Wednesday, December 26, 2007

The Year in Asia, 2007

The pictures Buddhist monks by the tens of thousands clad in saffron-colored robes parading peacefully through the streets of Yangon and other cities in Myanmar will form the indelible image of 2007 in Asia. It was the largest protest in the country since the demonstrations of 1988 resulted in the deaths of several thousand protestors. The immediate spark was rising fuel prices and conspicuous extravagance by the generals who have ruled the country for more than 20 years, but it was more fundamentally grounded in pent-up frustration with the way the generals have run the country into the ground. The junta reacted predictably, by shooting into the crowds, although the bloodshed was mercifully lower than two years ago. Other notable events in Asia in 2007 include:

2. Chinese shoot down an orbiting satellite.

3. Pakistan’s year of living dangerously

4. China’s PetroChem becomes world’s first $1 trillion company.

5. South Korea’s voters turn to the right.

6. Diplomatic reversals – India and North Korea.

7. Japan’s election gridlock

8. Chinese product recalls

9. The return of Thaksin to Thailand

10. Australia’s drought enters 10th year.

In January the Chinese destroyed one of its own aging weather satellites in polar orbit in a demonstration of technical dexterity that stunned Western defense chiefs and underscored the increasing sophistication of the Chinese military. Much of America’s technical advantage in precision bombing depends on guidance systems from orbiting satellites now demonstrably vulnerable to counter-attack. If that wasn’t enough, China demonstrated its increasing sophistication in space travel by putting its first satellite around the moon. Beijing says it plans to land a man on the moon in 15 years.

It seemed as if nothing could go right in Pakistan during 2007. President Pervez Musharrif feuded with members of the supreme court and Islamists, culminating in the siege and capture of the Red Mosque in Islamabad. Suicide bombings, which had been rare in the past, became a common occurrence exemplified by the horrendous killing of 50 by one bomber near the year’s end. President Musharrif declared a state of emergency, bringing protestors out in the streets and international condemnations. He tried to appease these protests by resigning his army commission ahead of another term as president. Former premier Benazir Bhutto returned to Pakistan in a US-orchestrated move to return some semblance of democracy only to barely escape assassination.

In 2006 the big economy story was China accumulating $1 trillion in foreign currency reserves (now more like $1.4 trillion). This year China unveiled the world’s first trillion-dollar company following the oil giant PetroChem’s initial public offering on the Shanghai Stock Exchange. Its market cap exceeded that of Exxon Mobile and General Electric Co. combined. What China would do with this wealth was partly answered in December when the country’s sovereign wealth fund pumped $5 billion into ailing Morgan Stanley to gain 10 percent ownership.

Lee Myung-bak of the conservative Grand National Party won a resounding victory in South Korea’s presidential election in December, ending 10 years of rule by two left of center presidents, Kim Dae-jung and Roh Moo-hyun. A popular former governor of Seoul and chaebol business executive, Lee ran mostly on a promise to boost the economy. It seemed doubtful that he would scrap rapprochement with North Korea, which is popular, but he will likely take a harder line around the edges, That should please Washington, which has seen the alliance with South Korea frayed in the past decade.

In 2006 the diplomatic story of the year was the astonishing nuclear deal with India and what it meant for a budding US-India partnership. Meanwhile, talks surrounding North Korea’s nuclear ambitions were stalled. This year it was the Indian deal that stalled in the face of unmoveable opposition from left-wing parties in India’s governing coalition. But in February, a breakthrough was achieved on the North Korea, which agreed to freeze and dismantle its plutonium plants at Yongbyon and elsewhere in exchange for renewed fuel oil shipments. At year’s end it was unclear whether Pyongyang would take the next step in revealing the details of its other nuclear establishments or the where about of its weapons.

Japan’s main opposition, the Democratic Party of Japan, won a stunning victory in the July election to the House of Councilors, meaning that the two chambers of Japan’s bi-cameral parliament were in opposing camps, presenting the new Prime Minister Yasuo Fukuda with tricky problems. The immediate result was temporary termination of Japan’s rather minor contribution to the Afghanistan War. A new bill allowing Japanese navy oilers to resume refueling operations in the Indian Ocean passed the lower house but faced almost certain defeat in the opposition-controlled upper house. That should set the stage for a confrontation in the new year that would lead to anything in from a general election to a grand coalition.

Perhaps the one Asian news development that truly impinged on America’s conscience during the year was the string of embarrassing product recalls. That was especially true as they focused on such popular items as pet food (The Chinese are poisoning our cats and dogs!) and toys, which are overwhelmingly made in China and exported to the US. But the product standards and safety issue was not just a Sino-American trade problem. During the year Beijing convicted and executed the head of China’s equivalent of the Food and Drug Administration, Zheng Xiaoyu, for accepting huge bribes to certify untested medicines and other drugs as safe.

The return of former prime minister Thaksin Shinawatra to Thailand if not to office seemed a real possibility after his supporters won a convincing victory in the first parliamentary elections held since the army seized power and ousted him last year. After his party was disbanded, supporters regrouped under the People Power Party banner. It won 233 seats in the 480-seat House of Representatives and at year’s end claimed to have enough support from minor parties to form a government. It seemed that Thailand was right back where it had started before the 2006 coup with unknown consequences for 2008.

The one serious blot on the otherwise happy picture for the “Lucky Country” this year was the continuation of the severe drought in Australia’s populated southeast, which is sometimes described as the first measurable impact of global warming on a developed country. It has led to reduced agricultural output and unpopular water restrictions. Whether these irritants played a part in prime minister John Howard’s convincing defeat in the parliamentary election may not be clear, but it seemed hardly a coincidence that the first thing the new Australian Labor government did was to ratify the Kyoto Agreement.


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