Source: East Asia Forum
Author: Alvin Camba, Johns Hopkins University
Numerous reports in the past few weeks have claimed that China’s US$24 billion commitment to the Philippines has barely materialised. These stories suggest that the Philippines ‘gave up’ the South China Sea to China in exchange for investment and aid that never arrived, and that China ‘used’ the Philippines by making false investment promises to acquire geopolitical concessions.
But a careful assessment of the projects included in the initial investment agreement demonstrates that these claims are untrue. Rather than deceptive Chinese behaviour, changes in the Philippines’ national institutions, its regulatory procedures and project-specific factors better explain the delays and cancellations. These host state factors affect Chinese and non-Chinese projects alike.
One reason foreign investment and aid projects in Mindanao are delayed is due to the uncertainties regarding the Bangsamoro Basic Law (BBL), which institutionalises a high level of autonomy to the Islamic areas of the southern Philippines. The BBL shifts authority over investment decisions and other legal regulations, causing headaches for Chinese firms and Filipino development authorities alike. For instance, the BBL hindered China Power corporation’s ability to raise funds from public sources in 2017, which led to the project’s eventual cancellation.
Another cause for delay is that Philippine regulation requires detailed feasibility studies of planned projects, which can cost millions and take an enormous amount of time. Findings from these feasibility studies — which can uncover geographic unviability, technical incapacity and immense cost overruns — explain many instances of modification, delay or cancellation of Chinese projects in the Philippines.
In other countries, Chinese firms are not required to conduct feasibility studies quite so rigorously. But this process demonstrates the seriousness of Chinese and Philippine …continue reading
Furniture company Nitori Holdings is entering the boutique hotel industry with the acquisition of a historic hot spring hotel in Hokkaido’s port city of Otaru. The sale price has not been disclosed.
Ginrinsou has long been considered one of Hokkaido’s leading onsen inns. The three-story ryokan sits on a prominent hilltop location overlooking Otaru’s port district and Ishikari Bay. An additional five-story concrete building was added to the ryokan at a cost of 400 million Yen, bringing the total floor space up to 3000 sqm. Nightly room rates at the 14-room ryokan are around 37,000 Yen per person.
The ryokan was built in 1900 in neighboring Yoichi town as a ‘Herring Mansion’ (Nishin-Goten) for the Inomata family. These large Herring Mansions were built by wealthy fishermen not only as their residence but also to process fish. Local materials such as chestnut, ash, Sakhalin fir and castor were used, with construction spanning three years. In 1938, town planning saw the house relocated to its current location where it opened up as a ryokan the following year. In 1944 it was briefly confiscated by the Imperial Japanese Army and used as an anti-aircraft weapon camp.
Nitori is considering opening up the ryokan’s hot spring baths to day-trip visitors, expanding the services on offer.
In 2016, Nitori opened the Otaru Art Base – a group of four historic warehouses alongside Otaru canal. The art space is open to the public. Nitori also owns historic residences in Tokyo and Kyoto.
Source: East Asia Forum
Author: Editorial Board, ANU
Many in the United States are deeply worried that US President Donald Trump is actively undermining and trying to tear down the institutions on which the health of the American democracy and society depends. His administration is also doing the same to international institutions for which he has shown at best indifference but mostly contempt.
The US security alliances that have underpinned global peace and stability are also under threat. Trump has fanned uncertainty and anxiety around the world by questioning the value of the US alliances with Japan and South Korea as well as the entirety of NATO.
US President Donald Trump arrives to hold a news conference after participating in the NATO Summit in Brussels, Belgium, 12 July 2018 (Photo: Reuters/Yves Herman).
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After World War II, the global community was able to take for granted a United States that aspired to values of freedom, democracy and openness, even if those values were imperfectly observed. The US withdrawal from the UN Human Rights Council and its separation of refugee children from their parents has put an end to US moral leadership for now. And it’s difficult to regain moral authority quickly once lost.
But what Mr Trump is doing to the international trading system is likely to be the most damaging. In its second year in power the Trump administration has found its …continue reading
According to the Real Estate Economic Institute, 2,986 brand new apartments were released for sale across greater Tokyo in July, up 12.3% from the previous month but down 12.8% from last year. This is the first time that the supply for the month of July has fallen below 3,000 units since 1992.
The average sale price was 61,910,000 Yen, down 0.8% from the previous month and down 5.7% from last year. The average price per square meter was 917,000 Yen, down 1.2% from the previous month and down 3.7% from last year.
The contract ratio was 67.8%, down 4.1 points from last year. The contract ratio in Tokyo’s 23 wards was 73.0%, down 0.4 points from last year, but above the 70% line that indicates healthy market conditions.
TOKYO METROPOLITAN AREA
1,437 new apartments were released for sale in Tokyo’s 23 wards, up 0.6% from the previous month but down 22.9% from last year. The average sale price was 72,710,000 Yen, down 3.9% from the previous month and down 1.5% from last year. The average price per square meter was 1,146,000 Yen, down 3.5% from the previous month but up 3.1% from last year.
107 of the apartments sold were priced over 100 million Yen and accounted for 10.2% of total sales for the month. The contract ratio in the 100 million Yen + range was 79.2%.
Source: The Real Estate Economic Institute, August 15, 2018.
Source: East Asia Forum
Author: Shiro Armstrong, ANU
President Trump’s America First agenda is a dramatic departure from US leadership of a multilateral order that has been the guiding norm for over 70 years. That order defines the rules of trade and economic exchange between countries that have signed on to it through the World Trade Organization (WTO) and other international institutions.While sometimes imperfectly observed, these rules have underpinned the growth in Asian economic relations and prosperity.
Economic relations between Japan and China have prospered hugely despite the ups and downs in their political relations because of both countries’ adherence to WTO rules. Economic relations would unravel all over Asia if confidence in the WTO-led rules-based order were undermined. Trade disputes, like that between Japan and China over rare earth metals in 2012, are settled appropriately and peacefully in the WTO without resort to retaliation, escalation or force.
US tariffs on steel and aluminium imports to protect American steelmakers and, putatively, to reduce trade deficits, as well as other protectionist measures now aimed at China, may not have large, immediate economic effects but they pose a bigger and long-term threat to the entire global rules-based system.
Some countries, including Australia, have received exemptions from the US steel and aluminium tariffs. By accepting those exemptions, they have failed their obligations to the rules-based order. These choices will become starker as the United States continues down its chosen path of extra-WTO tariff action, and as other countries are pressured to retaliate. The price for an exemption for Japan seems to be negotiation of a bilateral deal with the United States that would likely include many non-economic issues. Japan has rightly chosen not to be coerced in that way.
The United States and China — the world’s two largest economies and traders — are on the precipice of a tit-for-tat trade war …continue reading