FEER : MAHATHIR'S PARTING SHOT AT THE WEST

[Lemur]

As for the U.S., you know that I am strongly opposed to the invasion
and occupation of Iraq and the doctrine of "preemptive attack," which
has been shown to essentially mean attacking a country with no
justification for doing so.

Yes I do. :)

But whatever is going on now is not colonialism; it is something else.

Probably so, but Mahathir can create a stronger rallying point
by claiming that the West are trying to colonize them, as opposed
to suggesting that the West are engaged in activities that can be
constituted as a benign form of colonialism through use of economic
pressures. Most of the target audience might not understand the
impact of the latter.

But I notice you didn't address the issue of displacing aborigines from
their traditional lands.

I am not aware of any incident other than Bakun, I guess there
are, but I doubt there were loss of life and such, like in Brazil.
Brazil are guilty in this case, but I don't think they've tried exerting
their will through economic or any other means in a far off place to
make them colonialists.

If you extend credits to incompetent people, they'll leave a legacy of
unpayable debts, right?

And if you don't, does the country starve?

They have humanatarian aids for that, don't they?

Lots of money has been lost because of reckless lending. I'm not sure
it's really been so advantageous to the lenders.

Most of the problems faced by poor countries are their own
doing. Maybe they had a corrupt leader. But if the lenders
are adamant of getting their just dues from poor nations,
even when a more responsible leader comes along, they'll
still be stuck in perpetual poverty. The cycle has to be
broken.

colonialism. Loose use of words is something I do not favor.

In communication, the most important thing if for the
other person to understand what you're trying to say.

I also have often been highly critical of the IMF and World Bank. But
again: There have been huge anti-globalization demonstrations in the
U.S. and Europe, including the shutdown of the GATT meeting in
Seattle, which friends of mine participated in. You are talking about
undemocratic, unaccountable banking institutions, not the "European
race."
As I said, most Europeans and many Americans strongly opposed the war.
That doesn't make the "European race" inherently violent, etc., etc.
All of that is racist bullshit.

But the IMF and World Bank are still around. Their main players
are mostly Westerners, I believe. Western tools. Western government
are in favor of IMF & World Bank. The majority of people are in favor of
their
government.

In a democracy, if the people want enough, they can demand it from
the government, so either the majority of the people are in favor of their
government's policies or they are indifferent about the plight of third
world
nations. Though it's not their fault, they're not entirely blameless.

Which country is Germany trying to colonize today? How about Poland?
Italy? The Netherlands? Bulgaria? Perhaps Greece? Do you see how
absurd this is?

How active are those countries in the IMF/World Bank's policies?
Of course not all Western nations/people are at fault. I guess there
was a fair bit of generalization.

That's even bigger bullshit! Your claim is that he put forth a bunch
of stereotypes about the ostensibly inherent nature of the "European
race" and then said that he was not against the members of that
"race"?

Well that's what he said. If it's my nature to steal, for example, would
it be impossible for you to still accept me as a friend?

And some Asians and Africans do sneaky things behind people's backs.
So what?

Yes they do. I was talking in context with 'colonialism'. For example,
despite what and why they did what they did in Iraq, America still come
across looking like the good guys because of favorable reports
from their mass media. Despite some European countries taking
advantage of poor nations and possible keeping them in perpetual
poverty, they still come out looking respectable. However when someone
does something which is against Western interest, he's portrayed as
a global villain, like Fidel Castro.

[snip]

If Mahathir had been politically correct in trying to
make his point, it would probably have been ignored by the world's
media,

[snip]
And that would have been much better for Malaysia!

It is better for poor nations in general if more people were aware
of what's going on.

This shit will do
_wonders_ for tourism and investment in Malaysia on the part of the
"European race"! One can only hope that Mahathir's successors will be
able to undo some of the damage your intemperate old redneck of a PM
has done, and that Mahathir will shut up a little more often when he's
retired.

While the European nations happily continue doing what they do?

I hope you recognize the difference between content-based criticism of
policies and racist rants, and I hope you recognize that, while
Malaysians like you may be used to "interpreting" (I'd say
interpreting away) Mahathir's language, we orang putih recognize
racism when we hear and read it. Expect Thailand to have an increased
share of tourism in the coming decade or so.

I sort of understand him. He's not a bad person. He a realist.
Sometimes he say stupid things but most of the time he makes
sense, though it may not be popular or please all the parties.
I believe he genuinely care about bringing poor nations out of
poverty, if it means treading a bit on Westerner's toes, it's
a small price to pay. :)

[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 3 July 2003

TRAVELLERS' TALES
By Nury Vittachi

ELECTRIC SHOCKS: A man in Bangladesh paid for a telephone line and
waited for the engineer to come and install it--for 27 years. A
uniformed man finally turned up last month at the home of Mohammad
Ismail of Dhaka to fix the line he had paid for in May, 1976. During
the past quarter century, the householder had regularly reminded the
company about the nonarrival of the serviceman, the Associated Press
reported. But it was only when a newspaper reported his long wait that
the state-run Bangladesh Telegraph and Telephone Board took action. "I
am so happy. But I am a bit sad, also," Ismail, 60, told the
Manabzamin newspaper. "When I applied, I was a young man of 33 and had
dreams about owning my own telephone. Now all those dreams are gone.
My children will use the phone now." If his kids are like other kids
around the world, believe me, they'll make up for lost time.


--------------------------------------------------------------------------------
Shop sign written in the similar font but spelt
dumhill

NAME SAYS IT ALL: Copycats in China are usually pretty good at
replicating designer labels. But there's something about this shop in
Chengdu, Sichuan, which gives the game away. The picture was sent by
reader Paul Sham.


--------------------------------------------------------------------------------

DIGITAL TRACKING: A Japanese assailant left more than a fingerprint at
the scene of the crime--he left his entire finger. The man pounced on
a 30-year-old woman in a car park in Itami, Hyogo prefecture. She put
up a fight and bit his finger off. He fled, leaving his right middle
digit at the scene. His mother persuaded him to give himself up, the
Mainichi Daily News reported. In an unusual twist on normal police
fingerprint procedure, officers could not match the assailant's
fingerprint to their suspect's, since he no longer carried that
particular fingerprint.


--------------------------------------------------------------------------------

SCARED TO DEATH: The critics may have said it was flawed, but one
film-goer apparently found Indian horror movie Bhoot (Ghost)
sufficiently scary. The man, aged about 50, was found dead in a cinema
seat after the show ended after midnight in a New Delhi cinema. "Maybe
he got frightened, I don't know," a police official told Reuters.
Before the movie starts, a warning from the director tells people with
heart problems that they are viewing the film at their own risk. This
incident, in a way, is the ultimate compliment to a horror director.


--------------------------------------------------------------------------------

MISCOMMUNICATION: A hotelier in Bangkok became suspicious when he saw
a man furtively hanging out in the lobby. Proprietor Asuwin Inghakul
got even more worried when he recalled that the person, who was
carrying a walkie-talkie, had also been at the hotel the previous
night.

The hotel owner and a security guard together pounced on the
interloper, who was found to be carrying a gun and 12 rounds of
ammunition. They locked him up and called the police, the Daily News
reported.

The captured "intruder," Prasanpangsri Sathit, explained that he was a
police officer moonlighting as a bodyguard and working at the hotel.
His story turned out to be true. The person who had hired him was Nada
Wiyakan, hotelier Asuwin's wife. Police arrived and arrested their
colleague for carrying weapons. No doubt he wishes married couples
would talk to each other more often.


--------------------------------------------------------------------------------

COLLATERAL THINKING: A man left his girlfriend as a deposit when he
borrowed a mobile phone from a shop in China. The buyer, who claimed
to be a businessman from Taiwan, picked up a new Nokia hand-phone at a
shop in Guangdong, the China Daily reported. He told the shopkeeper
that he wanted to take the model outside to test its clarity over
distances. He never returned. The manager then asked the woman to pay
for it. She refused, explaining that she had only known him for three
days and had never even asked his name. She was released. Of course,
had she been his wife, she would have known his name--but probably
still wouldn't have paid his bills.


--------------------------------------------------------------------------------

(font too small to read)

STILL WATERS: People rarely read the small print on tickets, but the
details on the entrance ticket to the gorgeous white sands of
Dreamland and Balangan Beach in Pecatu, on the northeastern coast of
Bali, hints at a dark and complex tale of double-dealing in business
and politics. It was sent by reader Ismira Lutfia, who found it
amusing but also "innocent and sad."


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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 10 July 2003

oops, forgot to change the date in earlier post

No Frills, Smaller Bills

Good news for cost-saving travellers: A bevy of budget airlines is
taking off in Asia. But international restrictions between governments
keep them boxed in to domestic routes, so the big, traditional-style
carriers are safe--for now
By Trish Saywell/SINGAPORE and Scott Neuman/HONG KONG

THERE'S DEFINITELY something in the air. In the past few weeks,
Singapore Airlines said it's thinking of launching a low-cost,
no-frills carrier from scratch. Malaysia's budget airline, AirAsia,
unveiled a fleet expansion and signed a private equity deal with three
new investors worth 98.8 million ringgit ($26 million). And on June
24, news broke that the former managing director of Singapore Airlines
had registered a new carrier called ValuAir. Not to be outdone,
Australia's domestic low-cost airline, Virgin Blue, recently asked for
permission to fly to Fiji, New Zealand and Vanuatu.

FLYING FOR LESS

Passengers cut costs by:
• Paying lower ticket prices
• Paying directly for in-flight snacks
The airline cuts costs by:
• Hiring nonunion pilots and other employees
• Sticking to a single type of aircraft
• Limiting network expansion
• Using on-line ticketing

The success stories of budget carriers such as Southwest Airlines in
the United States and Ryanair in Europe have sparked a push in Asia
for similar services. In India, Air Deccan plans to woo away the top
end of some of the country's 5-billion-passenger annual rail market,
while budget airlines in Australia, Japan, Malaysia, New Zealand,
Thailand and the Philippines are winning a chunk of the
domestic-market share of their mainstream counterparts.

So far in Asia, the two most successful budget carriers, AirAsia and
Virgin Blue, have stuck to a cost-saving model. For the passenger,
that means a cheaper ticket, but you'll pay for extras such as
in-flight meals, drinks and snacks. For the airlines, it means hiring
nonunion pilots and employees, sticking to a single-type of aircraft,
limiting the expansion of their networks and using on-line ticketing
to cut out travel agents' commissions. AirAsia, whose fares on some
routes have become legendary for being cheaper than bus tickets,
boasts the lowest unit costs of any airline in the world, according to
the Centre for Asia Pacific Aviation, a consultancy in Sydney.

"We have a product that people want," explains David Huttner, head of
commercial at Virgin Blue, which is partly owned by Richard Branson's
Virgin Group. "There's a niche out there that expects business class,
expects frequent-flyer miles and wants free drinks at the lounge."
That's a group that on a per-passenger basis is the industry's most
lucrative, but ironically it's one that doesn't fit into Virgin Blue's
formula for success. By targeting primarily leisure travellers, as
well as some price-conscious businessmen, the airline has captured 28%
of Australia's domestic market at the expense of Qantas Airways,
despite the venerable carrier's own low-cost ringer, Australian
Airlines.

It's not surprising that low-cost carriers offering cheap tickets and
few in-flight services are gaining traction in the region. Rising
incomes and economic growth are empowering more Asians to board
aircraft--particularly in parts of the region that are poorly served
by road and rail infrastructure. In theory, Asia has most of the
ingredients for making a budget airline work: a huge and dense
population base, the emergence of underused regional airports, a
growing propensity among some upwardly mobile people to travel, and
relatively high Internet usage.

The question is whether no-frills carriers can replicate their
domestic track records overseas. One of the biggest hurdles is the
restrictive regulation of international routes that boxes new carriers
into their domestic markets to start with. That's in sharp contrast to
Europe and the U.S. Europe is now a single aviation market with few
obstacles to adding destinations and flight frequencies, and the U.S.
is its own vast domestic market anyway. Those environments have
enabled no-frills carriers to account for a quarter of all air travel
in the U.S. and about 10% in the European Union, according to Philip
Wickham, an aviation analyst at ING Financial Markets.

"Europe is one market--it's not governed by a series of bilateral
aviation agreements like Asia," explains Tony Fernandes, AirAsia's
Kuala Lumpur-based chief executive officer, in a June 6 interview with
the REVIEW. "Asia is just going through the initial stages of
liberalization." Fernandes, a former music executive who holds about a
25% stake in the airline, points out that AirAsia has received landing
rights in Thailand, Indonesia and the Philippines, but says that
regional routes are not likely to be launched for another 12 months.
"It's an incredibly tough business," he says. "We're taking our time
because flying outside Malaysia is going to be very difficult."

Indeed, not all budget airlines have thrived even within the insular
confines of their own domestic markets. Japan's Skymark has recorded
annual losses since its launch in 1998. And bilateral agreements
aren't the only obstacles in the way of truly pan-Asia budget
carriers. Landing charges at so-called "gateway airports" and
navigation charges are often prohibitively expensive, and in key
destinations like Bangkok, Beijing, Hong Kong and Singapore there are
no cheaper, secondary airports. Moreover, in cities with two airports
such as Kuala Lumpur, Seoul, Shanghai, Taipei and Tokyo, Wickham of
ING Financial Markets notes in a recent report, the older airports are
used for domestic flights.

Wickham also points out that should budget airlines in Asia start
flying regionally, the average point-to-point route in Asia is longer
than in Europe or North America. That means that the aircraft of
choice for budget airlines--the Boeing 737 or the Airbus A-320--may
not have sufficient range for some longer-haul routes. "While a
potential low-cost carrier could employ longer-range aircraft, such as
[Boeing] 767s or A-310s, a mixed fleet of different aircraft types
increases operating costs and reduces productivity," Wickham writes.

Passengers are also reluctant to board a no-frills airline for a
long-haul flight. "The longer the route, the less price-sensitive the
passenger becomes," notes Simon Gresham, an analyst at Merrill Lynch
in Sydney. "They don't want to be crammed into a plane for six or
eight hours." Especially when there are limited or no in-flight
services.

But low-cost carriers still have plenty to cheer about. AirAsia has
expanded quickly since its parent, Tune Air, purchased a 99.25% stake
in the company in December 2001. Fernandes and four partners agreed to
buy the loss-making, full-service airline from its owner, car-builder
DRB-Hicom, for a nominal payment of 1 ringgit. That came with two jets
and debt of 40 million ringgit. The carrier announced this month that
it is to lease seven and buy four Boeing 737-300 aircraft from GE
Capital Aviation Services. This will bring the airline's fleet to 18
aircraft by June 2004.

Its focus is on lowering costs: cabin attendants clean the aircraft,
thus reducing turnaround times at airports, and they earn commission
on sales of snacks like soft drinks and peanuts. "Sometimes pilots
help clean the planes and I've checked in passengers," Fernandes
notes. "Competition is not our enemy, cost is our enemy."

So far, AirAsia has transported nearly 2 million passengers to 13
cities around the country. About 40% of tickets are sold on-line. For
the fiscal year ended June 30, AirAsia posted a net profit of 20
million ringgit on turnover of 330 million-335 million ringgit. Its
profit margin is about 6% and there is no debt on the company's
balance sheet.

Helping that healthy balance sheet is the company's policy of flying
the same type of aircraft and only to destinations within a three-hour
radius--no further. "It's absolutely necessary that you fly a single
type of aircraft to make the budget- airline model work," Fernandes
explains. "737s are good aircraft for that. They allow us quick
turnaround times and they allow us to reach plenty of places with lots
of people within a three-hour radius."

At his first press conference in Singapore on July 1, Fernandes said
he would be talking with the Singapore government about the
possibility of flying to Singapore. But he cautioned that cost was
key, and said that Changi International Airport "is an expensive
airport." "We'd definitely love to come to Singapore, but we'd have to
lower the cost," he said.

Meanwhile, with about 5.5 million passengers in the year to March
2003, Virgin Blue generated revenues of A$934.3 million ($623
million), according to the Centre for Asia-Pacific Aviation. The
consultancy also says about 85% of its sales are through call centres
or the Internet. That's a key cost saving. Industry analysts estimate
that distribution or ticketing costs generally run to 15%-17% of an
airline's budget, a cost that can be significantly reduced if
passengers buy their tickets on-line. At Virgin Blue, the reservations
system costs one-tenth per passenger of what it costs the big
carriers, and just three staff handle tickets in its accounting
department compared with an average of 50-60 at the big carriers. Sums
up Virgin Blue's Huttner: "Simplicity is key."

Looking forward, Huttner is optimistic that eventually Asia will go
through the same deregulation process that occurred in the U.S. and
Europe, and cites Malaysia and Australia as the most progressive
examples. "The same countries that have deregulated telecoms and other
upstream businesses are starting to look at airlines in the same way,"
he says.

But at the end of the day, Huttner emphasizes, success is all about
efficiency. "Big carriers have this view: They think if you start
taking away the meals and beating up your staff on wages, that's all
it takes to be a budget carrier. It's much more than that--even with
that, they still can't meet our efficiencies."
+++++++++++++++++++++++++++++

Executives on A Leash

Post-Sars, some companies are saving on their travel budgets, as
technology keeps them in touch with Asia
By Scott Neuman/HONG KONG

AT THE HEIGHT OF the Severe Acute Respiratory Syndrome, or Sars,
outbreak, Bangkok-based executive-search firm The Wright Company was
faced with a dilemma: For a typical search, the company might fly in
as many as eight candidates to its regional offices for interviews.
But travel bans to parts of Asia were threatening its business. "Once
you got a search going, you couldn't get the candidates to fly in,"
says Vincent Swift, the company's regional managing director.

So the company tripled its use of videoconferencing instead. But now
that Sars is tailing off, it's not back to business as usual. The firm
saved so much time and money that it is replacing many of its
preliminary face-to-face interviews with videoconferencing. The firm
is even investing tens of thousands of dollars in a videoconferencing
suite in its Bangkok office.

This kind of Sars-inspired innovation might end up saving companies
significant amounts in the long run, but it also stands to deliver
another blow to the region's business-travel industry. Already, the
numbers indicate that the temporary travel bans might be having a
permanent affect: According to a focus group conducted in May by the
International Air Transport Association, an airline industry grouping,
30% of the 200 corporate travellers or corporate decision makers
surveyed worldwide expected a reduction in their travel budgets;
that's up 5% from a pre-Sars survey.

The reason? Many companies learned by necessity that they can get away
with doing less business travel than they did before. "It really
doesn't make much sense to have a senior executive [from Europe or
North America] take a 20-hour flight for a day and a half of
meetings," Swift says. "Now that we have the option not to do that,
we'll be taking advantage of it more often."

In tradition-bound Asia, that had rarely been an option in the past.
The value of a face-to-face meeting far exceeded the cost of an
airline ticket. "Traditionally, there has been a view that you have to
be face-to-face to conduct business," says Merle Hinrichs, chief
executive of Hong Kong-based Global Sources, a worldwide trade
facilitator that links buyers with suppliers. "But when you say that's
not possible, people very quickly become quite creative. They begin
doing things in ways they didn't believe were possible." Sars got some
executives thinking "maybe I can cut down the number of trips I need
to make to the Orient and cut my costs at the same time," Hinrichs
says.

That change has been reflected in bookings at travel agencies, such as
Compass Travel in Hong Kong, which handles mostly business clients.
"Instead of flying executives out from headquarters in Europe or the
[United] States, more and more [companies] are delegating to their
regional offices," says General Manager Janet Li.

Oneida Silversmiths, a cutlery manufacturer in Britain, found that
Sars tested its ability to resolve production and quality-control
issues at its plants in Asia. Unable to fly out staff from
headquarters, it discovered an inexpensive, hi-tech solution: a simple
digital camera and e-mail. "We pack a lot of products at source [in
Asia] in sometimes quite complicated packaging," says Tanya
Everest-Ring, the company's European marketing director. "The
procurement team has sent a series of step-by-step construction
pictures to help the packers understand how to pack a product."
Post-Sars, they plan to continue the arrangement.

For years, Motorola had been using Microsoft's NetMeeting, Web-based
videoconferencing software, to communicate between the U.S. and its
regional offices twice a week. During the Sars outbreak, the software
proved effective in keeping a handle on operations throughout
Asia--much of which would usually be done face-to-face. "We've proven
that some discretionary travel can be reduced through technology,"
says Mary Lamb, director of corporate and public affairs at Motorola's
Asia-Pacific office in Hong Kong. "Certainly not all in-person
meetings can be eliminated--nor would we want it that way--but we're
seeing that some business can be conducted remotely."

Of course, it's not just Sars that brought about this change, but the
widespread availability and affordability of technology like
videoconferencing that can make communications easier. Five years ago,
the technology was expensive and the quality questionable, admits
Pierre-Francois Catte, chief operations officer for U.S.-based
PolyCom, the largest maker of videoconferencing equipment. Images were
jerky, video and audio often didn't synchronize and the necessary
dedicated digital phone lines were expensive. On top of that, it was
hard to use. Now, PolyCom's system taps into the Internet. Using
broadband, or high-speed Internet access, the cost of operating
PolyCom's equipment is about one-tenth what it once was and is much
more reliable, according to Catte. He adds that the technology is now
hitting critical mass. "It's like the fax machine 25 years ago: If you
bought a machine then, you couldn't use it because no one else had
one," Catte says. "Now, there's enough equipment out there that we're
getting a network effect." Although he declines to give exact figures,
Catte says PolyCom has benefited in Asia as a result of Sars. "We
think we're seeing a structural change in our industry with more
businesses adopting this technology. We are expecting 15% growth next
year."

Still, there are many people who maintain that technology can never
replace personal contact in Asia. Michael Lee, a self-employed
electronics broker based in Singapore, says, "There's not a lot I can
do via e-mail. I really need to look at the product, touch it. You
can't do that over the Internet."

U.S.-based Rosenbluth International, a leading travel-management
company with clients such as Sun Microsystems and Bank of America,
says it has seen only a slight change in attitudes toward corporate
travel to Asia. "Among people who handle Asia, there's a belief that
they have to get back out there," says Pieter Reider, vice-president
for international development. "What we are not hearing is clients
saying we've found this wonderful system for circumventing travel."

Few argue that there'll be a profound shift, but even a small change
could further hurt airlines and hotels, already reeling from the
impact of Sars on their business. Peter Negline, head of
transportation research at JPMorgan in Hong Kong points out that in
North America, 10% of travel was wiped by the September 11, 2001,
terrorist attacks. The same could happen in Asia because of Sars, he
says. "In every company's travel budget, there's a percentage of
discretionary travel," he explains. "I think a good chunk of that will
be more or less permanently lost because of Sars."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 10 July 2003

Singapore's Housing Glut

The steady drop in residential-property prices is creating negative
equity for homeowners and choking off private consumption
By Trish Saywell/SINGAPORE

A COLLAPSE IN Singapore's private residential-property market has some
economists and homeowners spooked. Residential-property prices have
been in decline since the Asian financial crisis, according to a
recent HSBC report. With the exception of a minor mini-rally in 2000,
private housing prices have dropped 37% since they peaked in the
second quarter of 1996.

That's smaller than Hong Kong's peak-to-trough collapse of 63%--but
the decline in Singapore has had had far-reaching effects because
about 90% of all Singaporeans own their own homes compared to 55% in
Hong Kong. HSBC forecasts average prices for private housing will
decrease by at least 5% this year, following a 2% drop in 2002.

Resale prices for public-sector flats have largely mirrored the
private sector, argues the HSBC report's author, economist Arthur Woo.
The bulk of Singapore's population lives in public-sector housing
supplied by the government-run Housing Development Board. Average
resale prices for HDB apartments have dropped about 30% since 1996.
Says Woo: "It's hard to imagine there will be an upside for the
property market."

Things aren't likely to get better until supply and demand come back
into balance. In the private residential market, 15,790 private
residential properties sat empty in the first quarter of this year--a
vacancy rate of about 7.6%. The supply of private housing units to be
completed is expected to surge from 4,943 this year to 11,999 in 2004
and 12,493 in 2005, according to figures from the Urban Redevelopment
Authority.

About 12,000 HDB flats were empty at the end of last year--translating
into a two-year supply, the HSBC report states. "It looks like the
type of supply that's likely to come out in the next few years is
tremendous and is almost at pre-crisis levels of 1997," says Woo.
"Developers eventually are going to have to launch these properties.
Are the demand factors going to be there? It doesn't look like it."

While some people living in HDB flats may "upgrade" and move into
pricier private apartments, he argues, those numbers may dwindle as
the population ages. "You've got empty-nesters who don't need larger
apartments and will need greater retirement funds," Woo says. He also
points out that roughly 20% of the population are foreign workers who
rent rather than buy. In addition, more than 5,000 families living in
HDB flats "downgraded" to smaller flats last year--up 23% from 2001.

Stagnant wages and rising unemployment are likely to continue to
exacerbate the imbalance of supply and demand in the housing market
and depress prices, Woo argues. Average wage growth of 0.8% year on
year in 2002 was the weakest rate in two decades. And recent calls by
the National Wage Council indicate that about 12% of Singapore's
workforce is likely to experience wage cuts this year. The combination
of lower housing prices and higher unemployment may renew deflationary
pressures.

Changes in residential-property prices also typically have an impact
on private consumption. Lower housing prices can drive savings rates
higher; when property prices fall, fewer owners withdraw equity from
their homes to borrow against the increase in value to finance other
consumption. "There has been a huge negative wealth effect because
people are leveraged into the property market," Woo says. "Going
forward, it just doesn't seem like things are going to improve."

At the same time, developers realize that prices are probably not
going to revert to where they were in the good old days when they rose
20%-30% per year, some analysts warn. But even if there's no upturn
they'll have to launch their properties sooner or later, pricing them
to sell. If developers are sitting on huge land banks for which they
pay hefty holding and interest costs, there's deterioration on their
balance sheets. "When developers acquire a piece of property they
don't hold it and wait for the price to go up," says Tan Cheng Teng of
GK Goh Research in Singapore. "It's changed from an asset-holding game
to a volume or trading game."

Sharmini Rajasingham, an equity analyst at Goldman Sachs, argues there
are several companies with three or four years of supply on their
books, and this has become a "millstone." Developers are unable to
monetize those assets and are generating nothing but holding costs,
she points out. "It's okay to hold that much land bank if prices are
flat or looking like they'll appreciate. But the opposite scenario is
happening and prices are falling. If you can't generate a cash return
and there's no sign the cycle will pick up again, you're better off if
you've got a lean land bank and price moderately."

Of course, not all property analysts agree that the outlook for
Singapore is so gloomy. "There's no denying we've seen substantial
declines since the Asian financial crisis, but I think it's
stabilizing," argues Tan of GK Goh Research. She expects prices to
remain flat this year but stabilize, and notes that there has been new
interest lately when developers have launched low- and mid-end
apartment blocks for the mass residential market. "Demand has been
demonstrated to be strong if developers price it at what buyers are
willing to pay," she argues.

Winston Liew, a property analyst at Daiwa Institute of Research adds
that while prices in the high-end market are still likely to drop
another 10%-15% in the next 12-18 months, the low- and mid-end
markets--S$350-400 ($201-230) per square foot and S$500-700 per square
foot respectively--have bottomed out. "Prices have fallen in that
segment, so we're actually seeing quite healthy demands in that sector
of the market," he argues.

Looking ahead, Liew is optimistic government measures will help shore
up the market. He cites as positive signs the government's suspension
last year of new public-sector housing construction and its further
liberalization of its pension scheme to pay for housing. Moreover, for
the last year and a half, the government has cut back on the amount of
land it is releasing to developers. Adds Terence Tang, country head of
property agent Jones Lang LaSalle, "Prices of private residential
properties will stabilize at the current level or dip marginally in
2003."

But others aren't so sanguine. Even at the low end it's not clear that
prices have bottomed, argues Rajasingham of Goldman Sachs: "Talking
about things improving is very premature." She notes that while it is
true that demand is probably moving up slightly, it remains confined
to a few projects, and even low-end properties that are attractively
priced are not seeing good demand. This may reflect the fact that HDB
dwellers are downsizing their flats to preserve capital, rather than
looking to upgrade, she says.

"What we're seeing is not encouraging. There are a lot of developers
needing cash flow because they haven't had any launches for months and
months, and there are a lot of people worried about their jobs who
aren't buying. It's not a pleasant dynamic, whether it's low-end,
middle-end or high-end."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 10 July 2003

Cuban Chop Suey

A former sin city, Havana's Chinatown today retains a flavour of
naughtiness--but mostly of ersatz Chinese food
By James Pringle

AH, FOR THE BAD OLD DAYS. And in El Barrio Chino before Fidel Castro's
1959 revolution, they were very, very bad. Havana's Chinatown was once
the most notorious district in the most notorious city in the
Caribbean--a playground for sun and sin-seeking tourists, especially
Americans who arrived on $10 flights from Key West, Florida, to drink,
gamble and indulge in the pleasures of the flesh. For the latter, they
invariably headed to Chinatown's most infamous attraction: the Teatro
Shanghai where, as Graham Greene noted in his memoir Ways of Escape,
"for one dollar and twenty-five cents one could see a nude cabaret of
extreme obscenity with the bluest of blue films in the intervals."

After the revolution the Teatro Shanghai was demolished; the site is
now a scraggly grassed empty lot. And El Barrio Chino has been reduced
to three streets with a dozen or so Chinese restaurants and a small
market; the Chinese groceries, laundries, pharmacies and other small
businesses have long gone. A Chinese arch stands at the entrance to
one of the streets, and two years ago, the Chinese embassy paid for
the construction of a bigger arch further down the block, as if hoping
for future expansion.

The enclave, on the southwestern edge of Old Havana, has been enjoying
something of a revival since cash-strapped Cuba started going after
tourist dollars in the mid-1990s. Visitors come seeking a hint of
Chinatown's lurid past, and it does retain a flavour of naughtiness.
In the evenings, young women are ready to sell their companionship,
trying to entice foreign men with a hardly alluring "psst, psst." And
the area is colourful if run-down.

On Cuchillo Street, the Tien Tan restaurant, named for Beijing's
Temple of Heaven, is decked out in yin-yang symbols, red lanterns,
caged songbirds, fake firecrackers and Cuban waitresses clad in
scarlet cheongsams emblazoned with phoenixes. Cuban-Chinese head
waiter Li Gufu wears Qing-dynasty garb with a tacked-on queue halfway
down his back. He waves a menu that includes pork chop suey, spring
rolls and fried rice, and enthuses about the "original ingredients."
But instead of noodles, spaghetti is served.

Havana-born and still speaking Mandarin and Cantonese, 43-year-old Li
is one of only about 500 ethnic Chinese left in Cuba; most are
elderly. Many are descended from the bonded labourers who arrived in
the 1840s on eight-year contracts to augment the African sugar-cane
cutters after the slave trade was abolished. In all, about 140,000
Chinese, mainly from Guangdong and Fujian provinces, were shipped to
the island. After 1870 they were allowed to settle. Whole companies of
Chinese fought in the struggles culminating in the 1898
Spanish-American War and Cuba's eventual freedom. By 1899 Cuba's
population was 1% Chinese--perhaps 16,000--and El Barrio Chino was
home to 10,000 of them.

After 1959, most Cuban Chinese either sought exile in Miami or were
absorbed into the racial melting pot--the mixture of mulatto and
Chinese often produces women of rare beauty. Even President Fidel
Castro's younger brother and heir-apparent, armed forces chief Raul
Castro, is nicknamed El Chino because of his somewhat Oriental
appearance, a matter of much subdued local speculation.

Fidel Castro went to China in February, his second fraternal visit.
But he rejects the socialist-market model for Cuba, where the sluggish
planned economy results in average monthly salaries of $15. Cubans
speak hopefully of the "China model" after Fidel, 76, departs the
scene. Raul Castro has also visited China, several times, and he has
encouraged his army to get into business--it now owns tourist resorts,
an airline, bus and taxi companies and vegetable farms.

Nobody says so openly, but post-Fidel, the man they call El Chino may
begin to open up the economy--and then the Tien Tan may be able to
serve some real noodles.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 10 July 2003

Malaysia's New Growth Strategy
By Tan Siok Choo

The writer is a visiting fellow at the Institute for Strategic and
International Studies in Kuala Lumpur

What has gone largely unnoticed in Malaysia's recently announced 7.3
billion ringgit ($1.9 billion) economic rescue package is an ambitious
objective: The attempt to use new strategies towards building
sustainable growth. Success in achieving this objective will depend on
how fast and how enthusiastically three major groups--small and
medium-sized enterprises (SMEs), banks and development institutions,
and officials in state and local governments--respond to the economic
package.

The immediate objective is to spur on the economy and provide relief
to those hardest hit by the recent outbreak of Severe Acute
Respiratory Syndrome, or Sars. But notably, apart from a half-month's
pay bonus to government employees--which doesn't amount to much in
terms of consumer stimulus--little in handouts was announced. Indeed,
for the first time in a long while, this package includes no
mega-infrastructure projects, nor any other gut-busting fiscal
pump-priming measure. Nothing.

In fact, parsimony is the main characteristic. Out of the 7.3 billion
ringgit to be spent, the federal government's share amounts to just
1.7 billion ringgit, excluding the 800 million ringgit in lost tax
revenues it expects will result from the package. Bank Negara, the
central bank, is providing 2 billion ringgit in additional funding: 1
billion ringgit to be channelled to two existing funds--one for SMEs
and another for new entrepreneurs--and another 1 billion ringgit for
the special relief guarantee facility for those economically hard-hit
by Sars. Other government institutions will disburse an additional 3.6
billion ringgit for targeted priority sectors, of which SMES will
receive 1 billion ringgit. Thus, in a sharp break from the past,
policymakers now regard SMEs--rather than their bigger brothers--as
catalysts for growth. In addition, the fact that multiple
institutions--such as the Agriculture Bank and the National Savings
Bank--are involved reflects a determination that microcredit should be
easily accessible to SMEs.

Another shift in the stimulus paradigm is to be seen in the package's
main focus, which is largely domestic. Although foreign investors
continue to be courted--as borne out by a recent policy initiative--a
pattern of declining international capital flows, coupled with
increasing competition for foreign direct investment, has prompted
policymakers to step up efforts to increase domestic investment.

Similarly, though exports remain a significant component of the
economy, the package reflects a realization that, if left unchanged,
the capacity of the manufacturing sector to fuel growth could diminish
significantly. Thus, a shift to production of higher-value
manufactured goods is to be accelerated. One proposal is to develop
and promote local brands, for which a 100-million-ringgit fund will be
set up. The government is looking at Malaysian-owned companies like
Royal Selangor Pewter in an effort to replicate them on a broader
scale than currently exists. Special attention also will be given to
service industries like education, health and tourism, and efforts to
become a regional centre for food production and halal products will
intensify.

Nevertheless, building affordable housing will be key to boosting
domestic-oriented growth. But in a break with past policy
prescriptions, the emphasis is on the private sector and the
demand-side of the equation. Subsidized loans and cash grants, as well
as tax relief on interest payments for a select group of borrowers,
are intended to make housing more affordable for new buyers. But if
the supply side is to respond to demand signals, removing
disincentives to private investment is crucial. Thus, the stimulus
package proposes easing bureaucratic bottlenecks so building plans are
quickly reviewed by integrated local and state government offices.

Not the least of its intentions, the government seeks to liberalize
the investment climate. Indeed, it has already gone further than
initial plans. Late last month, it was announced that with immediate
effect there would be no foreign-ownership cap on new manufacturing
operations. This makes permanent and extends the 1998 waiver on the
normal 30% bumiputra-equity requirement for investments by foreign
manufacturers.

In the end, reducing red tape clearly won't be accomplished overnight;
the full impact of some proposals may be felt only over time. But the
proposals are a good start--and at least one precedent shows we can
expect further tweaking. What remains to be seen is whether the
private sector will step up to the plate and hit the ball

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[Yap Yok Foo]

From The Australian
7 July 2003

Little hope for Suu Kyi's release
By Kimina Lyall, Southeast Asia correspondent

BURMA'S military regime has published a character attack on democracy
leader Aung San Suu Kyi purportedly written by a close member of her
circle which blames her "rash judgments followed by blind action" for
the breakdown of reconciliation talks between her party and the ruling
generals.

The article, in the state newspaper The New Light of Myanmar, was
published with pictures of the Nobel peace prize laureate dining with
military leader Than Shwe and was said to be written by National
League for Democracy member Maung Yin Hmaing.

While some diplomats said the article did not augur well for hopes of
the early release of Ms Suu Kyi, who has been held in an undisclosed
location since May 30, some Burma analysts said it was a sign the
junta was on the defensive over continuing international criticism of
her detention.

It comes after two witnesses to the May 30 violence, which led to her
detention and left an estimated 90 NLD members missing, arrived in
Bangkok and gave detailed descriptions of the violence.

Burma's generals, who call the country Myanmar, are also reeling from
a decision by Japan to freeze new aid until Ms Suu Kyi is released.

One of the undated pictures showing the two leaders shaking hands was
captioned: Exchanging Clear Smiles and Shaking Trustful Hands.

Another described a "family dinner" hosted by General Than Shwe for Ms
Suu Kyi and other NLD leaders.

But the substance of the article was designed to demonstrate that Ms
Suu Kyi was losing the support of her own party.

"The way she considers the NLD as if she owns it, and acts as sole
proprietor of the organisation, is certainly not in tune with the
desires of the rest of NLD party members," wrote Maung Yin Hmaing, who
at one point in the article said he was "not on close terms with her"
but at another described himself as "a member of the inner circle with
access to her compound".

"Auntie Suu is a wilful and hard-headed person, liable to rash
judgments followed by blind action, in her relations with the present
Government. Nevertheless, whatever the provocation, responsible
leaders of the present Government, preferring to act with forbearance,
and on the basis of give and take, have always chosen to take action
in moderation," he said.

He described a situation where Ms Suu Kyi "flew into a rage" after
meeting a Government representative. "We of course as usual had to
make ourselves scarce to cower in corners here and there to escape her
wrath. Otherwise we would bear the brunt of her anger," he said.

In a bizarre conclusion typical of the junta's propaganda machine,
Maung Yin Hmaing, whose name is not familiar to Burma's exiled
activists, claimed Ms Suu Kyi protested at an NLD photographer taking
video footage of her during a particular journey. He said it was
unusual for her to object to being photographed.

http://www.theaustralian.news.com.au/
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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 17 July 2003

Pop Go the Mosquitoes

In the never-ending war against malaria, scientists in Thailand have
come up with a new weapon
By Rodney Tasker/BANGKOK

IT'S FEEDING TIME, and Namchai Chewawiwat pours a yellow liquid from a
test tube into a small plastic container full of tadpole-like
creatures wiggling around in water. Then he waits for them to start
eating the protein mixture--not to feed them up, but to blow them up.

The wigglers are mosquito larvae that carry plasmodia falciparum, the
parasite that causes malaria, a worldwide scourge that kills as many
as 2 million people a year. Namchai, a researcher at the Thai
government's National Centre for Genetic Engineering and
Biotechnology, or Biotec, is among the scientists frantically working
to find new drugs to outwit the constantly-mutating malaria parasite
and new ways to protect humans from being bitten.

Namchai and his team of four now say they have successfully developed
a cocktail of proteins from three types of bacteria that, when nibbled
by mosquito larvae, makes their cells swell and explode. Killing
mosquitoes at birth is not a new concept, but the Biotec team has
developed what it believes is a more potent toxin than any previously
used. The cocktail combines proteins from two types of bacteria, known
as BT and BS, which have been used for several years in similar
projects to exterminate larvae, by using bacteria extracted from the
guts of malaria mosquitoes, known as anopheles gambiae. The scientists
have managed to make the bacteria mixture float for longer on the
water's surface, where the larvae live. The bacteria not only kill the
larvae but are retained in the dead larvae which are eaten by other
larvae, thus spreading the toxic cocktail.

"Scientifically, we think it's a breakthrough," says team leader Sakol
Panyim, Mahidol University's Director of Molecular Biology and
Genetics. "We are creating bacteria which will give better biological
control than the existing bacteria being used." And the bacteria
mixture won't harm other organisms, he stresses. Sakol has been
working on the project at Mahidol University since 1985, and in 1990
Biotec pitched in by providing personnel and funding of 500,000 baht
($12,100) a year. Mahidol University has a reputation for medical
research in a country that's at the forefront of global research into
tropical diseases, particularly malaria.

