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The coronavirus crisis calls for novel economic policy solutions

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Author: Shiro Armstrong, ANU

To help save the economy in the coronavirus crisis, governments need to target and design financial assistance at different phases of shutdown, lockdown and recovery and they need to do so urgently and responsibly. The strategy needs to be simple, communicated clearly and use tried and tested Australian policy innovations to succeed longer term.

A worker sprays disinfectant on a street during the movement control order due to the outbreak of the coronavirus disease in Kuala Lumpur, Malaysia 28 March 2020 (Photo :Reuters/Lim Huey Teng).

The emergency health measures of many governments have taken out a huge chunk of national economic activity. The impact on employment through the shutdown on large swathes of economies has already seen the unemployment rate rise rapidly in many countries. It could start to approach levels not seen since the Great Depression in the 1930s in some countries. Without special help, many will become long-term unemployed.

While many stay home during a shutdown or lockdown, assistance has to be targeted to individuals to keep them fed and housed, and businesses to keep them from laying off staff and collapsing. That was the aim of the Australian government’s first two stimulus packages. The British government is paying 80 per cent of wages of many employees to achieve the same goals. Other governments are deploying similar policy strategies.

Until the health crisis is under control, assistance has to freeze parts of the economy so that it can be jump-started for rapid economic recovery when it’s over. In the recovery phase, governments will need to pump up spending quickly when it’ll be desperately needed.

Targeted assistance and then rapid stimulus needs to be deployed in a way that helps budget repair when the economy starts to recover, without slowing the recovery.

Now is not the time for complicated rules and formulas to fine tune incentives. That slows down and will ultimately foil the effective response that many economies will need. The threat to the economy from the COVID-19 health crisis is much greater than in the global financial crisis.

The government does not need to choose who gets the assistance, nor does it need banks or others to decide which businesses to stay afloat. Instead it can make extra support available to economically-distressed individuals and businesses via special emergency support (SES) loans repayable as the economy recovers. Any individual eligible for welfare support should be eligible to sign on for additional support of up to the equivalent of a minimum wage for up to a year, for example, and businesses should be able to borrow against their past revenue.

Eligibility criteria are necessary but this should not be tightly restrictive. It needs to take account of the thousands trapped in countries without citizenship or residence on work visas.

Individuals and businesses will only need to repay when their income recovery allows. As US economist and adviser to President George W Bush Greg Mankiw explains, instead of selecting who gets the assistance and screening before the fact, there’s a way to screen after the fact. This is the policy strategy that has been championed in Australia by ANU’s Warwick McKibbin and other economists.

SES assistance can be provided to all individuals and small and medium-sized businesses as a loan. But it would be a loan that is repaid only when the individual’s income or business revenue is high enough that they can afford to repay. When the economy recovers, loans can be repaid via a taxation levy after income reaches a threshold level. This is the same mechanism as the income-contingent loan scheme that ANU’s Bruce Chapman invented for higher education tuition. Under that HECS or HELP system students repay their university tuition via a repayment levy that kicks in at a certain threshold level after they enter the workforce.

An SES loan will be a loan to those who will be able to repay. For those who continue to struggle, it effectively becomes a grant. Like the income contingent loan for university tuition, loan holders cannot default on the debt. Repayment can be designed to avoid hardship. It is easy to design so that it does not distort economic behaviour and is fair and efficient.

Repayment rates can be designed so that the loan is only repaid when times are better. A low marginal rate that only starts to be collected at a high income threshold will not deter re-entry to the workforce as opportunities open up. A high marginal rate at higher incomes will not change behaviour either. The same principle applies to business revenue. Individuals with high income or businesses doing well as they come through the crisis will repay the loan faster. SES contingent loans can strengthen the progressive tax system for the recovery from the downturn.

The university tuition version of this kind of loan scheme has shown it is a trivial cost to administer through the tax office. Sign-on to the scheme could be completed through online registration through a tax office, with a simple eligibility verification process.

Much needed government assistance can be pumped into the economy now, and ramped up as needed, without queues at welfare offices or difficulties with having to show need, and without budgetary or tax restrictions. And that can be done without recklessly spending future taxpayers’ money through responsible automatic budget recovery. The scheme acts as what economists call an automatic stabiliser, providing income cover when it’s needed and automatically recouping it when it’s not.

The economic priority for governments today is to keep the economy ticking over, to keep businesses and their employees tied together, to avoid a deeper downturn that will create huge numbers of unemployed and position for a sharp recovery. Doing so via an SES income or revenue contingent loan program is fiscally responsible and will make it easier to get more assistance out faster to where it’s needed. Budget repair is not a priority now but it will be one day, hopefully soon.

Shiro Armstrong is Director of the Australia-Japan Research Centre and Director of the Asian Bureau of Economic Research, The Australian National University.



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ASIAN (H)

Looking beyond Tsai’s big election win

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Author: Gerrit van der Wees, George Mason University and George Washington University

President Tsai Ing-wen and her Democratic Progressive Party’s (DPP) momentous election victory on 11 January 2020 represents a significant turning point for Taiwan. It marks the culmination of a democratic transformation that started with the end of martial law in 1987 and the commencement of democratic reforms by former president Lee Teng-hui in the early 1990s. Since then, the government has changed hands three times. But a persistent public fear exists that a return of the Kuomintang (KMT) will cause Taiwan to backslide away from democracy and towards China.

Taiwan President Tsai Ing-wen listens to a speaker in New Taipei City, Taiwan, 26 December 2019 (Photo: REUTERS/Ann Wang).

