Category Archives: BUSINESS

Watch out Rim of the Pacific, a Rim of China may be on the horizon

Author: Tuan N Pham, Yokosuka

The Chinese People’s Liberation Army Navy (PLAN) and navies from 10 ASEAN member states carried out a field-training exercise in the South China Sea (SCS) from 22–28 October 2018. The joint naval manoeuvre followed a joint ASEAN–China table-top exercise in Singapore on 2 August. Together these drills mark the inaugural ASEAN–China maritime exercise — the first time such exercises have been conducted between ASEAN and another country.

Military personnel take part in a maritime rescue exercise near Chinese amphibious transport dock Kunlun Shan during the China–ASEAN Maritime Exercise in Zhanjiang, Guangdong province, China, 23 October 2018 (Photo: Reuters/Stringer).

” data-medium-file=”http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-400×262.jpg” data-large-file=”http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-600×393.jpg” title=”Military personnel take part in a maritime rescue exercise near Chinese amphibious transport dock Kunlun Shan during the China–ASEAN Maritime Exercise in Zhanjiang, Guangdong province, China, 23 October 2018 (Photo: Reuters/Stringer).” src=”http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-400×262.jpg” alt=”Military personnel take part in a maritime rescue exercise near Chinese amphibious transport dock Kunlun Shan during the China–ASEAN Maritime Exercise in Zhanjiang, Guangdong province, China, 23 October 2018 (Photo: Reuters/Stringer).” width=”400″ height=”262″ srcset=”http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-400×262.jpg 400w, http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-150×98.jpg 150w, http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-768×503.jpg 768w, http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-600×393.jpg 600w, http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-300×197.jpg 300w, http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-100×66.jpg 100w, http://www.eastasiaforum.org/wp-content/uploads/2018/11/2018-10-24T054312Z_171961827_RC11C9BFFD70_RTRMADP_3_CHINA-ASEAN-500×328.jpg 500w” sizes=”(max-width: 400px) 100vw, 400px”>

Eight ships, three helicopters and more than 1200 personnel from China and ASEAN countries participated in the field-training exercise in the waters near the major Chinese port of Zhanjiang. The PLAN dispatched a guided missile destroyer, guided missile frigate and supply ship. ASEAN nations sent three guided missile frigates from Singapore, Thailand and Vietnam, a patrol ship from Brunei and a logistic support vessel from the Philippines. The vessels carried out maritime tasks in line with the Code for Unplanned Encounters at Sea, and undertook joint search and rescue activities.

China’s Ministry of Foreign Affairs touted the inaugural …continue reading

    

Perspectives on Mekong-Japan cooperation for inclusive growth and mutual benefits

Perspectives on Mekong-Japan cooperation for inclusive growth and mutual benefits

Introduction

Rapid economic development in recent decades has transformed Southeast Asia and prepared the region to join international production networks, which allow greater exports of manufacturing products, textiles, and other primary high-quality valued added products to the international market. This economic development has been achieved thanks to investments from around the globe into the region as a result of a favorable labor force, connectivity and innovation growth, and regional political stability as driven by the Association of Southeast Asian Nations (ASEAN) vision. Faster connectivity along with human resource development in the Southeast Asia region, especially the Mekong subregion, has provided many opportunities for the region for growth and increased the social well-being of the people through income generation and employment. Connectivity through roads, railways, sea, and air has compressed time and space, allowing goods and services to flow internationally in a much faster manner and more efficiently in terms of cost reductions in logistics and, thus, has created a favorable functioning market for supplying goods and services linking production from the Mekong subregion into regional and global supply value chains. Besides hard infrastructure connectivity, the Mekong subregion has also progressed steadily in soft infrastructure as terms, regulations, and standards have developed to facilitate trade and investment in the region as well as outside the region.