Thailand is at the centre of a subregion with a high incidence of
malaria. While 90% of malaria deaths occur in sub-Saharan Africa,
countries in the Mekong region also suffer. According to World Health
Organization figures, in 2002 there were an estimated 2.9 million
malaria cases in Burma, with a mortality rate of 5.5 per 100,000
people. Cambodia, with a mortality rate of 3.85, had 476 deaths from
malaria in 2001. At the other end of the scale, Thailand, with five
times the population of Cambodia, has a mortality rate of only 0.73,
and had 424 deaths the same year, and Vietnam an even lower 148
deaths, with a mortality rate of 0.18.

Thai scientists have already done pioneering work in malaria. In
October 2002, for instance, teams from Biotec and Edinburgh
University, Scotland, announced they had jointly discovered how and
why some strains of malaria parasites become resistant to some drugs.
Drug resistance is a major obstacle in treating the disease. The joint
research has led to a new, more effective range of medicines.

Now, the focus is on destroying the mosquito-breeding cycle at source.
"We want to reduce the population of mosquitoes," says Sakol. "To
eliminate larvae is a long-fought process." The target is mosquito
vectors, or mosquitoes which transfer the malaria parasite from an
infected human to a healthy one with their bites. This includes the
strain of the parasite that causes cerebral malaria, which blocks
blood vessels supplying the brain, and is more often fatal than other
forms of the disease.

The next step is testing the effectiveness of the new anti-malaria
weapon in the field. That is the job of Usavadee Thavara, chief of
biology and ecology at the government's Department of Medical Science,
who is working with the project. "The results so far have been very
good," she says. "Not just against malaria-carrying mosquitoes but
those carrying other diseases." (Mosquitoes also cause such diseases
as dengue fever and encephalitis, a potentially fatal inflammation of
the brain.) Results from the field tests will be shown to the
government committee that controls genetic engineering, says Usavadee.
Practical application--spraying the killer cocktail on larvae-infested
stretches of water--could begin two years from now, she says.

But application could prove difficult because the three main strains
of malaria larvae breed mainly in the purer water that collects in
remote, forested areas, such as Thailand's borders with its
neighbours. Mosquitoes whose bite just gives you an itchy red bump
normally breed in the dirtier water found in urban areas. The areas
where malaria mosquito larvae concentrate may not be easy to find and
treat with the new bacteria-based killer.

"It's a good idea, but it may not be practical," says Krongthong
Thimasarn, a medical officer with the WHO based in Bangkok. She works
on the agency's Roll Back Malaria project, which aims to halve the
number of malaria cases in the Mekong area by 2010. The WHO has
different priorities. "We don't aim to kill mosquitoes, we are only
trying to prevent humans from being bitten," Krongthong says.

The Biotec-Mahidol University team does aim to kill mosquitoes. Each
member of the team is responsible for a different problem associated
with the project, including ensuring that the bacteria has no side
effects, such as causing diarrhoea in humans. Another important issue
is to try to break down possible resistance to the bacteria protein in
the larva's digestive tract. Yet another problem, says Biotec's
Namchai, is to overcome public resistance to such terms as toxins. "So
please call them proteins," he says.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 17 July 2003


Letters to the Editor, FEER

SUPPORT FOR MAHATHIR
You were mistaken in your report on Mahathir Mohamad's last speech as
party leader to the United Malays National Organization's general
assembly. [The Last Hurrah, July 3.]

The speech cannot in any way be construed as a policy address. It was
merely a farewell message to Umno delegates, who are composed of
people with varied backgrounds--village housewives to the elite. The
speech was therefore not an instance of policymaking, as you
apparently portrayed it.

SULAIMAN M. IBRAHIM

Kuala Lumpur

I hail Mahathir Mohamad for his opinion. The West has long been trying
to manipulate Asia and grab its wealth. Mahathir's speech will awaken
many Asians. Moreover, after the invasion of Iraq by American-led
forces, it is inevitable for us all to rethink our strategic
coalitions with the West.

Mahathir has been a voice of conscience for Asia. He might sometimes
be wrong, but from a broad perspective, the Malaysian prime minister
is an important figure who has been a champion for the interests of
Asia.

SULAV CHOWDHURY

Chittagong

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 17 July 2003

CHOOSING SIDES

By Trish Saywell

About one month after reports that the chairman of Singapore
Telecommunications bought and sold S$310,000 ($176,000) worth of
shares in a rival phone company, Ang Kong Hua said he would retire
from the company in August. The company said Ang, who became chairman
two years ago, retired "to pursue his other interests."

Ang's holdings in SingTel competitor MobileOne, known as M1, were
disclosed in the latter company's annual report, which listed him as
M1's 19th-largest shareholder as of March 3, 2003. Some fund managers
and investors have charged that it was inappropriate for Ang, as the
company's chairman, to invest in a competitor because it demonstrated
a lack of commitment to SingTel. Others rejected those claims and
argued that he could invest as he pleased.

Ang defended his purchase of M1 stock, arguing it was just a portfolio
investment. He said he would not feel there was a conflict of interest
in investing in other listed telcos in the United States or the
Asia-Pacific region "if the shares of these companies represented a
good value."

Chumpol Nalamlieng, president of Thailand's Siam Cement, will succeed
Ang in August. He will be the first non-Singaporean to head SingTel,
in which the government owns a two-thirds stake.

Ang, 59, who is also president of NatSteel, was last in the headlines
a year ago when he led a management buyout offer for the company, a
rarity in Singapore. Singapore's only steel maker subsequently became
the focus of a bidding war.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 17 July 2003

TRAVELLERS' TALES

A Test for Post-Modern Asians

Cities in the region may look increasingly Western on the surface, but
their inhabitants remain fiercely Eastern at heart
By Nury Vittachi

AS USUAL, he was waiting at the coffee shop in Orchard Road,
Singapore. "You're a real coffee addict," I said, sliding into a seat
opposite. "No," he replied. "I like Starbucks, but I can't stand
coffee. So I drink this." The reader, whom I shall refer to as Wang
(because that was his name), took a big slurp of Vanilla Creme
Frappuccino.

Wang had neatly put his finger (or his nose) on one of the great
conundrums of modern Asian life. Every day, urban living becomes more
Western. But Asia is Asia, and we inhabitants hang on tight to our
traditions. Thousands of people in Singapore go to Starbucks but never
buy cappuccino. In Hong Kong, residents flock to McDonald's but don't
buy burgers: the top selling sandwich for years has been filet o'
fish.

These days, we play pick 'n' mix with Western and Asian traditions to
create a New Way. As well as coffee-free visits to Starbucks and
eating fish at McDonald's, here are 26 other signs that characterise
the Post-Modern Asian:

1. Your No. 1 guilty secret is that you enjoy karaoke sessions.

2. You think wearing a gold Rolex Oyster is a legal requirement for
Asian businessmen.

3. When you have to eat a Western meal, you ask the waiter for chilli
sauce.

4. You think of your support staff as OLs, or office ladies.

5. Your mobile phone has one ring tone for your main wife and a
different one for your minor wife.

6. You know more European designer labels than any of your European
friends.

7. You sneer at organized religion but take the feng shui of your
office seriously.

8. You bought a Gameboy (pretending it was for your son) to play with
while commuting.

9. You use the office microwave to heat your homemade rice lunchbox.

10. You think of all software as freeware.

11. Even your youngest children stay up till you get home, and you all
go to bed together at 10 p.m. with some warm milk.

12. Your family and friends use what they think are trendy, popular
Western names, such as Bonnie and Gilbert.

13. You have never even thought about paying full price for a video
disc.

14. You drink cognac more often than beer.

15. You never realized that Solitaire could be played without a
computer.

16. You have at least one friend whose first name is a noun, as in
Diphtheria Chan.

17. You don't see anything odd in buying designer label clothes for
infants.

18. You have black hair but think of it as dark brown.

19. You buy a new mobile phone more often than you buy a new suit.

20. You pretend to be into modern pop music, but often find your head
filled with traditional Asian folk songs from your mothers' time.

21. You are amazed at what your Western friends pay for designer
chinoiserie or a salwar kameez that looks like the stuff in your
mother's wardrobe.

22. There is no gadget made of metal with a leather pouch that you do
not own or covet.

23. You drive a German car in your dreams and a Toyota in real life.

24. You have lived next door to someone for five years but know
nothing at all about them.

25. You have w-a-a-ay more remote controls than television sets.

26. After high-class Western cuisine, you sneak off for a bowl of rice
to "fill up."

Recognize yourself or a friend? Write to me the next time you find
yourself ordering chateaubriand with a side of basmati.


--------------------------------------------------------------------------------
(A shop with a lit signboard SMELL )


GIVING ITSELF AIRS: Asia has adopted the Western convention of having
brightly coloured fast-food restaurants with snappy names, I hear from
reader Rebecca Biqi Liu. At the East Railway Station in Guangzhou,
China, she found the Smell.


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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 24 July 2003

TRAVELLERS' TALES
By Nury Vittachi

HONOUR AMONG THIEVES: Gangsters in India have accused police of
breaching their human rights by clamping down on crime. A three-man
team of officers has shot dead six criminals in less than half a year
in a district of Lucknow. Throughout the city, gang leaders, known as
dons, have been thrown into great confusion.

"The situation has come to such a pass that these dons have begun
shooting complaints to the state and the national human rights
commissions pleading for safety from this crack team," the Times of
India reported. Gunman Ramesh Kaliya explained to human rights
officials that police were making his life miserable and he feared for
his safety.

On the plus side, officers claim a drop in criminal activity. The six
dead villains were "dreaded gangsters" with long records, the
newspaper said. "All these criminals were masters in their own field
of robbery, kidnapping or contract killing."

The three officers, whose names are Singh, Shahi and Singh, credit
their success to heavy patrolling, electronic surveillance, and good
timing.

Human rights officials have thus far been unable to find any rule that
enshrines the right of a criminal to commit crimes.
--------------------------------------------------------------------------------

ELECTRIC SHOCK: A family in a one-room apartment in Mumbai received an
electricity bill for "Rs. 3.04 crores." A crore is 10 million, so the
bill was for the equivalent of $645,000, I heard from reader Sunil
Prasad. There are only two power points in the apartment, so the bill
must be wrong. But sorting it out won't be easy. Whenever there's a
dispute over electricity supply in India, Sunil said, "the authority
asks the subscriber to first pay the bill. Only then will the
complaint be looked into."

TAKE NO PRISONERS: Reader Giles Blackburne snapped this picture in
Malaysia. "If I was even considering taking a short cut across this
building site in Kuala Lumpur, then this changed my mind," he said.
--------------------------------------------------------------------------------

SKIRTING THE ISSUE: An island community in the South Pacific has
outlawed women's trousers. From now on, females may only wear "proper"
female attire, such as skirts and dresses, Chief Frank Maki decreed.
Police on Paama Island, part of Vanuatu, have been ordered to detain
women who put on any form of slacks or jeans, the local press
reported. The entire population is only 600-strong, so it should prove
easy to monitor all the women. However, the community leaders are all
male, as is the police force--so no one is qualified to remove the
trousers from women who choose to flout the law.
--------------------------------------------------------------------------------

HITTING HOME: A Japanese motorist who hit a pedestrian and fled later
discovered that he had killed his own son. Hit-and-run driver
Yoshinori Niiya, 74, said he "fled in panic" after bumping into
someone in a tunnel in Kochi prefecture. Fifteen minutes later, he
came back to the scene of the crime--and discovered that the victim
was his son Tokio, 44. Niiya accompanied the dying victim in the
ambulance to the hospital, but kept quiet about his role in the
accident, the Mainichi Shimbun reported. Five hours later,
investigating police noticed that the old man's car licence plate was
dented and blood-stained--and the whole sorry story came out.
--------------------------------------------------------------------------------

DATE WITH DESTINY: A woman recovered her stolen phone by calling the
number and asking the thief for a date. The unnamed Beijing resident
was annoyed when her handbag was stolen from the balcony of her
apartment. She rang the number and pretended to be a friend of the
phone's owner, treating him as if he too were a friend of the owner.
Lively conversation developed into flirtatious text messages, the
China Daily reported. She finally arranged a date with him--and
introduced him to the local constabulary.
--------------------------------------------------------------------------------

GLOWING REPORT: Want some mood lighting for dinner? Forget candles.
Turn on a fish instead. You can now buy zebra fish which give off a
bright green glow in low light. The glowing creatures--zebra fish that
have had the benefit of a little DNA from fluorescent jellyfish--are
bred by Taikong Corp. of Taipei and sold through pet shops in
Southeast Asia for about $15 each. The fish are selling well;
production will be raised to 100,000 a month from August, the
Associated Press reported. But don't think about abandoning your
electricity supplier and breeding these fish to light up your home in
the evenings. The creatures are bred to be barren, so you keep having
to buy new ones.
--------------------------------------------------------------------------------

FAMILY FIRM: Garment companies in East Asia often adopt Italian words
and phrases to make their products sound more fashionable. In Sendai,
Japan, reader Carlos Aquino came across designer clothes by
Cosa-Nostra--which sounds cosy, but indicates links to mafia elements.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 24 July 2003

Malaysia's Monster Mall

Against all odds, Malaysian tycoon Vincent Tan has completed his giant
shopping mall and hotel. But now comes the hard part--finding buyers
By Leslie Lopez/KUALA LUMPUR

AFTER SLIPPING IN AND OUT of several multibillion-dollar development
ventures over the past decade, Malaysian tycoon Vincent Tan Chee Yioun
is betting his personal fortune on one of the region's most audacious
commercial projects.

Covering more than five hectares in central Kuala Lumpur, Berjaya
Times Square--which has taken nine years to complete at a cost of 1.8
billion ringgit ($473 million)--is no ordinary shopping mall. For one
thing, it boasts an indoor theme park that features a roller-coaster
capable of travelling 80 kilometres an hour as it careens through an
enormous eight-storey atrium in the centre of the mall. It will also
have 900 specialty shops, 65 restaurants and cafes, and 1,200 hotel
service suites in its two 45-storey tower blocks.

"This is a going to be a destination mall. Its sheer size will be the
main attraction," says Harminder Singh Bagrian, senior general manager
of Berjaya Times Square, a private company controlled by Tan.

The project's sheer size is also the chief source of concern over its
commercial viability, say private property consultants and bankers
tracking Tan's latest property development. With its location on the
fringes of Kuala Lumpur's central business district, Berjaya Times
Square will add 675,000 square metres of commercial space to an
already oversupplied market. Malaysia's National Property Information
Centre estimates the value of currently unoccupied and unsold
commercial property at roughly 7.6 billion ringgit.

"The fact is that the project has been completed and they've got some
secured tenants, so you will see some life. But it is really hard to
imagine it becoming a major commercial success," says a chief
executive of a foreign property-consulting company. Others gripe that
Tan is testing the limits of convention. For instance, Berjaya Times
Square will have a 12-storey shopping arcade. "But from the Malaysian
experience, shops located beyond the third-floor don't get the
traffic," says one investment analyst, who tracks Tan's business
ventures.

Tan, however, is absolutely self-assured. "We've eliminated a big risk
by completing the project," he tells the Review in a rare interview. A
key feature of Tan's business plan is to sell at least half the
commercial space at Berjaya Times Square, which his company has valued
at about 2.5 billion ringgit.

Berjaya Times Square has so far sold just 800 million ringgit worth of
commercial space and Tan blames the tepid response on what he calls a
"whisper campaign" that he wouldn't be able to complete the
development, which carries about 700 million ringgit in debt. "Now
that it is completed, investors will see the value," he contends,
adding that he expects to hit 1.25 billion ringgit in sales targeted
under his business plan.

Tan has been a big beneficiary of government-awarded contracts and
licences over the 22-year-long administration of Malaysian Prime
Minister Mahathir Mohamad, a long-time close friend and admirer of
Tan's "think big" attitude. The businessman first won the right to
privatize a state-controlled gaming business called Sports Toto in the
mid-1980s, an arrangement that has provided a large and steady source
of profits ever since.

During the 1990s, Tan-controlled companies landed a contract for the
privatization of the Malaysian national sewerage system and a licence
to operate a cellular-telecommunications network. At the peak of
Southeast Asia's 1990s development boom, Tan even secured an award to
privatize a river running through Kuala Lumpur with the intention to
build office towers and shopping malls along and above it, as well as
a contract to build and operate a monorail system in the capital.

But Tan's actual track record has been less impressive than his grand
plans. Apart from the gaming operations housed under Kuala
Lumpur-listed Berjaya Sports Toto and mobile-phone company DiGi.Com,
which he still controls, Tan has divested his problem-ridden sewerage
project and the long-delayed monorail project, which has yet to become
operational. And his ambitious river-development plans never got off
the ground.

Instead, Tan has refocused his recent efforts on the leisure business,
building a host of clubby establishments ranging from stables to
eateries. Most notable is his Bukit Tinggi resort. Perched on a jungle
hilltop about an hour's drive from Kuala Lumpur, the resort is built
to resemble an 18th century French chateau and features everything
from a golf course to karaoke lounges.

Bukit Tinggi, which has become a popular weekend destination for local
and foreign tourists, has also attracted controversy. The Malaysian
government's recent decision to let the resort operate 250 slot
machines raised a huge outcry from the country's opposition parties,
particularly Parti Islam SeMalaysia, which has accused the Mahathir
administration of failing to uphold Islamic values.

The government has since delayed the opening of the slot-machine
operations indefinitely. Tan calls the issue a "misunderstanding" and
contends that the matter will be resolved soon.

The Bukit Tinggi setback aside, Tan believes that his Berjaya Times
Square project will work. He concedes that the project was ambitious
but points out that it was conceived in the mid-1990s, a time of
swelling wealth in Malaysia driven by a booming stockmarket and an
export-led economy growing at an average of 8% a year.

When Asia's 1997 financial crisis hit, Berjaya Times Square, like many
other large property developments, stalled after bank borrowings and
shareholder funding ran out in 2001. Then Tan and his younger brother
Danny Tan Chee Sing, equal partners in the Berjaya Times Square
development, were left with the dilemma of whether to proceed or walk
away.

Danny decided against investing any more funds, but the elder Tan sold
part of his interest in his profitable mobile-phone company, DiGi.Com,
to raise about 250 million ringgit which he injected into Berjaya
Times Square. Tan's bankers, a consortium of financial institutions
led by AmBank (formerly known as the Arab-Malaysian Bank), matched him
ringgit for ringgit, providing enough funds to complete the project.

Borrowings for the project currently stand at about 700 million
ringgit and Tan says a repayment plan has been hammered out to "meet
the debt obligation."

But there are still loose ends to tie up. Some early buyers of shop
lots in the project have filed legal claims demanding compensation for
late completion. Tan acknowledges the problem, but says he can't
discuss the issue because it is before the courts. "We are trying to
work out a settlement. But all parties should appreciate that if we
didn't put fresh funds [into the project] the building would have
never been completed."

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From The Far Eastern Economics Review
Issue 24 July 2003

In a Tailspin

Weak export demand and a drop-off in tourist arrivals following the
Sars outbreak cause a sharp contraction
By Trish Saywell

Growth prospects for the world's most trade-intensive economy already
looked dim at the beginning of the year as the tiny city-state
grappled with a global economic downturn. But then the deadly Severe
Acute Respiratory Syndrome, or Sars, virus struck. The combination has
sent Singapore into a tailspin. Flash government estimates show GDP
shrank an annualized 11.8% in the second quarter over the first--the
worst such fall on record.

The data translates into a second quarter year-on-year contraction of
4.3%. "It's worse than even the most pessimistic analysts'
expectations," says Song Seng Wun, an economist at GK Goh Research.
"The next two to three months will be critical."

Sars hammered Singapore's economy and in particular its tourism
sector. Tourist arrivals contracted 63% year on year to 678,000,
according to preliminary figures; the last time Singapore saw fewer
visitors in any three-month period was in the first quarter of 1984.
"The contraction in the second quarter wipes off about 4% of GDP in
one stroke," argues Paul Schymyck of IDEAglobal. "Even assuming we get
a 50% improvement in tourism in the third quarter, the sector will
still be down by about a third year on year."

Uncertainties in the United States economy and a relatively weak
global electronics market further dampened demand for exports.
Second-quarter manufacturing output fell 7.5% year on year, according
to the Ministry of Trade and Industry, while construction output
contracted 10.9% and the services-producing sector dropped 3%.

Further cost-cutting and corporate restructuring also threaten to send
Singapore's 4.5% unemployment rate over the 5% mark. Port operator PSA
Corp., Singapore Airlines and media giant Singapore Press Holdings
have all recently announced retrenchment programmes.

Acknowledging that Sars and the war in Iraq had hit the economy harder
than expected, the government has effectively eased monetary policy.
In its semi-annual policy review released on July 10, the Monetary
Authority of Singapore "re-centred" the secret policy bands within
which it manages the Singapore dollar. "They're going to allow for a
slightly more competitive exchange rate," says David Cohen, an
economist at MMS International. "More critical will be whether global
growth can show the hoped-for pick-up in the second half."

Many economists including Cohen forecast that the economy will likely
improve in the second half of the year. Sars has been brought under
control and Cohen argues that Singapore should be able to post
positive growth in the third and fourth quarters--although he still
expects full-year GDP growth will be "just below 0%." In a July
research report, economists at DBS Bank argue that a technical
recession--defined as two consecutive quarters of negative
quarter-on-quarter growth--is unlikely in view of the improving
external outlook and note that recent U.S. economic data shows signs
of a pick-up in recovery momentum. For now, the government is
maintaining its full-year GDP growth forecast of between 0.5% and
2.5%.

But Singapore's manufacturing sector may have hit a trough and could
pick up in the third quarter, according to the Purchasing Managers'
Index readings for June. The PMI, widely held as a leading indicator
of trends in manufacturing activity, broke above the threshold 50%
mark, marking an expansion in manufacturing for the first time in four
months.

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[Yap Yok Foo]

From Time Magazine
Issue 21 July 2003

Long Lives Well Lived

Some Asians seem to have discovered the fountain of youth. So what
does it take to reach 100?
By Simon Elegant Okinawa

Huang Maliang, who is 104 years old, keeps a coffin in her house. Her
two-year-old great-great-grandson plays on it, and Huang herself uses
it as a rest stop on her slow journeys from the open-pit fire in the
back of her house to the front porch. Other family members—seven
Huangs, from five generations—share the huge, mud-brick dwelling. They
aren't in the least troubled by the sight of the matriarch sitting
atop the rough wooden box. And anyway, Huang says, lightly tapping the
cover with her fingernails, "this one isn't for me. This is for my
youngest son."

The son in question, a lithe 78-year-old, bounds by in pursuit of a
fleeing toddler. Having caught his prey and carefully wiped away a
smear of dirt from the child's face, he glances up at the coffin. "Oh,
that," he says. "Yes, that one's mine. Mom's had hers for 44 years,
but it's up at my brother's house. We use them for storing grain."

Although they live with these constant reminders of their own
mortality, the Huangs aren't particularly morbid. In the tiny hamlet
of Pinghan, nestled deep among a stand of limestone hills in a remote
region of southwestern China, locals honor an old, national tradition
of buying a coffin at the age of 61. Most of the locals get many
decades of workaday use out of their sarcophagi before pressing them
into service as eternal resting places. That's because the people of
Pinghan and surrounding Bama county, located 250 kilometers northwest
of Nanning in Guangxi province, are exceptionally long-lived. The
county (pop. 238,000) has more than 74 centenarians and 237 residents
who have reached their 90s. That's one of the highest per-capita
concentrations of old-timers in the world, according to Chen Jinchao,
a surgeon who for the past 10 years has run the Guangxi Bama Long Life
Research Institute.

You won't find the county in the Guinness Book of Records because
detailed official birth records only began to be kept there after
1949. But Bama is nonetheless renowned as a place where the sight of
sprightly centenarians is no rarity. Elsewhere in Asia there are
other, similarly fabled pockets of longevity, where, for reasons not
fully understood, life expectancy exceeds global norms by wide
margins.

The Japanese, of course, live unusually long lives—reaching an average
of 81.6 years. By comparison, in the U.S. the average life expectancy
in 2002 was 77.1 and only 74.5 for men, about the same as Cuba's.
Okinawa, the southernmost prefecture in the Japanese archipelago,
boasts the longest-lived population on the planet, with an average
life expectancy of 81.8. Meanwhile, Japan is currently home to the
world's oldest man (Yukichi Chuganji, 113) and woman (Kamato Hongo,
115

At Asia's other extreme, the average life expectancy in Afghanistan is
just 43.1 years. But in neighboring Pakistan there is the geriatric
oasis of the Hunza Valley. High in the country's northern mountains,
it's a place of such pristine beauty and with such a reputation for
fostering longevity that author James Hilton was inspired by a visit
there to write Lost Horizon, the 1933 novel about an isolated valley
called Shangri-La whose residents lived for hundreds of years. Another
death-defying region, currently being studied by gerontologists, is a
cluster of villages in Sunchang county located in South Korea's
mountainous southwest, where some local farmers continue to work the
fields until they are well into their 90s.

Is it something in the water? Why do some communities, located in
disparate places and harboring very different cultures, seem to be
built atop a fountain of youth? Scientific efforts to uncover the
secrets behind these mysterious, mini Shangri-Las have varied
enormously in scope, ranging from a sporadic, amateur attempt by a
busy general practitioner in the Hunza Valley to a quarter-century
study in Okinawa during which researchers carefully amassed and
analyzed data on everything from eating habits to the preferred
hobbies of the oldest of the old (they enjoy playing the Okinawan
three-string sanshin and singing traditional folk songs). There are
tantalizing consistencies in research findings, offering priceless
clues to aspiring centenarians on what it takes to live a long and
healthy life.

You've heard some of the secrets of Asia's most senior citizens before
(probably from your mother): eschew an excess of meat, eat your
vegetables and get plenty of exercise. Other lessons from their lives
are downright depressing, particularly for gastronomes who regard Asia
as a place where one lives to eat rather than the reverse. For
example, it's best to eat only until you are hara hachi bu, or "8
parts out of 10 full," as the Okinawan phrase puts it. An old wives'
tale, perhaps, but scientific evidence has been steadily mounting for
years that gives credence to this simple adage. A daily diet
restricted to between half and three-quarters of the 2,100 calories
recommended by the U.S. government appears to boost health in humans,
and an equivalent reduction has extended the lives of lab rats.

But simply restricting your diet to watercress and celery won't get
you to your personal centennial. There are no magic potions or simple
regimens that automatically bestow longevity. It's the total package
that counts: diet, exercise, mental attitude, family and societal
support—and, of course, your genetic makeup. Some of the longest-lived
Asians appear to have an extended shelf life hardwired into their
anatomy by their progenitors. "My parents and grandparents lived until
they were in their late 80s and early 90s," says Hide Nakamatsu, a
1.47-meter-tall, 91-year-old bundle of life force wrapped in a white
cotton frock, cotton gloves and a bright blue-and-white bonnet. The
headgear is necessary to shade her darting eyes during her daily game
of gateball, a fiercely competitive Okinawan version of croquet that,
in Nakamatsu's case, involves lots of running from one hoop to the
next. Once she's dispatched her opponent's ball from the field with a
sharp crack, Nakamatsu returns to the shade of palm trees sheltering
the gateball court. None of her three children, 10 grandchildren or
nine great-grandchildren has ever suffered a major disease, she says;
they rarely go to the doctor. "I suppose it's something I gave them in
my blood."

Nakamatsu is almost certainly right. Scientists are only just
beginning to unravel how genetic makeup affects aging. But research
published in recent months suggests that a single gene or group of
genes appear to control the aging process. Scientists at Harvard
University and the University of California say a gene related to
insulin production seems to control the onset of aging in experiments
on yeasts and worms. Although the research is in its early stages, the
scientists say there is a high likelihood a similar system for control
of the aging process exists in humans.

The most important genetic factor in longevity is no mystery. Women
live longer than men all over the world, usually between five and
seven years longer in industrialized nations. In Okinawa, as many as
86% of the centenarians are female, according to scientist Craig
Willcox, one of three authors—including his brother Bradley—of the
2001 best-selling book The Okinawa Program. Researchers think women
might have a not-yet-understood genetic advantage. But DNA isn't
entirely destiny—men can improve their chances for a long life by
avoiding destructive behaviors, such as heavy drinking, that most
women tend to avoid. "From our studies, genetics accounts for about a
third and lifestyle kicks in for the rest," says Willcox. "Of course,
if you want to make it to 100, you need a very nice set of genes. But
these days, making it to 90 isn't so hard, with a bit of luck and a
good lifestyle."

Included in a "good lifestyle" is the avoidance of proven killers. Few
of Asia's ancients smoke; if they once did, they kicked the vice long
ago. Most will happily admit to taking a drink now and then, though, a
habit whose benefits in moderation are well enough established that
they are acknowledged even by such cautious institutions as the
American Heart Association. The Hunza's are partial to "Hunza
water"—potent wines made from the area's fruits such as grapes,
mulberry and the ubiquitous apricot. Residents of Sunchang county in
South Korea swear by their soju and makgoli, fiery rice spirits. Park
Bok Dong, who is 101, attributes a major part of her continuing health
(until a few years ago she was still working in her family's rice
fields) to her practice of downing several daily shots of 50-proof
soju. Okinawa, meanwhile, has awamori, a distilled rice spirit that
has a whiff of kerosene in its bouquet but is much beloved on the
island. "I used to like to drink a lot of awamori when I was young,"
smiles Asanori Takemura, a beaming Okinawan baker who recently turned
93. "I still like to, but these days I only take one glass a night—no
more."

Indeed, dietary moderation is a consistent feature of the lives of the
superwrinklies. Protein and animal fat typically play a minimal role
in their menus. In Sunchang, for example, rice and boiled vegetables
are a staple. "The white-rice-and-vegetables-dominated diet consists
primarily of carbohydrate, while remaining low in fat," says Dr. Park
Sang Chul, who heads the World Health Organization's aging-research
center in Seoul and has spent three years studying the residents of
Sunchang. "Low fat content is one of the more crucial keys toward
longevity." The story is similar for the locals of Hunza Valley, says
Khwaja Khan, a physician in the Hunza town of Karimabad who has
treated many of the valley's eldest residents. The Hunza, Khan says,
were cut off from the outside world for centuries by the 7,000-meter
Himalayan peaks ringing the valley, and until recently were forced to
subsist on a spartan menu of apricots, walnuts, buckwheat cakes and
fresh vegetables. Many cross the century mark, and a few motor on for
another 10 years or longer.

Living in relatively poor conditions in a village free of the
industrialized world's dietary sludge—and miles from a fast-food
restaurant—isn't required for long life. But eating habits influenced
by scarcity appear to contribute to health. Says Chinese longevity
expert Chen, the residents of Bama "are not starving, but for many
years they weren't often full, either." In Okinawa, researchers found
their subjects ate about 20% fewer calories than the Japanese
average—which in turn is about 20% lower than the average in the U.S.
According to Dr. Makoto Suzuki, leader of the study of Okinawan elders
and one of Willcox's co-authors, a restricted-calorie diet might
reduce the harmful effects of free radicals—molecules that occur
naturally in the body during biochemical reactions but that can damage
cells and are implicated in most of the deleterious effects associated
with aging, including cancers and cardiovascular diseases.

Happily, living to an advanced age doesn't depend entirely on
self-denial. Researchers are also trying to pinpoint particular foods
consumed in each of the regions that can help avert the diseases and
disabilities associated with aging. The people of Bama, for example,
cook with oils derived from hemp and the fruit of tea bushes. These
oils are rich in unsaturated fat, vitamin E and vitamin B1—antioxidant
nutrients believed to contribute to a healthy cardiovascular system,
says Chen, as well as helping prevent certain types of cancers. Suzuki
says Okinawans do most of their stir-frying with canola oil, which has
been widely shown to protect the body against free radicals.

The Okinawan elders who were part of Suzuki's study got most of their
protein from fish, which provides another so-called good fat: omega-3.
This oil is particularly prevalent in fish such as salmon, tuna and
mackerel, whose established heart-protecting properties are considered
by researchers to be an important reason that Japan's incidence of
heart disease is one-third that of the U.S.'s. Okinawans have about
one-fifth as many heart attacks as North Americans, Suzuki says, and
when they do, they are twice as likely to survive.

The differences in rates of cancer deaths are similarly stunning. In
Okinawa annually, there are an average of six breast-cancer deaths per
100,000 people; that rate is five times lower than in the U.S. The
incidence of prostate cancer is seven times lower than in the U.S.
Suzuki's team attributes the differences in part to Okinawans' very
high intake of substances called flavonoids, relatively
little-understood compounds that appear to help prevent cancer by
neutralizing the destructive effect of free radicals. "Okinawa's
national dish is a stir-fry called chample," says Suzuki. "The exact
recipe varies from house to house but the basic ingredients are always
there: tofu, soya beans and goya [a local variety of bitter gourd].
Those three are all very high in flavonoids as well as other compounds
like isoflavones, saponins and vitamins B and C that provide
protection against free radicals."

Alas, the inhabitants of Asia's Shangri-Las aren't always immune to
the temptations of modern eating habits. In 1978, engineers
constructing the famed Karakoram highway that links Pakistan with
China blasted a route through the mountains and exposed the Hunza
Valley to the outside world. Since then, says local physician Khan,
consumption of previously unheard-of items such as artery-clogging
potato chips and white sugar has risen sharply. The consequences have
been swift, too. In the past, "people would die from diarrhea or from
falling off cliffs. That was about it," says Khan. "But now they are
coming down with hypertension, heart attacks and cancer, just like
everywhere else."

It's a similar story in Okinawa, where the island's youth are
increasingly succumbing to the lure of fast food. "The young people
are eating hamburgers and pork and don't do enough exercise," Suzuki
says. "Okinawan male life expectancy used to be No. 1 in Japan. It
started to decline 10 years ago, and hit 26th out of 47 prefectures in
the 2000 census. I expect it to decline even further in the next
census." The change is almost entirely due to a much higher mortality
among younger people, according to Suzuki. "The elders are living
longer but the young are dying younger." If any further evidence is
needed of the dramatic effect a change in diet can produce, Suzuki
points to the example of an Okinawan community in South America.
Recruited to work on rubber plantations, several hundred thousand
islanders moved to Brazil in the 1930s and switched to eating large
amounts of beef because it was widely available and cheap. According
to Suzuki, they now live an average 64 years—17 years lower than the
Okinawa average.

Still, a healthy diet is hardly the only prerequisite for a long life.
Scientists say another key factor is your mind-set—that's to say, the
emotional resources that enable you to cope with the stresses of daily
life from missing the bus to enduring the death of a loved one. Inner
strength derives in part from vigorous activity, mental and physical.
Bama centenarian Huang Maliang, for example, still prides herself on
her ability to thread a tiny embroidery needle, although she no longer
works in the fields since injuring her hip two years ago. Okinawan
elder Setsuko Miyasato, 90, still spends three hours a day tending to
her vegetable and fruit plots. "I used to have someone do the hoeing
for me when I was younger," says the animated, silver-haired Miyasato,
shielding her mouth as she giggles at the thought. "But I've done it
myself since I was 48. The exercise is good for me. You've got to keep
yourself busy."

That might be a mantra for elders across the region. Okinawan baker
Asanori Takemura rises every morning at 5 o'clock to put in his shift
at the bakery he started 50 years ago. At 93, he continues to create
new confections for the bakery, which specializes in rakugan, cookies
given as gifts on ceremonial occasions such as weddings. "He's still
the boss here," says Takemura's son Isao. "He's the one who started
the business and he still knows best."

Isao, 68, is smiling as he says this, but he isn't just humoring an
old man. His tone is respectful, and his father simply nods his head
at being given his due. Such reverence for the elderly is another
constant in Asia's longevity oases—and it's apparently healthy. In the
Hunza Valley, elders' opinions on critical issues such as when to
plant the barley and the buckwheat are listened to with reverence.
Haji Sikander, an 84-year-old former schoolteacher, sits with his
friends under an ancient chinar tree in the village of Ganish,
watching boys dive into a tank of silty brown, glacier-fed water. "The
elders have always had a command here in the valley," he says with
satisfaction. "What we say is respected."

As Setsuko Miyasato sees it, respect is important because it helps
build the inner strength she believes is the key to achieving a long
life. "In the end, it's your mental attitude that's most important,"
she says. "Every morning I wake up and I'm just grateful for being
alive and healthy. You have to try not to worry about tomorrow too
much. Don't get too serious. Don't think too much. Sing out loud and
play your music."

Don't worry. Be happy. Live long. It might not be quite that simple,
but it's time-honored wisdom from a woman who has lived by it for
almost a century.

—With reporting by Mingi Hyun/Seoul, Susan Jakes/Pinghan, Hanna Kite
and Yuki Oda/Okinawa and Tim McGirk/Hunza Valley
++++++++++++++++++++++++++++++

What You Can Do to live long and well

A large part of longevity is dependent upon genetics. If your family
members lived for a long time, chances are you will too. But, cautions
Bradley Willcox of the Okinawa Centenarian Study, inheriting a solid
set of genes doesn't make you bulletproof. "If you don't take care of
the Benz, you'll be worse off than if you had a [cared-for] Ford
Escort," he says. Here are a few tips to put plenty of miles on the
odometer:

By Aryn Baker

EXERCISE
Regular exercise not only helps to maintain flexibility, joint
resilience and balance but it also keeps the mind alert and the
cardiovascular system healthy. Walking and yoga are particularly good
for maintaining fit abdominal muscles. A Canadian study published in
the Journal of Medicine and Science in Sports found that participants
with weak abs suffered a higher death rate.

STRESS REDUCTION
Asia's most elderly have suffered extreme stress in their
lifetimes—multiple wars, hardship and the loss of loved ones. But many
share a positive and easygoing attitude that lets them roll with the
punches. A study of female centenarians done at the Boston Medical
Center in Massachusetts found they tend to be less neurotic than
average, as did a similar study in Japan. Gerontologists report that
psychological health is far more important than physical health for
maintaining well-being in later life.

SEX
Dimming the lights and putting on some mood music might have more
benefits than simple stress reduction. A 1997 study published in the
British Medical Journal tracked 918 men aged 45 to 59 for a decade and
found that those who ejaculated less than once a month were twice as
likely to die during the study period than men who had orgasms at
least twice a week.

MARRIAGE
Increased sexual activity, however, does not mean that swinging
singles have any advantage over their coupled counterparts. A 1996
report by the RAND Center for the Study of Aging confirms that married
men live longer than confirmed singles. Gerontologists suspect that
better nutrition, attentive care during illnesses and the
stress-reducing benefits afforded by a steady home life are possible
factors. Professor Jean Woo, head of Hong Kong's Sau Po Center on
Aging, says stimulating companionship in old age is an additional
indicator of longevity.

CHILDBEARING
Mature couples may hesitate to have children, citing studies that link
older mothers with an increased risk of birth defects. But a recent
study in the British journal Nature found that women who begin
childbearing in their 30s or 40s tend to live longer than average. An
earlier Harvard study suggests centenarians are four times more likely
than average to have had their first child while in their 40s.

SLEEP
Shut-eye is essential for repairing daily cell damage, which over time
could lead to cancer and breakdown of organ function. A recent survey
by the American Cancer Society found that participants who slept an
average of seven hours a day had the lowest mortality rates. Too much
sleep, however, might be worse than not enough: nine hours per night
was more risky than four. David Phillips, associate director of the
Asia Pacific Institute of Aging Studies, points out that excess sleep
can lead to depression, sloth and mental inactivity—proven impediments
to long life.

DIET
After good genes, smart eating habits might be the single most
important longevity factor. The standard platitudes apply: fruits,
vegetables and unprocessed carbohydrates such as rice should make up
most of your diet; protein should come mostly from fish or legumes
(lentils, chick peas or soy beans); and go easy on the red meat.
Moderate consumption of alcohol is O.K. A long-term study by the
Harvard School of Public Health and the Beth Israel Deaconess Medical
Center shows that daily consumption of a glass of wine, beer or any
other kind of alcohol can significantly reduce the risk of coronary
disease and heart attack.

http://www.time.com




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[adchin]

Very good read. Thank you

[PeeWee]

I'm more interested in Tigress Lily Wan. I love them fierce and packing
power.

Post by Yap Yok Foo
From Time Magazine
Issue 21 July 2003
Pssst... Wanna Buy Some Clubs?
Golfers spend millions a year on counterfeits and knockoffs. To find
southern China
BY E.M. SWIFT AND DON YAEGER
The trap, months in the planning, had been laid. The quarry, a
beautiful Chinese businesswoman named Lily Wan, had taken the bait.
The sting, code-named Operation Tiger Lily, a joint venture of

.com

[Yap Yok Foo]

From Newsweek Magazine
Issue 21 July 2003
A Laugh a Day...
For diabetics, jokes may be beneficial

From The Telegraph, UK
22 July 2003

Laughter 'the best medicine for a cold'
By Roger Highfield, Science Editor

Happy people are more resistant to colds, according to a study in
which subjects were deliberately infected with a virus.

