Rising Tensions In East Asia

Tensions continue to rise in East Asia. Japan and China spar over the Senkaku/Diaoyu issue. Korea and Japan still mull historical issues and North Korea continues to be unpredictable. The Philippines and China are in a dispute over territorial waters. And Taiwan buys more arms from the U.S. while experiencing domestic unrest. At a global security conference on Feb. 2, 2014, former Secretary of State Henry Kissinger said that East Asia is like 19th century Europe. He said  “Between Japan and China, the issue for the rest of us is that neither side be tempted to rely on force to settle the issue.” The Wall Street Journal reported that a top U.S. official, Admiral Harry B. Harris Jr. told a naval conference in Australia on April 9, that “There’s both growing uncertainty in the region and increasing tensions–a witches’ brew, if you will, for miscalculation,” So what will happen? Will miscalculations lead to more than a war of words? Can we expect a genuinely “hot” incident this year? Give us your thoughts on this matter.

U.S. China Defense Talks Feature Some Blunt Words

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                        (Photo: U.S. Dept. of Def.)

                              by David Parmer

For many Americans, a trip to China is a once in a lifetime dream. They get to see Beijing, tour the Forbidden City, meet Chinese people, soak in the culture and have some real Chinese food. And even on a business trip it is possible to squeeze in some of these things. But for U.S. Secretary of Defense, Chuck Hagel, China was no dream vacation this April. In fact it was not even a great business trip.

 On April 7, the Secretary landed in Qingdao on China’s eastern coast following a meeting with ASEAN defense ministers in Hawaii and a drop-in at Japan. As the first event of his visit, he toured China’s first aircraft carrier, the Liaoning, where he was briefed and met with crew members. Hagel was the first foreign dignitary to be accorded this honor. China presented this as a show of transparency. From here things became less cordial.

 On April 8, Hagel met with Fan Changlong, Vice Chairman of China’s Central Military Commission, who told him bluntly that China was dissatisfied with remarks he made at the ASEAN meeting and while in Japan. Later in the same day China’s Minister of Defense and the U.S. Secretary of Defense held a joint press conference at Defense Headquarters in Beijing, where both traded barbs. The New York Times reported that General Chang said “China has indisputable sovereignty over the Diaoyu Islands.” He also boldly asserted: “The Chinese military can assemble as soon as summoned, fight any battle and win.” On the status of U.S. allies, Secretary Hagel stated, “The Philippines and Japan are longtime allies of the United States.” “We have mutual self-defense treaties with both of these countries.”

 On April 9, Secretary Hagel concluded his visit by meeting with China’s president, XiJinping in Beijing. It was reported that in the meeting he asked for China’s cooperation in containing North Korea. President Xi noted that Hagel’s meeting would lead to better military-to-military understanding. On April 10, Secretary Hagel was off to Mongolia for the last stop on his Asian tour. As for his China visit, it might have been a bit rough business-wise, but he did get to visit the Forbidden City.

 

 

 

A New Century, A New Democracy?

The beginning of the 21st century seems to be bringing forth a new type of democracy spawned by technology and the social media. Mass protests are easy to organize, and tens of thousands of people can be mobilized in a relatively short period to support or oppose some issue or cause. Except in what is know as direct democracy, where the people exercise power directly, most democracies have representatives of the people who following their wishes enact law and public policy. In the 21st century we have seen more and more action by citizens to protest the behavior of their leaders or government. This has often lead to bloody confrontation and even to the overthrow of certain governments. In many of the cases worldwide, citizens ignore their elected representatives and take to the streets.But what form of government is this? Is this democracy or anarchy? What do you think? Where do citizen protests end? How should democracy function in the 21st century, and is there anything better available? Please post you thoughts and comments.  