This happened in 2008 when Ma Ying-jeou regained the presidency. His pro-China stance led to the 2014 Sunflower Student Movement, which changed the political landscape, and led to major defeats for the KMT in the local 2014 and national 2016 elections.

The overwhelming mandate received by President Tsai and her party significantly reduces the danger of such a pro-China agenda. The KMT candidate Han Kuo-yu lost by a margin of almost 20 per cent, demonstrating that the KMT’s pro-China approach is losing ground, especially among younger voters. In its recent search for a new chairman, the candidate elected on 7 March 2020, ‘Johnny’ Chiang Chi-chen, campaigned on the theme that he would ‘bring back’ the young voters. It remains to be seen whether he can bring about changes that appeal to young voters.

As Mark Harrison and Huong Le Thu wrote, ‘Han’s campaign machine was dysfunctional and the KMT was beset by an identity crisis. In the second half of 2019, the protests in Hong Kong left few in Taiwan under the illusion that Beijing would honour any arrangements that would respect any form of autonomy. The younger generation in particular saw an urgency to defend Taiwan’s sovereignty, maintain their democracy and refuse a future like Hong Kong’s’.

The overwhelming victory also represents a clear mandate for President Tsai and her DPP, which — in combination with several smaller parties — holds a majority of 70 seats in the 113-seat Legislative Yuan. Tsai will be able to push through legislation and continue reforms initiated by her government in its first term. These reforms include much-needed judicial reform, transitional justice measures, further economic and industrial reforms, streamlining of the economy and strengthening substantive ties with the United States, Europe, Southeast Asia, India, Japan, Australia and New Zealand.

A question remains: how will Taiwan’s relationship with China develop moving forward? If Beijing continues or intensifies its current approach of pushing Taiwan into a corner, it will increasingly find the United States and other democratic countries in the way. The democratic world has now clearly seen that President Tsai has a broad popular mandate and will be much more supportive of Taiwan and its democracy.

In this context it is important to understand that President Tsai and the DPP are the political descendents of the native Taiwanese democracy movement that brought about Taiwan’s transition to democracy in the 1980s and 1990s. Rowan Callick emphasises that the youth vote focused on issues of identity in place of issues of living standards. The majority of Taiwan now identifies as Taiwanese and not Chinese, with only 13 per cent of the population descended from those who came from mainland China in the 1940s.

This distinction is essential for understanding the Taiwan of today, as the China–Taiwan relationship has until now almost exclusively been cast by media and governments alike in terms of the historical rivalry between Mao Zedong’s People’s Republic of China (PRC) and Chiang Kai-shek’s Republic of China (ROC). This narrative asserts that Taiwan ‘split off’ from China in 1949, and that Taiwan and China were perpetual rivals dating back to the Chinese Civil War.

That may have been the case from the 1950s through the 1980s when Chiang Kai-shek’s government imposed ruthless martial law on the island while still claiming to rule all of China. During that period, ‘Taiwan’ became synonymous with Chiang Kai-shek’s ROC. But after the momentous transition to democracy in the late-1980s and early-1990s, the Taiwanese developed their own narrative, very different from  Mao Zedong’s PRC or Chiang Kai-shek’s ROC — an open and inclusive multi-ethnic identity, emphasising that all people who identify with Taiwan are Taiwanese.

A new and democratic Taiwan should prompt the international community — including China — to see Taiwan in a new light. Democratic Taiwan in 2020 is very different from the old and repressive ROC of 1979, when the United States broke relations with the regime in Taipei as it was still claiming to be the government representing all of China. Taiwan demonstrably and rightfully claims to represent itself, and it is only rational and reasonable to welcome it as a full and equal member of the international community.

Gerrit van der Wees is a former Dutch diplomat. From 1980 through 2016 he served as chief editor of Taiwan Communique. He teaches history of Taiwan at George Mason University and Current Issues in East Asia at George Washington University.



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ASIAN (H)

Too little, too late? Washington rediscovers Central Asia

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Author: Matthew Sussex, ANU

Does the recent visit by US Secretary of State Mike Pompeo to Kazakhstan and Uzbekistan signal renewed US interest in Central Asia? Maybe. The broader question is why Pompeo is seeking to engage with the region in the first place.

US Secretary of State Mike Pompeo meets Kazakh President Kassym-Jomart Tokayev at the Akorda presidential residence in Nur-Sultan, Kazakhstan, 2 February 2020 (Photo: Reuters/Kevin Lamarque).

Central Asia remains plagued by corruption and political instability, which translates directly into business risk. Despite the attractiveness of Central Asia’s natural resources, US and EU firms remain wary of investing in the region. Given China’s significant presence, it is reasonable to ask whether the US Secretary of State’s positive investment signals are credible.

One reason for the United States to take a fresh look at Central Asia may be the emergence of incremental regional political liberalisation. The accession of the ‘Uzbek Gorbachev’ Shavkat Mirziyoyev in 2016 and the shock resignation of Kazakhstan’s Nursultan Nazarbayev in 2019 triggered a wave of optimism that a region characterised by authoritarian governments might be witnessing a partial thaw. The power transitions in both nations were achieved in an orderly fashion, indicating that Uzbek and Kazakh elites are prepared to tolerate politicians who try to lead with a more human face.

Yet limited liberalisation only partly explains US interest in Central Asia. There are few incentives for either Mirziyoyev or Kazakhstan’s new president Qasym-Zhomart Toqaev to embrace liberal democracy. The June 2019 Kazakh presidential elections were characterised by widespread irregularities. Toqaev’s predecessor Nazarbayev continues to lead Kazakhstan’s ruling party Nur Otan, chairs the Security Council and in 2019 lent his name to the national capital Nur-Sultan (formerly Astana).