Prince Charles: 'If you are high in positive emotional style, you
report fewer symptoms', says the report

People who are depressed, nervous or angry are three times more likely
to get sick than those who are more energetic, happy and relaxed.

The former are also more likely to moan about their symptoms, even if
they are the same.

To find out the influence on health of "a positive emotional style",
Dr Sheldon Cohen, of Carnegie Mellon University, and colleagues
interviewed 334 healthy volunteers to assess their emotional states.

Each volunteer got a squirt in the nose of a rhinovirus, one of the
types that causes colds. The findings, published today in the journal
Psychosomatic Medicine, also found that a happy disposition reduced
complaints about cold symptoms. "If you are high in positive emotional
style, you report fewer symptoms."


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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 31 July 2003

Bootleg Backlash

Software industry groups are snooping for people using pirated
software. But their assumptions about who's a pirate seem awfully
mixed up
By Jeremy Wagstaff

One recent morning, Jim, a postgraduate student, logged onto his
computer at a Singapore university and checked his e-mail. As he
scrolled his way through, one message made him nearly jump out of his
chair. It was from the university, telling him he was downloading and
distributing pirated software. Jim (a pseudonym) was scared out of his
wits. Two weeks earlier he had used a file-sharing program called
Shareaza (www.shareaza.com) which, among its more legitimate
functions, allows users to download pirated programs from other
people's computers.

Jim's chair-jumping experience is the result of a new aggressiveness
on the part of major software manufacturers, operating under an
umbrella organization called the Business Software Alliance, who are
determined to stamp out illegal copying of their products. Using small
pieces of code called bots, the BSA is trawling the Internet looking
for folks like Jim. When they find them they'll pass on the details to
the bootlegger's Internet service provider, or wherever he's accessing
the Internet from. Using its logs the provider can then find out who
was using what computer, and when.

Needless to say, Jim is contrite--he's removed all the dodgy software,
told his friends to do the same, paid a fine to the university, and
probably wears a tie to the office and helps little old ladies across
the street--and I'm not defending bootlegged software. But I have to
say the episode leaves me feeling queasy, mainly because I believe the
BSA is operating under some serious misconceptions.

Firstly, I'm not convinced it's done its sums right. It claims in its
latest survey that piracy rates, while declining over recent years,
are still high--39% globally, and in my neck of the woods, Indonesia,
89%. But how do they get this data? The figures seem to come from
calculating how many PCs are being shipped in any particular country,
figuring out how many copies of the main programs have been shipped
there, and then comparing the two.

Basically this is how it works: Say country A has shipped 100,000
computers, but folks there have bought only 25,000 copies of, say,
Microsoft Windows XP. That would mean three quarters of the computers
are running dodgy versions of XP, representing a piracy rate of 75%.
The amount lost to piracy? Add up what it would have cost those folks
to buy legit versions of XP, and you've got it. As far as I can work
out, this doesn't seem to take into account usage of different
operating systems on PCs, the possibility that not everyone wants to
use, say, Microsoft Word, and the likelihood that many users might
stick with earlier versions of software, such as Windows Millennium,
or even that old warhorse, Windows 95.

MALAYSIA'S BETTER MOUSETRAP

I think the BSA has its wires crossed here. If it reckons that
everyone who didn't buy a copy of Microsoft Word is a pirate, then
presumably its crackdown is going to end when everyone throws up their
hands, admits defeat and shuffles down to OfficeWorld and shells out
for a legit copy. But is that actually going to happen? Say Jim had
been interested in PhotoShop, an Adobe product and the main commercial
photo-editing program of choice. Retail, it would cost Jim $600. So he
shops around for alternatives. Jasc Corp.'s Paintshop Pro costs $100.
And there's The Gimp (www.gimp.com), a free program written originally
for the UNIX operating system, but now available for Windows. In other
words, an efficient crackdown may merely open up what is presently a
market dominated by the few.

A solution? Malaysia, 23rd on the piracy list with more than
two-thirds of its software allegedly bootleg, reckons it has a piracy
problem because software prices are too high, and earlier this month
gave groups like the BSA two weeks to come up with suggested price
levels that might deter bootlegging. Of course the BSA and company
hate it, but they may not have much choice. If nothing else, it will
provide an excellent export market for home users, who could quite
legally buy software in Malaysia for a fraction of the price back
home. In the end, that may hasten the end of bootlegging, and the
BSA's black-and-white view of the world. Let's hope so.

Write to me at ***@feer.com
(Please state if you do not want your letter published.)

For more, see http://loosewire.weblogger.com

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 31 July 2003

No Sky-High Results

If Singapore Airlines releases poor first-quarter results--as is
expected--the company can justify its cutbacks
By Scott Neuman/SINGAPORE

PERENNIALLY PROFITABLE Singapore Airlines, bludgeoned by a huge drop
in demand due to Severe Acute Respiratory Syndrome, will almost
certainly report a first-quarter loss on July 30.

The results, coming close on the heels of wage cuts, forced unpaid
leave and two rounds of contentious lay-offs that axed nearly 600
people, will add to the sense of foreboding that has pervaded the
airline since the outbreak of Sars.

But there are already signs that the world's sixth-largest airline
will soon be back in flying form: Passenger volumes are rebounding and
the airline says capacity, reduced by a third during the Sars
outbreak, will be fully restored by August. And despite the current
turbulence, analysts still expect the airline to earn S$300 million
($171 million) profit for the fiscal year ending March 2004.

Because this is the first time Singapore Airlines, or SIA, will report
earnings on a quarterly basis, analysts are reluctant to predict what
the numbers will be. Still, healthy annual profits would make SIA a
standout among Asian airlines this year. The consensus forecast would
be a far cry from last year's S$1.06 billion profit (including a S$278
million tax writeback), but it would be more than respectable
considering the S$370 million in losses suffered in April and May, the
months when Sars had the biggest impact.

So, if the losses at SIA are short-term, why the sudden urgency about
cost-cutting?

After decades of easy living at the top, SIA seems to be steeling
itself for a tougher environment that extends far beyond this year's
Sars trouble. The industry has rarely been in worse shape, low-cost
competitors are emerging, and the Singapore government--the majority
owner of the airline--is pushing for greater efficiencies across its
holdings.

The challenge to ticket prices presented by budget carriers such as
Malaysia's AirAsia seems to be weighing heavily on the airline.
AirAsia has yet to expand beyond purely domestic service, but it has
already received landing rights in Thailand, Indonesia and the
Philippines. What's more, last month two ex-SIA executives said they
were studying the possibility of starting a new low-cost service in
Singapore to be called ValuAir. In order to maintain its price and
cost structure, SIA's only choice may be to start a separate low-cost
carrier to compete.

In a sign of the government's concern about the operating environment,
Deputy Prime Minister Lee Hsien Loong said on July 22 that the future
prosperity of the flag carrier "affects not only SIA's workers but the
whole economy and our international reputation." The airline's premium
service--exemplified by the sarong kebaya-clad Singapore Girl--"will
remain its selling point but SIA will have to cut costs, lower prices
and offer even better service in order to outperform competitors." The
alternative, Lee warned, was for SIA "to see its business taken away."

And barely a month after leaving his post as SIA's chief executive
officer, Cheong Choong Kong last week urged the airline's new
leadership to take the low-cost threat seriously and to expand its
international routes. "SIA is taking the view that they need to be
leaner to meet the challenges ahead," says Teo Hiang Boon, an analyst
at GK Goh in Singapore.

Better to bite the bullet now before it is too late, the thinking
seems to go. Savings in labour costs, which account for about 16% of
the budget, bolster the carrier's bottom line. Unlike some of its
rivals in the region, Singapore has also been cautious about returning
too many planes to the air too quickly after Sars. Analysts say it is
the best strategy for keeping per-passenger revenue up. And the
post-Sars traffic volume--led by business travellers who are the
airline's mainstay--is picking up, although it's still far from the
levels carried last year at this time.

Newly appointed Chief Executive Officer Chew Choon Seng, who took the
helm in June, faces the difficult task of selling his staff on the
need to cut costs at a time when--aside from the short-term hit from
Sars--Singapore Airlines continues to show a profit. "These job cuts
are definitely having an affect on morale," says GK Goh analyst Teo.
He adds that Chew "has got to balance the short-term pain with the
long-term needs of SIA."

While the lay-offs, including 26 pilots and 156 cabin crew, represent
only a small fraction of the airline's 30,000 workers, wage cuts and
unpaid leave have been vocally resisted by the unions. The first
proposal on the table would have seen base salaries for pilots reduced
by 22.5% and by 15% for first officers. The two sides compromised at
16.5% and 11% respectively.

In the final stages of the negotiations, Chew helped pave the way for
the compromise by agreeing to a "clawback" clause that would restore
15% of the pay cut if SIA hit a profit of S$600 million for the year.
Although that's twice what analysts forecast, the move was considered
a face-saving gesture for both sides.

Those familiar with Chew say he brings a better sense of diplomacy to
the job than his often-brusque predecessor. "Deflationary pressures in
the industry are definitely pointing to the need to do some
restructuring," says Peter Negline of JPMorgan in Hong Kong. "Mr. Chew
is an excellent person to be leading the business in that kind of a
scenario."

Even with all the hand-wringing at SIA these days, it's good to know
there are some things the airline's loyal travellers can still depend
on--a glamorous image. Even as Singapore Airlines braces for a
bruising battle-for-business round with low-cost carriers, Deputy
Premier Lee said, it "does not mean that SIA should drop the Singapore
Girl."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 31 July 2003

Black Comedy

A Malaysian theatre troupe's brief banning could have been the stuff
of one of its scathing satirical skits
By Leslie Lopez

FOR MORE THAN a decade, Malaysia's Instant Café Theatre Company has
dished out irreverent, often politically incorrect, humour to sold-out
shows, testing the limits of expression in this multiracial,
multifaith country where public dissent is closely monitored and
sometimes punished.

Despite repeated incursions into taboo zones--from lampooning
religious leaders who want to impose Islamic law to mocking ethnic
Malays' dependency on state handouts--the Instant Café troupe had
never been censored. Until last week.

Reacting to a letter published in Malaysia's top-selling
Malay-language newspaper from an anonymous member of the audience at a
recent show, the Kuala Lumpur city government declared it would no
longer issue performing licences to the theatre company, effectively
banning it. The letter writer had called the show--titled The 2nd
First Annual Bolehwood Awards 2003: The Director's Cut--"rude and
demeaning" because some of the skits were peppered with profanity and
allegedly poked fun at Islam.

"It's crazy how this country works--one letter can do it," said Jo
Kukathas, a founding member of Instant Café, pointing out that City
Hall had permitted the group to stage the same show last year. But
five days later, after direct intervention by Malaysian Deputy Prime
Minister Abdullah Ahmad Badawi, the ban was lifted.

The incident highlights how touchy religious and ethnic sensitivities
continue to be in Malaysia. Ever since riots between Malays and
ethnic-Chinese Malaysians in 1969, which left at least 200 dead in the
capital, public discussion of issues involving race, religion and
culture has been severely curtailed and can be considered seditious
under Malaysian law.

These harsh measures, and sweeping affirmative-action policies to
empower the country's Malay majority, have helped preempt a recurrence
of serious ethnic or religious violence. Tensions have been further
eased as a generation of Malaysians has grown up in uninterrupted
prosperity.

Driven in part to challenge the no-go zone of race, religion and
politics, four actors decided in 1989 to form Instant Café. The group
quickly became a household name among Kuala Lumpur's middle-class
because of its sharp-edged shows, which often make fun of the
political establishment as well as ordinary Malaysians' biases and
foibles. Promotional material said the latest show satirized
"everything under the Malaysian sun . . . no one, no institution, no
project, no cultural norm is spared."

Despite sparing neither politicians nor corporate bigwigs, Instant
Café has performed at private functions before the country's political
and business elite, including Prime Minister Mahathir Mohamad, who is
often the butt of the group's sarcastic skits. One is about the
Titanic's little-known sister ship, MSC Bitanic (twice the size of the
Titanic), which is also known as the "the ship of subsidized dreams"
and is captained by think-big Mahathir. MSC stands for "my son's
company," a dig at the debt-heavy shipping company controlled by one
of Mahathir's sons during the 1990s.

Instant Café's success has raised the profile of Malaysian theatre and
encouraged other satirical performances. And it's made money doing it,
which has helped attract fresh talent to Kuala Lumpur's budding arts
scene.

Some Malaysian intellectuals believe the government has tolerated
Instant Café's jibes in part because their shows are mostly in
English. That limits their appeal to Malaysia's urban professionals
and dyed-in-the-wool anti-government types. Many of their barbs and
one-liners--"in Malaysia, culture is only found in yoghurt"--would be
lost on most rural or blue-collar audiences who don't speak English.

So what was behind City Hall's on-again, off-again crackdown? Some had
suggested the move was symptomatic of a government unable to deal with
open criticism and predisposed to knee-jerk reactions. But by quickly
intervening to get the ban lifted, Abdullah, who's scheduled to take
over from Mahathir in October, has squelched suggestions that the
clampdown on Instant Café was a foretaste of what to expect in a
post-Mahathir era.

Kuala Lumpur Mayor Mohmad Shaid Taufik was quoted by a local newspaper
as saying that a City Hall department had acted against Instant Café
without his knowledge. "I don't find anything offensive about the
show," he said.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 7 August 2003

GLOBAL CHINA TRIES TO LIVE UP TO ITS NAME
By Michael Vatikiotis

Just three years ago, Global China Group was a media minnow. But its
chairman and founder, Hong Kong entrepreneur Charles Ho, had a
vision--"to become a multimedia corporation serving global Chinese
communities." Today, the group publishes 16 newspapers in Australia,
North America and Britain and claims a global media circulation of
200,000 and a readership of some 2 million.

Not bad for a venture that started out with a small broadband Internet
service in China's Shandong province. "On a single-brand basis, our
flagship newspaper Sing Tao Daily is considered the largest,
Chinese-language, international newspaper among the Overseas Chinese
communities (excluding the Greater China region and Southeast Asia)"
says Wong Wai Ming, Global China's chief executive officer.

Without a licence to circulate its media products in China, and given
Taiwan's crowded market, Global China's empire is currently confined
to the rest of the Chinese-speaking world. But in Global China's view,
that's a worthy prize.

The company's expansion drive began when it acquired the ailing Hong
Kong daily, Sing Tao, in 2001. The middlebrow title with a reputation
for being pro-Beijing had been sold by its previous owner, Sally Aw,
to the merchant bankers Lazards, who, in turn, sold it to Global China
for HK$690 million ($88 million). Company officials claim it has
already recouped its initial investment by selling Sing Tao's nonmedia
assets.

Global China is listed on the Hong Kong Stock Exchange and recorded a
profit of HK$162 million on revenue of HK$1.09 billion for the year
ending December 31, 2002, compared with a loss of HK$131.4 million for
the previous year.

Sing Tao claims to have the largest-circulating Chinese-language daily
in Britain, and also publishes in Sydney, Los Angeles, New York,
Toronto, Vancouver and San Francisco. "Where there are Chinese, there
is Sing Tao Daily," the company boasts. In the next year, Global China
plans to expand in Africa and Europe and is targeting a daily
circulation of 500,000, a market the group estimates could generate
$250 million-$300 million in annual revenue.

According to CEO Wong, the key to profitability is relevance, but each
of these markets is different. Most Los Angeles readers have Taiwanese
roots; San Francisco customers tend to trace their origins to mainland
China; and New York has a concentration of immigrants from Fujian.
They all want news from their former homes.

Global China's answer has been to set up a news production centre in
China itself and tie up with various local newspapers in China and
Taiwan to help provide relevant local content for each overseas
edition. The group's Shenzhen production centre, meanwhile, now
produces the bulk of news for all Sing Tao's editions.

The idea is to create what Wong calls a "central kitchen" for all of
the group's news publications. This now includes a stable of lifestyle
magazines mostly circulating in Hong Kong, Sing Tao and the
English-language The Standard in Hong Kong.

But Global China's real goal is to crack the mainland market. Here,
the major problems are selling a product and maintaining editorial
control over its content. For most foreign media groups this means a
long wait on the sidelines while local publications reap a windfall.

Global China has made a leap into one permissible area of investment,
setting up a joint-venture media distribution company with the
state-owned People's Daily. This doesn't mean that it can sell its own
publications, but does give the group an insight into China's market.
"This gives us a first-hand knowledge of which publishers are good and
bad," says Wong. "So as and when the market opens up, we'll stand a
better chance than others."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 7 August 2003

Let's Make A Deal

The success of ECM Libra, a one-year-old firm, is shaking up Malaysian
stockbroking circles
By S. Jayasankaran/KUALA LUMPUR

IT'S THE HOTTEST deal maker in Kuala Lumpur, having handled over
two-thirds of Malaysian share placements this year. But the success of
boutique financier ECM Libra Investment Banking Group, a privately
held firm registered last August, is spawning as much jealousy as
admiration in Malaysia's broking community.

Part of the angst stems from the fact that ECM Libra has been
outperforming Malaysia's biggest listed stockbrokers and merchant
banks, which previously carved up share-placement work for themselves.
Assuming a standard placement commission rate of 2%, ECM Libra would
have grossed more than 33 million ringgit ($8.7 million) on this
year's deals.

ECM Libra is controlled by Malaysian investment bankers Lim Kean Onn
and David Chua, and businessman Kalimullah Hassan, with Lim holding
40% of its equity and his partners 30% each. They've beaten out much
bigger local and international rivals to land deals for hard-nosed
clients like Malaysian telecommunications magnate T. Ananda Krishnan
and power and construction tycoon Francis Yeoh. "You have to give it
to them," says Kuala Lumpur-based businessman Jaafar Ismail. "They've
taken on some seriously big boys and won out."

ECM Libra's rapid ascent has some Malaysian rivals grumbling about its
supposed political clout, a reference to Kalimullah's friendship with
and access to Deputy Prime Minister Abdullah Ahmad Badawi, who is
slated to take over Malaysia's leadership when Prime Minister Mahathir
Mohamad retires in October. Kalimullah, a former journalist, is
currently chairman of Malaysia's state news agency, Bernama. "There is
a perception that these guys can open doors for you," says the head of
a local brokerage.

But Chua, who used to work for Merrill Lynch in Hong Kong, bristles at
suggestions that the upstart bank enjoys any special advantages.
"Banking is all about relationships," he says. "And even when you do
get by the door, you still have to deliver the goods." Lim and
Kalimullah declined to respond to questions posed by the REVIEW.

ECM Libra's genesis was an audacious corporate restructuring deal
begun last year. At the time, Lim headed his own financial-services
company called Libra, which won a mandate to arrange a $1 billion
recapitalization of Celcom, Malaysia's second largest cellphone
company. Given its huge debt accumulated under then-owner and
chairman, Tajudin Ramli, no investment bank wanted to touch it. Even
CIMB, the country's biggest merchant bank and the institution
initially given the mandate to recapitalize Celcom, gave up the task
in 2000.

PROFITS FOR PENSIONS
Lim priced the placement low at 1 ringgit a share, and the
reorganization paid off, allowing the ailing company to cut debt and
restore its balance sheet. Celcom's improved finances, in turn,
attracted national utility Telekom Malaysia to offer 2.75 ringgit a
share for the company in August last year. That meant windfall profits
for those who'd participated, including the Employees Provident Fund
(EPF), Malaysia's largest state-run pension plan, which made a profit
of 120 million ringgit from the Celcom general offer.

The Celcom deal brought Lim together with Chua and Kalimullah, both of
whom had been involved in parts of the arrangement. And the success
gave them an idea. Flush with their Celcom windfall, the EPF and two
other Malaysian pension funds had plenty of money to invest in other
telecoms companies. In March, ECM Libra proposed they reinvest their
surplus cash in recently listed Maxis Communications, Malaysia's
largest mobile-phone operator.

A senior Maxis official confirms that ECM Libra approached company
shareholders with the idea. "Kean Onn thought it up," he says. "It
made sense." In late May, a private company sold 260 million Maxis
shares to the three funds for 5.10 ringgit a share, the largest
secondary placement in Malaysian corporate history at 1.33 billion
ringgit. It's paid off so far: Maxis shares are trading around 5.95
ringgit.

The Maxis deal turned heads in Malaysia's financial community and more
business has begun flowing to ECM Libra. In late July, a senior broker
in Kuala Lumpur says, ECM Libra nudged aside CLSA Securities to place
out 120 million YTL Power shares to Malaysian institutions at 2.90
ringgit a share.

The angst level among its competitors is rising

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 7 August 2003

Oodles of Noodles
There's something about noodles. Maybe it's the slurping when you eat
them. Or the endless variations. Or the texture--everything from chewy
to melt in the mouth. Whatever it is, we think it's time to celebrate
one of Asia's all-time favourite foods

How come no mention of the humble Malaysian pan-mee?
This started life in the post WWII era when rice was severely
rationed, due to shortage and also to control supply, lest it
fell into the wrong hands (the MCP insurgents).
A shipment of flour was bought by the British and added to
the ration; which led to pan-mee being "invented"
Never mind, that would be another story from Uncle Yap

++++++++++++++++++++
Lofty Aims
A 22-metre noodle? At The Noodle Loft, they never tire of finding ways
to share their passion for pasta
By Craig Simons/BEIJING

LI JIAN, a 21-year-old chef from China's northeastern Shanxi province,
knows way too much about noodles. He knows how to make shaved wheat
noodles and sorghum pasta flakes and braised oat noodles shaped like
fish. He knows a folk song that records the names of 400 kinds of
pasta. He has memorized a poem by the Tang dynasty poet Li Bai
eulogizing the food. He says with a grin that in Shanxi you can eat
noodles every day of the year and never eat the same thing twice. He's
tried.

Since he runs the kitchen at The Noodle Loft, a popular upmarket
Beijing restaurant with track lighting, rooftop dining, and giant
paintings of flowers hanging on the walls, he might be forgiven his
obsession. Especially as he's also able to make the remarkable
"one-strand noodle"--a single ribbon of wheat dough stretched until
it's 22 metres long and served in a giant bowl with a tangy tomato and
egg sauce. Price? Eight renminbi, or about $1.

The Chinese have been eating noodles since at least the Han dynasty,
which kicked off in 206 B.C., and on a wall of the restaurant a sign
proclaims that China--not Italy--has the world's best pastas. Shanxi,
it says, further refines the art. Li agrees. "Our life in Shanxi is
very poor and plain," he says, "but we've made it plentiful by making
different kinds of noodles."

Hardly much of an ad for Shanxi tourism, but the noodles are good.
Three things spice up Shanxi cuisine. First, the ingredients.
According to Li, the best noodles are made with only water and flour
(although he admits he sometimes adds a pinch of salt, a drop of soy
sauce or a bit of egg white to add taste or keep the dough together).
While that might sound like a recipe for boredom, Shanxi adds variety
by deriving its flour from every kind of grain--wheat, rice, corn,
sorghum, barley and even peas.

The second thing that helps make Shanxi life a little more exotic is
the variety of ways the noodles are cooked. At the restaurant they
offer hand-pulled, shaved, sliced, scissored, picked with a chopstick
(chefs use chopsticks to flick the dough), rolled, and hand-shaped
noodles that can be braised, boiled, steamed, stir-fried or served in
soups.

Finally, Shanxi noodles come with a tray of condiments--shredded
cilantro and slivers of carrot, cucumber and onion--and, at least at
The Noodle Loft, a choice of eight sauces. There's everything from
vinegar and garlic to fried pork stewed with the same mouth-numbing
ailanthus prickly ash that heats up Sichuanese cooking. Li has even
added his own creation, a concoction of eggplant, dried tofu, potatoes
and yellow beans that has the taste of a sweet, summer evening.

If all those choices aren't enough to keep you from yawning, order the
"crystal style" cow genitals or a "salted cockscomb." Li says they're
good.

THE NOODLE LOFT
20 Dawang Road, Chaoyang District, Beijing.
Tel.: [phone]
Hours: 11 a.m. to 2:30 p.m. and 5:30 p.m. to 10:30 p.m.

--------------------------------------------------------------------------------

OUT OF PERSIA

By Fay Khoo

China and Italy may claim to be the spiritual home of noodles, but
these days many historians reckon they actually originated in ancient
Persia. From there, they travelled through China, where they were made
mainly from rice in the south and other cereals in the north.

Today, noodles--fresh, dried and instant--are an Asian staple. Cheap
and easy to make, they can be eaten with an endless range of sauces
and soups. And in some cultures, they're even thought to bring good
luck. At a birthday party in China, Japan and Philippines, long
noodles mean long life.
++++++++++++++++++++++++++++++++

Pressing Engagement

History comes alive on the plate in Kerala, where the pain of making
idiyappam is exceeded only by the pleasure of eating it
By Shailaja Neelakantan/NEW DELHI

MY SISTERS AND I always looked forward to idiyappam on Sundays, but
not without a little trepidation. The whole family was in good spirits
as my mother dry-roasted the parboiled rice flour to make the dough.

Then the trouble began. My father would bring out the presser--a
device that looked like something out of a medieval torture
chamber--to turn the dough into thin white noodles, and my mother
would volunteer to turn the rickety machine's crank. But soon, with a
sigh, my father would take over while my mother wrestled to keep the
presser pinned to the ground. Much sweating, much cursing, and by the
end they were vowing never to make idiyappam again.

Thankfully, their memories were short, and like most families in the
southern India state of Kerala, we regularly feasted on these light
and fluffy steamed noodles.

Idiyappam is native to Kerala but may have its roots in contacts with
China that go back 2,000 years. More recently, says Praveen Anand, a
food historian and chef at Dakshin restaurant in Chennai, the Chinese
concept of steaming food took root in India after traders from the
court of Kublai Khan arrived in the 14th century.

Rice, though, goes back much further in Kerala. Unlike most Indians,
who generally eat polished rice, Keralites prefer unhulled rice,
which--soaked, steamed and dried--is the basic ingredient in
idiyappam. Anand says the custom of eating these reddish-coloured
grains may come from Kerala's ancient medical system of Ayurveda,
which stresses relaxation and healthy eating.

No Keralite could do without idiyappam, especially for breakfast. The
combinations are endless, but one of the most popular is idiyappam
with ishtoo, a coconut-milk curry with peppercorns and vegetables or
meat. Or there's lemon idiyappan--noodles with grated coconut and a
squeeze of lemon. Or tamarind idiyappam--noodles with tamarind pulp,
ginger and green chillies.

Not long ago, my parents decided to end their long-running battle with
the idiyappam presser. Now they buy packaged idiyappam, which can be
boiled like any other dried noodle. Still, every now and then they
admit that it doesn't taste as good as the idiyappam from the machine.
And they're right.

Idiyappam can be found in restaurants specializing in southern Indian
cuisine. In New Delhi try Sagar in the Defence Colony Market. Tel.:
(91 11) 2433-3658. Open from 11 a.m. to 11 p.m.
++++++++++++++++++++++++++
NOODLE REFORM
By Arthur Jones

In China, as with so much else, noodles have undergone "reform and
opening up," and nowhere more so than in its most cosmopolitan city,
Shanghai. State-run old favourites are franchising to private
entrepreneurs and modern, stylish noodle chains are springing up to
wrest customers away from foreign fast food like McDonald's.

"Traditional noodle stores used to be dirty and old, so we thought
that if we could give people a good atmosphere and fresh tasty food,
they would be happy to go back to noodles," says Shanghai-born
restaurateur Fiona Wang, a Canadian returnee, or haigui ("sea
turtle"), as the Chinese call natives returned from abroad.

Wang and her brother Young Wang bought the rights to open a franchise
from a popular, 50-year-old state-run noodle chain that by the late
1990s had become a rundown brand with a dozen branches. "When we were
kids, we used to go to Shanghai's first famous noodle chain, Cang Lang
Ting," Young Wang recalls. "The noodles there were excellent--a secret
recipe, they said. So once we had decided on noodles, there was no use
reinventing the wheel."

Their first Cang Lang Ting outlet, opened in 2001 round the corner
from the American Consulate, was an instant hit, with lunchtime queues
for the chewy wheat noodles flavoured with toppings like crispy eel.
"The noodles are the best in Shanghai," says a young woman diner.
"They're not as soft as regular noodles." Now the Wangs have three
shops in the city centre that use the state-run chain's name and
noodles.

And while they didn't reinvent the wheel, they've given it a new spin.
Their outlets feature Qing-dynasty carved-wood reliefs suspended from
wires like objects in an art gallery. The food too is old-meets-new.
The fresh noodles come daily from the central Cang Lang Ting
kitchens--"the recipe is still a secret," says Young Wang--but the
soup and toppings are made in-house, with new twists like
sesame-coated pork ribs, steamed yellow-fish slices and sweet and sour
eel.

"Most of our customers are young," explains Fiona Wang, "and they're
looking for something new. But we still get old customers who remember
Cang Lang Ting from the early days and want to see if it tastes the
same."

"It was never like this," recalls a diner in his 50s who patronized
the old Cang Lang Ting (which means Surging Wave Pavilion). "This
place is much cleaner. There's even air-conditioning. The food is
still good, but it's a lot more expensive. We used to buy noodles for
2 or 3 jiao [one-tenth of a renminbi] a bowl." Prices at the new-look
Cang Lang Ting start from 10 renminbi ($1.20) a bowl.

CANG LANG TING (the new outlets)
1465 Fuxing Zhong Lu, Tel.: [phone]; 355 Madang Lu, Tel.:
(86 21) 6328 0137, and 401 Changshou Lu, Tel.: [phone]
+++++++++++++++++++++++

A Miracle of Make-Do

A shortage of rice flour forced the Vietnamese to find new ways to
make vermicelli. They're glad they did
By Margot Cohen/CU DA, HA TAY PROVINCE

WHEN CREATIVITY overcomes adversity, cuisines can veer off in new
directions. That's the story behind Vietnamese vermicelli--a culinary
compromise that's become a much-loved national staple. Back in the
1950s and '60s, Vietnam advised its impoverished citizens to devote
less rice to noodle-making. So villagers began experimenting with the
humble arrowroot, a starchy crop once fed only to pigs.

Today, even the pickiest French chefs sing its praises. Compared to
the Chinese or Thai varieties, "Vietnamese vermicelli is stronger and
its threads are bigger. It provides nice structure for crab soup,"
explains Didier Corlou, executive chef at the Sofitel Metropole Hotel
in Hanoi. So it's easy to understand the pride on display at Cu Da, a
hamlet in Ha Tay province just south of Hanoi, where vermicelli is the
leading household industry.

"If you make it by hand, it looks more beautiful than if made by
machine," says 39-year-old Vu Thi Hanh, who has been manufacturing the
noodles in her courtyard for the past 17 years. It's sweaty work.
Three days a week, Hanh spends 10 hours a day squatting in a vat. She
cleans the arrowroot and mixes it with water and sugar-cane extract,
which gives it a butterscotch-coloured sheen. Meanwhile, her husband
stands bare-chested before a charcoal brazier and spreads the gloopy
mixture over a huge steaming pan. After a few minutes, it's stretched
out to dry on a bamboo rack before being cut into strips and fed
through a mechanical cutter. Motorcycles are then piled high with the
bundles of dry vermicelli and zoom off to market, where it fetches
6,500 dong (42 cents) a kilogram.

Time, though, is catching up with traditional makers like Hanh. Two
years ago, one of her neighbours invented a machine that pumps the
powdered mixture into a steamroller to produce the flat, rubbery
slabs.

"Working like this is not as difficult as doing everything by hand,"
explains the inventor, Vu Van Thanh. Thanks to the machine, 20 of
which have already been sold, Thanh's family can produce 1,000
kilograms of vermicelli each day, instead of just 600. That's bad news
for families like Hanh's, who don't have room in their own courtyards
for the machine. Yet, as production rises, demand remains stable.

That helps explain why the ranks of vermicelli makers are thinning.
Ten years ago, Cu Da counted some 250 households pitching in. Now
there are just 80 families producing vermicelli throughout the year,
although an additional 70 get involved ahead of the Lunar New Year,
when soups and salads made with vermicelli are traditionally popular.
Hanh can't imagine her life without the noodle. But unless someone
hits on creative new ways to boost market demand, her business may
prove weaker than those strands of arrowroot.
+++++++++++++++++++++++

Slurp-Slurp Society

Noodle eaters in this town say "look, no hands!" as they wolf down a
favourite regional dish
By Erin Prelypchan/LUCBAN, QUEZON PROVINCE

THE SITE OF the LBC lighting shop, on a quiet road in the central
Philippine town of Lucban, is the unlikely birthplace of a pint-sized
culinary phenomenon. The shop on Avenida Rizal used to be a factory
that produced the noodles for a beloved regional dish--a simple but
enduring creation that now sells on street corners for the equivalent
of 10 cents.

The dish is called pancit hab-hab, and it's a steaming tangle of wheat
noodles, carrots, cabbage and pork slices, ideally flavoured with
broth made from a pig's marrow-rich front legs. The whole caboodle is
liberally seasoned with black pepper, and for chilli addicts there's
often pepper-spiked vinegar to sprinkle on top.

Sound ordinary enough? Try eating it without utensils. Pancit hab-hab,
a favourite lunch for construction workers and students in this town
of 40,000, comes on a square of banana leaf, sometimes with a scrap of
newspaper underneath to catch the drips. From the leaf, it goes
straight into the mouth--no fork, no chopsticks, no fingers--in a
series of dangling, fragrant mouthfuls. The sound of this procedure
gives the dish its name, which translates roughly as "slurp-slurp
noodles."

Slurpers can thank a migrant from Macau named Loo Sing, who set up
Lucban's first noodle factory at the end of the 19th century at what
is now the site of the LBC lighting shop. There, he and his workers
pressed out sheets of dough by hand with sections of bamboo as rolling
pins. According to Palermo Salvacion, head of the Lucban Historical
Society, the noodles were wildly popular, and soon Loo's employees
left to set up competing workshops. A street vendor named Basilia
Radovan is credited with creating the recipe a few years later, and as
for the way the dish is served, it was just a question of
practicality. "We had no utensils like spoons during that time," says
Salvacion, as Filipino food is traditionally eaten with the fingers.
"But if you use your hands it's hot. And then there's the sauce. Very
messy."

Pancit hab-hab is famous throughout the country and eating it is an
essential part of any visit to Lucban, especially during the town's
annual fiesta. Some places are trying to take the dish upmarket. At
the new Patio Rizal Hotel, it's served with forks and garnished with
curls of squid, wedges of hard-boiled egg and chips of toasted garlic.
Other places, like the Old Centre Panciteria, serve the dish with
chunks of roast suckling pig, crispy skin and all. But Lucban cooks
agree that the key to the dish is the noodles, which are still made
daily in home workshops throughout Lucban.

The dough is made with high-protein flour--ensuring tender yet chewy
noodles--which is kneaded by hand and then compressed into blocks with
the feet. It is then rolled paper-thin, mechanically shredded into
fine ribbons, steamed, air-dried and sold immediately to street
vendors and restaurants. The noodles can also be further dried and
packaged for retail shops, where they and the town's pungent garlic
and oregano sausages make popular souvenirs.

Pancit hab-hab's ubiquity in Lucban is probably because the town has
yet to boast a branch of a major fast-food chain, even the
Philippines' own Jollibee. For now, fast food in the town means
housewives on shaded street corners with folding tables, cast-iron
crocks and stacks of banana leaves. "We all know that things would
change if McDonald's came," said Castor Nantes, secretary to the
mayor, after a hearty noodle lunch. And Lucbanins are happy to slurp
while they still can.

In Lucban, pancit hab-hab (with cutlery) can be had at the Patio Rizal
Hotel, Quezon Avenue, tel: [phone], or the Old Centre
Panciteria, San Luis Street. Traditional vendors (no cutlery) are all
itinerant.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 7 August 2003

TRAVELLERS' TALES

Welcome To Monstropolis

People in Asia do not make enough of the strange, semi-mythical
creatures reputed to haunt our jungles, mountains, lakes and oceans
By Nury Vittachi

BORED WITH the beach? Browned off with sunbathing? Try something
different. Tour Monstropolis, the world centre of weird and wonderful
creatures. People familiar with high culture will know Monstropolis as
the setting of the Disney/Pixar movie Monsters Inc. But one suspects
moviemakers didn't realize that there really is a land of
monsters--and it's right here in Asia.

Never does a year go by without monsters being spotted in the jungles
or on the mountains of Asia. Here's an Asian monster update:

The Little Man of Sumatra: For more than a century, there have been
sightings in Indonesian jungles of short, stocky creatures who have
hair like apes, but who walk like humans (no, it's not the pop band ZZ
Top on vacation). Researchers have collected dozens of witness
accounts of the beast known as Orang Pendek, seen more than 20
footprints, and have even collected hairs that don't match other
creatures in the area, such as bears and orang utans. But scientists
fear the Little Man's habitat is being destroyed so fast he will die
out before we find him.

The Giant Squid: A Maori legend of the 10th century tells the story of
an explorer called Kupe whose crew caught a giant squid and ate it on
what is now South Island, New Zealand. This sounds fantastical, but
historians now think that there may have been a lot of truth in the
story. Enough pieces of huge tentacles have been found to confirm the
creatures existed. Even today some kinds of giant squid in the seas of
Australasia can grow as long as two double-decker buses parked end to
end.

The Yeti: In January this year, a young man in Kashmir was confronted
by a short yeti covered with dark hair. Raja Wasim, 20, shouted to his
uncle for help. They lit a fire and succeeded in frightening away the
creature. Other locals reported that yetis often come down to the
village when heavy snowfall makes it difficult for them to find food
in the mountains where they live.

The Lake Monster: Dozens of people in Hanoi watched the Hoan Keim Lake
Monster of Vietnam rise to the surface of the water for 15 minutes in
March last year. Locals said it was the second appearance of the
creature in 2003. The beast is believed to be a giant soft-shelled
turtle, estimated to weigh 200 kilograms, that has lived with a colony
of similar creatures in the lake for more than 100 years.

The Wild Man: A few weeks ago, six people in China claimed to have
spotted the Wild Man of Shennongjia. A fur-covered semi-human, he was
seen crossing the road by the witnesses as they were travelling by car
through the Shennongjia Nature Reserve in Hubei. The Wild Man was
moving fast and disappeared before the travellers could get close,
according to witness Shang Zhangmin, quoted in the China Daily.

The Naga: A crested snake that can grow as long as a train is reputed
to live in Thailand. Ten years ago, a traveller investigating isolated
caves near the Mekong River claimed to have seen a naga that was 18
metres long. Three years ago, a group of 30 people claimed to have
seen a 70-metre-long naga swimming in the Mekong near Phon Pisai
village. Some scientists think it may be similar to a giant aquatic
snake called the Madtsoid.

So get your camera out and explore. But be warned: Look carefully
before you put your foot in the water. Our monsters aren't
manufactured by Disney.