Taiwan: Push Comes To Shove on Trade Agreement

Taiwan Protest.jpg(Photo: Facebook Sunflower Student Movement)

                 by David Parmer

 Protest, confusion, disagreement and stalemate mark Taiwan’s political scene this week. Politics in Taiwan has long been a tug-of-war between the ruling Koumintang (KMT) and opposition Democratic Progressive Party (DPP) but it now looks like the student-civic group coalition known as the Sunflower Student Movement may become a permanent third force in the island nation’s political scene.

 Trouble began on March 17, when the Cross-Strait Service Trade Agreement (CSSTA) was voted upon and passed by the KMT majority without a clause-by-clause review. Opponents claim the bill was rammed through in record time using a “black box” maneuver. They objected to the bill because they believe that it gives the PRC more and undue influence on the Taiwan economy, and at the same time will negatively impact Taiwan jobs.

What seemed to be a “done deal” quickly backfired. On March 18, students occupied the main chamber of the Legislative Yuan. On March 23, they briefly occupied the Executive Yuan, but were forcibly ejected by riot police with what some claimed was excessive force. Student demands were laid out by protest leader Lin Fei-fan on March 30. These include:

  • Sending back the Cross Straits Trade Service Agreement
  • Creating a cross straits monitoring act
  • Convening a citizens’ constitutional assembly
  • Calling on all legislators to stand by the people

 The DPP sided with the students stating that the agreement will make Taiwan more dependent on the PRC, is not transparent and, as mentioned, was rushed through without proper oversight. According to a Taipei Times report on April 2, 2014, the DPP recommended 24 items including banking, printing and publishing be reconsidered. They called for much greater scrutiny and transparency.

 President Ma Ying-jeou , in order to resolve the standoff, agreed to meet the student leaders without condition, but his offer was rebuffed. He then proposed a national affairs conference on economics and trade to address this issue. On April 3, Bloomberg reported that Taiwan’s cabinet had approved a bill to monitor agreements with the PRC in hopes of ending the impasse. Protest leader Lin Fei-fan was quoted as saying the bill will not satisfy student demands. The KMT seems determined to stay the course and only make limited concessions, while the Sunflower movement coalition shows no signs of going away anytime soon. 

 It seems 21st century politics, characterized by the active participation of young people and the use of social media, has come to Taiwan. What was  until very recently a two-party game, with the KMT moving toward the PRC economically and the DPP resisting, now has a new player. And if the Sunflower movement does morph into a new political force, it will surely have its own agenda and its own take on the future of cross strait trade and economic relations.

 Wall Street Journal analysis of standoff results: http://blogs.wsj.com/chinarealtime/2014/04/11/taiwan-tallies-winners-and-losers-after-political-standoff/

 

Will Japan Ever Have A Silicon Valley?

320px-Santa_Clara_Valley.JPG                       (Santa Clara Valley-Wikimedia)

Northern California’s Silicon Valley, an area running roughly from San Francisco down to San Jose is synonymous with high technology, innovation and creativity. Certain historical trends came together to make the Valley what it is, including the explosive growth of the American economy after WWII and the need for military technology during the Cold War. From the 1970s on Valley culture developed, producing such giants as Apple, CISCO Systems, Intel etc. Even today this area in the Santa Clara valley leads the world for new and creative thinking and innovation. So will there ever be another Silicon Valley? What about Japan? Could such an area come in to being? Could Japanese government or industry create one? A few years ago there was talk about doing just that: setting up a kind of “Silicon Valley” in Okinawa. But it seems nothing came of it. So will Japan develop such a place, or will innovation stay centered in companies and universities? Let us know your thoughts on this. 

The Two Faces of Hangzhou

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                      (Photo: Wikimedia: Lexingtamenkims)

                                      by David Parmer

Hangzhou in China’s southern Zeijang province has been known for it scenic beauty and charm for centuries. One of its most famous visitors, Marco Polo called it the “most beautiful and elegant city in the world.” Not surprisingly, it is a major tourist attraction, with more than 80 million visitors both foreign and domestic visiting in a year.

