future this way?

Such changes will benefit the US, which will lose a strong rival in terms of the dominance of its currency. Politically it will be easier for the US to influence Europe.

There is no direct political impact on Russia and China. For the Chinese people, who are at a critical time to learn about globalization and democracy, they will continue to watch the consequence of Britain’s embracing of a “democratic” referendum. – Global Times.

No negative impact from UK vote for Malaysia

 

Britain is still a hugely important economy in Europe, says Liew

KUALA LUMPUR : Malaysian property firms with developments in the United Kingdom say that their ventures will not be negatively impacted as a result of the June 23 referendum whereby British citizens voted to exit the European Union.

Eco World International Bhd executive vice-chairman Tan Sri Liew Kee Sin said that while the decisive win by the Brexit camp was unexpected, the group is optimistic that the results hold a silver lining going forward.

“Now that the results of the EU referendum are known, the long uncertainty which has caused many investors to hold back on decision making is finally over. Britain is still a hugely important economy in Europe with highly principled, professional and competent leaders,” he said in a statement.

Liew added that he has every confidence that the British government will do their utmost to take proactive measures to assuage post-Brexit concerns and move the UK forward on every front.

London’s position as a prime destination for global real estate investment is unlikely to change given that many of the fundamental drivers of demand are still intact. Chief among them are transparency of laws, sesurity and ease of ownership, and shortage of supply, among others, Liew noted.

EWI, which is en route to listing on Bursa Malaysia, has three projects in London, namely the London City Island Phase 2 in East London, Embassy Gardens in Nine Elms, and Wardian London facing the Canary Wharf. All three were launched last year.

“For EWI specifically, it should be noted that through our proposed initial public offering we will be raising equity in ringgit. Now that the sterling has dropped it means that the cost we have to inject into the UK to pay for the developments there will be lower,” he points out.

Meanwhile, in a statement reacting to the results of the UK referendum, Sime Darby Bhd, which is undertaking the Battersea Power Station project has reiterated its long term commitment to the venture.

“The results of the referendum is not expected to impact the viability of the project.

“We are confident the iconic development will continue to generate interest in the longer term and that London will continue to remain a key investment destination and financial centre,” it said.

Sime Darby has a 40% stake in Battersea. The other joint venture partners are SP Setia Bhd and the Employees Provident Fund with 40% and 20% respectively.

A research note by MIDF Research said global capital markets may take some time to adjust to the Brexit vote which could have adverse repercussions on businesses.

Its group managing director Datuk Mohd Najib Abdullah said that as a result of Brexit, the world is moving into a period of elevated uncertainty, with risk appetite plunging in a flight to safety and security.

As the UK is an important market for Malaysian exporters and an important source of foreign direct investments, any economic malaise from Europe will inevitably affect Malaysia in the longer term, Aboth directly and indirectly, MIDF said. – By afiq Isa The Star

Windfall for Malaysian parents of children studying in Britain 

Parents with children studying in Britain are heaving a sigh of relief because the pound has weakened following Brexit.

The ringgit closed at RM5.66 to the pound yesterday, a drop of 4.67% compared to a month ago when it was RM6.03.

Parent Action Group for Education Malaysia chairman Datin Noor Azimah Abdul Rahman said tuition fees would be more affordable.

“For parents who couldn’t afford it initially, they may change their minds now,” she said when contacted.

She added that one should look at the positive instead of focusing on the negative implications.

A parent, who asked to be identified only as Auntie Chris, has a son studying biotechnology at Imperial College London, and said: “We are liquidating our accounts to take advantage of the drop in the pound, which is great news.”

She said her son, who is in his second year, planned to pursue his master’s in Britain after graduation but had put his plan on hold due to the strong pound.

“We asked him to work first, after graduating, due to the financial constraints but with the pound dropping significantly, going for his master’s may be back on the table,” she said.

Another parent, Azura Abdullah, said she did not expect her son’s tuition fees to increase any time soon.

Her son is a second-year law student at University of Exeter.

Some parents were fearful of Britain’s exit from the European Union.

Despite the weakened pound, Azura felt the price of goods may increase in the short term because Britain could no longer leverage on EU trade deals, which could increase the cost of living there for her son.

“But we hope to offset this with the lower currency rate as the pound will devalue in the short to middle term,” Azura added.

Auntie Chris said she was worried that Britain’s decision may affect job prospects for Malaysians over there.