--------------------------------------------------------------------------------
YETI being advertised as
book and movie


GOING APE: Comic-book artists (left) and moviemakers (right) love
Asia's best-known non-human celebrity

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[Alexander Chok]

wow nice info

Post by Yap Yok Foo
From Time Magazine
Issue 21 July 2003
Pssst... Wanna Buy Some Clubs?
Golfers spend millions a year on counterfeits and knockoffs. To find
southern China
BY E.M. SWIFT AND DON YAEGER
The trap, months in the planning, had been laid. The quarry, a
beautiful Chinese businesswoman named Lily Wan, had taken the bait.
The sting, code-named Operation Tiger Lily, a joint venture of
Callaway Golf investigators and the Orange County, Florida, sheriff's
office, was about to take place. The site chosen for the meeting was
symbolic of how brazen the sellers of counterfeit golf clubs had
become. It was the lobby of the Rosen Centre Hotel in Orlando, host
city of the biggest, most prestigious golf show in the world. Large
and small clubmakers, component dealers, importers, distributors,
wholesalers and retailers, not to mention journalists and club pros,
congregate at the PGA Merchandise Show every January to admire, sample
and network, trying to get a handle on the Next Big Thing. This year
they also commiserated. The boom times are over in the golf business.
The low fruit has been picked from the boughs.
Except in Lily Wan's end of the business. Counterfeiting has been on
the rise for about a decade, ever since U.S. golf companies began
subcontracting club production in China. Of the major manufacturers,
only Ping still makes most of its clubs in the U.S. The other big
brands—Adams, Callaway, Cleveland, Cobra, Nike, TaylorMade,
Titleist—make most of their club heads in China's Pearl River Delta
region, where the combination of cheap skilled labor and technical
expertise has created manufacturing's perfect storm.
"It's a no-brainer to be there," says Chip Brewer, CEO of Adams Golf.
"The Chinese produce golf clubs of consistently high quality at
unbeatable costs. They are very good capitalists, creative and
hardworking. But that same entrepreneurial spirit also creates other
issues."
Issues like theft of intellectual property. "Where you have legitimate
manufacturing in China, you will always have problems with
counterfeiting," says David Fernyhough, a former Hong Kong police
officer who is a director of the private-investigation firm Hill &
Associates. "It's worse now than it's ever been." And perpetrators
seldom feel they're doing anything wrong. They make and sell
products—CDs, clothing, toys, electronics, golf clubs—more cheaply
than the brand-name guys, offering consumers a comparable product at a
lower cost. What's wrong with that? Plenty, according to the U.S.
companies that spend millions in research and development to design
the products being copied. For starters, Article I of the U.S.
Constitution gives inventors exclusive rights to their "discoveries."
Lily Wan was a new name in a game with endlessly rotating players. A
private investigator in the United Kingdom suspected Wan's firm, Hong
Kong Cedar International Investment, Ltd., of shipping counterfeit
Callaways to Europe and informed the club manufacturer. So when the
sleuth learned that Wan would attend the Professional Golfers'
Association's show, Callaway's security director, Stu Herrington,
began plotting with the investigator's company, Intellekt, to shut her
down.
Intellekt set up a dummy corporation, Servitrade, Inc., which
purported to represent 400 sporting-goods stores in the U.S. and
Canada. Then Herrington enlisted the help of detective Ray Wood of the
Orange County sheriff's office, who posed as a Servitrade executive.
They contacted Wan to say they were interested in placing an order.
They'd be in Orlando for the show and wanted to see some of her
products. She promised to meet them on Saturday night.
She arrived looking like a Bond vixen: 157 centimeters tall, weighing
48 kilograms, stylish and attractive in her dark, tailored suit. She
exchanged business cards with Herrington and Wood and, after brief
pleasantries, laid counterfeits of a Callaway ERC II driver, a Great
Big Bertha II and a Steelhead X-16 iron on a coffee table, in plain
view of anyone strolling past. The men examined the copies carefully.
"In China everyone knows they are not real," Wan said.
"The Great Big Bertha was a very, very impressive copy," says
Herrington, who has been tracking down the Lily Wans of the world for
Callaway for the past five years. "She gave us a price of $33 a head,
delivered, or $32 with a volume discount." A generic graphite shaft
might cost an additional $6; a grip, 50¢. Total outlay: $38.50 for a
first-rate copy of a club that retails for $499. Wan even volunteered
to blacken the soles of the clubs with water-soluble paint to hide the
Callaway trademark. Servitrade could simply rinse off the paint once
the clubs cleared customs. She also asked about the best routes to
smuggle the clubs into the country.
Although Herrington is loath to reveal specifics of the conversation,
he and Wan discussed the fact that many golf-club counterfeiters fly
their shipments to Vancouver or Toronto, then truck them into the U.S.
sending the merchandise first to a country not associated with
counterfeit golf clubs—say, the Netherlands—thus avoiding the red flag
that cargo from Taiwan or China might raise. Counterfeiters also
smuggle club components in containers filled with legal goods, such as
ceramics or auto parts. Or they simply list their cargo as something
else on the shipping bill, playing the odds that it will get through
amid the mass of foreign goods flooding U.S. docks. Six thousand
containers a day are shipped to the U.S. from Hong Kong, according to
the U.S. Bureau of Customs and Border Protection, and only 2% are
physically inspected.
After an hour or so of such banter, Herrington and Wood identified
themselves to Wan. "She insisted she'd done nothing wrong," Herrington
recalls. "When we asked her where the clubs were made, she claimed she
didn't know. She said some Chinese man named Joe had come up to her
with the stuff on the streets of Hong Kong." Herrington confiscated
the samples, and Wood delivered a stern lecture to the distraught Wan
on the penalties she could face. In the end, though, he let her go,
and she bolted. Although trafficking in counterfeit goods is a felony,
"it's difficult if not impossible now to prosecute," says Wood,
because so much attention is focused on combating terrorism. Two years
ago Wan might have been put behind bars. Today, Wood notes, "U.S. law
enforcement has bigger fish to fry." Still, from Herrington's point of
view the sting was a success. "We really scared her," he says. "She's
never coming back here."
Others are, though. "Now that so much legitimate business has moved to
China, the counterfeit market can't be stopped," says Ken Gaul, the
U.S. customs agent who spearheaded Project Teed Off, which resulted in
14 indictments and the seizure of $6 million worth of counterfeit golf
merchandise in 1999. "At this year's show in Orlando, I saw an Asian
man taking pictures of a golf club from several angles. Everyone knew
what he was doing."
Those photographs, industry experts say, could have been digitally
transmitted to a tooling factory in China, converted into
three-dimensional form by means of a computer program and used to
create a copper master of a head that could be ready for mass
production in two weeks. "It takes us over a year to design a new
club, using sophisticated computer programs that require the expertise
of very experienced engineers," says Barney Adams, founder and
chairman of Adams Golf. "If the club's a success, copies are on the
market in 60 days. It's reprehensible. To get into the copying
business, all you need is to take a couple of drivers and irons you
like, fly to Hong Kong, and voilá, you could be in the knockoff
business tomorrow."
How much all this costs the golf industry is difficult to gauge.
According to the National Golf Foundation, U.S. consumers spent $2.8
billion last year on golf clubs, some 70% of which came from China. If
only 10% of those sales involved illegal knockoffs and
counterfeits—some experts believe that figure might be higher—that
would amount to nearly $200 million.
Jethro Liou is an expert in the knockoff business. A boyish
25-year-old Californian, he has been selling golf clubs since he was
15. After school he would make cold calls for his father, Ren-Jei
(R.J.) Liou, asking pro shops and discount stores if they wanted to
order from his line of clubs. R.J. owned Kent Graphtec, an importer of
club components from Taiwan and, later, China. He'd have the
components assembled at his warehouse outside of Los Angeles and would
distribute them to retailers all over the U.S. "The golf business was
so good between 1991 and '97, you could sell anything," Jethro says.
"We were one of the first companies to import from China."
Kent Graphtec dealt primarily in knockoff clubs, products with names
such as King Snake and Big Bursar—simulations of the popular clubs
King Cobra and Big Bertha. "The customs people thought my father was
[the primary distributor of] King Snake, which in its heyday had
something like 10% of the market," Jethro says, "but a lot of people
were importing that product."
A lot of people eventually got in trouble for it too. "There are
different levels of counterfeiting," says Debra Peterson, a U.S.
customs official who was involved in Project Teed Off. There is the
direct counterfeit, which is a dead-on copy that carries the
legitimate product's trademark, and that's illegal. Also illegal is a
club that is very close to a direct copy and is termed either
"confusingly similar" (if it infringes on company trademarks) or
"substantially similar" (if it infringes on design patents). What is
legal is the generic look-alike that does not infringe on a company's
trademarks or patents. Some features of a driver—its head size, for
instance—cannot be protected, but others can. But with confusingly or
substantially similar knockoffs, the line between legality and patent
or trademark infringement is often fuzzy and is subject to legal
challenge and interpretation. A counterfeiter tries to alter a
company's protected features just enough to avoid prosecution. Whether
the result is illegal can be established only in court, on a
case-by-case basis; in other words, the aggrieved company has to sue.
Callaway threatened to sue Kent Graphtec over its Big Bursar driver,
alleging patent, trademark and trade dress (trademark-design)
infringement. In 1997 R.J. Liou reached a settlement with Callaway.
Four years later, in March 2001, the U.S. District Court in Los
Angeles ruled that R.J. Liou, Kent Graphtec and Trophy Sports—a
separate company started by Jethro and his mother, Yeh-Chyn, in late
2000—had breached the settlement by continuing to sell Big Bursars.
The court ordered the defendants to pay $20,000 in damages to Callaway
and to turn over their inventory of more than 11,500 infringing
components for Callaway to destroy. According to Jethro, the family's
legal fees for the discovery phase alone came to more than $1 million.
By then, Jethro's parents had divorced, and Jethro had fallen out with
his father. Kent Graphtec officially went out of business, though R.J.
is now back in business on his own, according to Jethro.
The market for knockoff clubs, meanwhile, remains huge and lucrative,
and Trophy Sports is a major player in it. Trophy's Integra line
offers look-alikes of several major clubs. In February, TaylorMade
sent Trophy a cease-and-desist letter alleging design-patent
infringement, and Trophy agreed to stop importing and selling the
Integra Bomber 880 driver, a knockoff of TaylorMade's Burner 420.
Jethro Liou says he spends $10,000 a month on lawyers' fees. Lawsuits
are just part of the cost of doing business.
Liou also represents a dozen clubmakers, importing for a long list of
Internet-based dealers and discount retailers, including Kmart. All
told, Liou says, he sells a million golf clubs a year—roughly
equivalent to TaylorMade, which sold 89,282 clubs in March. And
recently Liou bought a Mexican foundry, Cast Alloys, which he is
disassembling and relocating to China.
A graduate of the University of California, Berkeley, Liou is fluent
in Mandarin and Taiwanese. A recent three-day swing with him through
the Pearl River Delta provided a rare look inside China's burgeoning
golf industry.
Liou flew into Hong Kong and from the airport he took a bus to
Dongguan, 1 1/2 hours to the north. Dongguan is one of China's
industrial meccas, a city of 1.4 million people where private
enterprise flourishes. Workers flock there from poor farms in central
China, providing cheap labor for manufacturers that have relocated to
Dongguan from Hong Kong, Taiwan, Japan and the U.S. The bus passed
miles and miles of factories, many operating 24 hours a day to satisfy
the appetites of Western consumers.
One of the factories was the Unimold Manufacturing Co., Ltd., which
sent a car to meet Liou's bus. Unimold is a tooling factory, the first
stop in golf-club construction after the club is designed. According
to Rob Duncanson, an attorney for several brands, including Titleist,
Cobra and TaylorMade, the tooling factory is also where the
manufacture of counterfeits begins. "The R.-and-D. department of a
company in California comes up with a new design for a club and must
transfer that proprietary information to the vendor," Duncanson says.
"The company doesn't own the vendor. It has a contractual relationship
with him. The company says it will pay X dollars to turn this design
into a master, from which a tool will be made. The tool is used to
mass-produce the club head. The problem is, there's no control over
the proprietary design when it gets to China. There's a six- to
eight-week period during which they develop the master and send
samples back and forth for approval, and things can happen."
Unimold, which has been in Dongguan for five years, employs 60
workers. They work 12-hour days, seven days a week, and are paid about
$100 a month, plus room and board, according to the manager, Hu Gui
Dong. During Liou's 45-minute visit, Unimold's workers were
hand-tooling masters for a set of Tommy Armour irons and a Mizuno
driver. On an open shelf on the wall were copper molds for some of
Unimold's other customers, including Dunlop, Spalding, TaylorMade and
Adams. Unimold charges $1,200 for a copper master of a driver. This is
the intellectual property of the company that designed the club, but
in this tooling factory there are no security guards, no surveillance
cameras and no metal detectors to prevent a worker from lifting a
copper master. On the street, Liou estimates, a finished copper master
of a brand-name club might fetch $10,000—an unimaginable fortune to
these workers.
That afternoon Liou made a call on one of his biggest vendors, Unitech
Golf Co., Ltd., a casting company on the outskirts of Dongguan. It's a
medium-sized operation by China's standards, employing 200 people and
cranking out 100,000-130,000 club heads a month for 10-20 little-known
companies, such as Akia, Echelon, Pax and Velocity. This may be
Knockoff Central, but the care that goes into the construction of each
club head is mind boggling. There are 200 steps involved between the
tooling and the shipping of a head. The wax has to be mixed, injected,
cooled and trimmed; the casts have to be scraped, welded and polished;
the heads have to be taped, painted, stacked and inspected. Fifty to
60 workers touch every club head as it is made—a club head that at the
end of the day might be sold to Liou for $4 or $5. There are no paid
vacations or sick days, no workers' compensation or maternity leave.
And if orders fall off, the owner can let a worker go with one day's
notice. Modern communist China is a 19th century industrial
capitalist's dream.
Five years ago, said Jimy Wang, the owner of Unitech, the land around
his factory was farmland. This area is called Tangxia, and it is home
to 20 factories that make both legitimate and illegal clubs. Since
February 2002 the population of Tangxia has doubled, to 400,000.
Security measures are much more elaborate at Unitech than they are at
the Unimold tooling factory. The front gate is locked and manned by
armed guards. There are five security officers among the company's 200
employees, not to mention surveillance cameras overlooking the factory
floor. Still, Wang admitted, no security system is foolproof. Wax
molds have a way of vanishing out the back door. "Every factory
experiences theft," he said.
Wang, dressed stylishly in a black designer T shirt, black pants and a
belt with a gold buckle, is relatively new to the golf business. His
capital came from his other line of work: a karaoke bar that he owns
in Dongguan. Another line of capital for some illegal club
manufacturers may come from Chinese triads, or crime syndicates, which
have long been suspected of using some foundries to launder money from
prostitution, drugs and gambling operations. "They are involved,
guaranteed," says Fernyhough, the private investigator who spent 14
years working for the Hong Kong police pursuing the Chinese Mafia.
"Golf clubs are a high-markup item, and anything that has a high
margin in it, they will be into."
Xiamen, a city of 655,000 people on the South China Sea, is across the
Taiwan Strait from Taiwan. Its port is the 10th largest in the world
in terms of volume of goods shipped to the U.S., and many Taiwanese
businesses have moved there since mainland China opened itself to
foreign investment. Many of those businesses are golf related. "Ten
years ago 70-80% of the counterfeits and illegal knockoffs were made
in Taiwan, and only 20-25% in China," says Callaway's Herrington. "But
since 1992 or '93, when the Taiwanese government began to enforce
intellectual-property laws, and Taiwanese labor costs rose in relation
to China's, those percentages have flip-flopped. Now 70-80% of the
counterfeits come from China, financed by Taiwanese investors."
Theft of intellectual property is illegal in China, but prosecution is
selective. A counterfeiter might be arrested after failing to pay off
a government official or after a U.S. company protests so vehemently
that an example must be made. And if convicted, the worst punishment a
counterfeiter suffers is a modest fine.
Yarn-Way Enterprise Co. is one of the companies that relocated to
Xiamen from Taiwan. Yarn-Way makes graphite shafts, producing some
450,000 a month, and Liou is one of its most valued customers. Liou
flew to Xiamen on his second morning in China, and Yarn-Way sent a car
to meet him at the airport. He gave Andy Zhu, the sales representative
who handles his account, a long triangular cardboard box he had
carried all the way from the States. Inside was a TaylorMade wedge.
Within minutes a graphics designer at Yarn-Way had downloaded the logo
from the TaylorMade shaft onto a computer screen and was making minor
design and color alterations to it. He incorporated the word Integra
into the logo and then submitted it to Liou for approval. The altered
logo would be applied to the graphite shafts Yarn-Way was making for
Liou's Integra line. "All you have to do is make a few changes to keep
anyone from suing you," Zhu said of equipment that walks the fine line
between what's legal and what's not.
In the afternoon Liou visited another of his vendors, the Aetenshun
Casting house, where Dunlop, Hippo, Integra, Maxfli, Ram and Tommy
Armour club heads are made. Along one wall of the factory's formal
conference room was a display case of the dozens of club heads made by
Aetenshun. As Liou surveyed them, he picked out two TaylorMade driver
heads, casually identifying them as counterfeits. The manager of the
factory feigned disbelief until Liou pointed out an imperfection in
the lettering and noted the hollow sound emitted from the head when he
pinged it. The manager, recovering, said that now he remembered. Those
two TaylorMade heads had been a gift. He couldn't remember who'd
brought them.
"The company that really should have its antennae up now is Nike,"
Liou said later. "It's a hot brand with an expensive product, and it's
new to the business."
Mike Kelly, the business director for Nike Golf, says one of the steps
the company has taken to discourage counterfeiters is to put
ultraviolet markings on its shafts, so U.S. customs inspectors can
identify them as legitimate with the wave of a blacklight wand. Serial
numbers are engraved on the hosels too, and according to Kelly, Nike
plans to put a serial number-checking system on its website.
Such a system would certainly have helped Scott Fong, a computer
engineer in Rocklin, California, who logged on to eBay last summer and
purchased what was described as a set of new Callaway X-14 irons. His
winning bid? A hefty $725, for clubs that would have cost $1,040 at
retail. When the irons arrived, they were in their original packaging,
individually wrapped. But Fong, a 16 handicapper, noticed some slight
imperfections in the Callaway lettering. Worried, he took the irons to
the practice range and discovered that he had more trouble than usual
hitting them straight. When he compared them with Callaway demos at
the clubhouse, he found that his club heads were slightly larger than
the demos'. He contacted Callaway, which put Stu Herrington on the
case.
Fong sent Herrington the clubs he'd bought, and Herrington confirmed
that they were counterfeits. The seller, who was from Toronto, was
eventually raided by Canadian police and his eBay auction shut down.
But how many other buyers had he hoodwinked? And what about the dozens
of other eBay sellers who peddle illegal knockoffs? "We took down 618
Internet auctions in 2002 and 60 in the first six weeks of 2003," says
Ken Parker, corporate counsel for Callaway. "Not a day goes by that we
don't deal with it."
All of which has raised the cost of legal clubs. Who's the victim of
counterfeiting? The legitimate manufacturer and, of course, the
consumer. "Our product-development group spends one-third of its time
studying other patents and establishing and enforcing our own patents
worldwide," Nike's Kelly says. "Plus, we constantly monitor the
Internet. Then there's the cost of adding the serial numbers and
ultraviolet codes and of establishing a serial number-checking system.
All that gets passed on to the consumer."
Why, then, do all those U.S. clubmakers continue to use Chinese
foundries, the track records of which in protecting
intellectual-property rights are so horrendous? "If we didn't, your
$400 driver would cost $1,000," says Barney Adams. "Making a golf club
is still very labor intensive. We understand the risks of doing
business over there. We do the best we can to minimize them, and we
move on."
One of the most significant breakthroughs in golf-club production in
recent years has been the use of titanium, notably in drivers.
Titanium is stronger and lighter than steel, enabling manufacturers to
make ever-larger club heads with ever-bigger sweet spots that propel
the ball ever farther. Most of the titanium in golf clubs comes from
Russia or northern China, and most of the foundries that work with it
are in or near Guangzhou.
Only a two-hour drive or 90-minute ferry ride from Hong Kong,
Guangzhou is a city of 3.8 million people and about 100 golf
manufacturers, if you count the makers of accessories such as bags and
shoes. But only seven foundries in the city work with titanium, which
requires a significant investment in specialized equipment.
One of these foundries is Maxwin Golf. Its owner, David Chiang, is
Taiwanese.
He moved to Guangzhou in 1989, becoming the second golf manufacturer
in the city. Between 1991 and 1997, he made good money. Since then,
business has been spotty. Many deep-pocketed, publicly traded
companies from Taiwan have moved to this part of China, and
competition has been fierce. Fortunately, Chiang said, he started a
karaoke club on the side, where with 60 girls, profits are more
reliable.
Chiang, wearing a counterfeit Versace jacket with Adidas buttons,
conducted a tour of his factory for Liou but said the third floor of
his plant was, unfortunately, off-limits. Something that no one was
allowed to see was going on there. "Any company that makes things in
China will experience theft," Chiang said. "Employees make so little
money, they're always going to steal and sell molds on the open
market. In Guangzhou alone there are three factories that do nothing
but make counterfeits and copies. We have our employees line up after
work, and we search them. We have metal detectors at both of our
entrances and security cameras at all the workstations. If they're
caught stealing, they're fired, and I'll call the police. But it won't
ever stop. The copy and counterfeit market is too large."
Callaway was so concerned about security at the Fu Sheng company, its
main manufacturer in China, that it sent Herrington there three times
in 2002. He offered a bonus equivalent to a year's salary to anyone
who turned in a co-worker for theft. He also made sure that Callaway
clubs were manufactured in their own building, separate from the
building that made Nike clubs. Despite these and other safeguards, wax
molds of the newest, hottest clubs still disappear. "We cannot
guarantee 100% against theft," said Fu Sheng's president, P.Z. Lin.
When Callaway learned that a foundry in Guangzhou, Shunde Jackson
Precision Industries Corp., was wrongly representing itself to
customers as an authorized Callaway manufacturer, Herrington began an
investigation. It's a frustrating endeavor. "We're running a big
investigation there, and it's pretty unsatisfying," Herrington says.
"I can spend $100,000, invest three to six months hiring investigators
in China to follow trucks and gather evidence of wrongdoing. We file
an affidavit with the Chinese anticounterfeiting authorities and stage
a raid. But the counterfeiters are back in business within a week. The
fines and forfeitures are minimal. They're happy to pay the fines as a
cost of doing business."
So, for the first time in a decade, there are rumors that some U.S.
companies are rethinking their involvement in China. Callaway is
believed by some of its competitors to be considering a move back to
Mexico, a rumor that Callaway's senior vice president of global press
and public relations, Larry Dorman, doesn't dismiss out of hand. "We
continue to explore relationships with other vendors, but that
decision will be made on the basis of quality and price, not
security," he says. "Wherever your vendors are located, there are
issues with intellectual-property theft. Proximity does not mean
better security."
Others have simply thrown up their hands. "When it finally dawned on
me what the culture was over there," says Barney Adams, whose company
will continue to make its clubs in China, "I realized we were never
going to win this war. Most golf companies are losing their asses
right now. One of the fallacies about golf is that we're an industry.
We're so busy trying to cut one another's throats, we don't cooperate.
Callaway wouldn't dream of working with TaylorMade. If we pooled our
knowledge and resources, we'd have a lot better chance of fighting
[counterfeiters]."
The final stop on Jethro Liou's three-day tour of his vendors'
facilities was Deson Golf Sport Co., Ltd., in Shunde, a suburb of
Guangzhou. This factory, too, works with titanium. It had 13 tons of
it stacked in a locked storage room. One hundred sixty people work at
the plant, which is clean, modern and well lit, churning out 40,000
heads a month for Dunlop, Knight, Pinseeker, Pro Select, Ram and other
companies. About 500 models of club heads are on display, there for a
client's inspection.
Liou stopped during the factory tour and lingered over one club head.
It was the mold for something called a Power 420. The model that Liou
sells to Kmart is called the Super 420, which is also made at the
Deson factory. The lettering, size and scoring on both club faces were
identical. Liou called over the president of Deson, a man named Su
Hiao, and in a moment rich with irony, complained that the Power 420
appeared to be a direct knockoff of, and confusingly similar to, the
Super 420 (which is a knockoff of TaylorMade's 300 Series drivers).
Liou had planned to order as many as 30,000 Super 420s every two
months to keep Kmart supplied. Why would Hiao risk losing that?
Smoothly, with élan, Hiao dismissed the Power 420 as a one-of-a-kind
sample. He couldn't remember why it had been made or what it was doing
there. He'd be sure to find out, after he finished with the tour.
Asked if he thought the golf industry in China would ever consolidate,
Hiao smiled and shook his head. "If one factory is taken over, another
one will be born," he said. "Everyone in China wants to work for
himself, to be an entrepreneur. Workers save their money, pool their
resources, buy a polishing machine, and all of a sudden you have a new
factory." In the past four years two of Hiao's managers have left to
start finishing factories. Could his factory, he was asked, put a
logo—any logo—on a golf club? Say, a Sports Illustrated logo?
"Absolutely," he replied. "We can do almost anything here."
——From Sports Illustrated. With reporting by TIME's Joyce Huang/Taipei
http://www.time.com
*************From Uncle Yap**************
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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 28 August 2003

TRAVELLERS' TALES
By Nury Vittachi

WATER OF LIFE: A small boy in Malaysia has developed a form of
drinkable prayer. Muhammad Shukur, eight, prays into a glass of water
and it turns into healing medicine. The prayer drinks are in great
demand after he used them to cure himself and a parent of troublesome
ailments. His mother, Rohayu Hamat, 32, told his story to The Star
newspaper: "He had a very high fever for almost a week. I took him to
several clinics but his situation did not change. Then he told me not
to waste any more money by taking him to clinics and asked for a glass
of water, which he said could help relieve his illness. He drank the
water after saying some prayers into the glass and, to my amazement,
he woke up the next morning and walked out of bed as though there was
nothing wrong with him. He just told me he wanted to go back to
school." His mother, who had long suffered from high blood pressure,
was sceptical--until the boy cured her with another glass of prayer
water. Now there is a constant stream of sick people visiting the
family home in Taman Klebang Jaya. All Rohayu and her son have to do
now is to work out how to market the cure. Perhaps they could borrow
an old slogan from an American soft drink: "Come alive with Pepsi."


--------------------------------------------------------------------------------

TWO EVILS: Two old men who fell into waters infested with sharks
decided to go into hiding--in a swamp infested with crocodiles. It was
a choice of frying pan or fire for Ross Pennisi, 82, and Phillip
Sorbello, 77, when a wave overturned their dinghy while they were
fishing off the coast of northern Queensland. They swam to a nearby
swamp and decided their best bet was to pray that God would repel the
crocodiles and send rescuers. Apparently he did. "The bloke from up
there must have seen us," a relieved Pennisi told the Associated
Press, after a helicopter reached them before the crocs did. "We asked
him for help and I think we got it."


--------------------------------------------------------------------------------

LIFE AFTER DEATH: A man returned to his family home 24 days after his
funeral. Family members were shocked, particularly since they had had
the body of Ashok Sindhi cremated--or so they thought--near his home
in Jodhpur, India. A day after the man had gone missing on July 10, a
body was found in a ditch, The Statesman of Calcutta reported. His
relatives identified it as Sindhi. When he returned three weeks later
and convinced his family that he was no ghost, the apologetic Sindhi
explained that he had gone to visit his grandmother in Jaipur. This
just goes to show that the pernicious male habit of not phoning home
can have awkward consequences.


--------------------------------------------------------------------------------
Advertisement whose first 2 lines were
"Kingston International School
Two Year Old Class Teacher"

JUNIOR MISS: This advertisement, seen in the South China Morning Post
by reader V. Chiew, suggests that teachers start young in Hong Kong.


--------------------------------------------------------------------------------

SNAP HAPPY: Multi-function phones are proving their worth in
unexpected ways. A hit-and-run victim in Japan used one to photograph
the car that hit him. The 52-year-old decorator was knocked off his
bicycle in Hiratsuka. As he landed on the ground, he grabbed the phone
and got a clear image of the car's number plate as the motorist sped
away. Police used the image to track down the driver, a 29-year-old
whom they arrested, the Mainichi Shimbun reported. The decorator told
the police that he always carried the phone around because he used it
as a spare bicycle light. One might assume he also used the phone as a
phone, but these days one can't take that for granted.


--------------------------------------------------------------------------------

COOL CAT: A large tiger escaped from a Dhaka zoo--but was so scared of
human society it decided to go back into its cage. The Royal Bengal
tiger, named Bhim (which means "powerful"), made a dash to freedom
after the zookeeper left the door open. He strolled around the zoo in
the city and was spotted by the keeper, who reacted quickly by
fainting on the spot. "The keeper passed out because he had never
faced off a tiger outside its cage. A tiger in freedom could be
extremely ferocious," a city official told Reuters. The tiger was
horrified to find mobs of human beings roaming free with no bars or
fences preventing them from reaching him. The official said: "Bhim
apparently found the maddening crowd outside the zoo intolerable, and
too much for it to feel safe, and came back--to the utter surprise and
astonishment of zoo managers." This cat has taste.


--------------------------------------------------------------------------------
(picture of a road with two signposts, but without signs)


EMPTY-HEADED: Long-time contributor James Pringle of Bangkok was
stopped while driving down a street in Baracoa, Cuba. A police officer
barked: "This is a one-way street. Can't you see the signs?" James
explained that though the signposts were present, the actual signs
were missing. "Well, that's what they would say if they were there,"
the officer continued. "Don't let me catch you ignoring them again or
you'll be in trouble."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 28 August 2003

The Terror War's Next Offensive

In the aftermath of the Jakarta bombing and the arrest of terrorist
suspect Hambali, Thailand and Indonesia are considering new measures
to get tough on terrorism--and grappling with how to do so without
upsetting delicate political and social balances at home
By Shawn W. Crispin/BANGKOK and Jeremy Wagstaff/JAKARTA

IT'S BEING HERALDED as the biggest hit yet against global terrorism in
Southeast Asia. But the legal manoeuvres behind the scenes of the
recent arrest of Asia's most-wanted terror suspect in Thailand could
have an even more profound impact on the region's future.

GOOD NEWS RAISES CONCERNS

• Hambali's arrest on August 11 is seen as a major victory for the war
on terrorism
• One day earlier, the Thai premier decreed new anti-terrorism laws
• Some fear that counter-terror efforts in Southeast Asia will undo
democratic gains
• Despite Hambali's arrest, his alleged network is far from being
dismantled

On August 12, Thai counter-terrorism agents stormed a nondescript
apartment block in the historic Thai city of Ayutthaya and apprehended
Riduan Isamuddin, or Hambali, suspected of being the operations chief
of Jemaah Islamiah, the radical Islamic group with alleged links to
the Al Qaeda terrorist organization.

Intelligence officials say Hambali is the mastermind behind some of Al
Qaeda's most lethal attacks and played a role in the planning of the
October 2002 attack in Bali that killed more than 200 people and the
August 5 blast at the JW Marriott Hotel in Jakarta that killed 12
people.

On the surface, Hambali's arrest marks a major victory for the
U.S.-led war on terrorism in Southeast Asia. Thai Prime Minister
Thaksin Shinawatra told reporters that catching Hambali, who he says
was plotting to bomb the Asia-Pacific Economic Cooperation (Apec)
forum meeting in Bangkok in October, means all foreigners suspected of
plotting terror acts in Thailand are now under lock and key.

"We have had to take special precautions because our country could be
used as a hiding place [for terrorists]," said Thaksin at a military
airport in Bangkok on August 15. "Terrorism is now no longer the duty
of only one country . . . we all need to cooperate."

At the same time, the evolving nature of counter-terrorism cooperation
between regional governments and the U.S. is raising concerns that the
war on terror could also undermine recent democratic gains in
Southeast Asia. In Thailand and Indonesia, governments are grappling
with how best to react to U.S. pressure to get tough on terrorism,
without upsetting delicate political, social and religious balances at
home.

"Every government in the region needs to think about how much they
should sign onto the international coalition against terror," says
Surin Pitsuwan, a former foreign minister of Thailand and an
opposition politician. "Without great care, the way the war is fought
could have a big impact on social balances that have taken decades to
achieve and could take decades to bring back."

It's proving an increasingly difficult balance to strike. One day
before Hambali's arrest, Thaksin pushed through new anti-terrorism
laws by executive decree, citing unspecified reasons of national
security. The move marked the first time Thailand's criminal codes had
been amended by the administrative branch, and controversially
bypassed the usual parliamentary process for enacting new laws.

NEW ANTI-TERROR LANDSCAPE
Legal experts say Thaksin's decrees will fundamentally alter
Thailand's legal landscape, providing tough new penalties for
convicted terrorists and including provisions that will allow for
detention without trial, similar to the controversial internal
security acts on the books in Malaysia and Singapore. The new
anti-terrorism laws will also give Thai authorities greater legal
leeway to track the financial transactions of suspected terrorists.

Opposition politicians, legal experts, and human-rights advocates
worry that the broad definition of terrorism contained in the new laws
could in the future be mobilized for political rather than legal
purposes, similar to how detractors say the governments in Malaysia
and Singapore have used their security laws to crack down on political
opponents. The opposition Democrat Party has already filed an appeal
to the Constitutional Court challenging the legality of the decrees.

"The new laws violate the Thai constitution," asserts Danai Anantiyo,
vice-president of the Law Society of Thailand. "They will make it
easier for the government to curb people's freedoms," he adds, drawing
parallels to past anti-communism laws that military dictators used in
the 1960s and 1970s to stamp out political opposition to their rule.

Former Foreign Minister Surin says anxieties are growing in Thailand's
predominantly Muslim southern provinces that the new laws will be used
to clamp down on Muslim activists working for greater local democracy
in the region. "People are nervous about the way things are being
handled," he says.

Indonesia is also grappling with how to build a legal framework to
deal with the problem of terrorism. Government efforts to push
anti-terrorism legislation through parliament have been sporadic in
the face of public opposition and parliamentary hostility.

Central to the delay has been public criticism that the government,
under the influence of the military, is rolling back liberties
hard-won by the reform movement that toppled President Suharto in
1998. It was the military that buttressed 32 years of authoritarian
rule that limited political activity, and led to the arbitrary arrest
of labour leaders, student activists and dissidents. Many Indonesians
fear a creeping return of such tactics under the guise of cracking
down on terrorists.

So far, it seems unlikely the Indonesian government will adopt
internal security laws like those in Singapore and Malaysia.
Coordinating Minister for Political and Security Affairs Susilo
Bambang Yudhoyono said on August 14 that the government would revise
several articles in the anti-terrorism law, particularly those
concerning pre-emptive and preventive action, as well as the role of
intelligence.

"These parts are considered insufficient so that right now the
government and security apparatus, including the police, are in a
waiting position until the terrorists launch their attack," he said.

The government will review the articles, consult the public and submit
the law to parliament as soon as possible, Bambang said. "It will be
done openly. The public will know about it," he said.

Unlike Indonesia, it is still unclear just how deep--if at
all--international terror groups have taken root in Thailand. Until
recently, Thai officials strongly denied any internationally backed
terrorist groups were active on Thai soil, with the apparent aim of
maintaining foreign confidence in the Thai economy and tourism
industry.

Indeed, Thai counter-terrorism and U.S. Federal Bureau of
Investigation agents were on occasion at loggerheads, as senior Thai
officials complained that their U.S. counterparts were pushing them to
arrest and interrogate terror suspects in ways that violated civil
liberties protected under Thai law.

But as Washington calls for tougher action in ferreting out terror
suspects, the political winds are shifting in Thailand. For example,
on the same day Thaksin was scheduled to meet U.S. President George W.
Bush in Washington, Thai counter-terrorism agents arrested three Thai
nationals on charges that they were plotting to bomb foreign embassies
during the Apec meeting.

Notably, Thaksin said there was "no evidence" that any Thai nationals
were involved in Hambali's alleged plot to bomb the Apec meeting.

Meanwhile, senior security officials say a number of other terror
suspects have been arrested in recent weeks, including some of
Hambali's close aides.

CIVIL LIBERTY CONCERNS
Legal experts and human-rights advocates in Thailand say U.S.-inspired
counter-terrorism techniques used in the arrest of Hambali--including
military-style abduction, detention without trial and unrestricted
wire-tapping--violate Thai constitutional provisions on civil
liberties.

Sunai Phasuk, spokesman for Forum Asia, a regional human-rights group,
fears that Thaksin's recent acquiescence to Washington's request to
bypass the International Criminal Court and extradite U.S citizens
directly to the U.S. for cases that could be tried by the world body
will provide a legal buffer for U.S. agents to employ such techniques
in Thailand.

In Thailand the perception is growing that the U.S. is driving Thai
policy, with greater emphasis on security and less on democracy.

Washington is providing plenty of economic incentive for Thaksin to
take up the counter-terror cause. One example: Thailand's Army Corps
of Engineers was recently awarded multimillion-dollar reconstruction
contracts in war-torn Iraq. When the Thai parliament declined to
allocate enough funds for travel and living expenses for nearly 1,000
troops, Washington agreed to pay the difference.

Another is a possible bilateral free-trade arrangement, where
preferential treatment for Thai exports would provide much-needed
relief for many beleaguered Thai industries facing pricing pressure
from lower-cost producers in China.

"There's a lot of quid pro quo flowing between Bangkok and Washington
right now," says a Bangkok-based Western diplomat.

For Thailand and Indonesia, the trick will be in striking the right
balance between U.S. security requests and domestic demands for more
democracy.

The controversial measures Thaksin recently enacted, and the ones
Indonesia is considering, will no doubt go a long way in fighting the
war on terrorism. The risk is they may lose the bigger regional battle
for democracy in the process.

Sasi-on Kam-on in Bangkok and Puspa Madani in Jakarta contributed to
this article
+++++++++++++++++++++++++++

THE TRAIL OF HAMBALI
By Jeremy Wagstaff

The arrest of Riduan Isamuddin in Thailand earlier this month marks
another successful manhunt for alleged members of the Al Qaeda
leadership. The manknown as Hambali was a rarity: According to
intelligence reports, he was the only non-Arab member of the Al Qaeda
elite. Indonesian by birth, Hambali fled the country along with many
other radical Muslims in the midst of a 1985 crackdown. He moved to
Malaysia and then joined a flood of young men fighting the Soviet
forces in Afghanistan. By the late 1990s he was a senior figure in Al
Qaeda, commuting between hotels in Bangkok and Kuala Lumpur, an
apartment in Karachi and the southern Afghan city of Kandahar, where
he drove a white sedan.

It was there, in late 2001, that he lost some of his closest comrades
in an American air strike, among them Muhammad Atif or Abu Hafs
al-Masri, a former Egyptian policeman and Osama bin Laden lieutenant
who was seen as the mastermind of the 1998 bombing of United States
embassies in East Africa and the September 11, 2001, attacks. Using a
false passport, Hambali fled Afghanistan. Tired, he mistakenly filled
in his real name and information on arrival papers in a Southeast
Asian country, and narrowly avoided arrest after questioning by
immigration officials, according to an FBI report.

It was in Southeast Asia that Hambali was most important to Al Qaeda.
According to FBI documents and other sources, he coordinated several
attacks in the Philippines and Indonesia, including an aborted plan to
bomb targets in Singapore in late 2001. It was Hambali's decision to
abandon the Singapore operation after the cell preparing the attack
told him it would take 18 months to smuggle the explosives in from the
Philippines. Instead, he switched to an earlier plan to bomb the U.S.
and Israeli embassies in Manila.

Around that time, in early 2002, things started to go wrong. The
Singapore cell was arrested, but Hambali, by then hiding in a Bangkok
suburb, allegedly continued to coordinate regional activities of Al
Qaeda operatives and cells of the Southeast Asian network, Jemaah
Islamiah. Using Internet cafes and a separate, innocuous-sounding
e-mail address for each contact-- ***@yahoo.com was one
example--Hambali switched the network's attention away from hard
targets such as embassies and military installations to softer ones.

In January 2002 he told a meeting of Jemaah Islamiah operatives in
Thailand to target bars, cafés and nightclubs frequented by Westerners
in Southeast Asia. Already stashed away in Indonesia, Hambali told a
terrorist suspect interrogated by the FBI, was one tonne of
explosives.

Ten months later three bombs exploded on the tourist resort island of
Bali, killing more than 200 people, most of them foreigners.
Indonesian police say he sent $45,000 last month from Thailand to a
Malaysian, money which they say may have been used in the attack on
the JW Marriott Hotel in Jakarta.

Hambali's arrest leaves a hole in Al Qaeda and Jemaah Islamiah, but
it's not likely to have any great impact on their operational
capacity, analysts say. Three or four men are qualified to take his
place, among them Zulkarnaen, head of military activities for JI, and
Yassin Syawal, son-in-law of the founder of JI, Abdullah Sungkar.
Yassin, while not a member, heads Sulawesi-based Laskar Jundullah, an
organization regarded by some analysts to be loosely affiliated with
JI. Other possible replacements are Fathur Rohman al-Ghozi, who
escaped from a Manila jail last month, and Malaysian bomb expert
Azahari Husin.

With a line-up like that there's little doubt that JI has the
capability to continue launching attacks. Indonesian intelligence
officials have said the organization has about 5,000 members in
Indonesia alone. Experts say that beyond that may exist other
organizations that are not regarded as JI, but which share some of its
goals, in particular the half-century-old struggle for an Islamic
state, a movement known as Darul Islam.

