19 DECEM BER 20 1 1 I SSUE 56

CARICAPTURES

BETA

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01 MYANMAR NEGOTIATING PEACE

WITH ARMED ETHNIC GROUPS

Myanmar is stepping up efforts to end

its civil war with armed ethnic groups by

creating a new negotiating team, promising

genuine reconciliation, and offering a

Myanmar

02 US AND RUSSIA BELIEVE FREE TRADE AGREEMENTS

WITH ASEAN MEMBERS ARE BENEFICIAL

David Adelman, the US Ambassador to

Singapore, considers the Singapore-US

Free Trade Agreement (FTA) one of the

most successful globally, while Russia is

confident that its FTA with Vietnam will

enable it to penetrate Asian markets.

Both countries see FTAs with ASEAN

members as catalysts for greater economic

involvement in the region

Building upon successful bilateral FTAs, the

US wants to create one of the largest regional

free trade zones in the world through the

US, Russia, Singapore, Vietnam

greater role to minorities in local

decision making.

The new team, headed by Railways

Minister ex-Major General Aung Min, met

five armed groups and secured a peace deal

with Shan State Army-South

The president has ordered the military not

to attack ethnic Kachin rebels in an effort to

bring them to the peace table

Investment in the Wa region greatly

increased and businesses are flourishing

after the ethnic group signed a ceasefire

agreement in early September

There is another negotiating team headed by

Aung Thaung, a secretariat member of the ruling

party, it may however be disbanded due to its

failure to reach agreements with rebels

Tourism stands to immediately gain from

peace, but current infrastructure cannot

absorb the potential influx of tourists

Irrawaddy, Asia Times, Wall Street Journal(14 December 2011)

multilateral Trans-Pacific Partnership (TPP)

Russia aims to finalise a FTA with

Vietnam after its ascension to the World

Trade Organisation in December

Bilateral FTAs are increasingly harder to

push through the US Congress, due to lobbying

by domestic industries fearing competition

Some analysts believe that the benefits

of FTAs are overrated while others worry

about increased competition between

trading blocs

Wall Street Journal, Viet Nam Net (13 December 2011)

12 1612 12‘11 ‘11

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

William J. Burns was on a two day visit to

strengthen ties with Malaysia and discuss

strategies for engagement in the region.

Burns called on the Prime Minister and the

Deputy Foreign Minister; he also attended a

roundtable meeting hosted by the Institute of

US DEPUTY SECRETARY OF STATE VISITS MALAYSIA

AND AFFIRMS THE IMPORTANCE OF ASIA-PACIFIC03Malaysia, US

04 MALAYSIA MAINTAINS LEAD

IN GLOBAL SUKUK MARKET

Driven by the government’s Economic

Transformation Programme, Malaysia will

continue to capture 60% of global sukuk

issuance in 2012.

There will be more products next year aimed

Malaysia

at retail investors as smaller quantities can

be bought at the branch level

More European and Middle East entities will

issue ringgit-denominated sukuk in Malaysia

as investors move away from the Eurozone

Malaysia’s robust secondary market for

Strategic and International Studies

The US believes that the world’s strategic

and economic centre of gravity will be the

Asia-Pacific in the 21st century

The US wishes to broaden bilateral

security cooperation in the region,

engage emerging powers such as China,

India, and Indonesia, and take part in

the development of regional multilateral

institutions such as ASEAN

The US sees Malaysia as a key partner and

a bridge between Asia and Southeast Asia

US Department of State, Bernama

(15 December 2011)

trading and ample liquidity to absorb issues

remain top attractions for sukuk investors

The growth of the global sukuk market

has exceeded investors’ expectations

Bernama, The Star (15 December 2011)

