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Second Asean-US summit to be held in Sept in New York

The second Asean-US leaders’ meeting will take place in New York on the sideline of UN General Assembly on 24 September, The Nation has learned.

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The second Asean-US leaders’ meeting will take place in New York on the sideline of UN General Assembly on 24 September, The Nation has learned.

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2nd Asean-US summit to be held on 24 Sept in New York

ASEAN is relevant to the US for strategic reasons. For example, ASEAN remains useful through its ability to shepherd regional processes like the ASEAN Regional Forum (ARF). The ARF also provides a natural forum for the US to engage other major players in the region through a regional security framework.

The strong, dynamic economies that the US helped foster in ASEAN have also allowed the US to reap significant economic dividends. ASEAN is America’s fourth largest trading partner, after Canada, Mexico and Japan. Total trade between the US and ASEAN is now almost 20% of its trade with Asia, and bigger than its trade with China.

Equally important, ASEAN’s commitment to free trade has helped reinforce US interests in preserving an open multilateral trading system. Through AFTA (ASEAN Free Trade Area) and other initiatives, ASEAN has also spurred regional economic liberalisation.

But US interest in ASEAN could weaken.

First, the Asian financial crisis has dented ASEAN’s credibility and standing. ASEAN’s current difficulties and perceived lack of political cohesiveness and vision risk diminishing its relevance in the eyes of US policy makers.

Second, throughout most of the later half of the 20th century, the US and its allies generally subordinated potential economic and other conflicts within the alliance to the overriding interest of political and security cooperation. With the end of the Cold War, however, the national priorities of the US and its allies have changed. It seems that greater attention is now accorded to domestic interests. Demands and pressures of domestic lobbies and specific interest groups are growing. Human rights, the environment and humanitarian interests are now active players in the US foreign policy process. These have complicated US relations with some countries in Asia, and distracted the US from its longer-term strategic interests in engaging Asia. Politics in an election year will confound and obscure these interests even more.

Third, US attention in Asia today is more focussed on Northeast Asia, where its fundamental interests are at stake and more pressing. In fact, the single most important relationship underpinning stability in Asia today is the triangular US-China-Japan relationship. In this relationship, managing US-China relations is a top priority for the US. The cross-strait issue is the nub of it. The rise of China and its impact on Japanese calculations of its interests will complicate US-Japan relations. So will Japan’s legitimate aspirations to play a greater leadership role in the region.

Thailand has been hard hit by flagging global demand, particularly in the US and Europe

Investment slumped in the first half 2009 and this contributed most to the contraction in GDP on the demand side. Private fixed capital investment dropped by 16.9%, reflecting weak external demand, the impact on business sentiment of the political uncertainty, as well as more cautious lending by banks.

Foreign direct investment applications declined in value by 47% in the frst 7 months of 2009. Public investment fell by 9.1% in the frst quarter, then rebounded by 9.6% in the second on faster disbursement by the Government and state enterprises.

New Prime Minister Abhisit Vejjajiva’s government has responded to the crisis with vigorous fiscal pump priming

By the 1970s, landlessness had become a national problem. Massive peasant protests resulted in a land-reform programme, instituted by the civilian government installed following the 1973 uprising. In order to appease the big landowners, however, private lands were not touched by the programme, instead, forests and public lands that had been encroached upon or become deforested over the years were allocated for distribution to landless peasants—in effect taking them from the public and giving them to the poor. In the following decade the government, with World Bank support, initiated a land-ownership survey to promote investment and farming. However, given widespread corruption among local officials, what actually took place was a wholesale privatization of community lands for purposes such as building tourist resorts, hotels, golf courses and housing estates, or securing bank loans on the unlawfully acquired property to speculate on the stock market.

2nd Asean-US summit to be held on 24 Sept in New York

It represents one of few times in recent years that fiscal and monetary policies have been complementarily calibrated. A grinding political conflict, pitting supporters and detractors of former Prime Minister Thaksin Shinawatra who was ousted in a 2006 military coup, has hobbled successive governments’ ability to devise and implement effective economic policies.
The debilitating conflict climaxed last November when military-linked anti-government protesters closed Bangkok’s two international airports for over a week, crippling the money-spinning tourism and air freight dependent export sectors. The Bank of Thailand has estimated the closure cost the Thai economy as much as 290 billion baht, with hotels estimated to have lost 140 billion baht due to cancellations.

Indeed grass roots competition for government resources is intensifying. For instance the Farmers Rehabilitation and Development Fund is seeking 17.2 billion baht from the cabinet to buy back debts owned by over 62,000 farmers and rehabilitation and occupational training programs. During the 1997-98 financial crisis, a large number of unemployed factory and service sector workers returned to the rural countryside to eke out a subsistence living working in their relations’ fields. Agriculture currently accounts for 11% of GDP. Higher agricultural prices drove up farm incomes during the first half of 2008, but fell sharply in the second half in line with declining global commodity prices. As the local economy slows and unemployment rates rise, it’s not clear that the rural sector will with falling food prices have the same absorptive capacity it did in the wake of the Asian financial crisis.

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