The good news? In the short term, police and intelligence agencies
seem to be getting better at knowing what to look for. After
floundering in the wake of Bali, Indonesian police have reacted
quickly to the August 5 attack on the JW Marriott Hotel, and have
already arrested a number of suspects. And with each arrest comes
possible new intelligence to help build a better picture of what is
going on higher up the chain.
++++++++++++++++++++++++++=

SOUTHEAST ASIA'S MOST WANTED
-------------------------------------------------------------------------------

AZAHARI HUSIN: A Malaysian physics lecturer, Azahari is a skilled bomb
maker and a suspect in the bombing of the JW Marriott Hotel in Jakarta

NOOR DIN MOHAMED TOP: A Malaysian who used to teach in an Islamic
school in Johor. Believed to be a key recruiter for JI and wanted in
the Marriott bombing

FATHUR ROHMAN AL-GHOZI: An Indonesian bomb maker, he was convicted in
Manila for possessing explosives; escaped from jail last month

DUL MATIN: This Indonesian Jemaah Islamiah operative is also
considered to be a competent bomb maker

ZULKARNAEN: The head of military activities for Jemaah Islamiah; a
possible successor to Hambali in the organization's operational
leadership

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 28 August 2003

Next U.S. Deal? Try Thailand

Who would benefit the most? Would labour complain? The next big
Southeast Asian trade pact after Singapore is a sticky proposition
By Rebecca Buckman/RAYONG, THAILAND

A SIGN ALONG the highway from Bangkok to Thailand's industrial eastern
seaboard tells travellers they are entering the "Detroit of the East."
Indeed, the area is packed with foreign car firms such as Ford Motor,
General Motors and Toyota Motor, all drawn to Thailand by the
country's low labour costs and special economic incentives.

Soon, some of those car makers may get even closer to the United
States' Motor City. The Thai government and some businesses here are
lobbying for a free-trade deal with the U.S. that could eliminate most
tariffs on goods flowing between the two nations. Those barriers would
likely include the 25% tariff the U.S. now levies on imported pick-up
trucks--just the kind of sturdy, one-tonne vehicles built in Ford's
five-year-old plant here, a joint venture with Mazda that employs
about 3,000 people.

Ford says publicly it has no plans to export Thai-made Ford Ranger and
Mazda Fighter trucks to the U.S. market, a move that could provoke a
labour backlash at home. "We wouldn't even begin to speculate on such
a remote possibility so far in the future," says U.S.-based Ford
spokesman Ken Zino.

But Ford officials speaking privately concede that the ability to more
cheaply ship pick-up trucks to the U.S. could be one by-product of a
bilateral free-trade deal. While shipping costs for Ford would
increase, the savings in labour would be considerable: Full-time
workers at the Rayong plant make a minimum of about $143 a month, plus
a small housing allowance. A typical U.S. Ford hourly worker earns
$25.30 an hour, including cost-of-living pay.

The Thai government hopes it can formally announce some progress
toward a deal in October, when President George W. Bush is scheduled
to visit Thailand for a regional economic summit.

The U.S. has said that it wants to do more trade deals with Asia after
signing a free-trade pact with Singapore in May. That was America's
first-ever free-trade deal with an Asian nation, and is part of the
U.S. government's new push to pursue more bilateral trade deals--a
policy many economists still find controversial, since they worry
individual deals could undermine the kind of broader global trade
deals the U.S. is also seeking.

A Singapore-style free-trade pact could help both countries. Thailand
faces stiff tariffs on many items it exports to the U.S., like
sweaters, baby clothes and canned tuna. Free trade with the U.S. would
give Thailand an edge over competitors like Mexico, says Chalongpob
Sussangkarn, president of the Thailand Development Research Institute,
a Bangkok think-tank. Thai-made brassieres, for example, face tariffs
of up to 17% when they're exported to the U.S.; bras from Mexico come
in duty-free.

For the U.S., a deal could bring greater access to service industries
like banking, insurance and law. Opening up those types of markets, in
addition to doing away with tariffs on goods, was a key part of the
Singapore deal.

A U.S. embassy official in Bangkok insists it's too early to say they
will definitely pursue a deal with Thailand. But academics and other
trade experts consider it likely. Thailand is already America's
17th-largest trading partner in terms of imports, and Thai Prime
Minister Thaksin Shinawatra may have some rewards to claim for his
increasingly high-profile cooperation with the Bush administration in
the war on terrorism. In June, Thaksin met with Bush in Washington and
discussed trade between the two nations, among other issues.

Kantathi Suphamongkhon, Thailand's official trade representative, says
he's "quite optimistic" negotiations could start early next year if
Thailand can fix some trouble spots like the country's rampant trade
in illegally copied movies and music.

But as the potentially sticky situation with Ford shows, a bilateral
trade pact with the U.S. would be controversial in many circles.
Although economists say Thailand would benefit more than the U.S.
under a pact--since Thailand's economy depends on the U.S. much more
than the U.S. depends on Thailand--some Thai businesspeople are
sceptical. They worry that big U.S. multinationals like Ford could
reap disproportionate riches from freer trade. Indeed, Kantathi notes
that the more free-trade deals Thailand pursues with various
countries, the more foreign companies operating in Thailand could
benefit.

GOING BILATERAL
U.S. cars made in Thailand could be exported duty-free "to all of our
other partners, as well as to the U.S. bilaterally" if Thailand could
eliminate vehicle tariffs with several trading partners, he notes.
Thailand is close to wrapping up a trade deal with Australia and is
having discussions with China, India and Japan. Still, according to
the Thailand Development Research Institute, only 7.5% of all
multinational manufacturing firms in Thailand were American in 2000.
Nearly 38% were Japanese, 16.8% were from Taiwan and 12.3% were
European. But applications from U.S. firms to do business in Thailand
are rising, says Kantathi.

A Thailand deal also would be more difficult to negotiate than the
Singapore pact, mainly because the U.S. and Singapore didn't compete
heavily in many industries, including super-sensitive areas like
agriculture and textiles. Thailand's second-biggest export item to the
U.S. is shrimp and prawns. Last year, it also sent just over $2
billion in clothes and shoes to the U.S., including many products that
faced hefty tariffs. Singapore exports few foodstuffs anywhere and had
virtually no tariffs on any goods when it started negotiating its
trade deal with the U.S.

It's also unclear how well a trade deal would tackle non-tariff trade
barriers in areas such as agriculture. Sarasin Viraphol, an executive
vice-president at Thai agribusiness conglomerate Charoen Pokphand
Group, which logged sales of about $13 billion last year, says that
it's U.S. Department of Agriculture "equivalence" rules, and not
tariffs, that keep his company's flagship subsidiary from exporting
chicken to the U.S. Such rules mean that each country must recognize
the other's poultry standards as equivalent--a complicated,
bureaucratic process. Overall, free trade is "not as easy as some of
our politicians are making it out to be," Sarasin says. According to
Kantathi, the Thai government would work hard to eliminate such
non-tariff barriers in agriculture as part of a trade deal; those
types of barriers are currently a big issue in Thailand's trade
negotiations with Australia, he adds.

A free-trade pact won't be able to reverse all the damage that's been
done recently to Thai industries like electronics and textiles, which
are under increasing pressure from even cheaper labour in China. But
trade experts say getting rid of clothing tariffs could help revive
Thailand's textile business, which is currently the eighth-largest
supplier to the U.S. By around 2005, U.S. quotas on textiles imported
from China will disappear under international trade rules and likely
be replaced by tariffs. If Thailand's garments could enter the U.S.
duty-free, it would give them an advantage. "Duty elimination can
jump-start a sector, and can make a big difference," says Julia
Hughes, vice-president of the U.S. Association of Importers of
Textiles and Apparel

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 28 August 2003

Low-Intensity Export Wars

China's long march into global markets is wearing down competitors.
But Malaysia's Pensonic Holdings is fighting back by targeting niche
markets and tapping the mainland itself by outsourcing products there
By Cris Prystay/KUALA LUMPUR

DIXON CHEW prowls the aisles of Carrefour, a French hypermarket in the
northeast Malaysian state of Penang, poking through displays of
cut-price household electrical products from China.

HOW TO TACKLE THE CHINA THREAT

• Don't go head-to-head in flooded markets; dominate smaller, niche
markets
• Build brand-name recognition, so you're not just competing on price
• Take a cue from China: Build economies of scale

He picks up a chest-high stand fan that costs 52 ringgit ($14), half
the price of a similar fan made by his own company, Pensonic Holdings,
a 21-year-old Malaysian appliance and electronics maker. He turns the
made-in-China fan upside down and peers at the fittings on the base.
"Flimsy," he says, as the plastic parts rattle. He flips it back over
and fingers the fan cage. There's no clasp holding the frame shut.
"Looks like I'm safe on this one. I won't need to drop my price."

It's one small triumph in a protracted battle that's pushed Pensonic
to the brink. Pensonic evolved from being a distributor of Japanese
electronic goods into a competing manufacturer that won market share
by undercutting the multinationals on price. Now, the company faces
its own low-cost competitors: Chinese companies that have tired of
supplying the world with cheap parts and want to reap richer profit
margins by turning themselves into global players.

Pensonic's fight for survival highlights the challenge manufacturers
across Asia are starting to face as Chinese companies go global.

The flood of Chinese goods that has hit Malaysia in the last two years
has pushed Pensonic's prices to the floor. Its air-conditioners for
example, cost half what they did two years ago; the prices of its
television sets have fallen by 30%-40%. The company stayed profitable
through the worst of the Asian financial crisis, but in 2001 it lost
money for the first time.

To fight back, Pensonic is targeting niche markets, branding its items
and taking an "if you can't beat them, join them" approach by
outsourcing to China and becoming an original-equipment manufacturer,
or OEM, a role that China has historically dominated. The company
makes only a token number of TVs these days; instead, it's scaled up
production of smaller household appliances. It may not be sexy, but
it's better to be the King of Fans than say, the pauper among the TV
salesmen.

"We're not moving up the value chain. I'm not going to produce mobile
phones," says Chew. Consumers, he reckons, will pay a few ringgit more
for a Pensonic kettle because it has local brand-name recognition, but
the big price gap between his TVs and a Chinese brand will give that
same consumer pause. "For major appliances, when there's a 400-ringgit
or 500-ringgit difference, the consumer will try it. But if it's only
a 20-ringgit difference, they'll stick to the brand they know."

Pensonic and companies like it have been hit by a wave of Chinese
manufacturers using Southeast Asia as a base to build up expertise in
distribution and after-sales experience relatively close to their
manufacturing base at home. China's exports to Southeast Asia grew 27%
to $23.57 billion in 2002 over 2001. Consumers in Malaysia, one of the
region's fastest-growing domestic economies, were a prime target.
Chinese companies have grabbed a 30% share of Malaysia's 29-inch
television-set market, up from just 9% in 2001, according to GfK Asia,
a market-research company. Their share of Malaysia's
digital-video-disc market soared to 25% in May from 7.8% two years
earlier.

As many as 7% of the televisions sold in the United States last year
were imported from China, but virtually all of them were sold under
the brand names of multinationals like Phillips or under retailers'
in-house brands like Wal-Mart's Apex. But as Chinese companies become
powerful enough to market their own brands, they'll begin to capture
all the economic benefits of their low-cost manufacturing capacity.

It's a dynamic known well to Chew Weng Khak, Dixon's father and the
company's founder. One of 10 children of immigrants from China's
Guangdong province, he began working as an electrician at 17 and later
set up a small repair shop on the side. In 1978 he started
distributing Japanese electronic goods and in 1982, turned into a
low-cost competitor, using cheap parts sourced locally and in
neighbouring Thailand and then Taiwan to make electronic goods under
the Pensonic brand name.

In 1994 Pensonic bought equipment to churn out even more
air-conditioners, TVs and refrigerators. But then Chinese goods soon
began to trickle south and multinationals that were engaged in a price
war in China itself were starting to export their own lower prices.
Four years later, Pensonic wrote off that investment and began buying
entire units made in China instead.

By 2000 the trickle turned into a flood. Chew's son, Dixon, began a
detailed cost analysis of every product he and his Chinese competitors
made; If the quality of the competitors was good, he looked for ways
to cut costs. He switched from locally made parts for his gas stoves,
for example, to parts from China, lowering his costs by 40%.

"We had to go product by product--and we have to keep it up," says
Dixon, a slim, pale bespectacled man, who studied accounting in
Taiwan. Every week, he makes a trip to Carrefour and nearby department
stores to update his price comparison list. "If I knew seven years ago
what I know now, I would have sped up the whole process and outsourced
more, earlier," he says.

Although revenue grew by 21% to 121 million ringgit for the 12 months
to May 31, 2003, the company has slipped deeper into the red, posting
a 4-million-ringgit loss, according to the company's unaudited
statements. Dixon attributes the loss to inventory write-downs,
wrought by falling prices. He contends that his cost-cutting measures,
and the benefits of outsourcing, will take a few years to fully kick
in.

One difficulty is that outsourcing itself has become more complex in
the past few years. When Pensonic first began buying its
air-conditioners from China in 2001, it struck a deal with Chunlan
Electrical Appliance. But by the time the first shipment arrived one
month late later, prices in China had fallen, leaving Malaysian
importers who had more nimble suppliers with a cost advantage.

It took Pensonic three months to wangle a new price out of Chunlan, by
which time prices had heaved down again. This cycle repeated itself
for the rest of the year, leaving Pensonic with stock that was always
about 12% more expensive than its competitors. Pensonic finally
switched to Guangdong Galanz Enterprise Group, a more prominent and
more nimble producer.

So what works? Dixon's biggest success, he says, has been with smaller
items, like his fans. Critics might say he's been marginalized, but he
managed to bring the cost of his fans down by 10% in 2002 compared
with 2001 by getting the motors from China. But Pensonic has only cut
prices by 5% and company officials say its share of Malaysia's fan
market has grown to 12% in 2002 from 2% in 2000.

And so Pensonic is tapping other small markets. The company has
developed a high-end stainless steel line of appliances that retails
under a European-sounding name, Lebensstil Kollektion, for about five
times more than the Pensonic labelled products--and a lower-end range,
called Epicson, that sell for about 40% less. So it's targeting a
range of price points.

Such marketing savvy is essential in this war to woo shoppers. To that
end the company has also hired Paul Temporal, a Singapore-based
branding consultant who's authored Branding in Asia, to create its
first-ever branding strategy. Historically, Pensonic has stuck to the
odd billboard ad. The company has only ever run one TV commercial.
Even their brochures have been designed in-house.

"The window of opportunity is closing fast for these Southeast Asian
companies that haven't built up a brand," says Temporal. "The Chinese
have world-class manufacturing skills, and they're learning
world-class marketing skills from competing with the likes of
Motorola" in China.

At the same time, Dixon is also expanding his regional reach, scaling
up distribution in Vietnam, Thailand and Sri Lanka. With just 28
million people, Malaysia's domestic market just doesn't offer the
scale he needs if he's to compete with the Chinese, he says.

To help build that scale, Pensonic is taking yet another cue from
China. It's not just trying to buy up Chinese parts. It has begun
making products for other companies to sell under their labels, for
the very first time.

And so, visit Pensonic's two-storey factory, situated on the Malaysian
mainland just across from the island of Penang and you will find women
in a Muslim headscarves snapping lime-green casings onto electric
blenders. Fans churn overhead, providing a slight breeze. On the next
assembly line over, others assemble pink-coloured blenders--one of the
few items still assembled, from start to finish, in one of two
Pensonic factories here. The lime-green blenders are for Sharp; the
pink version will bear Pensonic's own name. Work done as an OEM now
comprises 8% of sales. Chew plans to grow that to 30%.

It seems like a step backwards: Chinese companies, for example, are
moving away from OEM work and toward their own-brand sales. Dixon sees
it instead as a way to compete. If he can expand his production lines,
he figures, he can make more of his own toaster ovens and fans at a
lower price.

"It's not the labour costs. Southern China costs the same as Malaysia.
It's the economy of scale those guys have," he says. "That's what I
need to focus on. Getting my costs down, and getting that scale."


--------------------------------------------------------------------------------

WHAT'S IN A NAME?
In this case, a home town. Chew Weng Khak named his company Pensonic
after his home town, Penang, and the audiovisual equipment it makes.
It's not a rip-off of his better-known Japanese competitor.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 28 August 2003

Finally, Some Good News

There are clear signs of a global economic recovery, with encouraging
economic news from the United States and Japan. This augurs well for
Asia's exports. But caution is in order and that requires governments
to keep a lid on the region's currencies
By Tom Holland/HONG KONG

THE WAR IN IRAQ is behind us; Severe Acute Respiratory Syndrome, or
Sars, we hope, is history; interest rates are low and governments are
spending freely. The conditions are in place and finally it appears
the global economy is beginning to pick up.

If so, that's great news for Asia, centre of the world's manufacturing
industries. Faster economic growth around the world equals more demand
for Asia's exports. That in turn feeds through to higher incomes for
the region's workers, creating stronger demand from local consumers.

But caution pays, and after years of being repeatedly coshed by
adverse economic shocks, Asia's policymakers are a cautious bunch. To
ensure their economies benefit as much as possible from what even the
optimists concede will be mild recovery, Asian governments and central
banks are going to work hard to prevent any strengthening of their
currencies on the international foreign-exchange markets.

Economists, usually a dismal lot, are feeling uncharacteristically
bullish. Even in Singapore, which this month announced a painful 4.2%
contraction of GDP in the second quarter, officials are upbeat.
"Barring a resurgence of Sars, the worst is probably behind Singapore
and other regional countries," says Friedrich Wu, director of the
economics division at the Ministry of Trade and Industry.

What encourages Wu and his peers most is the second-quarter upturn in
the United States' economy. Over the months of April to June, GDP rose
by a surprisingly robust 2.4% compared to the same period a year
earlier. That's set economists scrambling to revise their forecasts
upward. Most now expect a growth rate of around 4% for the second half
of the year. It appears that interest rates at four-decade lows and
President George W. Bush's massive tax cuts are finally working their
dim economic magic.

Even more promising for observers on this side of the Pacific is the
6.9% rise in U.S. business investment recorded in the second quarter.
If that trend continues, as surveys of U.S. companies' spending plans
suggest, it will mean increasing U.S. demand for the sort of
technological wizardry shipped by Asia's factories.

Some manufacturers are already benefiting. The price of benchmark DRAM
memory chips has soared by around a third over the last two months, to
reach double what they sold for just last October.

U.S. consumer demand is strong, too, with retail sales rising 5.6%
last month, compared to July 2002. According to Bill Belchere, Hong
Kong-based head of Asia-Pacific economic and policy research at U.S.
bank JPMorgan Chase, that demand is set to increase further over
coming months as the latest round of Federal tax cuts feeds through to
consumers' pockets. "A lot is falling into place," he says. "It all
bodes well for Asia."

The good news is not confined to the U.S. Japan, too, is showing
unusual signs of economic vigour. There, GDP grew at an annualized
rate of 2.3% during the second quarter; hardly a boom, it's true, but
a big improvement over the 1.3% recorded between January and April and
three times the rate predicted by economists.

Even the economic malaise of the euro zone--where two of the three
largest economies, Germany and Italy, are now in recession--is not
altogether negative for Asia. Over the last 18 months the euro has
risen by 15% against the U.S. dollar on a trade-weighted basis,
significantly boosting European purchasing power when shopping for
Asian exports. That's not all. A rising currency has hurt Europe's
competitiveness in global markets, squeezing the European rivals of
Asian exporters and accelerating outsourcing to Asia by European
companies.

Within the region, China continues to act as an important locomotive
for others' growth, sucking in imports at a rate that grew by 43% year
on year over the first seven months of 2003. Not even Sars could
derail growth, with China's economy still expanding by 8.2% over the
first half, compared to 2002's first half.

Expansion at that pace is helping to fuel an enormous shopping spree,
as newly rich customers flock to buy mobile phones, air-conditioners
and other consumer goods. Retail sales leapt by 10% in July, back up
to levels seen in January before the Sars epidemic struck, welcome
news for exporters around the region.

But for all the positive signals, global economic recovery is not
certain. Improvements in U.S. corporate profits can be attributed
largely to cost cutting and the inflation of overseas earnings as the
dollar has weakened, leading some analysts to question whether
business investment is really set to continue. Equally, economists
fret about the stamina of U.S. consumers, noting that household-debt
repayments as a proportion of disposable income are at near record
levels, despite rock-bottom short-term interest rates. Worse, the
recent rise in long-term interest rates, which have shot up to 4.5%
from 3.1% just two months ago, has curbed homeowners' appetite for
refinancing their mortgages.

That matters to Asia, explains Eddie Wong, chief Asian strategist at
ABN-Amro Bank in Hong Kong, because cash generated by mortgage
refinancing has contributed as much as 5% of U.S. consumers'
disposable income in recent times. "If the 10-year bond yield is
sustained at this level, let alone if it goes higher, mortgage
refinancing will dry up within three to six months," he warns. "That
will obviously have substantial implications for consumption."

A slump in either business or consumer spending in the U.S. would
hammer Asian exports at a time when some economists worry that their
growth has already peaked. Tim Condon, chief economist at ING
Financial Markets, also in Hong Kong, notes that trade growth among
the G-3 economies--the U.S., the euro zone and Japan--peaked at 19% in
March and has since dropped back to 9%. Now he worries Asian export
growth will follow the same trajectory.

Others share his fears. "On a year-on-year basis, exports appear very
robust. But looked at sequentially--relative to the last month or last
quarter--growth has definitely slowed," says Sun-Bae Kim, chief
economist at Goldman Sachs in Hong Kong. "Frankly, I'm scratching my
head over this."

It's possible none of these risks will materialize, but Asia's
policymakers are unlikely to take any chances. Of course, there is
nothing officials in Seoul, Taipei or Singapore can do about the
health of the U.S. or Chinese economies. But they can intervene in
foreign-exchange markets to ensure their own exports remain
competitively priced in the international market place.

Maintaining competitive exchange rates is nothing new to Asia. The
region's economic mandarins have long held local currencies down to
ensure their exports sell at attractive prices, especially in the key
U.S. and Chinese markets.

HUGE RESERVES
Keeping currencies down makes sense for other reasons too. Governments
stop their currencies rising by having their central banks buy U.S.
dollars in the foreign-exchange markets. That allows them to build up
foreign-exchange reserves, something Asia has done avidly since the
currency crisis of 1997. It also allows them to inject money into
their domestic economies, because for every dollar bought, the central
bank sells an equivalent amount of its national currency, which passes
into the domestic banking system.

For much of Asia, money injected through intervention is proving a
vital weapon in the battle against deflation. It is also helping to
create a domestic consumer culture as banks, flush with cash, begin
extending new forms of credit to individuals. That's crucial because
if, for whatever reason, the global recovery fails and demand for
Asia's exports dries up, countries in the region will be thrown back
upon their own domestic consumer demand to generate growth until
global trade picks up.

Sometimes intervention is conducted openly, more often it is covert,
but if anyone doubts that Asian countries are pursuing a deliberate
policy of holding down the value of their currencies, they have only
to look at the rate at which regional central banks are accumulating
foreign reserves. In May alone, the value of foreign reserves held by
Asia's central banks increased by $75 billion to hit nearly $1.6
trillion, a sum greater than the GDP of Britain.

With few, if any, signs of emerging global inflation, currency
intervention is a low-risk policy for Asian countries from Japan to
India. It supports vital export sectors while injecting money into the
region's domestic economies, assisting reflation and encouraging the
development of domestic demand. True, there is the possibility that
reckless lending could damage local financial institutions, but that
danger can be averted with better credit controls. And if money supply
does increase too quickly, in today's low-interest-rate environment
central banks can cheaply mop up excess liquidity by borrowing more in
their domestic money markets.

With those advantages, it won't matter how much politicians and
industrialists in Washington or Brussels carp about undervalued Asian
currencies undercutting developed world industries. Regional
governments will carry on intervening for now, because, in an
uncertain world, it's their best economic policy.

+++++++++++++++++++++++++++++

SINGAPORE

In a Slump
By Trish Saywell

SOUTHEAST ASIA'S richest country reported its worst quarterly
performance since independence, with the economy shrinking an
annualized 11.4% in the second quarter over the first. The government
cut its economic forecast for the year to between zero and 1%, from
0.5%-2.5% previously. For the second half of the year, GDP is expected
to expand between 1.3% and 3.3% after contracting 1.3% in the first
half, the government says in its quarterly economic survey.

Government officials say the economy will improve in the second half
of the year, barring external shocks as the United States' economy
accelerates, Singapore's tourism and transport sectors recover from
the Severe Acute Respiratory Syndrome, or Sars, outbreak and global
electronics demand continues to pick up. Export growth in Singapore
for the second consecutive month hit double digits in July. Last
month, Singapore's central bank eased monetary policy as it re-centred
its secret policy band against a basket of foreign currencies to
weaken the Singapore dollar and boost exports.

In his main annual speech after National Day, Prime Minister Goh Chok
Tong said Singapore must cut business costs in order to compete with
lower-cost countries such as China and India, stay competitive and
save jobs. As a result, he said, workers should expect contributions
to the state-run pension scheme to fall to as low as 30% from the
current 36%. Currently employers must pay 16% of the total into the
fund and employees the remaining 20%. The government's earlier promise
to restore the rate to 40% is "no longer realistic or wise," Goh
explained, because it would price Singapore right out of the global
market. Instead of a fixed-rate contribution, Goh added, there would
likely be a range of rates--higher rates during good times and lower
rates during bad times.

Singapore is facing one of its toughest economic slumps, worsened by
Sars and terrorism. While the domestic economy is expected to recover
soon, employment is not. Tens of thousands of Singaporeans have been
thrown out of work. Unemployment is expected to reach a 16-year high
of 5.5% this year, up from 4.5% at the end of June. Government
officials have told Singaporeans to be less choosy about job
prospects, lower their salary expectations and upgrade skills to
compete with foreign labour. Still, many Singaporeans are questioning
the government's policy of hiring foreign workers, who form about a
quarter of the workforce.
++++++++++++++++++++++++++++=

MALAYSIA

Well-Oiled
By S. Jayasankaran

THE CONSENSUS FORECAST of 14 securities houses on Malaysia's growth
for 2003 is, surprisingly, on the low side--it is estimated at 3.9%.

Surprising, because Prime Minister Mahathir Mohamad had said recently
that second-quarter growth, adjusted for inflation, would "be around
4.5%." The official figure will not be released until August 27, but
Mahathir's statement indicated that growth had been relatively robust
during a period troubled by the outbreak of Severe Acute Respiratory
Syndrome, or Sars.

Growth of 4.5% for the full year seems eminently reasonable, given the
containment of Sars amid an end-May 7 billion ringgit ($1.84 billion)
economic-stimulus package that's expected to boost growth. In
addition, first-quarter growth clocked in at 4%.

In the first half of the year, 8.1 billion ringgit of new investment
was approved. That's 58% higher than for the corresponding period last
year. Exports rose almost 7% while the trade surplus reached 36.6
billion ringgit. Plus, the stockmarket is up 16% since January. All
that has helped boost the country's reserves to more than $38 billion,
a seven-year high.

Inflation is benign (1.2% in June), while there is relatively full
employment--the jobless figure is 3.2%. Interest rates are low and
trending lower after the bank rate was cut by 50 basis points by the
central bank in late May. Three-month money now fetches 2.9%, a
10-year low.

The country is also incredibly lucky. Late last year, independent
United States contractor Murphy Oil struck oil in deep waters off
Malaysia's easternmost state, Sabah. The find is estimated to hold up
to 700 million barrels of recoverable reserve, about 22% of Malaysia's
current reserves, and is expected to prompt more exploration activity
in the so-called Baram Delta, the deep waters off northern Borneo.

Oil and gas will be a key driver for the Malaysian economy in the next
five years. Lim Beng Liong, the Kuala Lumpur-based research head for
Singapore brokerage UOBKayHian, estimates that between 38.7 billion
ringgit and 50.1 billion ringgit in contracts will be up for grabs for
local and foreign oil-and-gas companies during the next five years.

Oil analysts say that every 2.4 billion ringgit in new oil-and-gas
investment can add 0.5 of a percentage point to GDP. Lim says that
this year, global oil companies could spend as much as 10 billion
ringgit in Malaysia. If he's right, that's another 2 percentage points
of GDP.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 28 August 2003

INREVIEW: BOOKS: CHINESE OVERSEAS

Overdue History

The Chinese in America finally have a comprehensive chronicle of their
struggles and achievements, writes Barbara Chai

The Chinese in America: A Narrative History, by Iris Chang. Viking.
$29.95

IRIS CHANG, author of The Chinese in America: A Narrative History,
says in her introduction that she felt "a personal obligation to write
an honest history of Chinese America, to dispel the offensive
stereotypes that had long permeated the U.S. news and entertainment
media."

Chang writes that, in American history, television cartoons have shown
the Chinese with buck teeth, pigtails and slanted eyes. Textbooks have
carried racist illustrations of Chinese people eating snails with
long, claw-like fingernails, while Hollywood films have portrayed all
Chinese men as spies or crime kingpins and Chinese women as
prostitutes. This misrepresentation continues today, though in less
blatant forms.

Fed up with this state of affairs, Chang has written the first
comprehensive account of the Chinese-American experience. Other
nonfiction books examining Chinese-Americans tend to focus on limited
aspects of the immigrant experience, while Chang tackles the entire
history, breaking it down into three main waves, starting with the
gold seekers and migrant labourers from China's coastal cities in the
1800s. The Chinese were active in the California Gold Rush in the
1850s and worked on the American transcontinental railway in the late
1860s. The story of Chinese professionals of the mid-20th century
forms the book's middle and, finally, Chang writes about the wave of
immigrants entering the U.S. in the last two decades of the 20th
century.

The Chinese excelled almost from the start in the new homeland, but
this led to a backlash where whites viewed them as competition and
subsequently tried to drive them out. Chang explores how such
anti-Chinese fervour could come about, and why reason became "an early
casualty." She takes an honest look at the tremendous fear of the
Chinese, claiming "their physiognomy, their language, their food,
their queues--struck many whites as bizarre, making it easy to
demonize them." Caucasians, noticing a threat to their livelihoods,
began to feel as if the Chinese were part of a "giant, secret
conspiracy to undercut the American working man."

Such beliefs can help to explain one of the most devastating events in
Chinese-American history, the signing of the Chinese Exclusion Act,
passed in 1882. The bill barred Chinese immigration to America for 10
years. The act fanned the flames of hatred, and was seen as a carte
blanche to expel the remaining Chinese from the country.

In the ensuing years, known as the "Driving Out," Chinese communities
in the West suffered from "a level of violence that approached
genocide," Chang writes. "Throughout history, both the U.S. government
and industry have sought to exploit Chinese labour--either as raw
muscle or as brain power--but resisted accepting the Chinese as fellow
Americans." The Chinese banded together, protested, and sued over
special taxes, provisions and laws designed to limit their rights.

Images such as these are specific to the Chinese-American story. But
Chang emphasizes that these struggles join others experienced by
blacks, native Americans and Latinos, and together form the pioneering
force that helped shape U.S. civil-rights law.

Chang, a former journalist, distinguished herself with a previous
best-selling work, The Rape of Nanking. She interviewed survivors to
report on one of the worst chapters of World War II--the torture, rape
and massacre of hundreds of thousands of Chinese by Japanese soldiers.

Chang also researched thousands of documents in different languages
and dipped into her own family legacy--her grandparents escaped the
massacre--to give a thoroughly detailed and personal account of this
incident.

Similarly, in The Chinese in America, Chang draws upon the stories of
hundreds of sources, as well as her own family members, to illustrate
the different ways Chinese people have contributed to America and
become American.

At 500 pages, Chan's book is a comprehensive account that relates
experiences and incidents in an engaging and thought-provoking way. At
times, she tends to belabour the ill-treatment of the Chinese, when
her facts and anecdotes garnered from impeccable research can tell the
story fully on their own.

The final result is an important book that fills a gaping hole in
Asian-American studies. One wonders how it has been left empty for so
long.

Barbara Chai is a writer living in Belgium

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[Yap Yok Foo]

From Newsweek Magazine
Issue 8 September 2003

‘No Frills’ Takes Flight

But who will rule in Asia: the state or the entrepreneurs?

By Sonia Kolesnikov-Jessop
NEWSWEEK INTERNATIONAL

Sept. 8 issue — When AirAsia started flying out of Kuala Lumpur two
years ago, it quickly became the cheapest of the cheap, the
lowest-cost airline in the world. AirAsia says it spends only 2.5
cents to fly one passenger one kilometer, compared to 4.5 cents for
Ryanair and 7.5 cents for Southwest—the discount leaders of Europe and
America.

AIRASIA ACHIEVES THESE savings by asking pilots to train
staff in everything from first aid to baggage handling (on the premise
that pilots are smart and versatile). Cabin attendants do double duty,
cleaning planes and selling drinks on commission. It’s a “big fallacy”
to think no-frills means just cutting out free drinks, says CEO Tony
Fernandes, who has been known to work the check-in counter. You’ve got
to “change the airline culture.”

Even that may not be enough for no-frills entrepreneurs. The
discount revolution has been slow to arrive in Asia, where governments
still control most major airlines and have offered a grudging welcome
to new competitors. Last year discount carriers accounted for less
than 1 percent of passenger traffic in Asia (excluding Australia and
Japan), compared with about 25 percent in the United States and 10
percent in Europe. While Southwest recently became the largest airline
in the United States, AirAsia is a small success, with 7 planes and
profits of $5.3 million last year. Now, in a frontal assault on
AirAsia and other private upstarts like Cebu Pacific in the
Philippines and Bangkok Airways, state-owned carriers like Singapore
Airlines, Thai Airways and Qantas are considering their own no-frills
spinoffs. “Most of the airlines in Asia are big monopolies; they have
always had it their way and they don’t like any whiff of competition,”
says Fernandes. “The unknown is causing this mass hysteria.”

It may seem that major airlines can’t lose this war, with the
state on their side. Asian governments have yet to embrace the wave of
deregulation that made it possible for entrepreneurs like Tony Ryan to
become major players in the West. There is no Asian equivalent of
Ryanair, which flies all over Europe, because Asian states have been
much slower to open their airports to all comers. Asian discounters
are for the most part limited to domestic flights. Yet when Malaysia
Airlines last year launched a fare war against AirAsia, the government
stopped it, saying it wanted both to survive. Fernandes says for
majors to fly without frills is like Ritz-Carlton competing with the
YMCA. “Business sense will prevail,” he says.

It will be hard to make the no-frills formula work Asia wide.
In Europe and the United States, the strategy includes hiring nonunion
staff, using one (often narrow-body) aircraft model to cut maintenance
costs, flying short routes (less than two hours) to reduce turnaround
times, landing only at secondary airports, selling tickets online to
avoid middlemen and eliminating frills like hot food. In Asia, labor
is already inexpensive, most regional hops are longer than two hours,
secondary airports are not cheap and consumers are less likely to buy
online. Asian majors already cram cheap seats into the back of wide
body jets, creating a budget “plane within the plane.” All this makes
it near impossible for discounters to gain cost advantages on routes
in Asia, says Richard Stirland, director general of the Association of
Asia Pacific Airlines.

So why are the majors testing the down market? In the West,
no-frills airlines are luring millions of customers who have never
flown before, and Asia has an even larger untapped market—one that no
airline executive dares ignore. Analyst Peter Harbison says Asian
governments are opening up “possibly faster than many imagine,”
lowering airport charges and other barriers in response to SARS and
the recent downturn in air travel. Singapore and Thailand will decide
“fairly soon” on whether to launch a new budget carrier based in
Chiang Mai, Thailand, says Singapore Trade Minister George Yeo. And
while one former deputy chairman of Singapore Airlines recently warned
that aviation history is “littered” with no-frills failures, another
is leading a new start-up, ValuAir. None of this scares AirAsia, which
is gearing up for regional flights, perhaps next year. Fernandes
insists, “We can always beat the big guys on cost.” He won’t say how,
but pretty soon, he’ll have a chance to prove it.

--------------------------------------------------------------------------------
With Lorien Holland in Kuala Lumpur

http://www.time.com
http://www.msnbc.com/news/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 11 September 2003

The Best of Both Worlds

Not quite a hotel and not quite a museum, Penang's 'Blue Mansion'
offers hospitality and a fascinating glimpse into the past
By Michael Vatikiotis/PENANG

MOST BOUTIQUE HOTELS offer luxury and privacy at a premium. Penang's
"Blue Mansion" adds something else: an authentic cultural experience.
Step inside this two-storey courtyard mansion and you enter the world
of Cheong Fatt Tze, a 19th-century Hakka Chinese tycoon.

Cheong was a major player in his day, trading tin and opium and
running a bank and a steamship line. In 1880, he built a house that
reflected his status and which elegantly merged southern Chinese
craftsmanship with Straits Chinese tropical style.

By 1990, however, the 35-room building was dilapidated and home to a
colony of squatters. And that's where local architect Lawrence Loh
came in. He poured his energy into restoring the house, even bringing
over artisans from southern China in much the same way that Cheong
did.

The results are magnificent, and fully respect the traditions of the
house. When it rains, for instance, water gushes into the sunken
courtyard and is held there to enhance the building's feng shui. Even
the electricity fixtures are kept as authentic and brown bakelite as
safely possible.

None of this would have been possible if the building had been fully
converted into a hotel, Loh explains. Strict regulations would have
required sprinkler outlets and the replacement of original wooden
staircases with fireproof steel or concrete. But Loh also wanted to
avoid turning the place into a museum.

"I wanted to reintroduce the cycle of life into the building," he
explains. "It's good for the feng shui. It could not be a place that
is devoid of life." So in 2001, he opened the house as a private
homestay, a classification that requires less stringent building
regulations. There are 16 rooms, each of which has its own theme. One
is built around an old kitchen; another is decorated in 1950s style.
But all have their own bathroom and facilities such as
air-conditioning.

A small and friendly staff offers comfortable but discreet help and
serves up a delightful breakfast each morning. The only interruption
is the twice-daily tour conducted by Loh's wife, Li Lin. And, unless
you book a room, that's the only way you'll get to see this marvel of
restored history.

THE CHEONG FATT TZE MANSION ("THE BLUE MANSION")
14 Leith Street, Penang
Tel.: [phone]; www.cheongfatttzemansion.com
From 195 ringgit ($51) a night

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 11 September 2003

Shaking Up Coke in Japan
A silvering population and a sluggish economy are taking the fizz out
of Coke's Japan business. Now the company's serving up a slew of new
ways to whet appetites in this, one of its most important markets.
Coke by phone, anyone?
By Chad Terhune/ATLANTA and Gabriel Kahn/TOKYO

JAPAN IS THE LAND of the Not-So-Rising Sun for Coca-Cola these days.
Coke's sales there plunged 11% in July and have remained weak, partly
due to soggy summer weather hurting demand. But that isn't the only
dark cloud on Coke's horizon. Shifts in Japan's demographics and
consumers' buying habits, combined with a sluggish economy and falling
prices, are slowing Coke's growth in one of its most important
markets.

COKE'S FORMULA

In Japan, Coca-Cola is seeking to promote new growth on several
fronts:
• Launching new products to appeal to older consumers
• Trying to revive vending-machine sales
• Revamping its network of bottlers

In 2012, there will be more over-60s in Japan than under-30s,
according to New Zealand-based consultancy Asian Demographics, and
Coke risks losing many of its best customers--the under-30 set who
spend freely on its colas, coffees and teas. "The days of double-digit
growth are over," says Etsuko Katsube, executive vice-president of
Coca-Cola Japan and director of strategic marketing. "The big-picture
pie is never going to grow again."

Coke's not alone: Many other big consumer-product brands are facing a
similar challenge in Japan as their core market of young consumers
shrinks. Sales at McDonald's Japan dropped 12% last year from a year
earlier, and the company is planning to shut 172 of its 3,800
restaurants. Kirin Brewery, one of Japan's largest brewers, expects
sales volume to drop 6.3% this year over last year, partly due to a
change in the way alcoholic drinks are taxed.

Coke is trying to get business bubbling again with a slew of new
measures. The Atlanta-based company is trying to revive its
high-margin vending-machine sales, cut costs through a new venture
with its independent bottlers, and appeal to ageing consumers with
health-oriented drinks.

The implications of all this are huge for the world's biggest beverage
company. Japan has been a gold mine for Coke for more than a decade.
The country represents about 5% of Coke's overall sales volume, but it
accounts for roughly 20% of profits.

However, analysts expect annual profit growth from Japan to slow to
roughly 5% from the low-teens recorded since the mid-1990s.

"It will be tough for them to show progress corporately," says John
Faucher, a U.S.-based analyst at JPMorgan, "as long as Japan continues
to struggle." Bill Pecoriello, an analyst at Morgan Stanley, says
"Japan is one of the top risk factors at Coke."

The risk, analysts say, is that Coke will fall short of its goal to
grow overall earnings per share by 11%-12% annually if the company
can't reverse the decline in Japan. Coke wants to be measured by its
bottom-line results after recently dropping its traditional
volume-driven strategy.