Connectivity, innovation, and economic growth

The coordinated development of soft and hard infrastructure is essential for maintaining growth in the region. The new international division of labor calls for a novel approach to infrastructure development, in which the Mekong subregion has been prepared to participate actively for the promotion of economic corridors, including the Southern Economic Corridor (SSEC), East-West Economic Corridor (EWEC), and North-South Economic Corridor (NSEC). These economic corridors, together with the fast acceleration of domestic infrastructure development with special economic zones, urban amenities and other economic …continue reading

    

ORIX trialing 45-year loans on investment properties

ORIX Bank began trialing 45-year loans on investment properties in May 2018, making it the longest property loan on offer in the industry, exceeding the typical maximum term of 35 years.

The loan may be used on studio-type apartments for single occupant tenants ranging in size from 18 ~ 40 sqm (194 ~ 430 sq.ft). Buildings over a certain age may not be eligible.

The maximum age of the borrower at the end of the loan term has been raised from 80 to 85 years, which means a borrower under the age of 40 may be eligible for the longest loan term.

ORIX’s prime rate on investment loans for individual apartments was between 1.8 ~ 2.9% as at November 1, 2018. A longer loan term means lower monthly repayments (up to 15% lower than a 35-year loan), although the total interest paid is significantly higher (30%+ more).

Borrowers need to be very cautious when looking at potential cash flow estimates. It is typical for rents to decrease as a building ages. Something that appears to be cash flow positive on paper may actually end up running at a loss. Over time there is a risk of an increase in interest rates, vacancies, decreases in rent or increases in running costs that can cause an investment to operate at a loss.

Investment loan options have been shrinking rapidly since regional lender Suruga Bank was exposed for providing loans to unqualified buyers based on heavily falsified documents. Loans for share houses have effectively ceased. Banks are still open to lending on studio-type apartments but lending criteria has tightened this year.

Sources:
The Nikkei Shimbun, November 9, 2018.
ORIX Bank

…continue reading

    

Genuine immigration still alien to Japan

Author: Chris Burgess, Tsuda College

On 14 October 2018, a number of marches were held across Japan to mark what the organiser — the Japan First Party — labelled ‘anti-migrant day’. The target of the protestors’ wrath was the government’s proposal to revise the Immigration Control and Refugee Recognition Act to introduce two new types of residence status for foreign workers in industries currently undergoing labour shortages.

Workers from Thailand work at Green Leaf farm, in Showa Village, Gunma Prefecture, Japan, 6 June 6, 2018 (Photo: Reuters/Malcolm Foster).

The proposal represents official acceptance of unskilled foreign workers in Japan for the first time in the post-war period. Under the revision, type 1 residents will require basic Japanese language and job skills and will be able to stay for up to five years. Type 2 workers will need higher Japanese language and vocational skills but will be able to stay indefinitely and, unlike type 1 residents, bring spouses and children.

The plan to open the door to unskilled foreign workers is taking many in Japan by surprise. Japan has long followed a de facto ‘no immigration principle‘ — an institutionalisation of the ‘homogeneous people’ ideology of the Japanese nation that continues to play a key role in structuring national identity. The perception that allowing greater numbers of foreigners into Japan would damage social cohesion and harm public safety has tended to override rational economic argument.

Public concerns over migrants …continue reading

    

Nothing but net for North Korea in US–China competition

Authors: Nate Kerkhoff and Joel Petersson Ivre, Yonsei University

Beijing and Pyongyang are re-forging broken ties since a collective diplomatic detente with North Korea emerged at the beginning of 2018. Their deepening relationship promises to further complicate the United States’ as yet ineffective efforts to denuclearise North Korea.

North Korean leader Kim Jong Un and China’s Li Zhanshu, chairman of the Standing Committee of the National People’s Congress holds hand in solidarity during a military parade marking the 70th anniversary of North Korea’s foundation in Pyongyang, North Korea, 9 September 2018 (Photo: Reuters/Danish Siddiqui).

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After US Secretary of State Mike Pompeo’s fourth visit to Pyongyang on 7 October 2018, he travelled to regional capitals to debrief top officials on the state of affairs between the United States and North Korea. But unlike Pompeo’s meetings in Seoul and Tokyo, Beijing had other items on the agenda. Chinese Foreign Minister Wang Yi admonished the United States, not only for ‘escalating trade frictions’ but also for its recent actions regarding Taiwan and US President Donald Trump’s accusations of Chinese election meddling.

The United States needs China, …continue reading