CARICAPTURES

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ASEAN WELCOMES NEW SECRETARY-GENERAL AND CHAIRMAN

The first ASEAN Secretary-General

from Vietnam assumed the position on 1

January 2013, while Brunei Darussalam

has taken over the Chairmanship of

ASEAN.

ASEAN’s new Secretary-General, Le Luong

Minh, is a seasoned diplomat from Vietnam

During his time at the Foreign Ministry,

he served as Vietnam’s ambassador to the

United Nations

Analysts suggest Vietnamese style of

diplomacy is less public and transparent,

which may be a better way to deal with China

This is the second time Brunei has been the

Chair of ASEAN, the first time being in 2001

Brunei has chosen “Our People, Our Future

Together” as this year’s theme to emphasise

the importance of community building

As Chairman, it will be able to set the agenda

and has the responsibility to host the various

meetings and two Summits; the 22nd ASEAN

Summit on 24-25 of April, and the 23rd ASEAN

Summit on 9-10 October, where the 8th East

Asia Summit will be held on the sidelines

These changes come at an important time

as tensions continue to simmer between

ASEAN and China on the maritime claims in

the West Philippine Sea

Both Brunei and Vietnam are claimants and

will be more active in pushing for ASEAN

consensus on this issue

CARI analyst, Chayut Setboonsarng,

considers what to expect from the new

chairman here

VOA News (1 January 2013)

The Borneo Post (3 January 2013)

ASEAN

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Source: ASEAN Secretariat

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.

Best ASEAN country to be born in

ASEAN CLIMBS LIVABILITY

RANKINGS

Singapore and Malaysia went up in the

rankings of the best place to be born

in the world, to 6th and 36th place

respectively. The index which is provided by the

Economist Intelligence Unit (EIU) aims to

quantify how happy people say they are

based on a list of 11 economic and socio-

political indicators such as a country’s

income per capita, cost of living, human

rights, life expectancy, literacy, and

education levels

Thailand came in at 50, while the

Philippines dropped to 63rd place,

tying with Sri Lanka

ASEAN

Vietnam and Indonesia took 68th and 71st

positions respectively

Switzerland beat out all other nations,

including the US (16), as the best place for

babies to be born

Australia was the runner-up, followed by

Scandinavian countries Norway (3), Sweden

(4) and Denmark (5) while New Zealand,

the Netherlands, Canada and Hong Kong

rounded up the rest of the top 10

The Economist (21 November 2012)

CHAROEN

GETS MORE

THE

PHILIPPINES

Thailand, Singapore, Indonesia

Philippines

TIME TO BID FOR F&N

THE BIGGEST

SURPRISE

Thailand’s TCC Assets was granted

another chance to improve its original bid

of SG$8.88 for each of F&N’s shares, in

the face of the Indonesian consortium’s

bid of SG$9.08 a share. The new deadline for TCC Assets, which

is controlled by Thai tycoon Charoen

Sirivadhanabhakdi, is end of day on January 10

The Indonesia consortium is led by property

firm Overseas Union Enterprise (OUE), and is

backed by the Japanese brewer Kirin Holdings

Kirin Holdings owns 14.8% of F&N’s shares,

and is interested in F&N’s food and beverage

business, while F&N’s property interests are to

pass to OUE if their bid is successful

Bangkok Post (3 January 2013)

2012 is claimed to be one of the best

years ever for the Philippines economy,

with GDP growth expected to surpass the

targeted 5% to 6% and the stock market

ending the year on its 38th record high. Good economic fundamentals, benign

inflation, high foreign exchange reserves and

low interest rates, provide a good springboard

for a rosy 2013 outlook

It is hoped that this translates into another

credit rating improvement that would put the

country to investment grade, something they

haven’t seen in at least the last three decades

The Philippines economy in 2012 showed

resilience and strength amid the economic

crisis in Europe and territorial disputes in the

region, said Philippine Chamber of Commerce

and Industry president Miguel Varela

The Philippine Stock Exchange (PSE)

welcomed the New Year with a bang after the

benchmark stock market index recorded a new

all-time high

As of the end of 2012, the PSE Index set 38

new records during the year 2012

Malaya Business Insight (3 January 2013)Business Inquirer (30 December 2012)

Source: Economist Intelligence Unit

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.