Mary Minnick, president and chief operating officer of Coca-Cola Asia,
says the company is optimistic about long-term growth in Japan due to
the strength of its overall system there. "We are faced with a very
challenging environment," she says. "This is a long-term continuing
evolution of our business in Japan."

For beverage makers, one of the most troubling trends in the industry
has been the rise of supermarket sales. Consumer prices have fallen by
7.9% over the past decade in Japan and supermarkets have been
aggressive at discounting. For years, the Japanese love affair with
vending machines enabled Coke to better control pricing and earn
higher margins from its 1 million machines.

But vending machines' share of nonalcoholic beverage sales
industrywide fell to an estimated 32% this year from 36% in 1995,
according to data from the All Japan Soft Drink Association.
Supermarkets' share, meanwhile, grew to an estimated 28% from 24% over
the same period.

Minnick says vending machines should remain highly profitable for
Coke, but the company must find new ways to trigger an impulse
purchase. In supermarkets, she says, Coke won't match rivals'
excessive discounting even if that means losing short-term sales.
Instead, Minnick says, Coke plans to roll out more package sizes in
supermarkets "to drive reasonable levels of volume at reasonable
margins."

Coke is trying boost its vending-machine business by tapping into the
Japanese obsession with cellphones. Coke partnered with Japan's
leading cellular operator, NTT DoCoMo, to develop a service called
Cmode that lets customers buy a drink by using their phones instead of
cash.

Customers first open an account by accessing a menu function stored on
their mobile phones. To purchase a drink, they then call up a bar code
on their cell-phone screen and hold it up to a vending machine
equipped with an optical reader. The vending machine then debits their
Cmode account. The account works like a pre-paid debit card--consumers
can add cash at Cmode machines.

There are other tricks as well. By using the cellular operator's
network, Cmode users can pinpoint their location by calling up a
detailed street map on their phones. The map can then guide them to
one of the 900 Cmode vending machines.

KEEPING TRACK
More importantly, the system allows Coke to communicate directly with
its customers through their phones. On a recent summer day, Coke
beamed an electronic coupon to all of its Cmode customers. Sales
jumped 50% that day. "That one-to-one involvement is going to be very
important for us going forward," says Katsube. It also lets Coke track
the tastes and habits of Cmode users.

Overall, the new machines have generated 21% more sales volume than
regular machines since they were first tested in late 2001. Coke plans
to add several thousand Cmode machines next year.

Another critical component of Coke's strategy in Japan is helping its
ailing bottlers. The loss of vending-machine sales, plus the increased
buying power of Japanese retailers and the overall deflation of the
economy, have taken their toll on Coke's 14 bottlers and left them
unable to reinvest significantly in the business.

Coke generally earns money by selling concentrate to its independent
bottlers, who mix that with water or other ingredients to make a
finished product. The bottlers then package and distribute Coke's
drinks.

The system works a little differently in Japan. The Japanese bottlers
produce most of Coke's carbonated drinks and coffees. But Coke, not
the bottlers, manufactures many of the fastest-growing beverages in
Japan, such as teas and waters. The bottlers earn a fee for
distributing these finished products, but Coke reaps more of the
profits since it invested in the manufacturing. Unlike in most
markets, where sodas dominate, Coke's Japan business is split fairly
evenly among its carbonated drinks, coffees and teas.

This division of labour is one reason for the disparity in profits
between Coke and its bottlers. From 1995 to 2001, the bottlers'
profits declined 11% annually on average, according to Pecoriello at
Morgan Stanley, while Coke's profits in yen grew annually at 13%.

Coke plans to address this by establishing a new joint venture with
its bottlers later this year. This new supply-chain management company
is expected to help the bottlers cut costs and become more profitable.
The new venture will also take over production of teas and other
fast-growing beverages so the bottlers can share in more of those
profits. This isn't expected to alter Coke's profits from Japan; the
company could raise the prices it charges bottlers for its
concentrates to make up any lost income.

One area Coke isn't looking to cut back on is new products. In the
past year in Japan, Coke has introduced 40 new drinks and more than
200 different drink sizes and packages. Minnick says Coke intends to
plough even more money into research and development. In line with
that, the barriers to launching new products are also dropping. Coke
generally wants 30% of a target market to try a new product; the
previous goal was 50%. Says Katsube. "We've got to adapt to these
changes more rapidly."

Brand loyalty is notoriously low in Japan. Riho Yamanaka, a
29-year-old Tokyo hotel manager, takes up to four different drinks a
day and switches brands all the time. She recently stopped drinking
regular Coke and Sprite in favour of diet soft drinks and canned
coffees and teas.

Beverage makers try to keep pace with people such as Yamanaka by
filling store shelves with new products and packages. Each year in
Japan's fad-driven consumer market, more than 1,000 new drinks are
launched; only about 3% survive.

One of Coke's biggest challenges is finding new products that appeal
to its ageing customers. It has put considerable focus on drinks that
claim to boost energy or have health benefits--and possibly fetch a
higher price.

The company recently launched Tarumi, a low-calorie beverage which
claims to "balance mind and body" through its blend of six minerals.
Tarumi is Japanese for "sag unhealthily," a condition the drink is
intended to reverse. Another new drink launched this year was Boco,
billed as fat- and cholesterol-free.

Some industry observers say Coke is headed in the right direction. But
they worry that the level of innovation required in Japan drives up
costs and further complicates the task of turning around the bottlers.
And some analysts warn that the company remains overexposed to Japan's
economic ills.

"Coke is taking significant steps forward given the headwinds of a
difficult operating environment in Japan," says Faucher of JPMorgan.
"It will be a long time before we know whether these efforts are
enough."
++++++++++++++++++++++++++

CAN DO: HOW COKE CATERS TO QUIRKY JAPANESE TASTES
By Gabriel Kahn

Is it a can, or is it a bottle?
How far-reaching is Japan's infatuation with cellphones? It's now
changing the look of soft drinks. In researching the drinking habits
of young Japanese, Coca-Cola discovered that 30% of teens consume a
beverage while speaking on their mobile phones. Coke concluded that
traditional ring-pull cans didn't fit with this "trend of mobility."
Once opened, they couldn't be resealed. The solution was to push
another Japanese invention: the screw-top can. It's aluminium like a
regular can, but has a screw-top like a bottle, so it can be resealed
quickly for people on the go. Coke is now using the "bottle-can" on a
number of new products, such as its diet Boco drink, as well as to
repackage its standard Coke drinks.

Wakey, wakey, breakfast to go
Coke's consumer research in Japan discovered a habit that might make
mothers cringe: 50% of young, working males skip breakfast. However
unhealthy that might be, it also opens up a whole new market segment
for beverages. "They can't get through the morning without drinking
something," says Coca-Cola Japan's executive vice president, Etsuko
Katsube. "What can we offer?" Coke already has one drink on the market
in Japan that it thinks can fill that niche-Pocket Dr., which includes
vitamins and minerals. Now it's exploring other nutritional drinks
that can serve as an instant breakfast on the run.

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 11 September 2003

TRAVELLERS' TALES
By Nury Vittachi

FINGER-LICKIN' GOD: A Japanese baseball team is soaring to success
thanks to its chosen deity--Colonel Sanders of the KFC fast food
corporation. The deceased chicken king from Kentucky is leading the
Hanshin Tigers of Osaka to their best tournament performance in years.

Their return to form is all the more gratifying since the relationship
between the team and their spiritual guide has been stormy for years.

The team adopted Colonel Sanders as a guardian angel more than two
decades ago because their most distinctive member was a large, bearded
American slugger. After winning the Japan Series in 1985, team members
celebrated in the traditional way--by jumping into the Dotonbori
River. They also threw the Colonel Sanders statue into the water, but
failed to recover it despite an extensive search.

Colonel Sanders was angry. Hit by a curse, the team fell down the
league ladder and became a "cellar-dweller."

Now, almost 20 years later, the team has been forgiven. There's a new
statue of the Colonel outside the Hanshin Koshien KFC restaurant and
he is wearing a team uniform. "It has become like a deity for fans of
the club, who drape it with the megaphones Japanese fans usually use
to cheer on their team," the Mainichi Shimbun reported. Six times an
hour, a picture of the Colonel appears on screens at the stadium.

A spokesman for the restaurant said: "Tigers' success doesn't come
around that often, so we want to really enjoy it while we can." But
announcements are made during matches that fans should never, never,
never--even if the team wins--throw Colonel Sanders into the river
again.


--------------------------------------------------------------------------------
Picture of a sign in from of restaurant
RESTORAN HSBC

WORLD'S LOCAL BANK: Reader John Worth found this café on a recent
visit to Bangsar in Kuala Lumpur. "The restaurant claims to offer
genuine Bangsar food, whatever that's supposed to be," said John. "But
the real question is: Does this venture represent the latest
diversification for the bank?"


--------------------------------------------------------------------------------

WORK EXPERIENCE: A proud Australian father took his son to work with
him. Nothing odd about that--except that Dad was an armed robber. The
man and his eight-month-old infant stole a car, robbed a fast food
restaurant and made a speedy getaway. Dad wore a mask but apparently
couldn't find one in baby size for his young companion (clearly a
market opportunity for Mothercare). Police caught up with the pair at
a bar in Perth where the older male was celebrating with a drink, the
Associated Press reported. Officers took over Dad's babysitting duties
while their colleagues made an urgent search for Mum.


--------------------------------------------------------------------------------

PIXELPOCKET: A man who was robbed in a computer game has filed a writ
in a real court--against the software firm that developed the game.

Computer enthusiast Li of Beijing spent two years playing Red Moon, a
game in which he built up a large stockpile of virtual weapons. But
then he logged on to find that the guns had vanished. He contacted the
software firm for help, but the company refused to take
responsibility, the Beijing Morning Post reported. Li has filed a writ
at the Chaoyang District People's Court demanding compensation in cash
for the mental anguish he claims to have suffered--and the return of
all his weapons. I think obsolence should be built into all games so
people like this computer-games enthusiast can get a life.


--------------------------------------------------------------------------------

HEAVENLY CALL: Four people who identified the body of a male family
member after an accident dialled his mobile phone number--and were
surprised to hear him answer. Was it a long-distance connection to
heaven? The family, including the parents, from Kobe, Japan, had been
summoned to Minato Police Station in Osaka to identify a body found at
the scene of a motorcycle crash. The parents confirmed that the body
was that of their son, a 21-year-old student. But when they were told
that police had not recovered the son's mobile phone, they called the
number--and their son answered them immediately, the Asahi Shimbun
reported. Realising what had happened, the student raced to the police
station to comfort his family--and to explain that he had lent his
motorbike to a friend. No doubt calls to the afterlife will eventually
be added to the lengthening list of mobile phone functions, possibly
as part of a 3G service.


--------------------------------------------------------------------------------



BLOW ME DOWN: Asians often slip up because they use dictionaries to
translate sentences. Here's an example of English speakers doing the
same thing, sent in by reader Henner Lotz. The picture, taken by
Sylvia Weinzettl in the British city of Liverpool, shows the phrase
"football fan" translated into German as "soccer ventilator."

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 18 September 2003

TRAVELLERS' TALES
By Nury Vittachi

GIRL POWER: Bizarre North Korean leader Kim Jong Il has conquered
South Korea in a bloodless coup by rolling out an army of suspiciously
perfect cheerleaders.

The 303 young women arrived in South Korea for a sports event and
immediately won the hearts of the Southerners. For days, they
dominated the news on television, newspapers and magazines. "Beauty
troops take over Daegu" was one of hundreds of headlines describing
the activities of the army of young women. Even conservative
publications carried photographs of the women, with headlines such as
"Wow, they sure are pretty."

Debate raged over whether the girls were naturally stunning or whether
they had been "built" by a secret squad of plastic surgeons in the
totalitarian state, the Korea Herald reported.

The visit of the women struck a note deep in the South Korean psyche,
because it appears to reflect the ancient Korean saying namnam
buknyeo, which means the ultimate men are Southerners and the ultimate
women are Northerners.

Kim Jong Il's army of cheerleaders may have won over South Korea, but
will they have any effect on negotiations with the Bush administration
of the United States? Sorry, Kim: right strategy, wrong president . .
.


--------------------------------------------------------------------------------
"We need your intellect for the benefit of others"


TOO CLEVER: Reader Teddy Piastunovich was not impressed by the slogan
of Mensa Israel.


--------------------------------------------------------------------------------

BEAM ME UP: A hospital in China has ordered staff to give patients
"eight-tooth smiles." Doctors and nurses at the facility in Chongqing
will no longer be able to count a slight lifting of the cheek muscles
as a smile. The grin must be so wide that the patient can count eight
separate teeth. Staff say that the rule, put in place by a hospital
director named Huang, is extreme. But the Chongqing Evening News
reports that complaints against staff have dropped dramatically.


--------------------------------------------------------------------------------

FEEL THE FORCE: A man who worked as a police officer in New Delhi for
a decade was discovered to be a milkman. The Sahibabad man failed an
exam to join the force in 1992, but decided to don a uniform and strut
around fingering his lathi anyway. He promoted himself over the years
to sub-inspector in his own one-man force. The Hindustan Times
reported that he came unstuck when he started acting too much like the
worst sort of officer, trying to extort a 50% discount from a property
developer. The builder complained to the real police and the scam was
exposed. The Hindu newspaper reported that the arrest of Mustkeen
shocked police in his home town as "he had resolved many disputes over
the years."


--------------------------------------------------------------------------------

ACTING UP: A 12-year-old boy in Malaysia robbed a woman after
persuading her to close her eyes while he wandered around her
apartment. The boy, who claimed to be a young monk, turned up at the
house of a newly wed woman in the district of Taman Satellite, and
said she could get rid of an evil spirit afflicting her if she shut
her eyes and repeated some mantras for several minutes. While she did
so, he and his friends cleaned out her flat, The Star reported. This
child deserves punishment for his sins--and an "A" grade for drama
skills.


--------------------------------------------------------------------------------

NEWS SCOOP: The sports world of Japan has been shaken by the exposure
of a "corrupt superstar" in the hot new sport of competitive fish
scooping. A Saitama prefecture man aged 53 took first place in a
tournament organized by the National Goldfish Dipper Catching
Federation. In this thrilling, fast-action sport, competitors use
paper scoops to catch live goldfish swimming in plastic baths. But an
adoring fan filmed his hero's performance, only to discover on
slow-motion playback that he was using a nonstandard scoop he had
hidden behind a hand fan. Shocked judges stripped the champion of his
title and banned him from the sport for life, the Mainichi Shimbun
reported. Shaken federation chairman Kiyoshi Ueda said: "We want to
try and make the competition as fair as possible so that we don't
destroy children's dreams."


--------------------------------------------------------------------------------



YOU KNEW THAT: Bo Karstrom snapped this at the airport just outside
Tokyo "How can you possibly get lost in Narita airport, with signs
like this?" he asked.

http://www.feer.com/



*************From Uncle Yap**************
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[Pan]

Post by Yap Yok Foo
From The Far Eastern Economics Review
Issue 18 September 2003
TRAVELLERS' TALES
By Nury Vittachi

[snip]

Post by Yap Yok Foo
--------------------------------------------------------------------------------
YOU KNEW THAT: Bo Karstrom snapped this at the airport just outside
Tokyo "How can you possibly get lost in Narita airport, with signs
like this?" he asked.
http://www.feer.com/

What did the sign say, Uncle Yap?

All the best,

Michael

If you would like to send a private email to me, please take out the TRASH, so to speak. Please do not email me something which you also posted.

[Yap Yok Foo]

Post by Pan

Post by Yap Yok Foo
YOU KNEW THAT: Bo Karstrom snapped this at the airport just outside
Tokyo "How can you possibly get lost in Narita airport, with signs
like this?" he asked.
http://www.feer.com/

What did the sign say, Uncle Yap?

I found it difficult to describe the sign which was not a map with an
arrow pointing to a spot and saying "You are here"

It was a table of floors
and in the third floor where the sign was found
there were these words
"You are here"

The url is at
http://www.feer.com/articles/2003/0309_18/p060tales.html



*************From Uncle Yap**************
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[Pan]

Post by Yap Yok Foo

Post by Pan

Post by Yap Yok Foo
YOU KNEW THAT: Bo Karstrom snapped this at the airport just outside
Tokyo "How can you possibly get lost in Narita airport, with signs
like this?" he asked.
http://www.feer.com/

What did the sign say, Uncle Yap?

I found it difficult to describe the sign which was not a map with an
arrow pointing to a spot and saying "You are here"
It was a table of floors
and in the third floor where the sign was found
there were these words
"You are here"

Funny.

I'd click on the URL, but I think I can no longer access the website
free. Pity, I used to like to look at their site.

Michael

If you would like to send a private email to me, please take out the TRASH, so to speak. Please do not email me something which you also posted.

[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 18 September 2003

Fear Returns

A suspected new Severe Acute Respiratory Syndrome case in Singapore
underscores concern that the disease may resurface in force this
autumn
By Trish Saywell/SINGAPORE

JUST AS ASIA STARTED getting back to business after the outbreak of
Severe Acute Respiratory Syndrome, a Singapore man has tested positive
for the Sars virus.

The 27-year-old post-doctoral researcher developed a fever at around
midnight on August 26 and was admitted to hospital on September 3. He
had a dry cough, complained of fever, muscle aches and joint pains.
But he did not have any significant respiratory symptoms and his chest
X-rays were all normal. So his case thus far falls short of the World
Health Organization (WHO) definition of Sars.

On September 8 polymerase-chain-reaction tests and serology test
results came back positive for the virus, according to Singapore
officials. The tests were repeated the next day with positive results
again and samples were sent to the Centres for Disease Control and
Prevention in Atlanta for confirmation. The CDC is expected to have
results in mid September.

"Whatever the definition we should treat it as a probable Sars case,"
Acting Health Minister Khaw Boon Wan said at a press conference on
September 9. "I'd rather deal with a false alarm. I have to anticipate
the scenario that the CDC test will come back positive."

The significance of the new case remains unclear and will depend
largely on how the virus came to infect the man. He had been working
with West Nile virus at a microbiology laboratory at the National
University of Singapore and had also done some work on the same virus
in a laboratory at the Environment Health Institute. An infection from
a laboratory would likely be far easier to contain than if the disease
came from somewhere in the community.

The laboratory at the Environment Health Institute had been growing
the live Sars virus and providing inactivated Sars virus to other
laboratories to be used for work on diagnostic and antibody tests. The
man last visited the EHI laboratory on August 23--three days before he
developed a fever. He also visited the lab in late July, according to
Daniel Wang, director-general of public health at Singapore's National
Environment Agency.

The Sars outbreak, which began in China last November, was contained
in June after infecting more than 8,400 people around the world,
killing 916 of them. If the man didn't contract the virus in a
government lab, it could endorse widely held fears that the contagious
respiratory disease that circled the globe in a matter of weeks
earlier this year might resurface in the autumn.

Still, experts on infectious diseases note that this time around
governments will be better prepared. "What caused so much trouble
before was that the outbreak happened before we had any information,"
says Dominic Dwyer, a virologist at the Centre for Infectious Diseases
and Microbiology at Westmead Hospital in New South Wales, Australia.
"If this is Sars, now that the person is isolated, he can be taken
care of." Adds Gurinder Shahi, an international public-health
physician in Singapore: "We've learned a lot from the first time
around, so hopefully we won't make the same mistakes and can minimize
the damage."

The first step is determining how he contracted the illness. "A
genetic analysis should soon determine if this virus came from the
lab, as I think likely," notes Luis Villareal, director at the Centre
for Virus Research at the University of California, Irvine. He argues
that the greatest threat of a new Sars epidemic will now come from lab
accidents, and that the classification of the virus as a Biosafety
Level Three agent should be changed to Biosafety Level Four. That
means Sars research work would then only be undertaken in Biosafety
Level Four labs, which follow the most stringent safety regulations
outlined by the WHO.

But Wang says it's unlikely the man contracted the virus from the EHI
laboratory because researchers hadn't worked on the Sars virus there
since August 17. "There was a six-day gap between the last time Sars
was worked on in the [EHI] lab and the time he was present," Wang
said. "It [the Sars virus] cannot live for more than two days maximum
under the conditions in that lab. There seems to be a coincidental
link, but I think it's unlikely." The 23 research scientists who work
in the laboratory have tested negative for Sars, he added.

Khaw said he didn't know when work on Sars viruses had last taken
place at the National University of Singapore laboratory. But, he
added, "at the time the man was in the [two] labs there was no Sars
work going on."

There had been no new probable Sars cases detected in Singapore since
May 11. The illness killed 33 out of 238 people afflicted in
Singapore. Now everyone is waiting to see if there will be a chain
reaction from this case.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 18 September 2003

Torn in Two

Australia's long-standing failure to resolve its uneasy relationship
with Asia is examined in a new book, writes Dewi Anggraeni

About Face: Asian Accounts of Australia, by Alison Broinowski. Scribe
Publications. $19.95

ALISON BROINOWSKI'S About Face is a search for reasons why Australia
has had less than a flattering image in Asia. The book metaphorically
follows Australia into different Asian countries and observes it in
each place.

Unfortunately, Australia is not faring well, as Broinowski shows. Most
Asians do not regard Australia as an independent country, she says,
even if it legally is. It has never quite shaken off the image of a
colony. To start with, it has Britain's Queen Elizabeth II as head of
state. And since 1996, its policies have been one or two steps behind
the United States.

This lack of an independent image is a major contributor to the lack
of respect shown to Australia by Asian leaders and political analysts,
says Broinowski, who is a visiting fellow in the Faculty of Asian
Studies at the Australian National University and author of The Yellow
Lady: Australian Impressions of Asia.

Throughout the book the persistent picture of Australia being regarded
as an "outsider" to varying degrees by various Asian countries
dominates the whole metaphorical journey. And lurking like an
oversized shadow along the way is a feeling of hurt, which every now
and then becomes palpable enough to emotionally draw the reader into
wanting to rectify the situation.

Some well-known personalities from around the region feature
prominently. The relentlessly insult-giving Mahathir Mohamad of
Malaysia, who said of Australia that "they should learn how to solve
their own problems first; they solve their problems by shooting
Aborigines and having a White Australia policy." There is the
confidence-oozing Lee Kuan Yew of Singapore, of whom Broinowski
writes, "Unlike Mahathir, Lee ignored all his critics whom he didn't
sue, though he expected them not to ignore him. Unlike Malays, he
never doubted his superiority and that of those like him." And there's
former President Abdurrahman Wahid of Indonesia, who said he could not
visit Australia until it dropped its "childish attitude."

Broinowski makes a point of differentiating the degrees of warmth
extended by Asian leaders to Australia's former Prime Minister Paul
Keating and to the current one, John Howard. Barring Malaysia's
Mahathir, Keating was generally well-received in Asia, because he was
very open in expressing his views of how important it was for
Australia to be part of Asia, and followed up his words with policies
unquestionably favouring Asians.

Howard, on the other hand, did not even try to conceal his disapproval
at the fact that Australia was on its way towards Asia, and has since
hastily realigned his country with Britain and the U.S.

Australia's image in the region has also been hurt by Asian countries'
tendency to blame others for everything bad that's ever happened to
them, writes Broinowski, even if Asian societies do have much to blame
their colonial masters for. "Australia is frequently occidentalized by
representations of what it is not. Australia is not located in Asia,
as maps, graphics, and geographic terminology have often been
deployed, or doctored, to demonstrate," she writes.

Australia in this book is the misunderstood friend personified--a
gauche and awkward person who hesitates to enter the house of the
people whom he tries to befriend because the house doesn't seem big
enough or decent-looking enough for him. Yet he wants to know that he
is welcome in the house. But instead of inviting him in, these people
only come out to take the gifts he brings--Australia has been a
benefactor of scholarships, big and small. And when he peeps inside,
he finds that those inside are not always friendly with each other.

The book paints an apt picture of the unenviable position Australia is
in vis-à-vis Asia and its own geographical region. However, by
uncovering the warts on both Australia's and Asia's faces, Broinowski
runs the risks of being dismissed by both.

Dewi Anggraeni is a writer based in Australia

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 25 September 2003

Tycoon's Deals Raise Eyebrows

In August, Syed Mokhtar Albukhary set out to streamline his sprawling
business empire. But a string of recent deals only complicates the
picture
By S. Jayasankaran/KUALA LUMPUR

A SERIES OF DEALS by aggressive Malaysian tycoon Syed Mokhtar
Albukhary, including large-scale sales of his private assets to listed
companies he controls, is causing concern in Kuala Lumpur's corporate
circles, fund managers and analysts say.

Last month, private companies linked to Syed Mokhtar, 52, proposed
asset sales worth 1.19 billion ringgit ($311.8 million) to two listed
companies controlled by the businessman. First, listed power-producer
Malakoff--in which Syed Mokhtar has an 9% indirect interest--proposed
to buy 90% of SKS Power from a Syed Mokhtar concern for 835 million
ringgit in cash. SKS has a licence to construct, operate and maintain
a 2,100-megawatt power plant in Johor state. The plant is expected to
cost 7.8 billion ringgit and SKS has already negotiated an agreement
with national utility Tenaga Nasional to supply power by 2006.

In a second proposed transaction, Pernas International Holdings, or
PIHB, a loss-making and heavily indebted conglomerate that's 32% owed
by Syed Mokhtar, plans to buy 350 million ringgit in property owned by
private companies in which the businessman has substantial interests.
In fact, in a submission to the Kuala Lumpur Stock Exchange it was
described as a "related-party transaction." Having no recourse to more
bank financing, PIHB would buy the land by issuing more shares.

The latest deals follow a pattern established last year, when Syed
Mokhtar sold his Tanjung Pelepas port operation at a premium price of
1.9 billion ringgit to Malaysian Mining Corp., or MMC, a listed
company in which the businessman had acquired a controlling interest
through nominees.

On August 29, Syed Mokhtar declared his interest in MMC, announcing
that he would pay 2.6 billion ringgit to buy Indra Cita, a private
company that owns 40% of MMC and other interests in two ports
including Tanjung Pelepas. But analysts say that little, if any, money
will actually change hands as Indra Cita may have been his nominee
company to begin with.

Syed Mokhtar has emerged in recent years as one of Malaysia's most
ambitious entrepreneurs, as he plunged into an array of businesses
ranging from power generation to hotels. An associate of his defends
the SKS deal on the basis of a July PricewaterhouseCoopers report that
valued SKS at between 766 million ringgit and 1.09 billion ringgit.
Moreover, he points out, the PIHB deal will buy land that's already
been re-zoned for development and will "add cash flow" to PIHB.
"PIHB's paying in shares anyway, so it's not that he's waiting to
spend its cash," says the associate.

But the deals are also stirring controversy among some investors, who
contend that they could disadvantage minority shareholders in the
listed companies that are buying up Syed Mokhtar's assets. Critics say
the arrangements raise corporate governance issues because of concerns
about possible conflicts of interest and a general lack of
transparency regarding them. Indeed, very little has been disclosed
publicly about the structure of Syed Mokhtar's extensive business
network or its finances.

Moreover, the sales have been done or proposed with little disclosure
of the ultimate ownership of the companies involved or how the
transactions have been valued. "Everyone in Malaysia may say he's
behind these deals, but how do we know for sure?" asks Dennis Lim, a
director of Templeton Asset Management in Singapore and an investor in
Malaysia's stockmarket. "And if we aren't sure, how do you ensure that
the deals are on an arms-length basis?"

Critics also complain that the businessman is transferring the cost
and risk of capital-intensive projects like power generation, ports
and property development, which have long gestation periods, from
himself to his listed companies.

"These are very long-term projects, but cash is being taken out of
some of the companies now," says a Malaysian businessman who sold his
shares in Malakoff after hearing the proposal. "It makes investors
nervous."

The SKS Power sale raises other questions as well. Prime Minister
Mahathir Mohamad has long deplored the practice of ethnic Malay
businessmen on-selling government-issued licences and contracts,
granted to them under the auspices of affirmative-action policies for
indigenous Malaysians, for immediate gain.

In the power deal, for example, the businessman effectively sold a
contract--SKS's power-purchase agreement with Tenaga--to Malakoff,
which is 23% owned by Syed Mokhtar's MMC, for 835 million ringgit.
"He's cashed out and transferred the cost of the project and its risk
to Malakoff," says a Malay businessman, who did not want to be
identified.

While analysts say the SKS purchase will benefit Malakoff after
2006--when earnings will begin flowing in--they point out that the
power company will immediately have to borrow heavily to pay Syed
Mokhtar for its SKS purchase. In addition, Malakoff will have to raise
at least 6.3 billion ringgit to finance the power plant's construction
at a time when interest rates on corporate bonds have risen sharply.
Interest rates on bonds comparable to those of Malakoff have gone up
by 1-1.5 percentage points. That could mean an additional 630-845
million ringgit in financing costs for Malakoff over a 15-year period.

Some of the worry over Syed Mokhtar's corporate moves is rooted in the
businessmen's seemingly inexhaustible appetite for deals. Since the
August announcements, Syed Mokhtar has proposed to purchase the
government's interest in the huge Bakun hydroelectric project and an
Islamic bank for close to 1 billion ringgit.

He's also reported by the local press to want to take a 50% interest
in a $2.1-billion aluminum smelter, while pledging to invest another 1
billion ringgit to redevelop a Johor airport into an air-cargo hub.
"Investors worry that he's stretching himself thin," says a research
head of a European brokerage. "But he's so big that if he falls, he'll
pull the whole market down."

The practice of selling private assets to public companies has long
been viewed unfavourably by the authorities. In the early 1990s, the
Securities Commission moved to tighten its rules by mandating that
related-party transactions had to be declared up-front. Private assets
also had to be held for at least three years before they could be sold
to a "related" third party. But SKS only signed the power agreement
with Tenaga on July 25, 2002--significantly less than the three years
specified by the law. In addition, Syed Mokhtar has yet to declare his
interests in SKS Power, PIHB or the land he proposes to sell to PIHP.

A spokesman for the Securities Commission, Malaysia's markets
regulator, declined to discuss specifics beyond a broad statement
saying that "misleading or omission of material information is a
serious offence under Malaysian law, punishable by both fines and jail
terms upon conviction."

While the government does not believe Syed Mokhtar is in breach of the
law, officials privately say that the reason why he decided to begin
disclosing his corporate interests on August 29 was because of
pressure from the Securities Commission. "It was difficult to promote
Malaysia's capital markets on overseas road shows in the face of
questions about Syed Mokhtar from fund managers," says an official.

In a word, the concern seems to be about appearances--that nobody
should be seen to be exempt from the highest standards of corporate
disclosure. A businessman close to Syed Mokhtar contends that he will
"surface" on all his business interests soon. "I think by the end of
this year, he will come out on everything," says another Kuala
Lumpur-based businessman. Until then, doubts will persist.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 25 September 2003

Bitter Memories

Chin Peng was once branded one of Asia's most notorious terrorists.
Now the former leader of Malaysia's communist guerrillas tells
all--from his point of view
By Michael Vatikiotis/HONG KONG

My Side of History by Chin Peng, as told to Ian Ward and Norma
Miraflor. Media Masters (Singapore). No price given

Retails in KL at RM70

FOR MORE THAN FOUR DECADES, Chin Peng fought wars in Southeast Asia,
first as a "freedom fighter" alongside the colonial British against
the Japanese; then as "public enemy No.1" against the British in the
struggle for an independent Malaya; and finally as a "terrorist" in
independent Malaysia. If those twists and turns sound familiar, that's
probably not surprising: As ever in times of conflict, definitions are
a matter of perspective.

Now, Chin Peng has decided to tell his side of the story. The
just-published memoir by the former secretary-general of the Communist
Party of Malaya will stoke old memories and sentiments and perhaps
open old wounds. Its first print run has already sold out in
Singapore, and the book has just been approved for sale in Malaysia.
Quite apart from its value as a perspective on Malaysia's turbulent
early years, My Side of History provides a number of sobering
parallels with today's war on terror.

Chin Peng offers a glimpse inside the mind of a man once dubbed Asia's
most wanted terrorist, but who sees himself as "the last of the
region's old revolutionary leaders." For the most part, and perhaps
not surprisingly, the 79-year-old former communist leader is
preoccupied with proving that he was a nationalist who fought a war of
liberation.

The 527-page book is a compilation of oral recollections--some 120
hours tape-recorded over a three-year period, according to
ghost-writer and publisher Ian Ward. Chin Peng, who now lives in
southern Thailand, wasn't easy to find--Ward approached him through a
relative, and it was Chin Peng who decided when and where they would
meet. Ward, a former London Daily Telegraph correspondent who
professes to have no socialist sympathies, found Chin Peng still very
committed to his political views but nothing close to his British
colonial image as callous and calculating. "I found him a quiet,
gentle man who has strong views and a real moral outlook on life,"
says Ward.

Chin Peng strongly articulates the motivation for his life-long
struggle involving two decades as a jungle guerrilla commander and
almost 30 years directing the fight from China; it was old-fashioned
nationalism, he says, and a fight against inequality, corruption and
racism. "There was no question in our minds about the injustice of the
colonial system," he writes.

Born Ong Boon Hua, Chin Peng was a committed communist from his teens,
when he left the comfort of his parents' car-parts business on the
west coast of Peninsular Malaysia to join the clandestine party.
Despite the interruption of World War II, when the communist rebels
were supported by the British, Chin Peng's views about the colonial
government and its exploitation of Malaya's natural resources never
changed--"as clear to us as the cloudless tropical nights we know so
well," he writes.

In a post-war Malaya stricken by poverty and badly administered, such
sentiments helped the communists acquire a measure of popularity. They
found particular support among Malayan Chinese, who were disaffected
because of harsh social and economic conditions and their uncertain
status as citizens. Although Chin Peng states his pride in the few
hundred Malays who joined the CPM, the majority was always ethnic
Chinese. According to James Wong Wing On, a political analyst and
former legislator, Chin Peng enjoyed a "certain status in the psyche
of the Chinese; he was some kind of household hero, even up to the
1970s."

TERRORISTS OR FREEDOM FIGHTERS?
The core of this very readable memoir addresses the issue of whether
the party was a bunch of terrorists responsible for killing innocent
people, or a genuine liberation movement that helped win independence
for Malaysia.

This is where the book offers an intriguing insight into the murky
world of terrorism. The British and later Malaysian authorities had
very good political reasons to paint the CPM as a gang of bloodthirsty
terrorists. Malaya was a primary source of export earnings and London
needed to put the brakes on growing nationalist sentiment. Blackening
the name of the communists, who led the armed insurgency, made sense.
One contemporary British newspaper report described Chin Peng--who
just years earlier had been made an officer of the Order of the
British Empire for fighting the Japanese invaders--as a "man notorious
for his ruthlessness and calculated ferocity."

There were, of course, casualties and atrocities: More than 1,800
police and military were killed in the years spanning the 1948-60
Emergency. Chin Peng shows little obvious remorse. "We were involved
in a free-flowing war," he writes, but adds: "Perhaps from time to
time errors were made with identification." Yet he also puts distance
between himself and some of the worst excesses--often claiming that he
never issued the order. He attributes his profile as a "callous
terrorist" to the "image generated by a combination of carefully
concocted propaganda and the world press's natural inclination for
exploitation of crisis situations." It's the British, he declares, who
were the real terrorists.

The book goes to some lengths to try to back this up. It reproduces
recently declassified British records that demonstrate just how far
the British were prepared to go to eliminate the communists. One
document has Sir Gerald Templer, architect of the military campaign
against the CPM in the 1950s, advocating the beheading of dead
communist guerrillas; another alludes to plans for an invasion of part
of southern Thailand to deny the communists a cross-border refuge.
There are remarkable parallels here to later American methods in the
Vietnam War. The British, it seems, were desperate to deny the
communists--their former allies against the Japanese--either dignity
or sanctuary in the battlefield.

What helps lend this memoir credibility is Chin Peng's apparent
candour when it comes to assessing the failures of his struggle. He
admits that the British plan to corral Chinese village sympathizers
into barricaded settlements effectively starved his guerrillas of
food. "With battlefield statistics so obviously in the government's
favour, our political underground found the business of spreading
communist doctrine a thankless task."

Indeed, perhaps sympathy is what Chin Peng is looking for. He writes
of how the starving communists, hounded by military patrols, had to
decamp across the border into Thailand, where their suppression of
local bandits earned them a measure of tolerance. He claims he
attempted to construct an honourable peace with mainstream Malayan
political leaders in 1955, but it came to nothing. And he recounts the
ups and towns of seeking fraternal support from China and the Soviet
Union.

FRATERNAL COMRADES
According to Chin Peng, Beijing initially advised the Malayan
communists to give up the armed struggle, but by the 1960s it had
thrown its weight behind the movement because, he reveals, Mao Zedong
believed communist revolution was about to spread across Southeast
Asia. By 1980, support had once again waned as Beijing courted
Malaysia and other Asean countries for help to legitimize the Khmer
Rouge in Cambodia. In short, China's policy towards the CPM was rather
more fickle than Cold War historians would have us believe.

As Vietnam defeated the American military machine in the mid-1970s,
Chin Peng's emaciated communist army dissolved into a vortex of
betrayal and recrimination that splintered the movement and led to a
series of vicious purges. Chin Peng, by then in China, distances
himself from the internal purges and is quick to characterize the
movement he led for so long as inept and useless. Is this denigration
of the party the price he had to pay in his own mind to project the
more important justification of his life's work as a nationalist?

And is he pursuing a similar tactic when it comes to discussing his
time in China? He tells us about dining with Ho Chi Minh, debating
world revolutionary tactics and listening to Khrushchev as he
denigrated Stalin. But in reality he offers remarkably few details
from this long period of his life, 1961-89. Perhaps he fears that the
appearance of being a pampered leader of a fraternal party in China
will obscure his image as a wily guerrilla leader fighting a jungle
war.

For make no mistake, Chin Peng cares about such things: "If you are
authoritatively branded a mass child killer in a war situation, few
will detect the campaign's realities," he reflects bitterly. "Fling
enough muck and it tends to stick."

Chin Peng has managed to wipe off some of the muck. One concession
wrung from the Malaysian government during the 1989 negotiations that
ended the communist insurgency was Kuala Lumpur's acknowledgment that
the CPM had contributed to Malaysia's nationalist struggle. By that
time, more than half of the CPM's nearly 1,200 remaining guerrillas
had been born in Thailand and fewer than 400 were repatriated to
Malaysia. Chin Peng himself has yet to secure permission to visit his
boyhood home. "It is ironic," he concludes, "that I should be without
the country for which I was more than willing to die."
--------------------------------------------------------------------------------

CHIN PENG: A LIFE AT WAR

Born in Sitiawan on the west coast of the Malay peninsula in 1924,
Chin Peng joined the Communist Party of Malaya (CPM) in his teens and
was soon fighting against Japanese forces that had invaded the
then-British colony in 1941.

The guerrillas received extensive military support from London, but
relations soured in the post-war era as the communists fought for
independence.

In 1947, Chin Peng took the helm of the CPM and went underground. The
next year, the British declared the Malayan Emergency after communist
rebels killed three European estate managers.

By 1955, the communists were willing to talk peace, but the famous
"Baling Talks," in which mainstream Malayan political leaders sought
an end to the armed conflict in the hope of speeding up the granting
of independence, failed. Two years later, Britain did grant
independence, but the communist insurgency continued--at least
officially--until 1989.

Chin Peng, meanwhile, had moved to China in 1961. Today, aged 79, he
lives in southern Thailand.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 25 September 2003

BThe Military Digs In For the Long Haul

Carrots and sticks have failed to persuade the government to introduce
democracy. That's unlikely to change soon. The military has grown used
to its power and privileges, and it fears retribution for years of
abuses if it hands over power to civilians
By Bertil Lintner/CHIANG MAI

FOR WELL OVER A DECADE, the world has been calling on Burma's military
dictatorship to hand over power to the civilians who won the country's
last general election in 1990. For years, the generals have responded
with promises of democratic progress and then done nothing despite
protests at home, pleas from their neighbours, condemnation by the
international community and sanctions from the United States and the
European Union.

THE POWER OF FEAR
• The military fears losing its many privileges
• The military fears a total loss of political power
• The military fears retribution for rights abuses
• However, the military is emboldened by a divided international
approach

Neither carrots nor sticks have worked and the military seems more
firmly entrenched in power today than at any time since it first
seized power in 1962. Not even the crumbling economy seems to threaten
its grip on power.

