Ambition and Reality

Vietnam leadership woes, Japan has a long game, but its not what you think, Thailand struggles with fiscal and monetary policy, wind turbine revolution, and overview of ASEAN education figures

Jan 19, 2023

UPDATE: The Long Mekong Daily looks at regional turbulence, but regional troubles are linked to international politics. Regional education is making slow gains, but renewable energy is booming. Meanwhile, both Vietnam and Thailand are undergoing political and economic renewal and will increasingly need a strong China to ensure growth is maintained. Japan’s defence policy seems rational, but is it gearing up for what it has always really needed - proximate access to resources - look to Nippon’s past and its hard to see another alternative.

Vietnam’s President steps down in historic first, but as the saying goes; “kill one chicken to scare all the monkeys”.

Japan is rearming and that has got to be a major concern for the region. Is Russia the next target for Japanese revisionism? That is what happened last time Japan signed an alliance with Britain; and, don’t forget that Korea, Taiwan and Qing Dynasty Manchuria were colonised for 50 years.

Thailand’s central bank governor says the economic backdrop facing central banks has shifted from one of insufficient demand to insufficient supply, but Thaliand’s woes are also closely related to US inflation and rate hikes.

The declining cost of wind power, intense competition, growing environmental concerns, increasing reliance on renewable sources of generation, and technological developments are aiding the growth of the wind turbine market.

Public spending on education reflects society’s investment in children to equip them with fundamental social and economic skills needed to be self-sufficient in their lives. Investing in education reduces poverty and boosts economic growth through human capital development, and is most efficient, in terms of long-term costs and benefits to society, and effective, in terms of human capital development, when investment starts during the early years and continues throughout childhood.

Vietnam Party agrees for president Nguyen Xuan Phuc to step down

The decision was made at an extraordinary meeting of the committee on Tuesday.A statement released after the meeting said Phuc was a key leader of the Communist Party and the State. He was trusted and assigned to many important positions by the committee and the Politburo. As the prime minister during the 2016-2021 period, Phuc led and operated efforts in the fight against the Covid-19 pandemic which gained important results.

However, as the leader, he was responsible for letting several officials, including two deputy prime ministers and three ministers, commit violations that caused severe consequences. Two deputy prime minister have stepped down from their positions, while two ministers and several other officals are facing criminal charges.

"As he was well aware of his responsibilities to the Party and the people, Phuc filed a request to resign from his positions and retire," the statement said.

Vietnam's Constitution 2013 stipulates that the president is the head of state, represents the country in internal and external affairs. The president is voted by the National Assembly among the assembly's deputies, and thus the assembly will perform procedures to dismiss Phuc as president.

Phuc, 69, was a member of the Central Party Committee, the Politburo and the National Assembly for multiple terms.

From 1997 to 2006, he was the chairman of the Quang Nam Province People's Committee.

He was appointed head of the Government Office in 2006 and deputy prime minister in 2011, before becoming the prime minister five years later.

He was voted president in April 2021.

Policy Speech by Prime Minister KISHIDA Fumio at the Johns Hopkins University School of Advanced International Studies (SAIS)

I have three key messages to deliver to you in my speech today.

First, the international community is at a historic turning point. The free, open, and stable international order that we have dedicated ourselves to upholding is now in grave danger.

Second, Japan is resolved to proactively create peace and prosperity and a free and open order worldwide.

Third, in the course of undertaking such efforts, Japan and the United States, as the most important ally and closest of friends, need to engage in further strengthening our bond.

I am convinced that our bilateral cooperation will certainly bring about a better future for coming generations.

3. My Two Major Decisions in 2022

In 2022, I made two major decisions in Japan’s foreign and security policy.

One is the shift in our policy toward Russia in response to its aggression against Ukraine. Another is the shift in Japan's postwar security policy by formulating the three key documents at the end of last year: the National Security Strategy, National Defense Strategy, and Defense Buildup Program. They were both very heavy decisions with consequential impacts on the future of Japan and the world. I believe that these decisions were right for our nation and beyond around the globe.

(1) Japan's Decisions following Russia’s Aggression against Ukraine

Russia’s aggression against Ukraine has marked the complete end of the post-Cold War world. It has come to light that globalization and interdependence alone cannot serve as a guarantor for peace and development across the globe.

Witnessing this aggression, I thought to myself:

This is a moment that will transform history.
This is a critical moment, in fact, a moment of truth for Japan.
The future of the international community rests on how we respond to this aggression.
If we let this unilateral change of the status quo by force go unchallenged, it will happen elsewhere in the world, including Asia.
It is Japan that must rise to this challenge to take action to defend our freedom and democracy.