ASEAN’s AVIATION INDUSTRY IS ON

THE ASCENT

NEW MINIMUM

WAGE SWEEPS

INDONESIA’S BAJA STEEL TO

EXPORT ASEAN

Growth in the Philippines’, Malaysia’s

and Singapore’s aviation industry

looks promising although in the

Philippines it is being hindered by

infrastructure bottlenecks. Foreign airlines are forgoing operations in

the Philippines due to the lack of space at

its airports; the latest victim being Mumbai-

based Jet Airways

Carmello Archilla, executive director of the

civil aeronautics board of the Philippines says

airports can’t meet the many orders they

have for slots, which is a major deterrent for

growth in an otherwise burgeoning market

Ninoy Aquino International Airport

(Naia) in Metro Manila is the main culprit,

however areas like Cebu and Clark are being

developed to offset Naia’s congestion

Meanwhile Changi Airport celebrated a

The governments of Malaysia,

Thailand, Vietnam, and Indonesia are

implementing their new minimum wage

policies in an attempt to curb income

inequality; however, businesses are

concerned with the rise of labour costs. Businesses in Thailand are concerned with the

new US$10 per day minimum wage that will

come into effect nationwide as it will increase

production costs at a time of declining demand

from the US and EU

The chairman of the Textile Industry Club of

the Federation of Thai Industries (FTI), Somsak

Srisupornwanit, said he does not expect to see

many factory shutdowns as manufacturers will

try to find new cost saving measures in supply

chain management and logistics to lower costs

In Vietnam the minimum wage is expected

to be up to US$14 with varying increases

throughout different designated zones

According to a specialist from the International

Labour Organisation, Yoon Youngmo, the

Government used minimum wage policy to

gradually raise the wage floor over the last few

years, by more than 20% yearly

In Malaysia, new wage levels go up to US$10

per day depending on region; however, 600 firms

gained a 3 to 6-month exemption from the wage

hikes because they have been performing poorly

for two to three consecutive years

The extension is to give them time to

restructure their operations

Following massive strikes last year, Indonesia

will increase minimum wage by 50% this year to

US$228 per month

Malaysian plantation firms face problems as

domestic labour markets are already at a deficit

of 60,000 workers and Indonesian workers may

return home

The Nation (2 January 2013)The Star (21 December 2012)

Wall Street Journal (28 December 2012)VNA (8 December 2012)

Malaysia, Singapore, Philippines

Indonesia

Indonesia, Thailand,Malaysia, Vietnam

ASEAN

Indonesian steel manufacturer PT

Saranacentral Bajatama (BAJA) plans to

export its products to Malaysia, Myanmar

and Thailand, taking advantage of the

ASEAN Free Trade Agreement (AFTA). BAJA has already identified potential buyers

from the numerous on-going construction

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new milestone – 50 million passengers were

handled in 2012, a 10% increase from 2011

The success at Changi is credited to strong

business partnerships with airlines like

Garuda, and focused efforts with them to

grow air links and increase flight frequencies,

according to Lee Seow Hiang, CEO of Changi

Airport Group

Malaysia’s aviation industry on the other

hand is seeing increased competition spurred

by the new entrant, Malindo Air, and a new

lost-cost airport opening in May 2013, KLIA2

MAS and Air Asia are confident they can

face their new competitor, on the back on

their clear network expansion roadmap,

new fuel-saving and efficient aircrafts, and

established brand network

Asia One (28 December 2012) The Star (31 December 2012)

ANN (1 January 2013)

projects in these countries, according to BAJA’s

president and director, Handaja Susanto

BAJA projects its exports will account for 20%

of their global sales

Susanto predicts the increased income from

exports in 2013 to range from US$1 million to

US$2 million in 2013

The Star (2 January 2013)

Impact of AFTA on steel prices- Allows for greater profit margin

for regional firms- Promotes intra-Asean trade as it

is much cheaper to source for steel regionally

Source: Aseansec.org

Source: Aseansec.org

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.