Many in the international community, especially the United States and
its European allies, continue to be baffled by the generals. In late
July the United States imposed sanctions--including a complete ban on
Burmese imports--that the generals could have avoided simply by
releasing pro-democracy leader Aung San Suu Kyi from more than four
months of detention and initiating a dialogue with her National League
for Democracy (NLD). But, instead, they decided to dig in.

Neighbours in the 10-member Association of Southeast Asian Nations are
embarrassed by fellow-member Burma's cavalier behaviour as they try to
boost ties with the West. They also worry that Asean's image will be
tainted if there has been no progress by the time Burma takes over
chairmanship of the regional grouping in 2005.

What's behind the intransigence of the Rangoon junta in the face of
such pressure? It's clearly largely a matter of self-preservation, but
the generals must also be emboldened by the lack of a united
international approach to Burma.

"The regime still feels very insecure and vulnerable to a range of
external and internal threats," says a Western former diplomat who has
served in Burma. "This, together with pure self-interest and an
apparent conviction that they alone can run the country, seems to
persuade them that they simply cannot afford to let go of power."

The military has become used to power and privilege. Its members give
orders and expect them to be obeyed. Enemies must be defeated, while
retreat would be tactical only. Joseph Silverstein, a Burma expert at
Rutgers University in the U.S., has described it as a "turtle
mentality"--whenever they are under attack from the international
community, they withdraw into their shells and wait for the danger to
pass before sticking their heads out to see if it's safe.

Moreover, after 40 years in power, the Burmese military has also
created a state within the state for its 400,000 servicemen and their
dependents--altogether an estimated 2 million people. There are
special schools and hospitals for army personnel and their families,
who live in subsidized housing and can buy goods which are not
available in ordinary stores. An army pass assures the holder of a
seat in a crowded train or an overbooked flight, and a policeman would
never dare to stop a serviceman for violating traffic rules.

Democracy would deprive the ruling elite of these privileges and it
would also promise retribution. "They think that if they don't hang
together, they'll hang separately," says a political analyst who
worked in Burma in the 1990s.

They have reason to be fearful after overseeing decades of persecution
and human-rights abuses against the Burmese people. The Burmese
military is accused by rights groups of a litany of crimes ranging
from murder, torture and theft to rape and drug trafficking.

The government denies all these charges, but the fear of retribution
is so strong that senior NLD official Kyi Maung was arrested when he
told a regional magazine after the 1990 general election that "here in
Burma we do not need any Nuremberg-style tribunal." The very mention
of the town where Germany's Nazi leaders were put on trial after World
War II inspired fear among the generals at a time when they were about
to quash the movement toward democracy.

The military also seems to have been emboldened by the divided
international approach toward Burma. The U.S. and its European allies
have taken a tough line toward the junta ever since the NLD was
prevented from taking power after winning the 1990 election by a
landslide. Their position has toughened since Suu Kyi was once more
placed under arrest in May. The government claims she is under
protective custody after a clash between her supporters and a
pro-government mob in northern Burma. Western diplomats say she and
her supporters were the target of an unprovoked attack that the
government did nothing to prevent.

Conversely, China says Suu Kyi's detention is a domestic matter for
the Burmese to sort out. Beijing, keen to open up a trade route to the
Indian Ocean through Burma, has emphasized economic and military
cooperation. And Burma's other neighbours have also tried to avoid
confrontation, arguing that isolating the military government would
not lead to any concessions. Asean's other nine members have pursued a
policy of "constructive engagement" in a vain bid to break the
deadlock.

This has encouraged Burma's defiance, analysts believe, and led the
military government to believe that it can survive without the West's
dollars if necessary. In August, Gen. Maung Aye, vice-chairman of the
ruling State Peace and Development Council, travelled to Beijing to
ask China to help Burma out. The government believes that increased
border trade with China and Thailand will help make up the loss caused
by the U.S. sanctions. "But this is hardly realistic," says the
Western former diplomat. "Burma stands to lose hundreds of millions of
dollars in lost income from garment exports to the United States.
Cross-border trade with Burma's neighbours can never be a significant
source of income." Burma's exports to the U.S. in 2002--mostly
garments--were worth $356 million, according to official figures.

The generals, probably trying to keep the door open to the West, keep
insisting that they are committed to democracy, but on their own terms
and at their own pace. After a major cabinet reshuffle in late August,
Burma's new prime minister, intelligence chief Gen. Khin Nyunt,
announced a new seven-point "road map to democracy."

While the announcement was welcomed by Thailand, which had earlier put
forward its own road map for Burma, many analysts dismiss Khin Nyunt's
proposals as a rehash of earlier promises by the generals and note
that he has given no timetable for implementation.

Moreover, the first step, according to Khin Nyunt, would not be the
release of Suu Kyi and dialogue with the opposition. It would be the
reconvening of a discredited "national convention" that began drafting
a new constitution in 1993, but which was eventually boycotted by the
opposition in 1995. Burma's government-in-exile, the National
Coalition Government of the Union of Burma, dismissed it in a press
release on August 31 as "nothing more than a political ploy" to
legitimize military rule. Khin Nyunt's road map may therefore be a
nonstarter.

A more realistic proposal was put forward during a meeting in Thailand
of ethnic minority groups in early September. It called for convening
a congress for national unity, gathering parties that won seats in the
1990 election, members of the military and representatives of ethnic
minorities. After two years they would form a government of national
unity with a political role for the military.

Thailand-based Western diplomats welcomed this "Chiang Mai
declaration" as a reasonable solution to Burma's perennial problems.
But the junta is unlikely to be interested in such a compromise, and
hopes of change from within look remote.

"I see little prospect of a significant split in the Tatmadaw [Burmese
military]," says the Western former diplomat. "Despite all the
tension, the things that hold them together are still greater than the
things that divide them."
++++++++++++++++++++++

BURMA
CHANGING OF THE GUARD
By Bertil Lintner

Was it a promotion, a demotion or just more smoke and mirrors? More
than three weeks after Gen. Khin Nyunt was appointed Burma's prime
minister on August 27, analysts are still trying to figure out the
significance of the move. Proponents of the promotion theory say that
Khin Nyunt is more pragmatic than his fellow officers and so Burma is
more likely to move forward with him in charge of day-to-day affairs.
They point to his August 30 "road map" to democracy as evidence of his
more enlightened approach.

Those who believe he was demoted argue that the premiership is a
largely ceremonial post and that Khin Nyunt therefore has been
sidelined. But the most likely explanation for the change, according
to diplomats, is that it was a simple rotation of duties. They also
add that Burma's ruling officers may have acted in the belief that
Khin Nyunt is regarded as more acceptable to the outside world than
the country's top leader--Gen. Than Shwe.

When Gen. Maung Aye, vice-chairman of the ruling State Peace and
Development Council, visited Beijing on August 22, Chinese President
Hu Jintao said he believed the Burmese government "will make the
situation in the country develop in a positive and constructive
direction." Analysts say this could be seen as an appeal to the regime
to make itself more presentable to the outside world. Days later Khin
Nyunt was made premier. But it seems that the change had been planned
for weeks. When former Japanese Prime Minister Yoshiro Mori visited
Burma in April, Than Shwe even referred to Khin Nyunt as "my prime
minister."

Well-informed political observers in Rangoon, meanwhile, reject
speculation about rifts within the military leadership as wishful
thinking: "There is definitely a plurality of views, but when it comes
down to it, they follow the leader, even if they grumble quietly with
trusted colleagues. After all, it's an army," says one.

Whether he has been promoted or not, Burma's new premier will likely
face his first big test at the October 7-8 Association of Southeast
Asian Nations summit in Bali. In August, Indonesia's Foreign Minister
Hassan Wirayuda urged Burma to release detained opposition leader Aung
San Suu Kyi before the meeting. That's unlikely to happen, so Khin
Nyunt will be forced to defend his government's stand before Asean.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 25 September 2003

The Fine Art of Failure

Even as global trade talks collapsed in a heap of acrimony, Beijing
managed to gain praise both for its activism and restraint. How did
that happen?
By David Murphy/BEIJING

FOR CHINA the collapse of the World Trade Organization (WTO) talks in
Cancun, Mexico, was a triumph of failure. Beijing attracted praise
from both sides of the Cancun fence--developed as well as developing
countries--despite having played only a discreet role in the talks,
which broke down amid acrimony on September 14.

And while Beijing and its regional rival, India, supported the
Brazilian-led agenda of the so-called "Group of 22" developing
countries in Cancun, it is not yet clear that China has committed
itself to permanent membership of this new grouping. China is still
learning how to operate in multilateral forums and is still clearly
feeling its way. "China played a constructive role [in the Group of
22], not a leadership role," says Robin Bordie, a Shanghai-based trade
consultant.

The WTO talks collapsed after developing countries became angry that
their long-standing grievances over rich countries' farm subsidies
were being ignored, and some of the primary supporters of those
subsidies tried to shift attention to the so-called "Singapore
issues." These are measures related to investment, competition,
transparency in government procurement and trade facilitation favoured
by the European Union and Japan. China and other developing countries
are leery of bringing in these unrelated issues to the farm debate.

In its first big outing as a fully fledged member of the WTO, Beijing
was clearly a heavyweight in the ad hoc group of developing countries
that faced down the United States and the EU. In many parts of the
developing world, commentators and politicians opposed to the way the
talks were shaping up lauded the failure of Cancun as a demonstration
of the developing world's new political muscle. And China received
ample praise for its role in humbling the Western powers.

That included praise from its own media: "China was very clear that
rights and obligations must be balanced when it joined WTO," wrote the
International Business Daily, China's Ministry of Commerce newspaper,
shortly after the talks ended. "How right that looks today." The paper
said that "developed countries should undertake more obligations.
Multilateral WTO talks dominated by a handful of developed countries
including the U.S. and Europe won't last long."

So much for rhetoric. In fact, China was not leading the charge of the
developing countries. U.S. Trade Representative Robert Zoellick, a
fierce critic of the tactics of the Group of 22, praised China's
Commerce Minister Lu Fuyuan as a "good partner" at Cancun. "Frankly,
in the [Group of 22] meetings at least that I attended, China was
represented by a vice-minister. So while I know they participated, my
sense is their participation was . . . well, others were the leaders
of the process," Zoellick told reporters after the conference ended. A
Beijing-based trade diplomat puts it more bluntly: "The Brazilians are
mentioned all over the cables from our delegates coming out of Cancun,
but the Chinese are invisible."

China's reticence is partly explained by the fact that it is still
learning the ropes and lacks experience in dealing with sophisticated
multilateral mechanisms, say analysts. More importantly, agricultural
products make up only a small part of China's international trade and
there is no vocal farm lobby in China like those that exist elsewhere.
This means that while farming groups in Japan or South Korea have a
disproportionate influence on trade policies, the interests of China's
hundreds of millions of farmers are subservient to the national,
urban-dominated, trade agenda.

Although growing rapidly, China's farm exports account for only a
small amount of the country's exports. In the first half of this year,
according to the government, farm products accounted for just over 5%
of China's exports, with a value roughly equivalent to that of
agricultural imports.

Beijing is also wary of stirring up trade conflict with Washington in
a U.S. election year, when politicians traditionally pay more
attention to farm, trade-union and domestic-manufacturing lobbies.
Another reason that China may want to keep its head down concerns its
performance in meeting its WTO-entry commitments--including market
opening to agricultural goods. The U.S. might focus more on that
performance as the perception grows that Beijing's "honeymoon" period
of adapting to WTO membership is ending.

"The question of the implications of the Cancun collapse is perhaps
less salient than the question of whether China realizes its
obligations in the area of agriculture in full and on time," says Bob
Kapp, president of the U.S.-China Business Council. "The record to
date is not definitive."
++++++++++++++++++++++

WTO MEMBERSHIP HAS ITS PITFALLS
By Murray Hiebert and Margot Cohen

Almost lost in the furore between rich and developing nations over
farm subsidies during the recent World Trade Organization talks in
Cancun, Mexico, were the invitations for least-developed countries
Cambodia and Nepal to join the body. In Cambodia, some people believe
that WTO membership will jump-start the kingdom's economic
development. But others fear that the country isn't prepared for the
onslaught of foreign goods that might now descend.

Optimists see Cambodia's WTO membership promoting economic reform and
reinvigorating foreign investment, which has fallen by about
two-thirds since peaking in 1996 at $300 million. Deputy Commerce
Minister Sok Siphana hopes membership will be a springboard for
improvements to Cambodia's legal system, bureaucracy and
infrastructure.

"I look at the WTO as a catalyst," says Siphana, who spearheaded
Cambodia's membership drive. "We need to reform ourselves, and the WTO
gives us a perfect argument that we should reform."

Phnom Penh is betting that membership will bolster investment beyond
the garment industry, which accounts for some 96% of the country's
exports. Siphana hopes that foreign investors will take advantage of
Cambodia's lower labour costs and diversify into such areas as
footwear, mattresses and toys.

Cambodia also gets a seat at the table where trade policy is set. "It
can now go to the U.S. and say 'here's how your policies are hurting
us'," says Edward Gresser, a trade specialist who served in America's
Clinton administration. One of the first things Phnom Penh might want
to complain about are U.S. tariff levels on Cambodian exports. At an
average of 16%, tariffs charged on Cambodian goods are 10 times the
average that the U.S. charges the rest of the world.

Conversely, non-governmental organizations and opposition politician
Sam Rainsy have warned that reducing tariffs on Cambodia's imports
will prompt a surge of cheap food products from neighbouring Thailand
and Vietnam that will devastate small farmers, who make up 80% of
Cambodia's workforce. Oxfam, the British relief agency, said in a
recent briefing paper that Cambodia's maximum tariff rate under its
WTO accession agreements is 60% on agricultural products, compared to
a U.S. rate of 121%.

It is far from assured that foreign investors who were burned earlier
in Cambodia will now return. The nation's commitment to reform will be
seriously tested in the months ahead as it implements its WTO
commitments.

As recently as January, Cambodian rioters, apparently angry at the
extent of Thai involvement in their economy, looted and burned the
Thai embassy and Thai-owned companies in Phnom Penh. On top of that,
opposition parties are refusing to join a coalition government with
Prime Minister Hun Sen, who failed to win a majority in the national
assembly during elections in late July. Political instability isn't
likely to help the country as it embarks on a potentially dramatic
economic journey
++++++++++++++++

A Good Start
Now the mission to rebuild the violence-racked islands moves into a
more dangerous phase
By Mark Dodd/HONIARA

EIGHT WEEKS AFTER the multinational intervention force, called the
Regional Assistance Mission to the Solomon Islands (Ramsi), arrived to
help rebuild this strife-torn and near-bankrupt nation, Nick Warner,
its Australian head, has reason to be pleased with progress. One of
the most notorious militia leaders has surrendered. More than 3,400
illegal weapons have been handed in by rival militias. Senior police
officers have been arrested. The government is being purged of corrupt
officials. It's a good start on the long road to normalcy for the
islands' half a million people.

A clear sign that intimidation will no longer be tolerated came in
late August: David Dausabea, mayor of the capital Honiara, stormed
into the offices of the country's main newspaper, the Solomon Star,
after it reported that he had used $1,950 from a government land sale
as pocket money on a trip to South Africa. Instead of silencing the
paper, Dausabea found his name added to the growing list of government
officials under investigation for corruption.

Warner says that Ramsi could be in the Solomons for up to eight or 10
years. That's how long it may take to fix the damage to the former
British protectorate, which began its spiral into anarchy in 1998 when
land disputes between residents on the main island of Guadalcanal and
immigrants from the neighbouring island of Malaita flared into
violence. The ensuing five years of fighting pitted Guadalcanal
warlord Harold Keke and his militia based in Weather Coast on the
north of the island against the Malaita Eagle Force (MEF) militia.
About 150 lives were lost, tens of thousands were made homeless and
the economy was ruined.

Now, with thousands of illegal weapons collected from the militias
under a 21-day amnesty, the mission has moved into the second phase:
Police officers backed by troops and sniffer dogs are now searching
the homes of people suspected of hiding weapons and explosives. This
phase is "potentially more dangerous," says Warner. "But it is a very
important next step in this peace process."

The sharp end of Warner's task force includes 1,800 troops from
Australia, New Zealand, Papua New Guinea, Tonga and Fiji. In areas
like the Weather Coast militia stronghold, 50 soldiers provide
security for three-man police teams, says Acting Police Commissioner
Ben McDevitt, the Australian who heads a 300-strong police contingent.

McDevitt says he hopes that with most illegal weapons turned in, gang
leaders implicated in crimes including murder, rape and robbery will
turn themselves in, as Keke did in mid-August--after a warship was
positioned opposite his stronghold and military aircraft flew low over
his village. "We staged it so he knew we were negotiating from a
position of strength," says McDevitt. Keke and his militia are accused
of killing dozens of people, razing villages and taking hostages.

Other leaders McDevitt would like to see surrendering soon include
former MEF lieutenant Jimmy Rasta, who's wanted for rape and
extortion, and MEF member Edmund Sae, who was arrested for gunning
down police commissioner Sir Fred Soaki in February but escaped with
the help of prison guards. If they don't, McDevitt says he's prepared
to use all the force at his disposal to arrest them.

McDevitt's other priority is the creation of a new Solomon Islands
police force. He says the discredited Star Division will probably be
scrapped; many of its 190 officers and men had defected to the MEF,
taking their weapons with them. The Star Division's deputy commander
is among four senior officers in custody for various offences.

Stopping the militias extorting money from the government and stamping
out corruption are key to repairing Honiara's finances. Foreign debt
is running at about $450 million. In mid-September Australia paid debt
arrears owed by the Solomon Islands to the Asian Development Bank and
the World Bank totalling $3 million. Seventeen foreign experts are
assisting in the running of the Finance Ministry; another 20 are to
assist the judiciary.

"What we're trying do with those officers is to build up the capacity
of those departments and agencies," says Warner. "As part of the
process we will be undertaking forensic audits of the financial
situation in key ministries," such as reviewing controversial
government contracts.

An election is the most likely outcome of the investigations, says
Mark Plunkett, of Griffith University's Key Centre for Ethics, Law,
Justice and Governance, who recently completed a field assessment of
the Solomons. "If they [Ramsi] do their job properly in eradicating
kleptocracy, it will inevitably mean many senior mandarins and
politicians will be charged and convicted in the courts. This will
bring on a political if not constitutional crisis requiring an early
election."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 25 September 2003

TRAVELERS' TALES
By Nury Vittachi

WHISKY TRAIN: A gang of thirsty men dug a tunnel into a tax-free
booze-storage room at a United States Army base in South Korea. They
stole vast amounts of wine and beer for more than two years before
they were discovered, I heard from reader Aidan Foster-Carter.

The group's leaders, named Lee and Song in news reports, opened a
coffee shop in Hannam Village in Seoul. They dug a 20-metre tunnel
from under the restaurant to the Yongsan military base. This tunnel
was not just a grubby hole. It had rails and carts installed, so that
booze could be quickly and efficiently shipped out at high speed, the
Joongang Daily reported.

Over two years, the gang helped themselves to an estimated 58,000
cartons of beer and 4,000 cartons of wine and spirits, valued at 2
billion won ($1.7 million)--far more than they could drink themselves.
Since the South Korean authorities impose heavy taxes (up to 100%) on
imported alcoholic drinks, it was easy for the gang to resell what
they couldn't consume. "Smuggling alcoholic beverages off of U.S. post
exchanges has been a common small-time crime over the years, but
nothing like the scale of what was uncovered yesterday at Yongsan,"
the newspaper said.

The really amazing thing about this tale is how long it took for such
a large crime to be uncovered by the military. As Aidan commented:
"Er, how come nobody noticed?"
--------------------------------------------------------------------------------

YOU NEED IT: After delivering a frightening list of compulsory minimum
charges for making phone calls, this Bangkok hotel then wishes any
guest who still has the nerve to dial a number: "Good luck." (Spotter:
Philip Phan.)
--------------------------------------------------------------------------------

BURNING SHAME: A vicious villain in Japan threatened to burn his
victim alive--but accidentally set himself alight, prosecutors say.
The bungling bad guy was brandishing a knife when he raided a pharmacy
in Ryuyo, Shizuoka prefecture, the Mainichi Shimbun reported. He
threatened staff members and splashed petrol over the store's
33-year-old manager. Then he pulled out a lighter to ignite the fuel.
But he was clumsy and only succeeded in setting his own clothes
ablaze, police said. He fled empty-handed to hospital to receive
treatment for burns.

The suspect arrested for the crime, Hitoshi Kodama, 56, turned out to
be an assistant police inspector who had got himself into debt.
Officials apologized over the alleged robbery attempt, describing the
attempted crime and failed immolation as "unbecoming for an officer."
They don't mince words, do they.

--------------------------------------------------------------------------------

COPY CATS: Title of document e-mailed by the European Chamber of
Commerce in Shanghai: "Invitation to Counterfeiting Seminar."
Recipient Helmut Schneider said: "Who can you trust nowadays?"
--------------------------------------------------------------------------------

PUSHING THE LIMIT: Police in the Philippines have been confiscating
drugs from traffickers--and then peddling the drugs themselves. The
authorities noticed that snatched stashes of illicit substances are
mysteriously shrinking or disappearing from police premises. In one
case, a police anti-narcotics unit "lost" 50 kilograms of drugs, worth
100 million pesos ($1.9 million). Drugs have even disappeared from the
offices of the National Bureau of Investigation and the Philippine
National Police. "When law enforcers aren't stealing drugs or coddling
drug traffickers, they allow suspected drug dealers to escape,"
lamented an editorial in the Philippine Star. This is a reference to
some suspicious escapes. One captured drug dealer managed to vanish
despite being handcuffed to a bed at the headquarters of the
Philippine National Police. He walked out of the building taking the
bed with him. I imagine this would slow down a fugitive on the run,
but on the plus side, he could take naps whenever he wanted.
--------------------------------------------------------------------------------

TWO-FACED: Reader Graham Thompson showed us this dual ideology
T-shirt, purchased in Shanghai by his colleague Kay Sato. The English
slogan appears to urge corporate loyalty: "Do what boss says." But the
Chinese slogan says: "Do what the party says." Perfect for wearing
with monolingual friends of capitalist or communist allegiance.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 2 October 2003

TRAVELERS' TALES
By Nury Vittachi

PRIMATE MOVERS: The leaders of the poachers were baffled. Every time
they approached a farm, there were guards waiting for them. It was
almost as if there were spies among their members, tipping off farmers
off about their movements. In fact, there were unwitting spies among
them--despite the fact that the gang was not human: They were monkeys.

For years, a troop of about 100 macaques had plundered farms in
Sendai, Japan. No one knew how to stop them, since they moved swiftly
and silently through the forests. Then someone came up with the idea
of adding a "monkey forecast" to the local weather forecast. Four apes
were fitted with collars transmitting data on their location.
Officials monitored the group's movements and added it to the
information sent to farmers, the Mainichi Shimbun reported.

Now officials are upgrading the equipment so that as monkeys approach
a farm, they automatically activate the mobile phone of the relevant
farmer. I can picture the scene in the local Suntory bar:

Farmer (after listening to his mobile phone): Sorry, lads, gotta go.

Drinking buddy: Wife calling?

Farmer: Naah. The call was from my spies, who are going ape because
there's monkey business in my crop fields.


--------------------------------------------------------------------------------

WRONG PLACE: Sign seen by Singapore reader Christophe Moellers in the
men's room at the Sonesta Hotel, New Orleans: "Warning: Drinking
alcohol during pregnancy may cause birth defects." He said: "The sign
made sense, but the location didn't."


--------------------------------------------------------------------------------
News report "....(police) arrested two persons with the carcass of a
cow, they said...police said, adding that security has been beefed up
in the area."

HOLY COW: Reader Stephen Sparkes came across this article in the
Kashmir Times of Srinagar. "I'm not sure if the pun is intentional or
the journalist was just too enthusiastic in his use of bovine
language," he said.


--------------------------------------------------------------------------------

EASY COME: A gang of robbers in Malaysia escaped with sacks of cash
from a money-changer's outlet--but before they could spend the loot,
other robbers stole it. It all started when villains stole 500,000
ringgit ($147,058) in Jalan Putra, Kuala Lumpur. Within days of the
raid, the gang was tracked down--not by police, but by rival bad guys.
They beat up the first lot and stole the cash. Police grabbed members
of the first lot but were still looking for the second gang and the
cash. "Word about the robbery quickly spread among the underworld," an
unnamed source told The Star newspaper. So much for honour among
thieves.


--------------------------------------------------------------------------------

IT CONQUERS ALL: A newly-wed groom missed his arrested bride so much
he demanded to be locked up in the same jail. The 20-year-old woman,
Aye Mint of Burma, was arrested in Thailand on suspicion of being an
illegal immigrant. Her husband, Weng Mui Aung, was heartbroken and
marched to the police station in Nonthaburi, just north of Bangkok. He
demanded they lock him up for violating the same immigration laws. "He
said the only way to be reunited with his wife was to be under police
custody with her," police Major Nopadol Vichaikul told the Associated
Press. The news report said they were enjoying their reunion and would
be jailed together pending a trial. Love in a hut and all that . . .


--------------------------------------------------------------------------------

SIGN HERE: Investigators battling police corruption raided a dodgy
nightclub in Metro-Manila and saw the usual scene: a dance floor, a
bar and rows of "reserved" bottles of liquor. Then one of them had the
idea of looking at the names written on each of the bottles: Col.
Ruiz, Capt. Popoy, Sgt. Caballos and so on. Officers were not only
consorting with shady nightclub operators, they were major customers,
the Philippine Star reported. The discovery caused a furore, since it
was assumed that senior officers had got themselves in trouble.
(Police are supposedly banned from using such bars, whether on or off
duty.) Fortunately for the men concerned, investigators decided that
they couldn't use the names in their anti-corruption probes. First,
many policemen share the same surnames, and second, the courts would
not accept names scrawled on bottles of brandy in the middle of the
night as reliable pieces of documentary evidence.


--------------------------------------------------------------------------------
Picture of the back of a pc tower
with something that looks like a big worm crawling out

NOT A BUG: Reader Ken Kampe of Thailand sent me this picture of the
sort of computer problem you get in parts of Asia. In the West, they
worry about their PCs being hit by "worms"--here we get entire snakes.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 2 October 2003

Speculation over Abdullah's Deputy

Second-guessing Malaysian Deputy Prime Minister Abdullah Ahmad
Badawi's intentions has become something of a national pastime in
Kuala Lumpur. Abdullah, 63, becomes Malaysia's fifth prime minister
when incumbent Mahathir Mohamad retires in a few weeks. But Abdullah,
through his silence on the matter, has triggered speculation about
whom he will appoint as his own deputy on taking power. Traditionally,
the deputy premier has been one of the three vice-presidents of the
United Malays National Organization. Currently the three
vice-presidents of the leading party in Malaysia's ruling coalition
are Defence Minister Najib Razak, Domestic Trade and Consumer Affairs
Minister Muhyiddin Yassin and the former chief minister of Selangor
state, Mohammad Mohammad Taib. But most money is on Najib becoming the
next deputy premier, especially after Abdullah asked the defence
minister to deliver a keynote address on his behalf to an
international Islamic conference in Kuala Lumpur on September 15.
Abdullah was on an official visit to China at the time.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 2 October 2003

Shop on the Block

Robinsons department store is up for sale and attracting a lot of
interest. But all bets are off as to the right price
By Trish Saywell

Singapore's oldest and best-loved department store is going on the
block, and it's drawing interest from some of the biggest names in the
region. Robinson & Co. operates the 145-year-old Robinsons department
store on Singapore's trendy Orchard Road, as well as eight John Little
stores in Singapore and nine Marks & Spencer franchises in Singapore
and Malaysia. The company announced on September 12 that it would sell
its retail business and return the proceeds to shareholders along with
significant cash holdings. ING Bank officials estimate the divestment
will take about six months.

Robinson said the divestment is to secure the long-term future of the
company's retail operations and to optimize shareholder value. After
the sale of its retail operations, Robinson may delist from the stock
exchange. The company decided to sell its entire retail business in
the wake of a decision by two key shareholders, OCBC Bank and
insurance group Great Eastern Holdings, to dispose of their combined
stake of 38.4%. The Monetary Authority of Singapore has ordered
financial institutions to sell their noncore holdings.

A mixture of retail players and venture capitalists are interested in
the sale. Thailand's Central Retail Corp., which owns Thailand's
biggest department store, says it's interested, as does British
venture-capital firm 3I Investments. Investors have long held the
highly profitable and cash-rich group's stock for its consistent
dividend payouts. "It is a good asset," says Mark Thornton,
Singapore-based director for Southeast Asia at 3I Investments. "We're
interested in finding out more about it and to see whether we can help
the management team grow it."

AT WHAT PRICE?
The wild card is now in the price of its retail operations. Robinson
had a net profit of S$29.6 million ($17.2 million) for the year to
June 30, up 9.3% year on year. The retail business posted total
revenues of S$342.9 million and contributed S$21.6 million to group
consolidated pre-tax profit of about S$35.5 million. Its cash and
investment assets had a book value of S$337 million.

In a research note to clients, Winston Siay of Standard & Poor's
Equity Research estimates Robinson should be able to fetch between
S$305 million and S$406 million for its retail franchise. While some
analysts say the company's strong brand and cash flow will command a
premium, others are doubtful because the retailer operates in a
saturated market with few growth prospects.

Kevin Scully, managing director of NetResearch Asia, notes that
Japanese investors, who appear to be selling out of United States
treasuries to look for more yield, may be interested in the stock.
"Maybe they see this [Robinson] as an income play rather than a growth
play. It's got good cash flow," he says.

Chua Piang Sze, an analyst at DBS Vickers Research, says that in terms
of operating margins, Robinsons department stores are on par with some
of its newer peers like Sears, Roebuck and JCPenney in the U.S. Chua
points to Robinsons' strategy of managing a large portion of its
retail space rather than handing it out to concessionaires. Robinsons
sources merchandise so that it can sell it at a better price and with
a comparable quality, she says. From shoes to garments to health-care
products, Robinsons comes up with its own designs so that products
will be more exclusive to them. Chua has a 12-month target price on
the stock of S$8.56 a share.

Following the sale announcement, Robinson shares closed up S$1.25, or
18.1%, at S$8.15 a share on September 15. Market talk suggests that
bids for the retail operations range from S$200 million-400 million,
or S$2.25-4.50 per Robinson share, notes Jesvinder Sandhu, an analyst
at OCBC Securities.

"Together with Robinson's cash holding of S$337 million, or S$3.79 per
share, the value for Robinson ranges from S$6.04 per share, which we
believe is unrealistic, to S$8.29," she says. If the stock remains at
between S$8 and S$9 per share, she adds, that would value the
company's retail operations at a price/earnings ratio of 16-20 times
fiscal 2004 earnings.

Scully of NetResearch Asia, who has a "hold" on the stock, doesn't
believe the company will sell its retail assets above S$7.50 a share
and is advising investors to sell if the share price tops S$8. He
argues that at S$7.50 per share the price is already "quite rich"; no
one knows how many "real buyers" there will be, and it will take at
least a year to complete the transaction, he says.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 9 October 2003

TRAVELLERS' TALES
By Nury Vittachi

FORGOTTEN: A young man spent years in an Indian jail because everyone
forgot about him. Pratap Nayak of Orissa was arrested at the age of 14
and sentenced to life imprisonment after a violent clash in his
village. He was cleared by the High Court six years later, but no one
told him or the prison officials. His lawyer had died by that time,
Star News of India reported, and his family had lost touch with him.
So he remained in jail for eight more years until an official noticed
that he was not supposed to be there. He was released recently at the
age of 28. "No one bothered about me," he said. "Not even my own
family." He was reunited with his father Rahas Nayak, who greeted the
return of his son with this cry: "How do I take care of him? We don't
get enough to eat ourselves."

--------------------------------------------------------------------------------

SPICE BOYS: A curry-powder gang is on the prowl in Petaling Jaya and
Ipoh in Malaysia. The villains fling spice mixtures normally used for
making curries at lorry drivers. The cloud of pungent spices disorient
the men, who find themselves sniffing and coughing (and possibly
licking their lips). The villains drag the drivers out of their
vehicles and drive away with the trucks and their cargo, the Malaysia
Nanban newspaper reported. Police are looking for a spicy-smelling
group of evildoers.


--------------------------------------------------------------------------------
Picture of a man holding a target for a shooting range


HIGH TURNOVER: Reader Leslie Paul Bocobo sent me this picture of a
police officer in Beijing, whose job is to hold the target board
during shooting practice. "And you thought you had a bad job," said
Leslie.


--------------------------------------------------------------------------------

ADOLF AND FRIENDS: Candidates in elections in the Indian district of
Meghalaya often opt for memorable names--but not necessarily feel-good
ones. Rain, War and Comfort were on the ballot sheet earlier this
year, as were Lover, Morning Star, Britain and Artist. In Mendipathar,
the battle was between Rockefeller and Frankenstein. In Ransohona, we
had Zenith Magma and Stella Marie battling against Adolf L. Hitler.
Adolf assured voters that he would not behave as badly as his
namesake, according to The Week magazine. "I am happy with my name but
I have no dictatorial traits."


--------------------------------------------------------------------------------

LASSIE COME HOME: A 39-year-old woman in Osaka abandoned two small
puppies. She was moving into a new residence where dogs were banned,
so she took the identification collars off her pets and left them in a
park. After searching the city for three days, the pups managed to
locate the apartment where they had been living before and sat
outside, waiting for her return. Her former neighbours called the
police, who tracked down the owner, the Mainichi Shimbun reported. The
puppies ended up with a new family; the former owner was charged with
violating animal-welfare laws.


--------------------------------------------------------------------------------

BANG-BANGS: Psychologists say parents should give their children
choices instead of commands. A gun-toting Filipino father gave his son
the choice of getting a haircut or having his head blown off. Joey
Ochada, 25, was growing his hair long because he wanted to look like a
singer in the Chinese boy band F4. His car-mechanic father, Paciano,
nagged him to get it cut and eventually lost his patience, the
Philippine Inquirer reported. He aimed a gun at his son and gave him a
choice: a haircut or death. Police arrived and arrested Daddy for
illegal-firearms possession. So much for the latest good-parenting
theory.


--------------------------------------------------------------------------------

HAIR TODAY: A hairdresser in China spent hours styling a customer's
hair--and then cut it all off when she couldn't pay him. The unnamed
hairdresser in Nanchang, Jiangzi province, gave the woman six hours
worth of treatment before she announced that her money had gone
missing and that she wouldn't be able to pay him. Furious, the
hairdresser asked his staff to hold the woman down while he shaved off
all her (beautifully coiffeured) hair. The bald customer now has to
wear a wig, the China Daily reported. This incident reminded me of the
doctor in Kenya who took a bean out of a child's ear and then
reinserted it when the parents couldn't pay the bill.


--------------------------------------------------------------------------------
Sorry, the words are too small for Uncle Yap to see clearly


PLEASE DON'T WHAT? One of the most baffling signs on the planet must
be this one, spotted in Jiangshi province, China, by reader Mike
Sherman. The embedding of the word "prithee" in the middle suggests
that the translator was using a really old dictionary--several
centuries out of date.


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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 9 October 2003

FAREWELL, DR. M
The End of An Era
By Michael Vatikiotis

IT HAS TAKEN a long time to dispel the disbelief that greeted Prime
Minister Mahathir Mohamad's decision to retire. Now that he has given
a date, October 31, the reality is sinking in. It's the end of an era,
and for a country led by one of Asia's more controversial leaders,
it's a time to reflect on his accomplishments and paradoxes, and the
ways in which they have rubbed off onto Malaysia.

Mahathir drove Malaysians towards modernity and prosperity with the
determination of a visionary, yet he preached wariness and suspicion
of the outside world. He railed against ignorance and parochialism at
home, yet when he demonized the West, he sounded little better than
those he castigated for religious intolerance. Under his rule,
Malaysia grew out of colonial reliance on tin and rubber into a
producer of hi-tech goods. But the increase of patronage in the
business world spawned instances of corruption and a lack of
transparency.

His approach to the leadership of Malaysia over the past 20 years has
been to browbeat, cajole and on occasion persecute those who don't
share his vision of progress. There have been spectacular results:
Witness the rapidly changing Kuala Lumpur skyline, its modern
infrastructure and the boom of the 1990s. Some economists consider
that he saved Malaysia from experiencing the worst of the 1997
economic crisis by fixing the exchange rate and temporarily imposing
capital controls--though in the longer term he may have damaged
Malaysia's free-market credentials.

There have also been darker moments. Mahathir's duels with the
judiciary and the sultans weakened the rule of law and Malaysia's
federal system, important checks on executive power. His disdain for
untrammelled freedom of the press has cowed the country's media. His
anti-Western rhetoric has painted him and his country as reluctant to
join the global community. His 1998 falling-out with his deputy, Anwar
Ibrahim, divided the country, undermined support for his party and
drew anger from abroad. He leaves to his successor, Abdullah Ahmad
Badawi, the rising political challenge of conservative Islam.

In the end, Mahathir will be judged as a great Asian leader. But his
legacy will be coloured by his uncompromising political views and the
way he recast Malaysia's democratic institutions in a more
authoritarian mould. Many Malaysians, when asked about Mahathir's
successor, say they are happy that the next prime minister will be
quieter and less controversial.

Though it sometimes appears otherwise, Mahathir has not been
Malaysia's only prime minister. The country was tolerably well led by
three predecessors who established the political framework that has
maintained harmony in a multiracial society. Mahathir inherited a
country that was settling down, and his key challenges were economic.
Perhaps his principal achievement was to meet them.

He may be retiring, but Mahathir is not leaving the stage. He has said
he will not emulate the role of senior minister carved out by Lee Kuan
Yew in Singapore. Close associates say that, like Lee, he plans to
write his memoirs. The Mahathir story isn't over
+++++++++++++++++++++++++++++++++

HIS LIFE AND TIMES

[1925] Born in Kedah state to lower-middle-class parents. His father
was headmaster of an English-language school and a stern
disciplinarian

[1947] Given a partial scholarship by the British colonial government
to study medicine in Singapore. While a medical student, he wrote
extensive anti-colonial commentaries in Malay newspapers under a
pen-name

[1953-57] Graduates from medical school and returns to Malaya. Goes on
to become the first Malay to open up a private medical practice, and
the Malay with the biggest car in the city of Alor Star--a Pontiac

[1957] Britain grants independence to Malaya

[1963] Malaysia is formed, taking in Sabah, Sarawak and Singapore.
(Singapore pulls out in 1965)

[1964] Mahathir wins his first parliamentary seat, representing Alor
Star, capital of Kedah

[1969] Saying he does not need Chinese votes to win his seat again,
Mahathir loses in an election. In an inflammatory letter he tells
Premier Tunku Abdul Rahman he is too soft on Malaysia's Chinese, which
gets Mahathir expelled from the ruling United Malays National
Organization (Umno)

[1970] From the political wilderness he writes The Malay Dilemma, in
which he criticizes the Malays for failing to advance themselves. The
book is promptly banned in Malaysia, and Mahathir's application to
rejoin Umno is rejected

[1972] After Tunku's resignation, Mahathir rejoins Umno

[1974] Elected an MP again. Prime Minister Abdul Razak appoints him
minister of education

[1976] After Razak's death, the new premier, Hussein Onn, appoints
Mahathir as his deputy

[1978] Chosen as deputy president of Umno; he is now
premier-in-waiting

[1981] Mahathir takes over as prime minister from Hussein Onn. He
lifts the ban on The Malay Dilemma

[1985] Mahathir's vision of creating a Malaysian national car comes to
fruition as the first Proton Saga rolls off the production line

[1985] In Mahathir's first major challenge as premier, Malaysia is hit
by recession, with double-digit unemployment. He responds with fiscal
austerity measures and by relaxing affirmative-action laws

[1986] A period of political struggle begins as Deputy Premier Musa
Hitam resigns, citing "irreconcilable differences" with Mahathir

[1987] Confronted at the Umno assembly, Mahathir narrowly staves off a
challenge for the Umno presidency. He responds with a crackdown on the
opposition, arresting over 100 people and suspending three newspapers.
After the courts affirm a petition by the opposition that dissolves
Umno, Mahathir begins a crackdown on the judiciary

[1988-1997] Malaysia booms at average growth rates of over 8.5%

[1991] Mahathir outlines the path for making Malaysia a developed
country by 2020

[1995] He introduces the concept of a Malaysian Silicon Valley--the
Multimedia Super Corridor

[1998] Malaysia is hit by the Asian Crisis; he imposes capital
controls and pegs the ringgit to the U.S. dollar

[1998] He sacks his deputy of five years, Anwar Ibrahim, for "moral
misconduct"

[1998-2000] Anwar is tried and sentenced to a total of 15 years in
prison on charges of abuse of power and sodomy. He claims innocence,
describing a "high-level conspiracy"

[June, 2002] In an emotional presentation to Umno at the party's
annual assembly, Mahathir says he'll retire. He makes plans to step
down by October 2003 and says he will hand over power to Deputy
Premier Abdullah Ahmad Badawi

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From The Far Eastern Economics Review
Issue 9 October 2003

HIS ECONOMIC LEGACY
Lasting Achievements

In his own words, Mahathir diagnosed Malaysia's problems and treated
them. But he also created problems that will be hard for his
successors to solve
By S. Jayasankaran/KUALA LUMPUR

MAHATHIR MOHAMAD'S economic legacy is a chequered one. But its
hallmark has been his pragmatic response to crises, even if it meant
sharp shifts in strategy or gambling on unpopular policies. Maybe he
was simply thinking like a doctor. "I think my medical training has
helped me," he once declared. "You diagnose the problem and you treat
its symptoms."