Mirziyoyev has encouraged private media outlets to report on rights abuses and purged the repressive National Security Service. But Uzbekistan still ranks at 160th in the world for press freedom. Mirziyoyev has become the personification of Uzbek political power in a political system that remains highly centralised.

Pompeo’s visit shows that the Trump administration views its interests in Central Asia through the lens of pragmatic geopolitics rather than liberal ideology. Put simply, Washington’s main motivation is to try and erode growing Chinese power in the region.

One way to do this is to leverage human rights issues. After meeting with ethnic Kazakhs whose family members had been detained in Xinjiang, Pompeo called on China to end its repression of religious minorities. He identified Central Asian nations as safe havens for those ‘seeking to flee China’.

Pompeo also extended the possibility of trade and investment deals with US companies. Inviting pointed comparisons with China’s Belt and Road Initiative (BRI), Pompeo noted that when dealing with the United States ‘You get fair deals. You get job creation. You get transparency in contracts’.

Still, it is unclear how far the United States will be able to extend its influence into Central Asia. Both Brussels and Washington have sought to court the former Soviet republics on Russia’s southern flank. Kazakhstan is known for its ‘multi-vector’ foreign policy and is prepared to seek external partnerships to balance against its participation in regional integration mechanisms such as Moscow’s Eurasian Economic Union (EEU), which it joined as a founding member in 2014.

Kazakhstan has also been courted aggressively by China, receiving US$28 billion for 55 major projects. The development of the Eurasian Land Bridge also makes Kazakhstan an important transit node in China’s BRI, which will become even more crucial once Russia completes the Meridian Highway.

Central Asia is already a crowded economic and security space, where two permanent members of the UN Security Council maintain different views about how the region should evolve. Russia would like to see Central Asia as a military–security bloc supported by trade and investment partnerships that preference the EEU. But Moscow’s vision has been overtaken by China’s capacity to offer substantial investment deals.

Russia too has become reliant on Chinese investment in its energy sector. Whereas Beijing has previously been happy to pass the burden of managing regional security affairs to Moscow, it now has growing security ties to Central Asia as a result of its geoeconomic connectivity agenda.

The United States will struggle to lure Central Asian nations away from Beijing’s orbit. During Pompeo’s visit, Kazakh Foreign Minister Mukhtar Tleuberdi welcomed the potential for economic cooperation. But he pointedly declined to comment on the Uyghur issue, consistent with Kazakhstan’s policy of not criticising China’s treatment of ethnic minorities.

Pompeo’s experience in Kazahkstan is a good example of how Central Asian nations view their engagement with the United States — keen to embrace the prospect of investment and trade, but quick to separate economic issues from security or human rights issues. This is prudent for nations with consolidated authoritarian regimes that are wary of foreign policy choices that might erode their domestic authority.

The new US posture towards Central Asia will face a similar litmus test to its other efforts to blunt China’s rise in the Asia Pacific and South Asia. For instance, its announcements of an East Asia investment fund and the ‘Blue Dot Network’ have been grand in aspiration, but much more modest in terms of cash incentives. Whereas in East Asia the United States remains the dominant security actor, its economic and strategic footprint in Central Asia is much more limited.

At best, Washington’s renewed interest in Central Asia will give the region more trade options and slightly more leverage when it comes to negotiating with Beijing. At worst, it might prove to be a case of too little, too late.

Matthew Sussex is Associate Professor at the National Security College of the Crawford School of Public Policy, The Australian National University.



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ASIAN (H)

Is the Philippines moving to active middle power diplomacy?

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Author: Aileen S P Baviera, University of the Philippines

The Philippines was first a colony and then a formal treaty ally of the United States for so long that many Filipinos tend to take the existence of reciprocal defence obligations for granted. For the most part, the Philippines has always supported US security objectives when asked — whether during the Pacific War, the Korean War, the Cold War, the conflicts in Indochina or the ‘Global War on Terror’.Vessels from the U.S. Navy, Indian Navy, Japan Maritime Self-Defense Force and the Philippine Navy sail in formation at sea, in this recent taken handout photo released by Japan Maritime Self-Defense Force on 9 May 2019 (Japan Maritime Self-Defense Force via Reuters).

This support was not always unconditional or particularly strong. Domestic opinion and regional sensitivities still had to be considered — including US concerns over entrapment and Philippine fears of abandonment.

But even the closure of major US military bases (Clark Air Base and Subic Naval Base) in the early 1990s following acrimonious negotiations to renew the basing agreement did not completely remove Manila’s importance as a strategic location for US operations in the Asia Pacific. In consequence, the 1998 Visiting Forces Agreement (VFA) and the 2014 Enhanced Defense Cooperation Agreement (EDCA) were put in place to ensure there was a legal framework to regulate the presence of US troops and the conduct of joint activities.

The security interests of the two sides continued to converge post-Cold War. As terrorist networks expanded across Southeast Asia and concerns grew over China’s maritime assertiveness in the disputed South China Sea, the Philippines still found the alliance useful for deterrence, capability-building and armed forces modernisation. The 2012 Scarborough Reef standoff with China and the 2017 Marawi siege by ISIS-inspired extremists are incidents etched in recent memory that underscore the continuing value of the 1951 Mutual Defense Treaty for both sides.

Many were surprised, therefore, when the Duterte administration served the US government notice of termination of the VFA on 11 February this year, to take effect after 180 days.