“If Britain goes into recession, it will affect job prospects for new graduates,” she said, adding that immigration controls may also be tightened following Brexit.

Chief executive officer and provost of the University of Nottingham Malaysia campus Prof Christine Ennew said parents should expect cheaper education.

“Students should be able to do more with their money in the UK, at least in the short term, say over the next couple of years,” she said.

Prof Ennew admitted that there could be some concerns over the issuing of student visas.

“However, Boris Johnson, one of the leading figures in the Brexit camp, has always been very supportive of international students and this should give some reassurance that the visa regime will not necessarily become harder for students from outside the EU,” she said.

She added that it was likely that EU students would be more affected than those from outside the union. – The Star

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In spite of earnest pleas for the United Kingdom to remain, and
warnings of dire economic, political consequences of Brexit (or
Britain’s exit from the EU), the referendum was a matter of popular
choice, not a process dictated by reason and cool-headed analysis.

 

UK-M’sian partnership remains unchanged

Pound’s sudden dip a headache

Cameron out of No. 10 by October

Our students an anxious lot

M’sian developers unfazed by EU withdrawal

UK’s departure drives KLCI down

Stunned EU tells Britain to go quickly

Impact on Malaysia minimal in the long run, says Mustapa

Britain votes to leave EU

UK walks a tightrope in Brexit poll

If the UK votes to leave, it will become an Atlantic orphan and lose its special relationship with the EU.

Oil Prices: What’s Behind the Drop? Simple Economics


    Some think it will be years before oil returns to $90 or $100 a barrel, a price that was pretty much the norm over the last decade. Credit Michael Stravato for The New York Times

The oil industry, with its history of booms and busts, is in its deepest downturn since the 1990s, if not earlier.

Earnings are down for companies that made record profits in recent years, leading them to decommission more than two-thirds of their rigs and sharply cut investment in exploration and production. Scores of companies have gone bankrupt and an estimated  250,000 oil workers have lost their jobs.

The cause is the plunging price of a barrel of oil, which has fallen more than 70 percent since June 2014.

Prices recovered a few times over the last year, but the cost of a barrel of oil has already sunk this year to levels not seen since 2003 as an oil glut has taken hold.

Also contributing to the glut was Iran’s return to the international oil market after sanctions were lifted against the country under an international agreement with major world powers to restrict its nuclear work that took effect in January.

Executives think it will be years before oil returns to $90 or $100 a barrel, a price that was pretty much the norm over the last decade.

What is the current price of oil?

Brent crude, the main international benchmark, was trading at around  $38 a barrel on Wednesday.

The American benchmark was at around $37 a barrel.

Why has the price of oil been dropping? Why now? 

This a complicated question, but it boils down to the simple economics of supply and demand.

United States domestic production has nearly doubled over the last several years, pushing out oil imports that need to find another home. Saudi, Nigerian and Algerian oil that once was sold in the United States is suddenly competing for Asian markets, and the producers are forced to drop prices. Canadian and Iraqi oil production and exports are rising year after year. Even the Russians, with all their economic problems, manage to keep pumping.

There are signs, however, that production is falling because of the drop in exploration investments. RBC Capital Markets has calculated projects capable of producing more than a half million barrels a day of oil were cancelled, delayed or shelved by OPEC countries alone last year, and this year promises more of the same.

But the drop in production is not happening fast enough, especially with output from deep waters off the Gulf of Mexico and Canada continuing to build as new projects come online.

On the demand side, the economies of Europe and developing countries are weak and vehicles are becoming more energy-efficient. So demand for fuel is lagging a bit.

Who benefits from the price drop?

Any motorist can tell you that gasoline prices have dropped. Diesel, heating oil and natural gas prices have also fallen sharply.ny motorist can tell you that gasoline prices have dropped. Diesel, heating oil and natural gas prices have also fallen sharply.

The latest drop in energy prices —  regular gas nationally now averages just above $2 a gallon, roughly down about 40 cents from the same time a year ago — is also disproportionately helping lower-income groups, because fuel costs eat up a larger share of their more limited earnings.

Households that use heating oil to warm their homes are also seeing savings.

Who loses?

For starters, oil-producing countries and states. Venezuela, Nigeria, Ecuador, Brazil and Russia are just a few petrostates that are suffering economic and perhaps even political turbulence.

The impact of Western sanctions caused Iranian production to drop by about one million barrels a day in recent years and blocked Iran from importing the latest Western oil field technology and equipment. With sanctions now being lifted, the Iranian oil industry is expected to open the taps on production soon.