Hangzhou’s gem is the West Lake, perhaps one of the most photogenic and photographed tourist attractions worldwide. Outside the city are the tea fields which produce Longjing, or Dragon Well tea. And temples and pagodas abound. For a romantic vacation, visit Hangzhou. That’s it? Not quite.

2012621_1340266551030.jpg                              (Photo: Hangzhou.gov.cn)

Hangzhou, located 125miles (200km) southwest of Shanghai, has another face. It is a powerhouse of provincial and national development. Of note are its “big five” development zones.

  • Hangzhou Economic & Technological Development Zone
  • Xiaoshan Economic & Technological Development Zone
  • Hangzhou Export Processing Zone
  • Hangzhou Qianjing Economic Development Zone
  • Hangzhou High-Tech Industrial Development Zone

 The Hangzhou High-Tech Industrial Development Zone was founded in 1990 and was one of the first national High-Tech development zones in China. It has eight industrial clusters including Internet, software and e-commerce. Hangzhou government counts 804 high-tech companies and 84 software companies operating in the area. The Hangzhou-High Tech Industrial Development Zone is also seen as an incubator for small and medium-sized science and technology-based enterprises. The Hangzhou government is eager for foreign investment and offers a package of incentives, including tax breaks, for foreign companies to encourage them to locate there. Major international firms having a presence in Hangzhou include Nokia, Motorola, Alcatel and Mitsubishi. The city boasts 30 universities and colleges and 19 research institutes to supply a pool of educated talent for industry.

Hangzhou’s two faces make it not only a city worth visiting, but also an area to watch for innovation in this century and beyond.

Search For Answers-Cooperation vs Confrontation

The story of the missing Malaysia Airlines Flight 370 continues. For three weeks now the world has been waiting for some answers about the missing aircraft and its passengers. There is universal sympathy for the families and loved ones of those on board. While there are still no answers forthcoming, one phenomenon is emerging, that of international cooperation in the search. Naval and air forces from several countries including Malaysia, China, Japan, the US and Australia are taking part. Just a few short weeks ago the focus was on the possibility of an unfortunate confrontation as forces from Pacific countries flew above and sailed in disputed waters. So what has changed? Nothing except the will to work together for a common cause. When the plane is found, or the search abandoned, will all parties return to confrontation? Is it possible for all concerned to see the bigger picture and choose cooperation in working out their problems? Let us know your thoughts on this topic.

Person of Interest: SoftBank’s Masyoshi Son

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                       (Photo: M. Son/Facebook)

                           by David Parmer

Is Softbank’s CEO and founder a pioneer or a visionary? Recent tech history gives us the answer: he is both. Son is a pioneer—since 1980 he has been a key player in the worldwide information revolution. Son is also a visionary—realizing back in the 1980s that the future lay with digital technology. At that time he began to think strategically in terms of decades. The company’s  current 30-year goal, according to their website is “to be a corporate group needed by most people around the world.” At the rate that SoftBank is going, the world’s population might not have much of a choice.

 SoftBank is nothing, if not connected. It  is now comprised of 1300 companies around the world. Iran, North Korea and the polar regions seem to be the only places on the planet where SoftBank is not. China’s own Jack Ma, Chair of Alibaba, sits on the SoftBank board and Yahoo Japan and PayPal have long been members of the fold. Sprint (=SoftBank) has now set its eyes on acquiring U.S. carrier T-Mobile, and making some big waves in the U.S. telecom market.

Masayoshi Son is currently CEO of Softbank, CEO of Softbank Mobile, and Chairman of Sprint Corporation. Forbes magazine estimates his personal net worth to be $9.1 billion. ( “Billion” is the word most associated with Son. “Million” is about as outdated as the rotary dial phone when talking about him personally or his businesses.) When the tech bubble burst in 2000, he personally lost…billions. Son was born on August 11, 1957  in Japan to a poor Korean family. As a teenager he realized that opportunity for him lay overseas. Overcoming initial family resistance he went to the U.S. for high school, and in college studied economics and computer science at U.C. Berkeley. Following some promising business success in the U.S., he returned to Japan where he founded SoftBank, a company specializing in the sale of various types of software. After more than a decade of funding startups, SoftBank went public in 1994. The company continued to expand, was hit hard in 2000 when the bubble burst, recovered, continued to expand, and in 2008 was the first and only provider of the Apple IPhone in Japan.