While the move has been justifiably criticised by many as whimsical, reckless and untimely, it has taken place in a particular context. Both internal factors — improved confidence buttressed by a growing economy, winding down of the longstanding Muslim separatist movement and a declining communist insurgency — and external factors — an improvement in bilateral relations with China, the worrisome trajectory of great power competition, the Trump administration’s credibility issues and the greater security efficacy of other middle powers — are pushing the Philippines out of path-dependent defence reliance on the United States.

Like other countries in the region, the Philippines fears getting caught in the crossfire should US–China animosity lead to conflict. China’s effective use of carrots and sticks — economic incentives alongside coercive diplomacy and economic statecraft — has left countries ambivalent about their own priorities. The prospect of economic connectivity with China via the so-called Belt and Road Initiative is one that the pragmatic elites of the region do not lightly dismiss. This has led most regional governments to adopt hedging strategies on China, rather than balancing or containment behaviour.

At the same time, the security challenges that China presents expose the inadequacy and sometimes irrelevance of traditional security approaches. ‘Grey zone’ attacks cannot be countered using the old tools that defence alliances have in their arsenals.

For the Philippines, losing control of Scarborough Shoal despite the Obama administration’s role in the 2012 negotiations, as well as subsequent US inaction while China embarked on major island construction activities in the South China Sea, brought home hard truth about what one can realistically expect from an ally.

President Duterte is the first Filipino leader to publicly acknowledge this. This does not mean that US support is no longer needed or wanted — only that Washington’s willingness to get involved cannot be assumed, and that its support carries its own risks and uncertainties.

Many countries in Asia are coming to terms with a strategic environment where China expects a louder voice in regional affairs. The challenge for these countries is binding China to a rules-based order to ensure that it respects the rights of its neighbours as sovereign if not equal states.

In Southeast Asia, the preferred order is one that is inclusive rather than exclusionary, where larger powers engage constructively. Weak or small states usually have little influence in these processes and are often pressured into taking sides or remaining silent. But middle powers may act to preserve their autonomy amid great power competition.

This could explain why Duterte invokes the need to end dependence on the United States as a justification for terminating the VFA. Interestingly, ending the VFA reinforces the Trump administration’s preference for minimising alliance obligations and comes at a time when China’s assertiveness is making the Philippines’ neighbours far more jittery. In this sense, the decision is creating more instability, not less.

Multilateral institutions such as ASEAN and its extended dialogue networks remain attractive platforms for middle powers to shape their strategic communities. But these institutions must be strengthened to remain relevant. As the concept of the ‘Indo-Pacific’ continues to be debated in terms of what it can contribute to regional stability and security, ASEAN ‘centrality’ will be challenged.

Will the Philippines gradually transform from a secondary power supportive of, and dependent on, US primacy into a middle power pursuing its own autonomous interests through more inclusive diplomacy? So far, no such vision has been articulated. But by moving farther away from the United States, Duterte is taking a gamble that may force him down this path. Otherwise, the only remaining alternative is alignment with China.

The Editorial Board and entire EAF team were saddened to learn of the death of Professor Aileen Baveira from COVID-19 in Manila on 21 March. Her scholarship on China’s relations with Southeast Asia and her contributions to this Forum are widely acknowledged and appreciated. She was a warm and generous person and a friend to EAF whose good judgment and wise counsel will be deeply missed. 

Aileen S P Baviera was Professor of China Studies and International Relations at the Asian Center, University of the Philippines, and the founding president of Asia Pacific Pathways to Progress.

This article appears in the most recent edition of East Asia Forum Quarterly, ‘Middle Power Game’, Vol. 12 No. 1.



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ASIAN (H)

Assessing the economic impacts of COVID-19 on ASEAN countries

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Author: Jayant Menon, ISEAS–Yusof Ishak Institute

The COVID-19 pandemic is first and foremost a human tragedy. Measures introduced to deal with the pandemic could save lives but are having wide-ranging economic effects and inducing economic contagion. There are already studies estimating the economic impact of the virus. But greater focus is needed on the transmission mechanisms of the economic contagion and in critiquing how assessments of the economic impacts are made, concentrating on the ASEAN region.

An immigration police officer wears a protective mask due to coronavirus disease (COVID-19) outbreak, at a check point in Bangkok, Thailand, 26 March 2020 (Photo: REUTERS/Soe Zeya Tun).

The effects of COVID-19 are hitting ASEAN economies at a time when other risk factors, such as a global growth slowdown, were already rising.

COVID-19 is disrupting tourism and travel, supply chains and labour supply. Uncertainty is driving negative sentiment. This all affects trade, investment and output, which in turn affects growth. Tourism and business travel, as well as related industries, especially airlines and hotels, were the first to be affected. And the conditions are worsening as more countries go into shutdown.

The supply disruptions emanating mostly from China will reverberate throughout the value chain and disrupt production. Since China is the regional hub and accounts for 12 per cent of global trade in parts and components, the cost of the disruption in the short run will be high.

The negative effects of quarantine arrangements on labour supply could also be high depending on duration and sector. Manufacturing has been hit harder than service industries, where telecommuting and other technological aids limit the fall in productivity.

All these disruptions will lead to sharp declines in domestic demand. And their impact on economic growth will further propagate these disruptions. This compounding effect can magnify and extend short-run effects into the long run.

The highest economic cost could come from the intangibles. The effects of negative sentiment about growth and general uncertainty — which is already affecting financial markets — will feed into reduced investment, consumption and growth in the long run.

Rolling recessions around the world now appear inevitable, despite the stimulus measures being contemplated. If so, there will be sharp increases in unemployment and poverty. Some degree of decoupling from China, or de-globalisation in general, may also be a permanent reminder of this pandemic.