In the United States, there are now virtually no wells that are profitable to drill.

Chevron, Royal Dutch Shell and BP have all announced cuts to their payrolls to save cash, and they are in far better shape than many smaller independent oil and gas producers.

States like Alaska, North Dakota, Texas, Oklahoma and Louisiana are  facing economic challenges.

There has also been an uptick in traffic deaths as low gas prices have translated to increased road travel. And many young Saudis have seen cushy jobs vanish.

What happened to OPEC?

Iran, Venezuela, Ecuador and Algeria have all pressed OPEC, a cartel of oil producers, to cut production to firm up prices. At the same time, Iraq is actually pumping more, and Iran is expected to become a major exporter again.

Major producing countries will meet on April 17 in Qatar, and some analysts think a cut may be possible, especially if oil prices approach $30 a barrel again.

King Salman, who assumed power in Saudi Arabia in January 2015, may find it difficult to persuade other OPEC members to keep steady against the financial strains, even if Iran continues to increase production. The International Monetary Fund estimates that the revenues of Saudi Arabia and its Persian Gulf allies will slip by $300 billion
this year.

Is there a conspiracy to bring the price of oil down?

There are a number of conspiracy theories floating around. Even some oil executives are quietly noting that the Saudis want to hurt Russia and Iran, and so does the United States — motivation enough for the two oil-producing nations to force down prices. Dropping oil prices in the 1980s did help bring down the Soviet Union, after all.

But there is no evidence to support the conspiracy theories, and Saudi Arabia and the United States rarely coordinate smoothly. And the Obama administration is hardly in a position to coordinate the drilling of hundreds of oil companies seeking profits and answering to their shareholders.

When are oil prices likely to recover? 

Not anytime soon. Oil production is not declining fast enough in the United States and other countries, though that could begin to change this year. But there are signs that supply and demand — and price — could recover some balance by the end of 2016.Oil markets have bounced back more than 40 percent since hitting a low of $26.21 a barrel in New York in early February.Some
analysts, however, question how long the recovery can be sustained because the global oil market remains substantially oversupplied. In the United States, domestic stockpiles are at their highest level in more than 80 years, and are still growing.But over the long term, demand for fuels is recovering in some countries, and that could help crude prices recover in the next year or two. – The New York Times

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BRICS and SCO: Seizing the Eruasian moment


While the West is distracted by the Gulf region and Ukraine, moves are afoot in parts of Asia and Europe to empower emerging regions in the future

IF there is still any doubt that Russia and China are cultivating their global presence together, events in recent days come as a timely antidote.

The five emerging BRICS economies of Brazil, Russia, India, China and South Africa, spanning nearly as many continents, had their seventh summit in Ufa, south-western Russia on Thursday.

Any lingering uncertainty over Moscow-Beijing relations would also have been dispelled by the fact that the BRICS summit was held back-to-back with the 15th Shanghai Cooperation Organisation (SCO) summit on Friday.

The SCO is an association of six countries – Kazakhstan, Kyrgyzstan, Tajikistan, Uzbekistan – and prime movers China and Russia, which also happen to be dominant. Its summit this time saw a growth in membership with the inclusion of India and Pakistan.

The BRICS countries have certain shared concerns and objectives, such as national development and international commerce that need not conform to the strictures of the Washington Consensus.

Strictures imposed by the Bretton Woods institutions, the World Bank and the International Monetary Fund (IMF), have bled already anaemic economies and destabilised countries in the developing world on the basis of ideological prescriptions.

At the same time, these Western-dominated financial institutions failed to give emerging economies, epitomised by China, their rightful voice according to their global economic importance. Thus a cash-rich China has had to evolve financial institutions of its own.

Such multilateral efforts are best done together with like-minded nations. So besides BRICS, SCO countries that span Eurasia – with a collective focus on Central Asia and now also South Asia – have come together to develop alternative funding agencies.

In addition to the Beijing Consensus of rapid growth that is politically conscious, defined and directed, there is now the “Shanghai Spirit” of mutual respect, trust, benefit and consultation with equality.

These values broadly mirror the Five Principles of Peaceful Coexistence adopted by China and India (Panchsheel Treaty) two generations ago.

But even as SCO membership sees steady growth, it is clear enough that its main drivers and those of BRICS are China and Russia. By dint of sheer size and capacity, particularly those of China, Beijing and Moscow have come to lead the rest.

