Indonesia

Singapore-Indonesia Bilateral Leaders’ Retreat – Seven Agreements Signed

Singaporean and Indonesian leaders signed seven wide ranging agreements during a Bilateral Leaders’ Retreat on 10-11 October. In particular, the bilateral investment treaty aims to protect investors’ interests and reinforce economic ties, while the US$10 billion currency swap agreement aims to contribute to bilateral financial security.

Sources: The Straits Times, Jakarta Post

Australian Prime Minister’s Jerusalem Proposal – Jokowi Dodges a Metaphorical Bullet

Australian Prime Minister Scott Morrison’s proposal to move the Australian embassy in Israel to Jerusalem was a political gambit for the Wentworth by-election. However, it complicated Indonesian plans to finalise the Indonesia-Australia Comprehensive Economic Partnership. Not only was incumbent President Joko Widodo’s opponent, Prabowo Subianto likely to have leveraged the issue, but Vice-Presidential candidate Ma’aruf Amin was an outspoken critic when the US moved its embassy to Jerusalem in 2017. Fortunately for Jokowi”, the proposal seems to have foundered with the Australian Liberal Party’s defeat in the by-election.

Sources: Sydney Morning Herald, The Diplomat

Weak Rupiah – No Significant Impact on Jokowi’s Popularity for Now

The rupiah’s depreciation past the 15,000:US$1 psychological barrier might persist beyond the 2019 elections, some analysts warn. Indonesia’s current account deficit is widening with high oil prices, a tense global market and Jokowi’s reluctance to raise fuel prices during an election year. A Financial Times Survey found that currency woes have not impacted Jokowi’s popularity significantly, but the political effects of a prolonged slump in the rupiah remain to be seen.

Sources: The Straits Times, Financial Times

Malaysia

Return of the “Crooked Bridge”

Johor Menteri Besar Osman Sapian triggered a firestorm in Singapore media when he proposed reviving the “crooked bridge” project between Johor and Singapore. While Economic Affairs Minister Azmin Ali clarified that its construction would depend on Malaysia’s fiscal situation, Prime Minister Dr Mahathir Mohamad noted that it is easier to build the crooked bridge than a third link-bridge, which would require the Singapore government’s consent.

Sources: The Star Online, The Malaysian Insight, Free Malaysia Today

Infrastructure Projects – Under Review, Status Remains Uncertain

The East Coast Rail Link (ECRL), the trans-Sabah gas pipelines and the Kuala Lumpur-Singapore High Speed Rail (HSR) projects have ostensibly been delayed pending review. Yet, much uncertainty remains about the future of these projects. Adding to this uncertainty, Dr Mahathir remarked during a talk show in Selangor on 22 October that the projects are too costly to be funded by the government, and that their cancellation would reduce government debts by RM300 billion (US$72.1 billion).

Sources: New Straits Times

PKR Elections – Azmin Takes the Lead, but Software Glitches Stir Frustration

Following elections in nine states, incumbent Deputy President Azmin Ali is ahead of his opponent, Rafizi Ramli by a slim margin. This comes as a surprise for analysts such as University of Selangor Vice-Chancellor Redzuan Othman, who expected Azmin’s track record to put him convincingly ahead of Rafizi. Tensions are also running high due to glitches in the electronic voting software, with violence breaking out at two Selangor divisions on 21 October.

Sources: The Straits Times, New Straits Times

Myanmar

Australia imposes sanctions on senior members of Myanmar’s Military

Australia has joined other nations such as the USA, EU and Canada in imposing travel bans and economic sanctions on senior military officials in the Tatmadaw – Myanmar’s armed forces. Of those sanctioned, four were directly mentioned in the UN report published in August 2018, which imputed “genocidal intent” to the Tatmadaw’s actions in Rakhine, Kachin and Shan states. This follows on from a threat issued by the EU earlier this month to revoke Myanmar’s access to the preferential tariff conditions it enjoys with the bloc by virtue of being a developing country.

Sources: Channel NewsAsia

China and Myanmar sign MOU on major project attached to the China-Myanmar Economic Corridor

China’s state-owned China Railway Eryuan Engineering Group has signed an MOU with Myanma Railways to assess the feasibility of the Muse-Mandalay railway line. The proposed line will stretch 431km from Mandalay in Myanmar’s north to the border town of Muse on the Chinese border. The Muse-Mandalay railway line is positioned as an important component of the China-Myanmar economic corridor, which is itself linked to the wider Belt and Road Initiative.

Sources: Railway Technology, South China Morning Post

Myanmar Investment Commission (MIC) launches the Myanmar Investment Promotion Plan (MIPP).

The MIC officially launched the MIPP on the 8^th of October 2018. The MIPP lays out a roadmap for the future and asserts that public investments will be set to expand from US$5.6bn in the period of 2016-2022, to US$43bn in the period of 2031-2036. Key steps to be taken include the establishment of an Investment Promotion Committee, which will in turn manage different ‘task-forces’ that each oversee different strategies for the development of Myanmar’s investment environment.

Sources: Myanmar Times, DICA

Thailand

Prime Minister Prayuth Chan-ocha’s Social Media Push – Shaky Start, but Improving

Prayuth’s maiden foray into social media platforms started off poorly, with some of his first Facebook posts attracting thousands of negative comments. His modest follower count (393,000 on Facebook, 28,900 on Twitter on Wednesday, 24/10) also trails that of other Thai leaders such as Abhisit Vijjajiva (2.2 million Facebook followers, 365,000 on Twitter) and both Shinawatras. However, at a point where other parties are not allowed to use social media to promote themselves, Prayuth’s social media activities could give him a valuable head start for the 2019 election.

Sources: Bangkok Post

Trade War and Thailand – Surge in Investment and Initial Public Offerings

Thailand has overseen a boom in foreign direct investment (FDI) as trade tensions push supply chains towards Southeast Asia. From January through July, Maybank Kim Eng found that Thailand’s net FDI rose 53% from a year earlier to US$7.6 billion. Investors are also snapping up initial public offerings in Thailand, with Bloomberg reporting that local and government firms collected US$1.95 billion in October alone.

Sources: Bloomberg, Bloomberg