[Kabar-indonesia] Asean will gain from rise of China and India: MM Lee

[Joyo at aol.com]

also: ST: Asean states chase the Chinese investment dollar;
ST: Chinese in Jakarta, KL 'can help boost ties with
Beijing'

The Business Times [Singapore]
Thursday, November 2, 2006

Special Focus

Asean will gain from rise of China and India: MM Lee

Daniel Buenas

MINISTER Mentor Lee Kuan Yew has 'never been more upbeat'
about the prospects of East and South Asia, and believes the
rise of China and India will benefit South-east Asia and
Singapore especially.

Speaking last night at the Techventure Asia 2006 gala
dinner, held in conjunction with Global Entrepolis @
Singapore 2006, he said there are risks - such as war in
North Korea or Iran and high oil prices - but he believes
China and India will continue to grow, and these risks would
abort the process for only 'a few years'.

'This is secular growth that will see Asia transformed in
the next 50 years,' he said. 'It's relentless - the human
potential of China and India. These are not new peoples;
they are ancient civilisations re-creating their place under
the sun.'

Mr Lee also touched on China-US relations, saying these
should be 'very tranquil' in the next few years, given US
President George W Bush's stance on maintaining the status
quo with regard to Taiwan.

In the long term, the China-US relationship will depend on
how America defines its role in the Pacific, given China's
meteoric rise, Mr Lee said.

'I see (China) as a very considerable scientific and
technological power by the second half of the century . . .
What can stop them? Only themselves . . . The Americans have
to decide how do you live with that kind of a China.'

Responding to a question from a Malaysian-Chinese audience
member about how the rise of China and India could affect
Malaysia and Indonesia's racial policies, Mr Lee said
Indonesia and Malaysia can tap their Chinese communities to
maximise the potential offered by the rise of China.

'I think that it will be a greater use that Indonesia and
Malaysia will find in their Chinese as the Chinese economy
gets into full gear, because to really maximise your
potential you need people who are able to connect with them
- language, culture, etc,' he said.

He believes that developments in Indonesia, such as the
reopening of Chinese schools and newspapers, are signs that
the country 'has seen the economic potential' of engaging
China through its ethnic Chinese.
'Malaysians also understand that, so I believe the Malaysian
Chinese will play a bigger role as the Malaysians want to
engage China, and not just sell palm oil or rubber or
whatever, but engage China in the long term in joint
ventures, (and) cross-investments,' Mr Lee said, adding that
this will mean having people who can communicate and work
with those from China.

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The Straits Times (Singapore)
Thursday, November 2, 2006

Asean states chase the Chinese investment dollar

Regional leaders meet PM Wen to secure trade deals worth
billions

Goh Sui Noi, Senior Correspondent

ASEAN leaders had trade and investment on their minds when
they met Chinese Premier Wen Jiabao on the sidelines of the
Asean-China summit early this week.

With a booming Chinese economy hungry for resources and
flush with cash - with US$1 trillion (S$1.6 trillion) in
foreign reserves - it was only natural that Asean members
would want a share of that pie through trade and investment
deals.

And China did not disappoint.

What grabbed attention on Monday was the unveiling of a
US$25 billion deal between Malaysia and China in which
Malaysian oil company Petronas will provide natural gas to
the Chinese financial hub of Shanghai for the next 25 years.

What is more, the two sides agreed to start a feasibility
study on forging an economic partnership agreement - a
precursor to free trade talks - during a bilateral meeting
between Malaysian Prime Minister Abdullah Badawi and Mr Wen.

In comparison, Indonesia's trade and economic agreements
with China were more modest, although still significant for
the two sides.

Indonesian President Susilo Bambang Yudhoyono and Mr Wen
reaffirmed their commitment to boost bilateral trade to
US$30 billion in 2010, double the US$15 billion worth of
trade done last year.

In addition, China pledged US$800 million in soft loans to
support investment projects in Indonesia.

Before that, in Shanghai last Saturday, President Yudhoyono,
who took the opportunity of the summit to drum up
investments, presided over the signing of a US$5 billion
contract for six energy projects.

Philippine President Gloria Arroyo had also led a team of
Chinese-Filipino businessmen on a tour of the Guangxi
region, as well as Fujian and Jiangxi provinces prior to the
summit in Nanning - capital of Guangxi.