The way Washington has managed to alienate China and Russia at the same time has helped develop their partnership. Following years of US criticism of both countries, the US navy chief lately branded Russia as the greatest threat while presidential hopeful Hillary Clinton accused China of hacking US sites.

Russia and China were thus prodded by the US to work more closely together. US foreign policy is often said to be defined by domestic interests, or perceived interests, and this is seldom more true than when a presidential election campaign approaches.

However, improving relations between China and Russia are not thanks solely to US posturing. Moscow and Beijing are not without common interests of their own.

On Thursday, Russian Foreign Minister Sergei Lavrov rallied member countries of both BRICS and the SCO to fight terrorism together. International terrorism today is a clear and present danger, a substantive threat and a common scourge requiring close cooperation particularly among neighbouring countries.

While BRICS’s terms of reference are more economic, the SCO’s are broader and more strategic. Within BRICS, member nations have formed a Business Council and formulated an Economic Partnership Strategy. Key sectors are manufacturing and infrastructure besides clean energy and agriculture.

But the star attraction at Ufa was the launch of the New Development Bank (NDB), also known as the BRICS bank, with an initial capital of US$100bil (RM378.2bil).

To be based in Shanghai with its first president in India’s K.V. Kamath, the NDB would be raising funds locally and internationally. It is set to issue its first loans next April. This is among four new financial institutions championed by China, the others being the Asian Infrastructure Investment Bank, the Silk Road Fund and the SCO’s Development Bank.

In the SCO context, member countries had made strides in the energy, telecommunications and transportation sectors. Now such gains needed to be affirmed while also developing opportunities in agriculture. Russia places a special priority on the Eurasian Economic Union (EAEU), which also covers Armenia, Belarus, Kazakhstan and Kyrgyzstan, with Russia dominant. China has prioritised its Silk Road Economic Belt initiatives linking Asia with Europe.

Working together, the EAEU and the Silk Road projects would be promoted jointly by the SCO. The proposed financial institutions, to which China would be contributing the most, would finance these and other related projects.

The fortunes of BRICS economies however have dipped in recent months. The Ufa summit did not deny the current challenges but chose to emphasise the positives.

Although numbering just five countries, the BRICS group had contributed half of the world’s economic growth over the past decade and produced 20% of total global output. No less than IMF findings show that until 2030 at least, BRICS growth would outperform developed and other emerging economies.

For Russia, the plans and initiatives have a more immediate tactical purpose – to alleviate economic pressures brought on by Western sanctions against its moves in Ukraine.

For China, the longer-term strategic purpose covers efforts to facilitate more trade, expedite internationalisation of the renminbi and generally build and solidify China’s global stature.

In investing massively in the new financial institutions however, Beijing will be competing against the IMF, the World Bank and the Asian Development Bank.

In doing so it will have to be more borrower-friendly, minus the strictures so synonymous with the Western-run rivals. The official word is that these new lending agencies are not going to challenge the Bretton Woods institutions, but the practical effect is nonetheless to offer borrowers more choice.

To substantiate the claim that the new institutions will neither rival nor replace the older ones, China is also calling for more open international accountability of the IMF and the World Bank. Somehow that may still not come as comforting news to Western power brokers.

But after all the platitudes and hurrah in Ufa, there are now the realities to contend with.

Strategic analysts prefer to gauge the viability of regional institutions based on the common interests shared among member states. In this respect, the future of BRICS may seem less promising than the SCO’s. Precisely because of the broad spread of the BRICS countries, there is little they have in common besides an affinity with alternative modes of development.

Their economic growth has been significant, but achieved independently of other BRICS nations and – except for China – with little support from (integration with) other countries in their respective regions.

The obvious question arises as to how sustainable can BRICS as an entity be. The fortunes of international associations depend on more than goodwill and bravado.

The SCO by comparison holds more prospects for success. By comprising a contiguous region that includes Eurasia and a substantial chunk of the Asian land mass, cross-border concerns are shared and can be attended to jointly.

Furthermore, practical projects like the Silk Road Economic Belt and the EAEU require constant attention, commitment and contributions from the 60 countries and regions that are involved.

This may mean more obligations to begin with, but consistent maintenance will ensure better management and success.

Bunn Nagara
By Bunn Nagara Behind the headlines

> Bunn Nagara is a Senior Fellow at the Institute of Strategic and International Studies (ISIS) Malaysia.