With this in mind, Japan decided to make a major shift in our existing policy toward Russia and then put in place strict sanctions against Russia. We were also among the first in providing humanitarian assistance to Ukraine. Our nation is the sole representative of Asia in the G7. Japan's participation in the measures against Russia transformed the fight against Russia's aggression against Ukraine from a Trans-Atlantic one to a global one. In this sense, it was a consequential decision with significance for the international community in my view.

(2) Japan's Decisions for a Major Shift in Our Security Policy

The major transformation in Japan's security policy, including the formulation of the three new documents such as the National Security Strategy and the other key defense documents at the end of last year, is also guided by the same worldview. Due to the ongoing major shift in the balance of power across the globe, nations are now once again competing fiercely, and the world is now entering an era where we are witnessing a complex intertwining of cooperation and division.

The year 2022 marked the 70th anniversary of the entry into force of the Japan-U.S. Security Treaty in 1952. Today, both Japan and the United States are facing a severe and complex security environment as never before in East Asia and the Indo-Pacific since the end of WWII. In addition to Russia's aggression against Ukraine, we are observing an increasingly clear trend in countries and regions around Japan: reinforcement of nuclear and missile capabilities, rapid acceleration of military buildups, and attempts to unilaterally change the status quo by force.

I am serving as the Prime Minister at this juncture of history’s turning point and amidst a national crisis for Japan. I have a mission to firmly defend our nation and the Japanese people. With this determination, and for the sake of reinforcing our diplomatic capabilities to ensure international peace and security, I made the decision to transform our postwar security policy in order to first bolster our own foundation by implementing the following:
- making the level of our budget, for both the fundamental reinforcement of defense capabilities and complementary initiatives, reach 2% of the current GDP,
- possessing counterstrike capabilities,
- improving response capabilities in the field of cybersecurity and
- stepping up our defense posture in the Southwest region of Japan

This is a clear testament to Japan's strong resolve vis-a-vis the United States and the rest of the global community. In particular, this decision will also bring benefits to the security of the entire Indo-Pacific region, including Southeast Asia, the Pacific, and the Indian Ocean.

I am convinced that this decision represents one of the most historically critical milestones for strengthening the alliance, following such precedents as the conclusion of the Japan-U.S. Security Treaty by Prime Minister YOSHIDA Shigeru, the revision of the Treaty by Prime Minister KISHI Nobusuke, and the Legislation for Peace and Security by Prime Minister ABE Shinzo.

As you are all aware, Japan's postwar status of a peace loving nation has not changed in the slightest. The values of freedom and democracy are ingrained into the identity of the Japanese people. Our foreign policy also remains unchanged; we strive to prosper not at the expense of other countries, but together with them. Japan will continue to be a "model citizen" of the world.

I will further double down on our diplomatic efforts this year, building on the achievements from the previous year. I am also resolved to make the most realistic judgements, bearing in mind what is called for in this era, and am resolved to carry forward a "realism diplomacy for a new era."

Furthermore, let me reaffirm the two points, bridging what has changed and what has not changed, which I mentioned previously at the press conference on the occasion of the release of the National Security Strategy on December 16 last year; namely, the realistic view that diplomacy needs to be backed by defense capabilities and that reinforcing defense capabilities will also lead to persuasiveness in carrying out our diplomatic efforts, as well as the importance of the will of each and every citizen to proactively defend the country as precisely evidenced by the Ukrainian people at this moment in time. As I just outlined, Japan is going through considerable evolutions while always striving to harmonize the ideal and the reality. Going forward, you should be able to consider Japan as an even more reliable partner for all of you.

Read full transcript here.

Central banking amidst shifting ground: Governor of the Bank of Thailand

The first fault line, reflecting the rapidly changing economic backdrop, is palpable. Inflation has returned with a vengeance, catching everyone by surprise. The strong post-pandemic rebound in global aggregate demand combined with a large rotation of that demand from services to goods put huge pressure on global supply chains, which was unable to respond. This was compounded by a surge in commodity prices in the wake of the Russia-Ukraine war.

Supply constraints have clearly taken prominence, and their impact may well extend beyond the immediate horizon. At a deeper level, secular trends in globalization and demographics that have hitherto created a powerful tailwind, expanding production possibilities and generating persistent disinflationary pressures, may also be turning. Increasing fragmentationand ageing populations, along with the necessary but costly green transition will likely exert supply headwinds and upward price pressures going forward.