During that time, several trade agreements were signed on
mining, tourism and infrastructure development.

The less developed Asean countries, such as Vietnam,
Cambodia and Myanmar, wanted China's help in infrastructure
construction.

Cambodia's Prime Minister Hun Sen told Mr Wen he hoped that
China would 'continuously help with Cambodia's
infrastructure construction' and welcomed Chinese
enterprises to expand investment and build an industrial
park in his country.

All these developments have led Chinese expert on Sino-Asean
relations Zhang Xizhen to conclude that Asean countries now
see China as the 'engine for economic development in the
region'.

On Tuesday, President Arroyo, as Asean chairman, said that
growing the two sides' trade relations would 'reduce our
dependence for exports on Western markets, such as the US
and Europe'.

She made the remarks at the launch of a trade exhibition
following the summit.

Indeed, China ran a trade deficit of US$20 billion last year
on a trade volume of US$130 billion with Asean, as Chinese
Commerce Minister Bo Xilai pointed out.

But he added: 'The two-way trade is mutually beneficial. I
hope China's vast market could bring benefits to companies
in Asean.'

Said Malaysian Prime Minister Abdullah: 'What we always
believe (is) that China has not been a threat. Perceiving
China as a threat has been wrong. We have always regarded
China as an opportunity.'

Still, some Asean members have misgivings about whether they
will be able to reap full benefits from their economic
relationship with China.

For one, Indonesia last year suffered, for the first time, a
deficit in its non-oil trade with China although it
maintained a trade surplus overall.

Lawmaker Dradjad Wibowo told the Jakarta Post that China had
flooded Indonesia with cheap furniture and metal products
that threatened local businesses.

He noted that Indonesia was ill-prepared to realise the
potential benefits from its trade ties with China. It needed
to upgrade its industries such as fertiliser, paper and pulp
and furniture-making in order to be able to export finished
goods to China, he said.

Other Indonesian officials have acknowledged that while
China imported huge amounts of commodities such as rubber,
palm oil and timber from Indonesia, it was a stiff
competitor for Indonesia in the manufacturing sector.

Thailand, which signed a free trade agreement with China in
2003 that eliminated tariffs on 188 fruit and vegetables,
found that its deficit with China in this particular segment
of trade increased to 63 kinds in 2004, from only two in
2002.
In the area of investments, Asean invested a total of US$3.1
billion in China last year compared with a piddling US$158
million that China invested in South-east Asia.

China has sought to redress this by pledging US$5 billion in
preferential loans to Chinese businesses investing in the
region.

However, as Prof Zhang said, Chinese enterprises needed
first to build a strong base at home before they could
expand overseas.

Asean countries might have to wait a while more for Chinese
investments in the region to rise to a level that will meet
their expectations.

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The Straits Times (Singapore)
Thursday, November 2, 2006

Chinese in Jakarta, KL 'can help boost ties with Beijing'

THE Chinese in Malaysia and Indonesia can contribute to
building up their countries' economic ties with China, said
Minister Mentor Lee Kuan Yew.

As China's economy kicks into full gear, the expertise of
those who can connect with it through the language and
culture should be tapped, he said.

Mr Lee was responding to a question from a member of the
audience at the TechVenture forum on how the rise of China
would affect the policies of Indonesia and Malaysia towards
their ethnic minorities.

The participant, a Malaysian Chinese living in Singapore,
referred to MM Lee's comments in September that Malaysia and
Indonesia had 'systematically marginalised' their Chinese
minorities.

This provoked a furore in Malaysia over the controversial
issue of race relations. Mr Lee later wrote to apologise to
Malaysian Prime Minister Abdullah Badawi for causing him
discomfort with his comments.

Last night, Mr Lee noted the 'hubbub' caused, but pointed
out that it was not the first time he had expressed his
opinion on the subject. Indeed, he had done so 'more
explicitly' in his memoirs, a point he noted in his letter
to Mr Abdullah.

MM Lee said he believed the two countries could tap their
Chinese minorities to 'engage China' through more joint
cross investments, for example.

He added: 'Whether this will translate into a better
relationship between the ethnic groups and the equality of
treatment would be a very difficult problem for me to touch
on.'

He also noted that a think-tank report that showed Malays
controlled a much bigger share of the economy than the
Malaysian government claimed had to be withdrawn.

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Joyo Indonesia News Service
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