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US: an engine or a threat to the world economy? Unwise to write shortsighted rules!


WEF_improving

Is the US an engine or a threat to the world economy?

According to the World Economic Outlook published by the World Bank, the international economy is forecast to grow by 3 percent in 2015 and 3.3 percent in 2016. The US and the UK will maintain their economy recovery while Japan and the eurozone will remain sluggish, with growth forecast at no more than 1.1 percent. The World Bank also predicted that the US economy will grow by 3.2 percent in 2015. Developing countries are facing lots of challenges in its economic development.

The US seems to be the only engine of the world economy. But the US Federal Reserve is likely to raise its interest rate from 0 to 0.25 percent. The World Bank worries that any such move will make it more difficult for emerging economies to raise money. The US has emerged from its financial crisis while other countries are still trapped in economic troubles. From this perspective it is hard to assess whether the US is an engine or a threat to the world economy.

There is still a worry that Greece will exit the eurozone. If this happens, the eurozone will be thrown into turmoil. In Japan, so-called “Abenomics” have failed to generate the anticipated results. Russia and Venezuela are each facing their own troubles and threats.

The US economy is closely linked to the whole. Only when other economies achieve sound development, can the US economy maintain sustainable development. The US can’t just focus on its own development.

This article was edited and translated from 《美国是引擎还是威胁?》, source: People’s Daily Overseas Edition, Author: Zhang Hong

It is unwise for the U.S. to write shortsighted rules

In the latest State of the Union Address, President Barack Obama mentioned China many times. He claimed that China wants to write the rules for the world’s fastest-growing region (Asia-Pacific) but the U.S. should write those rules. He went on to urge Congress to give him the authority to promote trade with this region.

Obama is setting considerable store by the Trans-Pacific Strategic Economic Partnership (TPP) Agreement (TPP) and Transatlantic Trade and Investment Partnership (TTIP). These trans-regional trade and investment agreements are designed to increase America’s competitiveness and encourage its exports. Although Obama’s government has tried hard to promote these agreements and to make his mark on presidential history in the U.S., parts of the bills of the two agreements are opposed by some of the negotiation partners, and it is not clear whether Congress will support the agreements.

The U.S. is avoiding queries over its strategic rebalancing toward the Asia-Pacific. The American government cannot give a clear answer to whether TPP targets any specific country. However Obama has now made his position clear: “We should write those rules. We should level the playing field. That’s why I’m asking both parties to give me trade promotion authority to protect American workers, with strong new trade deals from Asia to Europe that aren’t just free, but fair.”

It is readily apparent that America is not satisfied with international trade rules set by the World Trade Organization (WTO). Some countries are trying to break rules while China is attempting to set rules for the world’s fastest-growing region. However, China’s efforts could undermine American interests. Obama hold the view that China is taking advantages of existing free trade rules and it is not fair to the U.S.

It is not wrong for America to benefit from reform of international trade rules. But from a country good at promoting global rules in the past to one now busy promoting trans-regional rules between Asia and Europe, America’s leadership in international system gradually fades out. The U.S. thinks that it has suffered losses from past world trade rules and therefore wants to establish new trans-regional institutions that exclude China and other counties.

America is no longer a country positively promoting global financial trade rules. It now seems to be focused on short-term rules to suit itself and a few allies. Although these agreements will co-exist with the WTO, world trade may become more fragmentized due to trans-regional agreements. A conflict of interests is slowly developing between a group of developed countries, including America, and the developing countries. Trade interests between developing countries might also be damaged. In view of this situation, it is hard to say that the world will be freer or fairer.

Are the trade rules established by WTO really unfair? The U.S. thinks that the standards involving environmental protection, intellectual property protection, and markets are too low. However, America should always bear in mind that it too encountered these problems during its industrialization. Progress was achieved only after a long period. If America remains reluctant to cooperate with other countries to define international rules, it might lose international respect and miss out on new opportunities for development.

The article is edited and translated from 《美国切莫制定短视规则(望海楼)》, source: People’s Daily Overseas Edition, author: Shen Dingli, Vice Dean and professor of Institute of International Studies, Fudan University

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West should end its hypocrisy on anti-terror war!


Anti_terrorists_China-RussiaChinese and Russian policemen attend a joint anti-terror drill in Manzhouli City, north China’s Inner Mongolia Autonomous Region, Oct 20, 2014. [Photo/Xinhua]

Senior US leaders invited sharp criticism at home for not attending last week’s solidarity rally in Paris against the terrorist attack on French satirical magazine Charlie Hebdo in which 12 people were killed. As a result, US Secretary of State John Kerry was in Paris this week to make up for the mistake.