Among ASEAN countries, Singapore, Malaysia and Thailand are heavily integrated in regional supply chains and will be the most affected by a reduction in demand for the goods produced within them. Indonesia and the Philippines have been increasing supply chain engagement and will also not be immune. Vietnam is the only new ASEAN member integrated into supply chains with China and is already suffering severe supply disruptions.

Given time, supply-side adjustments will alter trade and investment patterns. The main adjustment will involve relocating certain activities along the supply chain from China to ASEAN countries. Although the pandemic will disrupt the relocation phase, ASEAN countries can benefit from the new investments, mitigating overall negative impacts.

All ASEAN countries are dependent on tourism flows but Thailand is probably the most dependent. Cambodia and Laos receive most of their investment and aid from China, and a marked growth slowdown in China will affect them the most.

The Philippines and Mekong countries have large overseas foreign worker populations and restrictions on their movement or employment prospects as COVID-19 spreads will affect sending and receiving countries. Brunei and Malaysia are net oil exporters and the price war indirectly induced by the pandemic will hit them hard. Others will benefit from lower oil prices, as will the struggling transport sector.

In measuring the impacts of COVID-19, it is important to separate its marginal impact from observed outcomes. This is important because the remedy may vary depending on the cause of the disruption. This requires an analytical framework that can measure deviations from a baseline scenario that incorporates pre-existing trends. A model-based analysis, rather than casual empiricism, is required to reduce the problem.

Even before the outbreak, risks of a global growth slowdown were rising. The restructuring of regional supply chains had started, driven initially by rising wages in China and accelerated by the US–China trade war. While COVID-19 may further hasten the pace and extent of the restructuring, it is only partly responsible for what may happen. It would be misleading to attribute all of the current disruption to COVID-19. Had the trade war not preceded it, COVID-19 may have resulted in greater disruption to supply chains.

Any assessment of impacts must recognise that the spread of COVID-19 is unpredictable, and so too the response by governments. It is difficult to estimate the impacts of a shock that is uncertain in itself. This reiterates the need for rigorous modelling and scenario analyses. The current trend points to risks rising, often accelerating, as with previous epidemics. This uncertainty underscores the need for caution in assessing, and regular recalibration in producing assessments.

Jayant Menon is a Visiting Senior Fellow in the Regional Economic Studies Programme at the ISEAS–Yusof Ishak Institute, Singapore.

A version of this article first appeared in ISEAS Commentary.



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The damaging consequences of Modi’s Hindu agenda

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Author: Ramesh Thakur, ANU

India’s slide into illiberalism began before the Bharatiya Janata Party (BJP) came into power in 2014 under Prime Minister Narendra Modi. In his book The Intolerant Indian, Gautam Adhikari contends that extremist religious ideologies and the violent politics of left and right forces alike have overshadowed the idea of a tolerant, plural society on which modern India was established.A demonstrator attends a protest against riots following clashes between people demonstrating for and against a new citizenship law in New Delhi, India, 3 March 2020 (Photo: Reuters/Adnan Abidi).

But it took a more ominous turn under the BJP. Modi’s first five-year term (2014–19) witnessed many anti-Muslim acts of commission and omission that undermined their dignity as Muslims. Now Modi seems intent on erasing their Indian identity. With changes to citizenship laws, Muslims fear that they could be declared stateless and held in detention camps.

This is the background to the bloody Delhi riots that began in late February. Some Indian commentators compare them to the 1984 anti-Sikh riots. Others point to the similarities with the 2002 anti-Muslim pogrom in Gujarat when Modi was head of the state government. Like then, the 2020 Delhi riots have seen many disturbing reports of police apathy and complicity. The Delhi High Court expressed incredulity that Delhi Police had not watched videos of BJP leader Kapil Mishra’s alleged hate speech before the riots. The Guardian reports that three-quarters of those killed were Muslims.

Many key public figures have compared the riots to Kristallnacht, when Jewish homes and buildings were destroyed across Germany in 1938. This seems apt given the risk that what happened in Delhi in February could mark the moment when the existence of Muslims in India was shattered.

Kristallnacht was the most important staging post on the road to the Nazi regime implementing its final solution. Only after the defeat of Hitler and the exorcism of Nazi ideology did the civilised community institutionalise its determination to ‘never again’ permit such horrors in several legal instruments and institutional apparatus like the Genocide Convention and the International Criminal Court. But, as we know from Cambodia, Rwanda, Bosnia, East Timor and others, the pledge of ‘never again’ is repeatedly violated.

The Islamophobic agenda is not likely to be stopped by internal forces. The Supreme Court has become unduly deferential to the government. On 16 March, former chief justice Ranjan Gogoi was nominated by the government to the Rajya Sabha (Parliament’s upper house) just four months after his retirement, fuelling suspicions that he had been rewarded for decisions that had favoured the government. Gogoi’s former colleagues, retired justices Madan B Lokur and Kurian Joseph, said that the nomination has compromised ‘the independence, impartiality and integrity of the judiciary’ because people would now begin to be sceptical of judgments in cases involving the government, wondering if judges are influenced by the lure of post-retirement appointments.

Opposition parties are in disarray and Modi towers over all rivals inside and outside the BJP. The party lost two stalwarts last year with the untimely deaths of former finance minister Arun Jaitley and former foreign minister Sushma Swaraj — the two voices of moderation, respected in the party and listened to by Modi. Without them, no one is left to counter Home Minister Amit Shah’s agenda of aggressive cultural nationalism. This makes it imperative for friendly foreign governments to speak privately and, if that fails to produce course-correction, to speak out publicly against the Hindu primacy project.