12 1612 12‘11 ‘11

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

06

The Asian Development Bank projects

ASEAN+3 to play a more prominent role

globally, as GDP per capita is expected

to par with developed nations in 2030 and

regional cohesion to provide insulation

and recovery from global recessions. The speed of the 2010 recovery, also

resulting in increased intra-regional trade

within ASEAN+3 demonstrates lessons learnt

by ASEAN from the 1997 economic crisis

ASEAN should focus on infrastructure,

ASEAN, China, Japan, Korea

05 FLOODS AFFECT

GROWTH OF THAI SMES

Small and medium-sized enterprises

(SMEs) in Thailand are expected to have

Thailand

HELLO ASEAN+3,

GOOD-BYE EUROPE

Malaysia, Vietnam, Thailand, India

07 VIETNAM WILL EXPORT 300,000

TONNES OF RICE TO MALAYSIA

Vinafood 2, Vietnam’s largest rice

exporter, has secured a US$150

million contract to export 300,000

tonnes of rice to Malaysia in a bid to

stabilise prices for the upcoming

harvest and to stem competition from

India and Pakistan. Domestic prices have fallen as exporters

cut prices to attract foreign buyers and to

prevent a larger price fall during the supply

jump at the harvest peak, early next year

Next year’s production is expected to

rise 3.8% from this year, amounting to 11

million tonnes

Vietnam is considering to introduce soft

loans for exporters to buy rice for rice

reserves, halting price declines over the

harvest peak

Malaysia is the fourth-largest buyer of

Vietnamese rice this year, after Indonesia,

the Philippines, and Cuba

The Star Malaysia (13 December 2011)

industrialisation, and

population growth

to meet the Asian

Development Bank

projections

A robust population

will become the

source of domestic

demand and ensure

competitive labour

supply to support

industrialisation

The Jakarta Post (13 December 2011)

low economic and export growth even

as the government begins its first

disbursement of flood relief funds. Most of the affected SMEs are in the

retail- and wholesale sectors, followed by the

service- and manufacturing sectors

Businesses are confident that Thai SMEs will

recover next year as regional demand rebounds

The government is considering extending

low-interest loans to affected SMEs

One-third of the flood relief funds will

be spent by January 2012, the rest will be

disbursed pending government review to

avoid duplication in efforts

Bangkok Post, Reuters (12 December 2011)

O P I N I O N

12 1612 12‘11 ‘11

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. As such, CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

SMEs in the ASEANEconomic Community

09

10 ASEAN-CHINA TRANSPORT MEETING FOCUSES ON

MARITIME CONSULTATION FROM REGIONAL ARMS RACE

Japan’s planned US$8 billion

procurement of F-35 Lightning

II stealth fighters, China’s

introduction of the Chengdu J-20

stealth fighter, and the deployment

of 2,500 US marines in Australia

point to escalating tensions that

could trigger a regional arms race. I Nyoman Sudira (Dean, School of

International Relations, Parahyangan

University) believes ASEAN countries

should concentrate on domestic

politics and regional integration rather

than become involved in an arms race

Academics believe Singapore’s

US$23 billion defence procurement

and the Philippines military chief’s

hostile rhetoric on the South China

Sea conflict are unrelated to the arms

race between major Asia Pacific powers

The Jakarta Post (15 December 2011)

Maritime and air transport was the focus

of ASEAN and Chinese senior transport

officials in Phnom Penh this week, in

preparation for the 10th ASEAN-China

Transport Ministers meeting on 16

December 2011.

China, ASEAN

China has agreed to establish a China-

ASEAN committee on connectivity and

provide US$10 billion in loans to improve

overland connectivity as promised at the

14th ASEAN Summit

China has also committed to setting up

a CN¥3 billion (US$471 million) China-

ASEAN maritime cooperation fund as

part of its commitment to facilitate

maritime connectivity

Both parties are also working towards an

ASEAN-China air transport agreement

China Radio International (14 December 2011)

ASEAN, China, US, Japan

ASEAN MUST

STAY AWAY

FROM REGIONAL

ARMS RACE

08 KASIKORNBANK SEEKS EASY

AEC TRANSITION FOR SMES

To support the regional expansion of

SMEs in preparation for the ASEAN

Economic Community (AEC) in 2015,

Thailand’s Kasikornbank is in discussion

with Laotian, Indonesian and Singaporean

banks, and has signed agreements with

two Vietnamese banks. Thai SMEs in auto parts, processed

agriculture, building and construction

ASEAN

materials, energy, and tourism sectors are

strong candidates for regional expansion

Kasikornbank forecasts a 10% annual

growth in trade between Thailand and ASEAN

partners with the inception of the AEC

Trade finance from Kasikornbank for intra-

ASEAN transactions is expected to increase

from TH฿ 380 billion (US$12.1 million) in 2011

to TH฿ 490 billion (US$15.6 million) in 2012

Bangkok Post (15 December 2011)

O P I N I O N