However, terrorist attacks on innocent civilians in Nigeria, where Boko Haram fighters killed hundreds of, if not more, ordinary people early this month, have not received the same attention in the US and the Western world as the Paris attack. Yet such double standards and hypocrisy of the Western world is nothing new.

Over the past few years, the US and some Western countries have not responded to the terrorist attacks against innocent civilians in Beijing, Kunming and the Xinjiang Uygur autonomous region the way they reacted to the Paris attack.

On several occasions, US State Department spokespersons have used the excuse that they need more information and investigation into the incidents in China to condemn them as terrorist attacks. But they did not ask any such question after the Paris attack.

Some Western news organizations have refused to describe the perpetrators at Kunming railway station in Yunnan province as terrorists, insisting on calling them “knife-wielding attackers”. And on the rare occasions that they have used the word terrorist, they put it within quotation marks as if the ruthless killers in China were any different from those in Paris or elsewhere in the Western world. One CNN report even posed the question, “Terrorism or Cry of Desperation?”, as if killing innocent civilians in China can be somehow justified.

Even though China and the US have common interests in fighting terrorism, some Americans still seem to believe that only those setting off bombs in New York are terrorists while those doing the same in Beijing or any other Chinese city demand a different description.

The West’s double standards are not restricted to China and Nigeria. The decade-old wars in Iraq and Afghanistan have cost the lives of hundreds of thousands of civilians, but the mainstream media outlets in the US have largely ignored the tragedies and focused on the loss of their own troops.

If the number of civilian casualties is a measure of the intensity of a terrorist attack, tragedies like the Sept 11, 2001, attacks have occurred multiple times in Iraq and Afghanistan. But the Western media don’t seem to care much about them.

Some Western observers have even found excuses for West’s inadequate response to the terrorist attacks in Kunming on March 1 last year in which 31 were killed and 141 injured. But by failing to immediately condemn the attacks against innocent civilians in Kunming and Xinjiang, these people have by default condoned the action of the perpetrators.

It is true that terrorists in the eyes of some could be freedom fighters in the eyes of others. That is why Osama bin Laden was a freedom fighter to the US in the 1980s but a top terrorist in the 21st century. And Nobel Peace Prize winner Nelson Mandela was still on the US terrorism watch list as late as 2008, years after stepping down as South Africa’s president.

There is no doubt that the US and its allies have failed miserably in their “war on terror” despite the more than 1,000 air strikes launched against the Islamic State group. In spite of the heavy bombardments, we have seen terrorists gaining strength and spreading their tentacles to more areas across the world.

And the Western world responds to this deadly threat with double standards.

By Chen Weihua China Daily/Asia News Network

The author, based in Washington, is deputy editor of China Daily USA. chenweihua@chinadailyusa.com

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The Wealthy get wealthier


The richest people on Earth got richer in 2014, adding $92 billion to their collective fortune in the face of falling energy prices and geopolitical turmoil incited by Russian President Vladimir Putin.

Video: http://www.bloomberg.com/video/popout/4PRJi7eqTcWSR0cwVL05iA/10.938/

The net worth of the world’s 400 wealthiest billionaires on Dec. 29 stood at $4.1 trillion, according to the Bloomberg Billionaires Index, a daily ranking of the planet’s richest.

The biggest gainer was Jack Ma, the co-founder of Alibaba Group Holding Ltd., China’s largest e-commerce company. Ma, a former English teacher who started the Hangzhou-based company in his apartment in 1999, added $25.1 billion to his fortune, riding a 56 percent surge in the company’s shares since its September initial public offering.

Ma, 50, with a $28.7 billion fortune, briefly passed Li Ka-shing as Asia’s richest person.

“I am nothing but happy when young people from China do well,” Li, 86, said through his spokeswoman in Hong Kong.

Global stocks rose in 2014, with the MSCI World Index advancing 4.3 percent during the year to close at 1,731.71 on Dec. 29. The Standard and Poor’s 500 Index rose 13 percent to close at 2,090.57. The Stoxx Europe 600 gained 4.9 percent to close at 344.27.