They should do so because the religious agenda has five major deleterious consequences. It undercuts the shared liberal democratic values of political pluralism. It drags down India’s economic prospects. It degrades India’s ability to propel modernisation. It risks the radicalisation of 180 million Muslims that could transform India from an effective firewall against Islamic militancy to its west into a spawning ground of Islamist terrorism with the potential to spill over across the region. And it could produce the biggest wave of refugees.

The bigger indictment of the toxic political environment in India today is the torrent of ignorant and puerile comments triggered by constructive criticism from foreign well-wishers such as the former UN secretary-general Ban Ki-moon.

‘Indo-Pacific’ has displaced ‘Asia Pacific’, primarily to incorporate India into the regional strategic framework of countries concerned about China’s growing military presence and assertiveness. In 2017 a senior White House official justified the change of terminology, saying that ‘Indo-Pacific’ ‘captures the importance of India’s rise’.

The Quadrilateral Security Dialogue (Quad) is a popular ‘Indo-Pacific’ strategic construct to supposedly counter China’s growing geopolitical clout. An important justification for these new strategic groupings is the foundational values of democracy, political pluralism and civic freedoms that bind the Quad countries — Australia, Japan, India and the United States — together. Australia’s 2016 Defence White Paper noted that Australia and India’s shared interests and democratic values form a solid basis for engagement. If not checked, India’s slide into religious intolerance erodes these common values.

India’s economy was already slowing considerably. Deadly riots in the capital are a disincentive to foreign investors. Who would want to bet on a country on the verge of going up in flames as Hindu–Muslim tensions escalate beyond control? This is even before the impact of the coronavirus pandemic begins to take toll. The economic costs to foreign governments of calling Modi out are not going to be steep. They have a bigger vested interest in India’s continued economic prosperity if Modi switches to prioritising trade and productivity-led growth, development and good governance.

India’s Muslims are being alienated. This could push them to embrace extremism. It may also lead to waves of Muslims taking to the seas on leaky boats in search of refuge in countries around the region. We all have much to lose if religion-based hatred continues to intensify and spread across India.

Ramesh Thakur is Emeritus Professor at The Australian National University and a former UN Assistant Secretary-General.



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ASIAN (H)

The folly of Aung San Suu Kyi’s ‘bad apple’ defence

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Author: Adam Simpson, University of South Australia

Since the communal pogroms of 2012 razed the villages of Muslim Rohingya across Myanmar’s Rakhine State, there have been debates about how to protect Rohingya populations through international legal mechanisms. The search for legal avenues gathered pace following insurgent attacks by the Arakan Rohingya Salvation Army in August 2017 that resulted in a disproportionate punishment response from the Myanmar military. This saw the slaughter of thousands of unarmed Rohingya and over 740,000 people fleeing to Bangladesh.

Gambia's Justice Minister Abubacarr Tambadou talks to the media outside the International Court of Justice (ICJ), after the ruling in a case filed by Gambia against Myanmar alleging genocide against the minority Muslim Rohingya population, in The Hague, Netherlands 23 January, 2020 (Photo: Reuters/Plevier).

The most promising avenue to date has been through the International Court of Justice (ICJ) in The Hague. On 11 November 2019, the Republic of The Gambia filed an ICJ application to start proceedings against Myanmar for violations of the Genocide Convention.

Another international legal option is to prosecute the Commander-in-Chief of Myanmar’s military Senior General Min Aung Hlaing and other military leaders at the International Criminal Court (ICC). But there are difficulties with this approach. Myanmar is not party to the Rome Statute, which created the court, and any attempt to force the ICC to take a case like this one through the UN Security Council would likely be vetoed by China and Russia.

Since Bangladesh is party to the Statute, and the Rohingya crossed the Bangladesh border, the ICC ruled that it had jurisdiction over the case. In November 2019, the ICC approved a full investigation into allegations of ‘systematic acts of violence’, deportation as a crime against humanity and persecution on the grounds of ethnicity or religion against the Rohingya. By February 2020, investigators from the ICC Office of the Prosecutor visited Rohingya refugee camps to collect evidence for their case.

As the ICC case gathered pace, the initial hearings of the ICJ case in The Hague in December 2019 provided more spectacular imagery for the world’s media. With an eye firmly on the forthcoming November 2020 national elections, Nobel Peace Laureate and Myanmar’s de facto leader Aung San Suu Kyi personally travelled to the ICJ to defend the actions of the military and the Myanmar state against charges of genocide. There is little sympathy for the Rohingya in Myanmar. Ever since the 2012 pogroms, when the United Nations and aid agencies were seen as being overly sympathetic to Muslims and the Rohingya, there has been a nationalist antipathy to what is perceived as international meddling in Myanmar’s domestic affairs. Aung San Suu Kyi’s ICJ defence was interpreted as defending the nation and was supported by large rallies throughout the country.

While giving evidence to the ICJ, Aung San Suu Kyi admitted that ‘it cannot be ruled out that disproportionate force was used by members of the defence services in some cases, in disregard of international law’. She insisted that any breaches would be investigated internally. This ‘bad apple in the military’ defence was debunked by evidence that demonstrated the erasure of Rohingya communities was systematic.

Internal judicial redress within Myanmar has been ineffectual. There have been several internal inquiries, all of which have cleared the military of any systematic crimes despite overwhelming evidence to the contrary. The government-appointed Independent Commission of Enquiry (ICOE) did find that security forces and civilians committed war crimes and violated human rights in Rakhine State but held that these were rogue elements acting in isolation rather than reflections of a more systematic policy.