In a nutshell, the economic backdrop facing central banks has shifted from one of insufficient demand to insufficient supply. The challenge of inflation being too low has turned to inflation being too high. For monetary policy, the constraint on achieving inflation targets has shifted from the zero-lower-bound to the inability to influence inelastic supply. Calibrating and communicating policy under this new landscape will be very different than before, as we have already seen.

In parallel, the financial system is also evolving, and with it the risks and pressure points that central banks need to address. The greater prominence of the financial cycle, both domestically and globally, has transformed the nature of economic fluctuations, linking them more to swings in funding conditions, asset prices and risk- taking. The increased role of non-bank financial intermediaries (NBFIs) has also created new potential vulnerabilities, not least because regulation of NBFIs has lagged behind those of banks. Indeed strains in the NBFI sector were at the heart of financial stress during the Covid-19 crisis, as well as recent tensions in sovereign debt markets. Finally, advancements in cryptography and distributed-ledger technology have led to a proliferation of digital assets and tokens, some of which circulate in parallel infrastructure outside of regulatory control and oversight. It has also spurred a concerted effort by central banks to harness these new technologies, through CBDCs and other initiatives, in order to ensure that central bank money remains fit-for- purpose in a digitalised monetary system.

Download full speech here.

Wind Turbines Market Size, Share and Trends Analysis by Technology, Installed Capacity, Generation, Drivers, Constraints, Key Players and Forecast, 2021-2026

The global wind turbine market size was USD 90.43 million in 2021. The declining cost of wind power, intense competition, growing environmental concerns, increasing reliance on renewable sources of generation, and technological developments are aiding the growth of the wind turbine market.

The wind turbine market outlook report will offer a comprehensive study on wind turbine installation capacity for historical and forecast periods as well as global and country-wise drivers and restraints affecting the market. The report also provides detailed information about key policies and regulations and the competitive landscape for global in 2021. The report also outlines the profiles of major global wind turbine manufacturers.

Wind Turbine Market Dynamics

The wind turbine market growth has been driven by rising renewable energy auctions and feed-in tariffs. Countries including Argentina, Brazil, Chile, Mexico, Peru, Russia, India, and South Africa have adopted renewable energy auctions to allocate capacity at a competitive market price. Furthermore, there will be an upsurge with the demand for power expected to rise considerably by 2035. This necessitates generating more power from all possible sources of energy, in turn, aiding the wind turbine market growth to further accelerate during the projected period.

However, the wind turbine market might witness hindrances in growth mainly due to regulatory uncertainty and geopolitical conflicts. In addition, the shortage of skilled workforce, technological challenges, and underdeveloped grid infrastructure are a few factors likely to limit the market’s growth in the long run during the projected period.

Read full report here.

Education spending in South East Asia

Public spending on education reflects society’s investment in children to equip them with fundamental social and economic skills needed to be self-sufficient in their lives. Investing in education reduces poverty and boosts economic growth through human capital development, and is most efficient, in terms of long-term costs and benefits to society, and effective, in terms of human capital development, when investment starts during the early years and continues throughout childhood.

Public spending on education is around 4% of GDP on average across the Asia/Pacific and the OECD (see above). However, cross-national variation is considerable. In 2020, public investment in education amounted to 8% of GDP in Tonga, but less than 2% of GDP in Bangladesh and Papua New Guinea.

Public spending on education as a percentage of GDP can be higher in richer countries than in poorer countries but this is not necessarily so (Figure 3.13). For example, public spending on education as a percentage of GDP is similar in Australia, Georgia, Korea, Mongolia, Samoa and Uzbekistan, at very different levels of GDP per capita (Chapter 2). These differences can be explained by a range of factors, such as the role of private financing of education, which in Korea is among the highest in OECD countries, the level of wages of educators, costs of education material, and also population structures (Chapter 2). For example, the proportion of children (0-19) in the populations of Mongolia and Samoa (38% and 47% respectively) is much higher than in Australia (25%) or Korea (17%).

When considering education spending per student the picture is different. Public spending on education per primary student is higher in richer countries (see above) in the OECD on average it is more than twice as high as on average across the Asia/Pacific region. Public investment in education per student in Nepal is comparatively low, but still higher than in Cambodia (KHM) where GDP is higher than in Nepal (Chapter 2).

Data on public education spending as a percentage of GDP were taken from OECD (2021) Education at a Glance for the OECD countries, and the UNESCO Institute for Statistics for other Asia and the Pacific countries (UNESCO). Public spending on education includes government spending on educational institutions including different levels of education as pre-primary, primary, secondary education and post-secondary education and tertiary education, spending on fee support for low-income parents and towards school meals is included. Data on public spending per primary education student (in USD PPP) were taken from the UNESCO Institute for Statistics.