Two of the year’s other biggest gainers were Warren Buffett and Mark Zuckerberg of the U.S. Buffett, the chairman of Berkshire Hathaway Inc., added $13.7 billion to his net worth after the Omaha, Nebraska-based company soared 28 percent as the dozens of operating businesses the 84-year-old chairman bought over the past five decades churned out record profit.

Gates, Slim

Buffett passed Mexican telecommunications billionaire Carlos Slim on Dec. 5 to become the world’s second-richest person. Bill Gates, the co-founder of Microsoft Corp., was up $9.1 billion during the year. The 59-year-old remains the world’s richest person with a $87.6 billion fortune.

Zuckerberg, the hoodie-wearing chief executive officer of the world’s largest social-networking company, gained $10.6 billion as the Menlo Park, California-based business rose to a record on Dec. 22.

Bloomberg Billionaires Gainers of 2014

Bloomberg Billionaires Gainers of 2014

This year Facebook made headway in mobile, a business that has flourished as mobile advertising increased and marketing initiatives expanded with applications and video. Facebook’s acquisition of Instagram in 2012 for $1 billion has also been paying off: A Citigroup Inc. analyst said on Dec. 19 the photo-sharing app is worth $35 billion.

Russia Woes

Zuckerberg’s company faced a challenge in Russia, where the blocking of a Facebook page promoting a Russian opposition rally highlighted the challenges the social network faces as Putin cracks down on the Internet amid a looming economic downturn. The European Union and U.S. limited Russian companies’ access to financing to punish Putin after he annexed Crimea in March. Russia’s troubles have been worsened by the corresponding plunge in the price of oil, a bedrock of the country’s economy.

Nobody was hit harder than Vladimir Evtushenkov. Once Russia’s 14th-richest person, the 66-year-old lost 80 percent of his wealth, dropping him from the Bloomberg ranking. He was sentenced to house arrest by a Moscow court in September after a money-laundering investigation connected to the $2.5 billion purchase of shares in oil producer OAO Bashneft.

The court also ruled in favor of nationalizing his stake in Bashneft, which he controlled through publicly traded AFK Sistema. Evtushenkov’s fortune has fallen $8.1 billion, the most of any Russian in 2014.

Leonid Mikhelson has been the biggest loser in dollar terms among those remaining in the country’s 20 richest, dropping $7.8 billion since the start of the year. The 59-year-old is the chief executive officer of OAO Novatek, Russia’s second-largest natural gas producer, which fell 44 percent during the year. He has a $10.1 billion fortune, according to the Bloomberg ranking.

Western Sanctions

Viktor Vekselberg surpassed Alisher Usmanov as Russia’s richest person after Usmanov’s MegaFon OAO lost almost half its value since June. Vekselberg is worth $14.1 billion, while Usmanov fell 32 percent to $13.8 billion.

One of only a few Russians among the world’s 400 richest who gained in 2014 was aluminum billionaire Oleg Deripaska, who added $1.6 billion as his Hong Kong-based United Co. Rusal rose 122 percent. Deripaska has increased his fortune to $8.2 billion. He’s the world’s 154th-richest person.

“The reputation of Russian business in the west has become worse, and will continue to get worse,” said Stanislav Belkovsky, a Kremlin adviser during Putin’s first term who now consults for Moscow’s Institute for National Strategy, a research firm. “That means that the capabilities for Russia’s billionaires to run businesses abroad are going to decrease.”

Adelson Falls

Belkovsky says Putin will try to compensate the country’s sanctioned businessmen by giving them access to different state resources.

“The competition for resources will increase, as will the redistribution of ownership,” he said.

Russian billionaires weren’t the only ones to suffer losses. Sheldon Adelson, the gambling mogul who controls Las Vegas Sands Corp., the world’s largest casino company, fell $8.7 billion as the Las Vegas-based company dropped 25 percent.

Macau’s casinos are looking at their first down year in revenue since the market was opened to foreign operators in 2002, after China’s President Xi Jinping cracked down on corruption on the mainland and high-rollers shunned the gambling enclave. More than half of the company’s 2013 $13.8 billion in revenue comes from Macau.

Bezos, Musk

Adelson’s decline was followed by Jeffrey Bezos, the chairman of Amazon.com Inc. The 50-year-old had $7.2 billion trimmed from his fortune as the Seattle-based company lost ground in the cloud computing market to crosstown competitor Microsoft Corp.

Bezos, whose Blue Origin LLC space company won a contract in November to deploy rockets from NASA launchpads in Florida, is ranked 21st in the world with a $28.7 billion fortune. Blue Origin will develop a space vehicle that isn’t scheduled to be ready until after 2020.