In late January 2020, the Court declared that The Gambia had established prima facie a breach of the Genocide Convention. It issued several urgent measures to Myanmar to prevent further acts related to breaches of the Convention and the destruction of evidence. Myanmar is to provide regular reporting to the Court on measures undertaken. The Gambia has until 23 July 2020 to submit its full case and Myanmar has until 25 January 2021 to submit its response.

The ICJ has no power to enforce its judgements and compel a state to take action. It relies on the UN Security Council to support its judgements. As key allies to Myanmar, China — with its veto power at the Security Council — along with Vietnam refused to agree to a statement compelling Myanmar to comply with the Court’s instructions. Although the Court’s decision was celebrated by Rohingya refugees in Bangladesh’s camps, the limited powers of the ICJ mean that little may change on the ground.

The Myanmar government, led by the National League for Democracy (NLD) and Aung San Suu Kyi, has no oversight over the military and Senior General Min Aung Hlaing. But Aung San Suu Kyi is the only person capable of communicating the suffering experienced by the Rohingya effectively. Her silence on the military’s brutality and her attempts to exculpate it from wrongdoings is normalising what, under any reasonable assessment, constitutes ethnic cleansing, crimes against humanity and perhaps even genocide.

Myanmar’s politics is complex and fraught. After years of military rule, the path to democracy was never going to be smooth. But without the support of Aung San Suu Kyi, it is difficult to see justice for the Rohingya emerging anytime soon, with the potential of a coronavirus (COVID-19) outbreak in the refugee camps increasing the urgency of action. The NLD government needs international support to transform the country economically and politically. The pursuit of justice and democratic development in Myanmar will also require deeper engagement by Western companies, governments and NGOs. Right now, this pursuit is being left to the vicissitudes of foreign investment and diplomacy with China.

Foreign governments need to apply pressure on both the government and the military so that they adhere to international norms whenever they deal with Myanmar’s ethnic communities, regardless of that community’s perceived place and legitimacy in some mythical nationalist past.

Adam Simpson is Senior Lecturer of International Studies in UniSA Justice & Society and Program Director, Master of Communication, in UniSA Creative, The University of South Australia.



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ASIAN (H)

Besting coronavirus requires mass-testing

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Author: Kim Sawyer, University of Melbourne

As the coronavirus contagion unfolds, we are seeing patterns that should be emphasised. The novel coronavirus is now affecting 192 countries and there are nearly 425,000 cases. More than 295,000 cases are active and this means there are probably more than a million infections. Yet the news is not all bad. The data reveals how to fight the virus.

A medical staff member in protective gear uses a swab to take samples from a visitor at 'drive-thru' testing center for the novel coronavirus disease of COVID-19 in Yeungnam University Medical Center in Daegu, South Korea, 3 March 2020 (Photo: REUTERS/Kim Kyung-Hoon).

The data across 192 countries raises two issues. First, is there is a uniform curve of contagion or does each country have a different curve? In other words, are there country-specific factors that are affecting the spread of this virus? The data suggests there are.

Second, the data shows the virus is more successful than other viruses because it hides better. Those without symptoms or with mild symptoms are driving the virus: 95 per cent of current active cases have mild symptoms or none at all. The virus has power because it is unobservable. SARS, too, was asymptomatic in many people, but not as many as in the case of COVID-19.

When we examine cross-country data, country-specific factors are visible. Within Europe, four countries are prominent: Italy with 69,000 cases, 6800 deaths and more than 3400 in critical care; Spain with 42,000 cases, 2990 deaths, and 2600 in critical care; France with 22,300 cases, 1100 deaths, and 1700 in critical care; and Germany with 33,400 cases, but only 159 deaths and none in critical care.

It is possible that Germany is on an earlier part of the curve and that the contagion in that country had different types of clustering. It is also possible that country-specific factors are in play. For example, demographic factors like the proportion of elderly; environmental factors such as air quality; and social customs relating to how individuals interact.

The most important factor, however, seems to be how we congregate. Population clusters — whether in bars, at football matches, in schools, in apartment complexes, or in households — are what is driving this contagion. Countries with lower population densities, such as Australia and Canada, may be spared the worst. Each currently has relatively few deaths and few in critical care.

Social distancing and quarantining are obvious measures to stop the spread of the virus but we should consider other measures for population clusters such as apartment complexes: perhaps the use of thermometer guns or infrared cameras at their entrances, notwithstanding doubts about the precision of these measuring instruments.

What the data shows is the role of the asymptomatic. It is not only the person sitting next to you who coughs that matters. It is the person who doesn’t cough. That is why it is important to isolate the asymptomatic. The virus depends on the spread from the asymptomatic to the vulnerable. The segmentation of the asymptomatic from the vulnerable is the key to fighting the virus. It is not sufficient to identify the virus ex-post after the symptoms appear. It must be identified before the symptoms show.

Random testing is the key to stopping this contagion until we can mass-test the entire population.

The lesson is from the town of Vo, where the first death occurred in Italy. All residents of Vo, more than 3000 in all, were tested by the University of Padua. When 89 people tested positive, they were isolated. In the second round of testing, only six were found to be infected and they remained in isolation. Vo has had no more fatalities and a 100 per cent recovery rate. The way to beat the virus is to find it and to isolate it.

The challenge is how to initiate mass testing. That should be the highest priority of governments at all levels. We must isolate the virus, not the people. The only way to do that is to test.