SoftBank’s latest move, the T-Mobile acquisition is facing opposition from U.S. regulators. There are now four carriers in the U.S. : ATT, Verizon, Sprint and T-Mobile. If Sprint gets control of T-Mobile, Son predicts a price war, and one that will benefit consumers, by reducing prices. Analysts say the mobile phone market has reached a saturation point, and that the only way for one company to get subscribers is to poach them from another carrier. And Son’s price war would certainly encourage users to defect from the number one and number two carriers. Speaking about this question on an American TV show Son declared “I wanna’ be number one! ”  In many ways he already is, and is showing no signs of slowing down.  

Air Travel-How Safe Do You Feel?

This past week there has been continuous coverage of the disappearance of the Malaysia Airlines Flight 370. And it seems no news is bad news. The story continues to unfold, but that can be of little comfort to the families of the missing passengers. These days most of us fly as a matter of course, some several times a year and some for business. It seems that an aviation-related story is sure to catch our attention because we do, all fly so frequently. And generally speaking, aviation-related stories do not make us feel more secure, but rather tend to increase our sense of unease. Statistics tell us that flying, particularly with the world’s best airlines is perhaps one of the safest things we can do. Statistics suggest then when flying with the top 39 airlines we have a chance of one in 19.8 million of meeting an untimely end. And yet do such numbers make us feel reassured? Can we take them personally? What are you thoughts on this topic? Please let us know.

 

China Electric Vehicles-Not “Why?” But “How?”

Shanghai Taxi December 2012.jpg                  (Conventional Taxi Shanghai. Photo DP)

                       by David Parmer

 Almost everyone would agree electric vehicles are a good idea, or at least a step in the right direction. And for China, this would be even more so. The advantages of going electric for the world’s second largest economy would be far reaching. In the short term China’s nagging air quality problem would be significantly impacted. China’s reliance on imported energy would also be reduced and a productive and successful electric vehicle industry could make China a world leader in this technology. So where is the rub?

Apparently it’s not the government. The government is behind plug-in cars; laws,  number- of- vehicle targets and subsidies flow from the government side. Industry? No, Chinese automakers that have an electric model for sale abound. Import restrictions? Not insurmountable-America’s #1 electric carmaker Tesla has thrown its hat in the ring and committed to exporting to China and is doing so.

So what’s the problem? The problem is a lot of the parts of the solution to the problem have not come together yet. In a perfect world a driver would buy an electric car, accept the government subsidy, feel good about making a contribution to creating a sustainable environment and live happily every after. Unfortunately, such is not the case-yet. The #1 problem is keeping an electric car going. They need to be charged, and the infrastructure in China is just not there yet. In China, since home-charging is not really an option for most people, an external charging infrastructure is essential. And an extensive infrastructure isn’t there because the drivers aren’t there. And so on.

It seems Chinese automobile buyers won’t take a chance on electric vehicles whatever the licensing and buying incentives are.

One solution to deal with this problem is battery swapping, a system where a low battery can be exchanged for a fully-charged one. Battery manufactures, not surprisingly, are behind this solution. Battery swapping works well when applied to municipal buses where routes, distances and driving times are static.

Still another solution to the lack- of- charging- infrastructure problem is hybrid vehicles, particularly the REEV (Range Extended Electric Vehicle) which have an onboard internal combustion engine for charging the battery on the move. This bridging technology, combined with an expanding charging infrastructure might be the present of China’s electric vehicle future. And because of all of the benefits that electric vehicles offer to China, it looks like that future is not an “if” but  a “when.”