Elon Musk’s space-exploration company is close to winning the certification it needs to begin deploying satellites for the U.S. military, according to an Air Force official. A contract win by Hawthorne,
California-based SpaceX would be the first since the Pentagon opened the program in late 2012 to as many as 14 competitive missions.

Musk added $2.9 billion to his net worth, most of which was the result of a 50 percent gain by Tesla Motors Inc., the world’s largest electric-car manufacturer.

Chinese Gains

China’s 10 richest people have added almost $48 billion combined year-to-date. Following Ma’s $25.1 billion gain, technology entrepreneurs Richard Liu of online retailer JD.com and Robin Li of Baidu Inc. added a combined $8 billion.

The title of Asia’s richest person could be challenged by Wang Jianlin, whose Dalian Wanda Group Co. staged an initial public offering of its commercial properties division this month. An IPO for Wanda Cinema Line Co. is planned for early 2015. Wang has a net worth of $25.3 billion, gaining $12.8 billion during the year.

Alibaba’s surge minted at least three new billionaires this year, including Simon Xie, an Alibaba co-founder and the second-biggest shareholder of the finance affiliate that owns Alipay. Xie, 44, owns 9.7 percent of Zhejiang Ant Small & Micro Financial Services Group Co., the parent of Alipay, according to company filings obtained by Bloomberg News.

Hidden Billionaires

Small & Micro CEO Lucy Peng and Jonathan Lu, CEO of Alibaba, each controls almost 4 percent in Small & Micro Financial, according to filings submitted by the company in Hangzhou. They also both own less than 1 percent of Alibaba, which made them new 2014 billionaires.

Bloomberg News uncovered 86 new or hidden billionaires who had never appeared on an international wealth ranking. Among them were the six heirs to a $13 billion Monaco fortune that were unveiled after the family’s matriarch, Helene Pastor, was gunned down in a parking lot in Nice, France, in May. The fortune spans two branches of the Pastor family, which built much of Monaco’s skyline and owns thousands of apartments in the city-state.

Carlos Pellas became Nicaragua’s first billionaire rebuilding his family sugar mill and parlaying the proceeds into a new bank, BAC-Credomatic, which, by 2005, was one of the largest financial institutions in Central America. He sold it to General Electric Co. in a deal completed between 2005 and 2010 for about $1.7 billion.

Latin America

His rise to riches was almost interrupted by a violent 1989 plane crash that killed more than 130 people and left his wife with 62 bone fractures and skin melting off her face.

Other Latin America fortunes that emerged include five billionaires from Brazil — Joesley, Wesley, Valere, Vanessa and Vivianne Batista — who created the world’s biggest beef producer after making more than $17 billion in acquisitions. Their company, JBS SA, rode the biggest stock rally on Brazil’s Bovespa index this year, jumping 30 percent year-to-date, fueled by surging beef prices and Russia’s lifting of a ban on Brazil meat-processing plants.

A surge in real estate and corporate valuations elevated the fortunes of at least five Blackstone Group LP billionaires. Co-founder and chairman Stephen Schwarzman added $926 million as the company rose 7.6 percent. The performance, along with surging art values, made James Tomilson Hill, Blackstone’s vice chairman who runs the company’s $64 billion hedge fund business, a billionaire. Jonathan Gray, who runs the firm’s real estate division, is worth $1.5 billion.

Strong Dollar

Real estate is seen as one way the wealthy could make further gains in 2015.
“The fact that interest rates are going to remain low, there might be some opportunities, especially with residential real estate in Europe,” Efrat Peled, the chairman of Arison Investments, said in a phone interview from her office in Tel Aviv.

Peled, who manages more than $2.5 billion in assets for Shari Arison, says a strong U.S. dollar should give some foreign markets a boost.

“Exports are better when the dollar is strong,” she said.

Whether interest rates stay low remains a looming question moving into 2015. Federal Reserve Chair Janet Yellen appears poised to raise interest rates for the first time in almost a decade, and prognosticators are convinced Treasury yields have nowhere to go except up. Their calls for higher yields next year are the most aggressive since 2009, when U.S. debt securities suffered record losses, according to data compiled by Bloomberg.

Photographer: Scott Eells/Bloomberg

Billionaire Jack Ma, chairman of Alibaba Group Holding Ltd. in 2014.
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