Editorial Team: Manissa van Geyzel, Chayut Setboonsarng, Sóley Ómarsdóttir, Paul Leong Consultant Editor: Tunku ‘Abidin Muhriz

TRADE DEALS SET TO OPEN

NEW ERA FOR ASEAN, INDIA

Two Chinese firms signed a

memorandum of understanding,

overseen by the Cambodian Minister

of Transport, to start work later this

year on a massive project to build an

entirely new 400-km railway line. The first cargo train between Phnom Penh

and Sihanoukville’s port set off, marking

the beginning of a route that it is hoped will

decrease reliance on the road network to

transport goods to the coast

The expansion project, valued at US$9.6

billion, will be carried out by Cambodia

Iron and Steel Mining Industry Group, a

consortium of Chinese metal firms

China Railway conducted a feasibility study

on the rail project in 2011, but results have

not been made public

Peou Maly, deputy director of the

transportation department within the

Ministry of Public Works and Transport,

said that he believed the project will impact

people’s homes because it is more than 400

km long

The Cambodia Daily (31 December 2012)The Cambodia Daily (1 January 2013)The Cambodia Daily (2 January 2013)

ASEAN, India

Cambodia

CAMBODIA

EXPANDS

RAILWAY

INFRASTRUCTURE

08 MYANMAR MONITOR

The Information Ministry announced last

week that privately owned daily newspapers

will be allowed, but from April, for the first

time since 1964. This is the second major

step towards media freedom: but in August

last year the government abolished direct

censorship of the media allowing only weekly

publications of private newspapers.

Bangkok Post (30 December 2012)

Myanmar will install its first ever 500 kilovolt

power grid early this year in a bid to reduce

power loss in the country. According to the

Ministry of Electric Power, demand has hit

1890MW against supply of only 1500MW.

Xinhua (30 December 2012)

The Thai state-owned Krung Thai Bank

(KTB) is looking to form a joint venture in

Myanmar following the successful launch

of its representative office in Yangon in

Myanmar’s military admitted that it carried

out air-strikes against ethnic Kachin rebels in

the northern part of the country. The attack

highlights the rift between the government

and the military which has ignored orders

by President Thein Sein to halt offensives

against the Kachin minority.

The New York Times (2 January 2013)

Myanmar held its first public countdown

to the New Year, a celebration featuring

fireworks and performances by local

entertainers that gathered about 90,000

people. The President then made his

first New Year’s address to the nation

on 1 January. In the five minute speech

broadcasted by radio, Thein Sein

acknowledged that he needs to do more

to earn the people’s trust and will make a

point to speak to the people more often.

Abc News (1 January 2013)

December. The bank has provided financial

support to large Thai companies and SMEs

investing in Myanmar, mostly in border

trade and supply chain businesses.

Bangkok Post (25 December 2012)

Japan’s finance minister and deputy

prime minister, Taro Aso, met with

President Thein Sein on January 3 and

confirmed Japan’s intention to cancel

debt and help develop the Thilawa Special

Economic Zone, in the first high-profile

overseas visit by a member of Tokyo’s new

cabinet since it took office last month.

The Star (3 January 2013)

Myanmar has established diplomatic ties

with Iceland, according to official media

last week. Iceland is the sixth country that

Myanmar forged links with in 2012.

Xinhua (26 December 2012)

FORE IGN AFFA IRS

ECONOMY

POL I T I CS

The ASEAN-India Summit on 21 December

saw the conclusion of negotiations for

an ASEAN-India FTA framework which

boasts a combined market of almost 1.8

billion people, and GDP of US$3.8 trillion.

All ASEAN leaders, with the exception of the

Philippines president, attended the summit in

New Delhi

The FTA agreement which covers goods,

services and investments will be signed by

ASEAN countries in August 2013, before being

ratified at each member country’s parliament

The cooperation between ASEAN and

India also includes support for sub-regional

developments such as the Greater Mekong Sub

Region and the BIMP-EAGA

Salman Khurshid, Indian Foreign Minister,

expects connectivity projects between India and

ASEAN to take off, citing the highway project

between India’s border, Myanmar, and Thailand,

which is scheduled for completion in 2016

The Nation (30 December 2012)

Source: ASEAN India