We should begin by testing everyone in nursing homes, in hospitals and everyone at higher risk. But we must also find ways to test those who are not at risk and who are asymptomatic. That means we must begin random testing, not just the testing that follows the identification of an infected person. We must sample the virus in the general population, just as we do with voting.

Random testing is the key to stopping this contagion until we can mass-test the entire population. If a billion dollars were spent on testing and isolating the infected, we may save billions in the months ahead. Testing has to be prioritised. To beat the virus we have to find it and isolate it.

Kim Sawyer is an Honorary Senior Fellow at the School of Historical and Philosophical Studies, The University of Melbourne.

A version of this article was originally published here on The Australian Financial Review.



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Governance for global pandemics

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Author: A Chong, Singapore

Much of the public alarm triggered by the outbreak of the novel coronavirus (COVID-19) is greatly bound up with the management of cross-border security threats. COVID-19 resembles a 21st century medieval plague in terms of how little we understand its character and how vulnerable we are to its effects.

A departures board is seen at Brazilian International Airport amid the coronavirus disease (COVID-19) outbreak in Brasilia, Brazil, 25 March 2020 (Photo: Reuters/Adriano Machado).

The Director-General of the World Health Organization has openly admitted: ‘You can’t fight a virus if you don’t know where it is. That means robust surveillance to find, isolate, test and treat every case, to break the chains of transmission’. The virus is known to transmit through direct contact with respiratory droplets and residue on cool surfaces, which suggests that infection at room temperature is likely. Most standard medical advisories published by national health authorities include strong recommendations for regular handwashing, avoiding handshakes and hugs, and social distancing. Meanwhile those with suspect or confirmed cases are quarantined.

These drastic measures have spread panic and fear among the public, despite government calls for calm.

Addressing the pandemic should not be left only to medical professionals. The coronavirus crisis is emblematic of the difficulty of constructively extending good governance across borders. An effective response requires governments, medical authorities and civil society to consider a new spatialisation of threats to human security when making decisions.

Tourists, migrant workers of all skill levels and businesspeople are the daily agents of globalisation. They bring much-needed services to their host populations. Their spending delivers the most visible benefits of open borders, lifting local incomes and fuelling industrial supply chains.

But when these human agents of transnational movement carry pathogens, governments are compelled to close their borders. Whole towns restrict or deny entry to outsiders, entire ships and their passengers and crew are embargoed offshore, and even peaceful arrivals are blocked by military force. In this regard, the Chinese lockdown of Wuhan and other cities in Hubei province was necessary and commendable.

The general idea of observing the socially diseased from a central point is widely known in social science thanks to the work of Jeremy Bentham and Michel Foucault. The ‘panopticon’ is an idea that can be traced back to early modern prison surveillance architecture where prison cells are arrayed around a central towering guard post. This system was meant to instil fear in those prisoners being watched in their cells, while also ensuring that they develop self-vigilance.

The panopticon is a remarkable analogy for preventive health surveillance today. The infected are monitored 24 hours a day in quarantined locations by nurses and doctors. Bureaucrats in national health ministries report every improvement or deterioration of the sick. This compels both the sick and the uninfected to adapt to a regime of compliance with medical advice and good sanitary practices. In places as diverse as China, Israel, Singapore, South Korea and Taiwan, mobile apps have been made available to the public to report their temperature and health status on a regular basis. In Israel and Singapore, authorities are even attempting to use mobile phone records to triangulate the proximity of ordinary passers-by to possibly infected persons.

In some countries, contact-tracing is being employed to good effect, guaranteeing that every contamination suspect is isolated from acting as a point of further contagion. Everyone then starts to monitor fellow citizen’s hygiene out of internalised habit. The question of invading one’s privacy seems momentarily irrelevant.

Local, federal and supranational governments justify these practices in the name of watching the population police themselves. In this regard, there is nothing wrong with governments telling people how and how often to conduct personal ablutions for the sake of the nation’s health. China can invoke Maoist-style totalitarian campaigns, the United States can dub its response an emergency measure and the South Koreans, Spaniards, Iranians, Italians and Singaporeans can label their response a government and society action plan.

The irony is that in psychologically disinfecting an entire population under threat, the long arms and eyes of surveillance must reach into every nook and cranny of private life. An inner globalisation has to take place – but ideally under the watchful eyes of civil society. The Leviathan of Government needs to be unbound to do its job, but once done, democratic liberties will have to be observed.

Defeating a globalised biosecurity threat necessarily demands something akin to real-time intelligence sharing. For many sovereign governments, this is easier said than done. The World Health Organization ought to initiate more intensive pandemic preparedness programs for training civil servants tasked to manage health crises. It is already offering crash courses in managing COVID-19.

The global north and global south must find a common depoliticised platform to exchange relevant information about the latest viral threats in much the same way cyber security firms and national cyber agencies monitor digital viruses in real time. Both Chinese President Xi Jinping and US President Donald Trump should forge a politically-insulated channel of communication whereby their respective medical establishments can swap the latest pathogenic threat information without fear or favour. It will also burnish both governments’ claims to be providing responsible global leadership under both peacetime and crisis conditions.

Above all, global biosecurity intelligence sharing should operate beyond nationalist considerations, simply because pathogens afflict all human beings regardless of political allegiance.

It is sobering to recall that the first cross-border infections broke out across East Asia in less than a month. Three months later, 188 countries have officially declared infections amounting to more than 400,000 cases and over 17,000 deaths. This scenario panned out this way because there was no early warning through intelligence sharing across borders.

A Chong is a foreign affairs and political commentator based in Singapore.



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