In 1985, for example, Malaysia fell into recession amid low global
commodity prices, high unemployment and a record budget deficit.
Mahathir responded by relaxing a 15-year-old affirmative-action policy
that aided ethnic Malays--once a cornerstone of his own Malay
nationalist ideology--in favour of opening up the economy to foreign
investors. It worked: From 1988-97, more than $52 billion in foreign
direct investment--more than 10 times the amount in the previous
decade--flowed into Malaysia, helping to underpin a decade of
unprecedented prosperity.

Then in 1998, faced with a tumbling ringgit in the wake of the Asian
financial crisis, Mahathir--who had embraced the global capitalist
system in the 1990s--unplugged Malaysia from world financial markets.
Against the advice of his central bankers, he banned offshore ringgit
trading, imposed capital controls to limit currency movements and
pegged the ringgit to the U.S. dollar. The radical moves sparked
criticism, but eventually helped to stabilize the economy.

Such bold steps won Mahathir, now 78, admirers. To them, he was the
decisive, blunt-spoken problem-solver, and the great modernizer.

Over his 22 years in power, Malaysia evolved a huge, multiethnic
middle class--more than 60% of households now have cars, TVs and basic
amenities--which has helped to consolidate economic and political
stability. "It may be Dr. Mahathir's lasting achievement," says Musa
Hitam, a former deputy premier. "For these people, the differences
aren't ethnic but class ones: the second car, the mortgage. They have
a stake in the economy and no one wants to rock the boat."

Indeed, by many economic measures, the national well-being has
improved. Per-capita incomes have tripled since Mahathir came to
power--to 14,877 ringgit ($3,915) in 2002 from 4,630 ringgit in 1982.
And the poverty rate has dropped to 5% of all households from more
than 35% in 1982.

Mahathir also spotted trends faster than most. In 1984, for example,
he saw that tourism was a potential money-spinner and backed projects
to attract visitors. Tourism has now topped oil and gas receipts in
terms of annual foreign-exchange earnings and visitors have jumped
seven-fold to 14 million in 2002 from 2 million in 1985.

Mahathir's most astute trend-spotting may be manifested in the
Multimedia Super Corridor, a hard-wired hi-tech zone south of Kuala
Lumpur that he wants developed into Malaysia's version of Silicon
Valley. Still in its early stages, the MSC has attracted a steady
influx of local start-ups and foreign multinationals.

But Malaysia's progress isn't all Mahathir's doing. In 1981, he
inherited control of a reasonably vibrant economy with
well-established government institutions. His predecessors had
actually done better in some respects. "Between 1961 and 1981,
Malaysia's real GDP grew 7% annually," says Tan Teng Boo, the chief
executive of icapital.biz, an investment advisory firm. "Over the next
20 years, the figure dropped to 6.2%."

Even the popular notion that Mahathir transformed Malaysia from a
sleepy rubber- and tin-producer into an industrial hub is misleading:
In 1981, the country already possessed a significant industrial base,
with manufacturing accounting for 19% of GDP. The figure today is
close to 33%, primarily due to the deluge of foreign direct investment
after Mahathir opened up the economy.

But global events also pushed the change: Japanese, Korean and
Taiwanese manufacturers relocated their factories to Southeast Asia
after the Plaza Accord in 1985 boosted the yen's value against the
dollar. That helped make Malaysia the 17th largest trading nation by
1995 and explains why Mahathir is so closely associated with its
industrialization.

In fact, much of Mahathir's own industrialization strategy failed.
Early on, the premier promoted the creation of state-backed,
capital-intensive heavy industries, including steel, cement and car
making, funded largely by low-interest yen borrowings from Japanese
aid agencies. Today, state-owned Perwaja Steel is insolvent and
burdened with more than 10 billion ringgit in government-guaranteed
debt, while two thirds of Malaysia's cement plants were bought by
foreign companies after the Asian Crisis rendered them unprofitable.

Now, only car making survives. And the profitability of national
car-maker Proton depends on steep tariffs that make foreign cars much
more costly. But Malaysia's home-made cars will face tough competition
after 2005, when most tariffs on regional goods are to be lifted under
a pact to create a Southeast Asian free-trade area.

The amount of money lost in Malaysia through waste, corruption and
mismanagement over the last 20 years would have severely stretched
less resource-endowed countries. Based on published data, the REVIEW
estimates that between 1980 and 1997, at least 25 billion ringgit was
squandered through financial misadventures. These include the central
bank's disastrous foray into currency speculation in the mid-1990s, a
failed attempt to corner the world tin market, the Perwaja fiasco and
bailouts of state-owned banks. Moreover, the government's own
estimates indicate that it will have to spend an additional 20 billion
ringgit renationalizing services--such as urban light-rail transit
systems and the national airline--that were privatized but went bust
after the 1997 financial crisis.

"A balance sheet for the Mahathir era suggests that he has much to
answer for," says University Malaya economist K.S. Jomo, referring to
those financial excesses.

Even Malaysia's 1985-86 recession was partly self-induced. During the
1980s, the government overspent with an expansionary fiscal policy,
which was then exacerbated by its commitment to heavy industry and the
yen's 70% appreciation against the dollar following the Plaza Accord.
The soaring yen hugely increased, in ringgit terms, Kuala Lumpur's
debt to Japanese aid agencies.

Another hallmark of the Mahathir era was an extensive privatization
programme, which featured billions of dollars in sales of state assets
and the awarding of huge infrastructure projects to the private
sector. Begun in 1984, privatization unlocked new wealth for private
investors and businesses, created many jobs, deepened the stockmarket
through new listings and spawned a new class of entrepreneurs.

But it came at a great cost. To create a class of Malay entrepreneurs,
the government routinely dished out awards to politically favoured
individuals and companies without competitive bidding. The Renong
group, once the investment arm of Mahathir's political party, for
example, received 15 privatization awards in the late 1980s and early
1990s, including the 6.4 billion ringgit North-South Highway.

Instead of fostering transparency and good corporate governance,
privatization came to be identified with cronyism. "No competition
meant there was no benchmark to see how fat the actual award was,"
acknowledges a Malay businessman. And, he says, it has created a
problem for the future: "People who lived off this easy money can
never compete and may have to resort to shady deals. It's one legacy
that will take time to remove because many people are used to it."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 9 October 2003

Pride and Despair: Nine Views of Dr. M

Mahathir Mohamad's resignation as prime minister of Malaysia will end
a significant era of strong Asian leadership. To mark the occasion,
the REVIEW has asked prominent Malaysians and figures from the region
and beyond to reflect on Mahathir and his 22 years in power. Drawing
on personal recollections and long experience of the man, the
composite portrait that emerges is a study in contrasts: Mahathir's
stridency at the podium at odds with his charm and shy demeanour in
person; his vision of a unified society encompassing Malaysians of all
races coupled with his view of a world divided unequally and unfairly
under the domination of "Europeans." In the following pages, his
colleagues and critics speak out on what one contributor calls the
pride and despair of Malaysia under Mahathir.

--------------------------------------------------------------------------------

MUSA HITAM FORMER DEPUTY PRIME MINISTER

We Were Followers

When Malaysia's third premier, Hussein Onn, pondering his choice of
successor, asked me to write an analysis of the merits of every
potential deputy premier, I strongly recommended Dr. Mahathir. But
little did I realize that he would go on to be Malaysia's most
illustrious leader ever, even in the years to come.

All things considered, friends and foes alike cannot deny that it was
under Mahathir's firm leadership that Malaysia is what it is now:
stable, modern and internationally respected. Malaysians of all racial
and religious groups are now proud of their nationality, something
that wasn't apparent before.

If I had to pick an outstanding characteristic--among many--I'd say
Mahathir single-handedly led Malaysia. The rest of us were mere
followers. The story of Malaysia has been cast as a one-man show. But
have Malaysians been dictatorially forced into submission? Certainly
not: The political system is democratized enough to allow the
electorate to assert themselves if they so wish.

His ideas, his thinking, were always ahead of the times to the extent
that they sometimes confused those who had to implement them. And his
hands-on style, his attention to detail--from how to gift-wrap items
to how to design a Muslim toilet--was remarkable.

He was a technology buff, telling us very early on that information
technology would revolutionize our lives and the way we did business.
In cabinets of the early 1980s, all ministers were given computers,
though few knew how to use them.

In that sense, he could spot trends better than anyone I know. Way
back in the 1970s, when he was in Umno's supreme council before he
became deputy premier, he tabled a paper warning of a growing
Islamization among Malays, characterized by the increasing practice of
women covering their heads. I supported him, but the senior Umno
people dismissed him, as he wasn't considered a religious expert.

What he's got is this: supreme self-confidence that is both his
biggest strength and his greatest weakness. So in policy matters that
he holds dear, he can be very stubborn.

Musa Hitam was deputy premier from 1981 to 1986, resigning over what
he called "irreconcilable differences" with Mahathir


--------------------------------------------------------------------------------

K.S. JOMO ECONOMIST

Do the Right Thing

While I object strenuously to Mahathir's misplaced reliance on cronies
and tolerance of abuses, many of his policy initiatives were honest
attempts--if misguided and flawed--to deal with economic development
problems as he perceived them. I admit that I will miss Mahathir.

People tend to focus on his rhetoric, which often obscures realities.
He is clearly more pragmatic. His policies were quite different in
three different periods (1981-85, 1986-97 and 1998-2003); i.e., there
was no single Mahathir economic-policy package. This, in itself, is no
criticism, as it implies a pragmatic willingness to face problems,
rather than a dogmatic adherence to past policies.

And while he may condemn Washington's policies, he readily embraces
American captains of industry and finance, except when they cross his
path, as in George Soros' case.

But the quality of Malaysian economic policymaking would have been
considerably enhanced by genuine popular consultation in the national
interest, rather than presuming to know what was best for the nation.
There are few instances when greater consultation, transparency and
accountability would not have helped.

I hope we proactively take steps to overcome the many problems which
have not yet been adequately addressed.

Unfortunately, Mahathir has also missed opportunities for political
reform which would have lasting beneficial consequences. With the
indigenous bumiputra demographic majority growing and the ruling
coalition's electoral base more ethnically diverse than ever, he could
have ridden the wave of the 1997-98 political reforms in neighbouring
Thailand and Indonesia to create a more equitable, representative and
legitimate electoral system based on proportional representation.

After over two decades of essentially presidential-type power,
Mahathir could also have appointed much more competent and accountable
cabinets, instead of relying on the seemingly irremovable chieftains
of the ruling coalition's component parties.

The power and privileges associated with such cabinet ministers have
served to deepen and consolidate the oligarchic capitalism associated
with "money politics" and "crony business" that have compromised and
undermined public policy and economic development in Mahathir's
Malaysia.

Finally, it will be unfortunate if he leaves without bringing
satisfactory closure to the Anwar affair. Failing to do so will
continue to haunt him and permanently scar his reputation. With the
benefit of hindsight and the magnanimity of a senior statesman,
Mahathir can still do the right thing before he goes.

K.S. Jomo, author of more than 50 books, is professor of applied
economics at University Malaya in Kuala Lumpur


--------------------------------------------------------------------------------

PARAM COOMARASWAMY LAWYER

Injustice for All

Mahathir took office in July, 1981 with the slogan for his
administration: "Clean, Efficient and Trustworthy." Soon after taking
his oath of office he directed the release of 22 detainees held under
the Internal Security Act (ISA). At a meeting with me in his office
soon afterwards I commended him for his decision. He told me how he
had feared the ISA when he was out of politics after being sacked from
Umno.

Within five years he set out to consolidate power under the veil of
democracy, which he often asserted was being fulfilled as long as
periodic elections are conducted.

The amendments to the Official Secrets Act in 1986 eroded
accountability and transparency in public administration and curtailed
investigative journalism. The 1987 arrests and detentions under the
ISA of 106 people, including leaders of the opposition, created and
left a culture of fear in the country. At the same time the ban on
three newspapers undermined press freedom, which has never recovered
since.

Thereafter the constitution was amended in preparation for the assault
on two key constitutional institutions, the judiciary and the
monarchy.

In 1988 the suspension of six independent Supreme Court judges and the
following tribunal hearings and the resultant removal of three judges,
including the then lord president, left a chilling effect on judicial
independence and jeopardized the rule of law. The judiciary has never
recovered its independence.

The worst indictment against Mahathir Mohamad will remain the
continued injustice perpetrated on his former deputy, Anwar Ibrahim,
by the use of the prosecutorial and judicial processes. In the first
trial Anwar was charged for an offence of corruption--not for any
financial improprieties, but for alleged abuse of power in interfering
with police investigations. He was convicted and sentenced to six
years' imprisonment.

The present economic development of the nation is quite rightly
attributed to Mahathir. Yet history, if not the next administration,
will take stock and count its cost to the nation's core human values,
justice, and its constitution.

Param Coomaraswamy practises law in Kuala Lumpur. He recently stepped
down as United Nations special rapporteur on the independence of
judges and lawyers


--------------------------------------------------------------------------------

TUNKU ABDUL AZIZ WATCHDOG

Confusion, Turmoil

From my vantage point as president of Transparency International
Malaysia, I have watched Mahathir's brand of governance with a mixture
of alarm, disbelief, despair, pride and joy, my senses and emotions
continually thrown into a state of confusion and turmoil. His gamble
with his personal integrity in outrageously questionable
ventures--putting at risk the Employees' Provident Fund and the
national reserves, no less, in his forays into the international tin
market and the world of currency speculation--so glibly described as
being undertaken in the "national interest"--must rank as the most
bizarre aspect of his premiership.

It would be churlish to deny him the accolade he so richly deserves
(his many inconsistencies and contradictions notwithstanding) for his
brilliant stewardship of this difficult, dynamic, multiethnic, and
potentially volatile nation in search of national greatness. Even
Mahathir's worst detractors will readily admit that no one has done as
much as he to instil a sense of national pride and confidence in his
countrymen and women based on solid social, economic and political
achievements.

There can be no denying that this man of destiny has wrought changes
that will ensure that Malaysia will never be the same again. I will
miss him.

Tunku Abdul Aziz is president of the Malaysian chapter of Transparency
International, an organization working at the national and
international level to curb corruption


--------------------------------------------------------------------------------

SYED AZMAN OPPOSITION MP

Prosperity? Not Quite

Without doubt this longest-serving prime minister has taken Malaysia
through it all; highs and lows, good and bad. It would not be fair to
deny Mahathir some legitimate claims of success. He has defined a
place for Malaysia in this globalized world, changed the structure of
the economy and even the social fabric of the society. Malaysia
bristles with some of the most advanced infrastructure of the world;
Malaysian society is prosperous and harmonious.

Well, not quite. Look deeper. Herein is Mahathir's true legacy, a
complex, paradoxical and sometimes jingoistic Malaysian society.

Mahathir's vision from 1991 for Malaysia to be a developed nation by
2020 required 7% GDP growth annually. But critics argued that this
growth rate was unrealistic and unsustainable. Today, you can kiss it
goodbye. Since the Asian Crisis, fiscal prudence has been put aside,
and after seven years of fiscal deficit the economy is sputtering
along at an average of 4% growth.

Sure, there are some successes, but nothing beyond what huge
infrastructure subsidies and tax breaks can achieve. Much has been
said about transforming Malaysia into a knowledge economy. But at the
end of the day, the media and press are controlled by the ruling party
and suppressive legal provisions drown out transparency. The
universities are controlled by the University and Colleges Act,
restraining freedom of expression and political association.

The epitome of Malaysian spirit, MalaysiaBoleh, is the belief that
everything is possible for Malaysians. Everest has been scaled and the
globe circumnavigated. There is a $5 billion new administrative
capital and soon a 1 billion ringgit ($263 million) endeavour to put a
Malaysian in space. What Mahathir seems oblivious of is the steadily
rising income inequality in Malaysian society today.

Mahathir is a true pragmatist and equally a true Machiavellian. Every
instrument of power and wealth is used to prop up his rule, and yet he
plays the populist tune with catchphrases that are advertised
endlessly in government-controlled media. Which is why if Mahathir is
not the Statesman of the Century, he certainly is the PR Man of the
Century.

Syed Azman Syed Ahmad is a member of parliament for the opposition
Islamic party, Parti Islam Se Malaysia, or Pas


--------------------------------------------------------------------------------

NARAYANA N. R. MURTHY HI-TECH BUSINESSMAN

A Hands-On Leader

I have known Mahathir for over three years now. I am amazed at his
mental and physical energy levels. Every year, he chairs the meeting
of the International Advisory Panel (on Malaysia's Multimedia Super
Corridor), of which I am a member. The meeting starts with his
receiving all of us personally at 8 a.m. He conducts the meetings in a
hands-on fashion. He notes down any important point raised by a
member, asks insightful questions, and answers every question raised
by the members with data and objectivity. He is alert throughout the
meeting, which runs to 6 p.m. Then, he is ready with his wife to
receive us at his house at 8 p.m. He sees us off personally at 11 p.m.
That is a clear 15 hours. I am not sure there are many 78-year-old
people who can exhibit that kind of mental and physical energy.

Last year, when I sat at his table for dinner, he ensured I had my
vegetarian food and asked about my family. He asked about my music
preference, and immediately instructed the crooner to switch to
Malaysian music, which was my choice. This year, when he saw me
standing at the fringe when photographs were being taken with him, he
was so kind as to invite me to join him for a photo. These are all
small gestures, but this is where most of us fail.

His ability to get into details and ask systemic questions about any
topic is rarely seen among heads of state. Last year, at the IAP
meeting, we had sessions on proprietary systems vs. open systems, the
digital divide and security. He asked deep and insightful questions on
each of these topics. He summarized the entire day, bringing out
kernel ideas clearly. This again is a rare attribute. It has been a
pleasure to interact with him all these years. I wish him a happy,
productive and prosperous life.

Narayana N. R. Murthy is chairman of Infosys Technologies


--------------------------------------------------------------------------------

CLYDE PRESTOWITZ AUTHOR

Dr. M, the American

I first met Prime Minister Mahathir at a small private breakfast in
Washington in 1993. He had a reputation for anti-Americanism, and I
expected the standard shopworn complaints about the United States. But
what I actually heard and continued to hear in a number of private
meetings and interviews over the next 10 years was something else
altogether. On the one hand, it was a forthright refusal to buy into
the latest policy fads perpetrated by purveyors of the conventional
wisdom. Thus, Mahathir refused to knuckle under to the demands of the
International Monetary Fund that he float the ringgit and refrain from
imposing capital controls in the face of the Asian financial crisis of
1997-98. This was taken as anti-free trade and anti-American because
it flew in the face of the then conventional wisdom as maintained in
Washington.

This was all the more true because Mahathir had a way of speaking like
an American. That is to say that he was not deferential and called
things the way he saw them, letting the chips fall where they might.
But, in fact, he was not being anti-American so much as
anti-ideological. The pragmatist in him said there was something wrong
with the application of a theory that proved itself successful only by
impoverishing millions of people. And so, in the classic style of a
rugged American individualist, he defied world opinion, applied a
pragmatic solution and lived to see himself vindicated. One reason
Americans have had difficulty with him is that he is so American.

On the other hand, Mahathir also consistently and persistently asked
world leaders, and especially American leaders, to put themselves in
the shoes of others and to try to see themselves as others saw them.
Thus, he asked why America could pursue a North American Free Trade
Agreement that excluded Asians while at the same time opposing an East
Asian Economic Caucus that excluded the Americans.

Because of his eye for double standards and hypocrisy and his frank
American-style rhetoric, there was a tendency in some places to want
to shoot the messenger. Yet the message had more than a kernel of
truth, and Mahathir's support of the U.S. when the chips were down on
things like defence, terrorism and secular government was the proof of
his essentially sound thinking. Because of his devotion to his people
and to the mission that fate had allotted him, he will go down as one
of history's great men.

Founder of the Economic Strategy Institute, a think-tank on
international trade policy, Clyde Prestowitz served in the Commerce
Department in the Reagan administration


--------------------------------------------------------------------------------

JEYAKUMAR DEVARAJ ACTIVIST

The Malay Capitalist

The apparent contradictions and paradoxes of Mahathirism are explained
if we understand where Mahathir is coming from. In The Malay Dilemma,
the doctor diagnoses the backwardness of Malay society as due to
culture and biology. His prescription was and is affirmative action,
to create a Malay entrepreneurial class that will modernize and uplift
the Malay community. "We must have as many Malay businessmen and
millionaires as there are Chinese," he wrote. This is the essence of
Mahathirism--the creation of a self-confident Malay capitalist class.

Mahathir is no sycophantic capitalist stooge. He has been an important
force in the creation, nurturing and, ultimately, the defence of the
Malay capitalist class.

What pains many thinking Malaysians is that some of the means employed
by Mahathir in the pursuit of this goal have seriously undermined
vital institutions such as the Malaysian judiciary and the police,
cultivated money politics and launched Malaysian society down the
slippery slope of privatization.

Jeyakumar Devaraj is a specialist in internal medicine and a member of
the central committee of the Malaysian Socialist Party


--------------------------------------------------------------------------------

RODOLFO C. SEVERINO DIPLOMAT

Mahathir's Paradoxes

Through more than two decades, most Malaysians regarded Mahathir as
indispensable; even his strongest critics within and outside Malaysia
could hardly imagine Malaysia without him. And he clearly believed
that himself; who else could have held Malaysia together while moving
the economy so rapidly forward and expanding the Malay share of that
economy?

In my encounters with him, I found him to be self-effacing, almost
shy; I was equally struck by how much he revelled in rallying crowds
of his countrymen.

And then, there are the paradoxes. Muslim Malays make up a bare
majority of Malaysians. A faithful adherent of Islam, Mahathir
proclaimed himself as the true fundamentalist, condemning the leaders
of the Islamist party as dangerous extremists who departed from the
authentic tenets of Islam.

Mahathir strongly attacked U.S. policies, particularly America's
unilateralist tendencies, but allowed the U.S. Navy the use of
Malaysian port facilities.

He railed against hedge funds and currency speculators as exploiters
of emerging economies, yet kept Malaysia's trading regime open to the
world, throwing the country open to foreign investment, which was
happy to stay there.

He pushed hard for Malay participation in the economy, but recognized
the economic indispensability of the Chinese community and often
castigated his fellow Malays for their tendency to depend on
government protection and support.

These seeming contradictions arise from profound sophistication and
clear-minded pragmatism, the passion to speak what to him was the
truth and the ability to discern and carry out what was necessary,
useful and workable--qualities that made Mahathir such an effective
and successful leader.

Severino, a former ambassador to Malaysia, was Asean secretary-general
until late 2002

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 9 October 2003

Returning to Islam's Roots
By Mahathir Mohamad

The following is an edited excerpt from a speech by the prime minister
of Malaysia, delivered at the School of Oriental and African Studies
in London on September 22

Can we honestly say that the situation of the Muslim today is good? It
certainly is not. And if it is not, is it because of Islam, because of
its teachings? Or is it because changes have been made to Islam so
that it is no longer in accordance with the original teachings of
Islam?

After the collapse of the Turkish Ottomans, Muslims everywhere became
divided and much weaker. In fact, for a time there was hardly a Muslim
country which was not colonized or dominated by Europeans. Some Muslim
reformers then began to question the orthodox views of Muslim
scholars. They wanted to "modernize," to emulate the Europeans. Some
went so far as to believe that only by discarding Islam and becoming
secular could Muslims regain their pre-eminence. They achieved very
little success in the face of strong opposition by the influential
orthodox scholars. The problem was that some of the reformers were too
influenced by the European concept of the separation of state and
church. This may be possible in the Christian context. It is not in
the Muslim world.

Islam is a way of life, and a way of life cannot be compartmentalized
into spiritual and material areas. The system of government of a
country and its development is a part of the way of life. It is
entirely possible to be Islamic even if a modern administration or
system, including democracy, is adopted. It is possible if we go back
to the fundamentals of Islam. The problem is that Muslims tend to
emphasize and venerate the form rather than the substance in the
practice of everything.

Thus, clothing to cover the body is translated as the wearing of the
Arab dress. That other forms of dress can also cover the body is
regarded as being of no merit, un-Islamic. Reading to acquire
knowledge is interpreted as reading to acquire Islamic religious
knowledge only. Defence of the ummah [or Muslim community] is
interpreted as veneration of the ancient weapons of war. But what is
one to make of the neglect of learning and defence in the Muslim
world? Must Muslims forever buy their weapons from others? Surely they
must have indigenous capacities to invent and produce for their
defence needs. To do this, they must learn science, mathematics,
technology and the rest. Far from regarding the pursuit of these
subjects to be not as good as the study of Islamic theology, it should
be regarded as an ibadah, which should gain merit for the individual
and the community.

But to focus on the defence of the ummah will need political stability
and economic wealth. And so Muslims must learn to restrain themselves
and to make whatever system of government they adopt, work. Democracy
is compatible with Islam. The Prophet left it to his followers to
choose a leader from among themselves. One can say that a system where
the leader is chosen by an electorate is much more Islamic than
otherwise. And having been elected, a leader must care for his people.
This means ensuring they have food, clothing, shelter and security.

Islam means peace. We wish peace upon each other. This is also
fundamental to Islam. We only fight against those who attack us. When
the enemy sues for peace, Muslims must respond positively. But we are
doing none of these fundamental things. Today, Muslims are labelled
terrorists. We don't think it is justified. But the fact is that we
are killing people because of our anger, regardless of who we kill or
the consequences. Admittedly, we are desperate and outgunned and there
is very little else we can do to defend ourselves against injustice.
But should we just lash out indiscriminately, killing innocent people,
including those who sympathize with us? Shouldn't we stop to think,
plan and strategize with ultimate victory as our goal? What have we
got after almost 100 years of fighting? Nothing. Even our anger is not
assuaged. We are, in fact, getting more angry.

Our present predicament is not pre-ordained by Allah. It is entirely
due to our own doing. We have neglected and misinterpreted the
teachings of Islam. We rely merely on praying to Allah for help when
Allah has said in the Koran that we have to help ourselves first
before He will help us.

We do not have a need to reinvent Islam. Islam is perfect and is for
all times. Islam is relevant if we stick to the fundamentals, if we
interpret them correctly. The problem is with the interpretation. It
has not only divided the ummah but has made the ummah practically
illiterate, incapable of dealing with even the simple problems of
governing.

Islam is still the perfect religion. It is Muslims who are not
perfect, who have allowed themselves to misinterpret Islam. Muslims
must correct themselves. It is they who must change. The Prophet
brought to us only one religion of Islam. Today, there are hundreds of
Islams. We have to go back to the one Islam brought by the Prophet.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 9 October 2003

Party-Poopers

Lee Kuan Yew's call to remain optimistic must sound a bit hollow to
Singapore's army of unemployed
By Trish Saywell

At a tribute gala dinner celebrating Lee Kuan Yew's 80th birthday on
September 16, Singapore's first prime minister urged his countrymen to
be optimistic about their future. "The present pessimism of the
faint-hearted, reflected in the media, that Singapore has seen its
best days, that the music has stopped and the party is over, is
totally unfounded," he told his guests. "That is not how I see the
future of Singapore."

Lee's rousing words may offer some comfort. But with unemployment at
near 20-year highs, many Singaporeans find it hard to be cheerful.
Total employment, or the number of available jobs, contracted by
25,963 in the second quarter, signaling "the steepest decline on
record since the mid-80s recession," according to the Ministry of
Manpower. The unemployment rate reached 4.5% in the first and second
quarters, but many analysts believe it will rise to 5.5% later this
year--the highest rate since late 1986.

Stung by the outbreak of Severe Acute Respiratory Syndrome and the war
in Iraq, Singapore has cut its economic forecast for the year to
between zero and 1%. The economy shrank an annualized 11.4% in the
second quarter from the first, its worst performance on record.

Nonoil domestic exports grew just 3.5% year on year in August. The
deceleration was largely attributable to reduced sales to the United
States and Malaysia. Shipments of electronics exports, Singapore's top
export earner, declined by 6% year on year in August, following modest
gains in the preceding two months. HSBC analysts point out that
Singapore accounted for just 5.7% of total U.S. electronics imports in
the second quarter, compared with a peak of 13.4% in the same quarter
in 1997.

The good news: nonelectronic exports, which include pharmaceuticals
and petrochemicals, continued to show solid growth. Still, even in
these sectors there was a slowdown in the year-on-year growth rate, to
16.7% in August from 22.3% in July.

These slowdowns impact unemployment, some of which is structural as
Singapore makes the transition to a higher-value-added economy. But
the loss of jobs in the electronics sector is not being offset by new
job creation in the chemicals and pharmaceutical sectors. According to
HSBC figures, between 1996 and 2002, 40,000 jobs were lost in the
electronics sector, compared with roughly 3,000 added in chemicals and
pharmaceuticals.

Singapore sees restructuring of wages and costs as critical in efforts
to regain an edge in the global economy. In August, the government
made deep cuts in the state-run pension system, effectively reducing
workers' pay and saving businesses about S$1.3 billion ($752 million)
annually. The Central Provident Fund is a nest egg for retirement, but
most Singaporeans use the savings to buy government-subsidized
housing, education and some health care. The cut in contributions to
the CPF was followed by a S$1 billion package of rebates and
concessions to help Singaporeans hurt by a slowing economy. Part of
the package is a S$40 million fund to help the unemployed for up to
six months.

Much hope for Singapore rides on a robust recovery in the U.S. But for
now, just how long it will take for Singapore's economy to make a
comeback is anybody's guess. "The slowdown has ended but robust
recovery isn't here yet," Moh Siong Sim, an economist at Citigroup
wrote in a report in late September. While the economy is gaining
strength, he adds, it's at a "modest pace."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 9 October 2003

Editorial : The Rogues of Rangoon

As Asean prepares for its summit meeting, it needs to figure out what
to do about Burma

IT'S LONG BEEN a mantra that Asean members don't interfere in the
internal affairs of other members. So it's curious to note the
displeasure that has emerged from the leaders of several members that
have called on Burma to end its detention of Aung San Suu Kyi. As the
group prepares for its summit in Bali, some are acting as though they
hope Burma doesn't show up.

None of this means Asean is about to change its principle on
noninterference. But the thing is, Burma's rulers, even by the diverse
standards of Asean's membership, make for a particularly nasty regime
by today's reckoning. No others in Asean care less about their people
than Burma. Vietnam and Cambodia are wooing investors from the region
and beyond to create jobs; Burma doesn't seem to care very much, as
evidenced by its refusal to budge even as the United States tightens
sanctions. What motivates the generals is their control of the
country, whatever the cost. It is all this that puts Burma so
startlingly at odds with present-day Asean. Burma contributes nothing
to the group, and only hurts its credibility. Yet its pariah junta is
set to take over the chairmanship of Asean in 2005. What an
embarrassment that's set to be.

That's why Asean is worried. Malaysian Prime Minister Mahathir Mohamad
earlier said that the group may expel Burma if it continued to detain
Aung San Suu Kyi. Philippine Foreign Secretary Blas Ople has expressed
a "hope" that Burma will decide to "release Daw Suu Kyi and the
members of the National League for Democracy." According to The
Jakarta Post, Indonesian President Megawati Sukarnoputri said: "We
want the democratization process in Myanmar to continue and Madam Suu
Kyi released before the upcoming Asean summit." She also said: "The
road map for democracy and reconciliation in Myanmar that [the junta]
presented has no clear direction or time-frame. So there is a
possibility of me sending [former Foreign Minister] Ali Alatas to the
country for a second time." Noninterference?

As we go to press, United Nations special envoy Razali Ismail is on
his 11th trip to Burma. Days before he arrived, Aung San Suu Kyi was
moved to house arrest rather than returned to an unknown location
after undergoing surgery. Whether Mr. Razali manages to immediately
secure her release is not the issue. The junta has shown it isn't shy
about undoing any decision it makes.

Asean's public impatience with Burma provides welcome pressure. But as
the group meets, some may want to consider how to better help advance
the peaceful and civil regime change Burmese long have hoped for. It's
that or consider how to live down the embarrassment of Burma's
chairmanship of Asean.


--------------------------------------------------------------------------------

No-Show

What's hampering governance in Cambodia

AFTER YEARS of turmoil, Cambodia's July elections were supposed to
mark a step in the gradual establishment of normalcy in the country.
Admittedly, polling was far from perfect. But it'd be na•ve, for
instance, to have expected neighbouring Thailand's election norms; and
in fact voting was less dirty than previous exercises. But following
last week's absenteeism at the opening of parliament, are bets off?
Not entirely. What is clearer is that a deficiency in the constitution
is wreaking havoc with the country's governance.

Certainly, there was some damage after last Saturday's no-show. There
is the tarnish done to Cambodia's image. It's no good for the
country's credibility--ever struggling--that the Cambodian People's
Party, which won 73 of the 123 seats in the national assembly, failed
to hold the parliamentary meeting. Because the CPP did not win the
two-thirds majority needed to form a new government, the Sam Rainsy
Party and Funcinpec held it to ransom by refusing to show up. Next,
this failure to convene a meeting will cause jitters about political
stability among foreign investors the country sorely needs.

But some perspective is called for. The parliamentary meeting had to
be called because the constitution requires a first sitting within 60
days of elections. If it weren't for this clause, no meeting would
have been scheduled before negotiations to form a coalition government
were complete, nor could Funcinpec and the Sam Rainsy Party have
exploited this stipulation to posture before the press. Indeed, it is
best to keep in mind that whether or not all who were elected actually
met last week, a new government wasn't going to have been formed by
then. The horse-trading was set to continue, as it does now. As this
goes on, there is no reason the current government can't continue to
function until a two-thirds majority finally is cobbled together.

What it can't do is pass bills without parliament. No pretending, this
is a serious matter--Cambodia's acceptance into the World Trade
Organization must be ratified, for instance. Yet the larger question
is why the constitution requires a two-thirds majority to form a
government in the first place. Preferring an absolute, rather than
simple, majority is understandable for the stability it brings. But
demanding a two-thirds majority opens the door for impasses such as
the current one--and likely others in the future. One way or another,
negotiations for a coalition will be concluded--Funcinpec is tipped to
eventually join the CPP. Cambodia then may want to decide how to make
its constitution more effective and in line with that of other
nations.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 9 October 2003

Riding Out a Storm

The barrage of criticism from the United States about China's currency
policies is at best misguided. U.S. businesses operating in China have
never had it so good. But if Beijing isn't about to float the
renminbi, what can it do to assuage U.S. anger?
By Ben Dolven/SHANGHAI and David Murphy/BEIJING

PITY THE AMERICAN businessman or woman dealing with China. Judging
from the noise coming out of Washington in recent weeks, United States
business is being cut a very raw deal by Beijing. China manipulated
the renminbi to create a $103 billion trade surplus with Washington
last year and sucked American jobs overseas. It welshed on
market-opening commitments made when it joined the World Trade
Organization almost two years ago and continues the wholesale piracy
of foreigners' intellectual-property rights.

HOW TO DEFUSE A TRADE CRISIS

China won't revalue, but may want to placate the U.S. The options for
Beijing include:
• A gradual widening of renminbi trading bands
• Lowering tax rebates for Chinese exporters
• Announcing large orders for U.S. products, such as aircraft, or
opening up China's markets faster

If that sounds like a tale of woe and misery, that's because it's
meant to. But unfortunately for its authors--a mix of U.S. politicians
and manufacturing interests--the bulk of the evidence points to the
opposite conclusion: U.S. business never had it so good in China.
Despite the real difficulties of doing business here, profits are up
sharply and most U.S. companies are planning to significantly boost
their investments in the coming years.

A report released by the American Chamber of Commerce in Beijing on
September 25 paints a rosy picture compared to just a few years ago,
when many foreign companies were shackled to domestic partners and the
China market was considerably more opaque than today. According to a
survey of 254 member companies by AmCham, 75% made a profit last year,
with the majority of those making substantially more money than they
did the previous year. A total of 42% reported that profit margins at
their China operations were higher than their worldwide margins and
81% said they had plans to expand their China business. The report
also notes that business conditions in China "have improved
substantially over the last five years" and that this is expected to
continue over the next five.

In fact, China is opening large parts of its economy at a very fast
pace--especially on the trade front. "China is, roughly, three times
more open than Japan. This year, for the very first time, China is
going to import more than Japan does," Nicholas Lardy, an expert on
China's economy at the Washington-based Institute for International
Economics, told a Senate Foreign Relations Committee hearing on
September 11.

But despite all this, China looks likely to emerge as U.S. trading
enemy No. 1 all the way to the November 2004 U.S. elections unless
there's some narrowing of the trade deficit. "Perceptions of job and
income security have long been the defining issue in U.S. presidential
campaigns. It's hard to believe that it will be any different this
time around," Stephen Roach, chief economist at Morgan Stanley, told
the U.S.-China Congressional Commission in late September.

So China will have to manage this extra degree of complication in its
relationship with the U.S. over the coming months, which will feature
an October meeting between U.S. President George Bush and Chinese
President Hu Jintao, visits to China by U.S. Trade Representative
Robert Zoellick and Commerce Secretary Donald Evans, and the first
U.S. swing by Premier Wen Jiabao. What will Beijing give? Many argue
that on current trends, it doesn't have to give anything. "I think
they're going to give them [U.S. critics] what they've been giving
them--22% export growth. Beijing is thinking: 'What more do they want
from us?'" says Andy Rothman, China analyst for CLSA Asia-Pacific
Markets.

But in order to smooth those upcoming meetings, China will for sure
need to offer something. It certainly isn't about to float its
currency. Even though capital has been flowing into the country in
recent months, the spectre of capital flight remains strong in
authorities' minds. The one thing that holds the country's rickety
banking system together is the fact that depositors can do very little
else with their money. And Beijing has enough trouble keeping tabs on
corporate financial chicanery without the possibility that Chinese
companies might be borrowing in foreign currency to finance business
at home. That combination, unchecked in Southeast Asia for years, was
what led to the Asian financial crisis.

That crisis rocked the economic strategy of the Chinese leadership and
killed all talk of open capital markets in China. Jonathan Anderson,
chief Asian economist at UBS in Hong Kong and a former head of the
International Monetary Fund in China, recalls that when he first took
up the post in Beijing in 1996 the country was aiming at making its
currency fully convertible by 2001. Now such a move is at least a
decade away, according to Li Yushi, vice-president of the Chinese
Academy of International Trade and Economic Cooperation attached to
the Ministry of Commerce. "The big difference is the Asian Crisis,"
says Anderson.

A more likely scenario, nearly everyone watching the situation says,
is a gradual, managed widening of the trading bands for the renminbi,
accompanied by equally gradual, managed opening of foreign-investment
options for Chinese. Most see a widening of the renminbi band of
3%-5%, probably sometime in the next 18 months.

What would happen in that case? The truth is, not much on the trade
front. Indeed, for all the hot air emanating from politicians in
Washington, there's no real signal of what the renminbi's proper value
is. Cliff Tan, a Singapore-based economist with Citigroup, figures
that on current trends, China's global trade balance could be in
balance by the middle of next year. "The major cause of China's
booming exports is not an undervalued currency," Chicago-based
economist David Hale told a U.S. congressional committee on September
25. "It is an upsurge of foreign direct investment which has
significantly boosted China's productive capacity and managerial
competence."

Meanwhile, as Chinese exports power across the Pacific, U.S. goods are
shooting in the other direction. Exports to China rose by 22% in the
first seven months of this year compared to a rise of only 3% to the
rest of the world. More and more agricultural products are also
heading to China. U.S. agricultural exports to China for the first
seven months of this year were up 139% on the same period last year,
according to the U.S. Department of Agriculture.

The vast trade gap between the two countries is largely a result of
China's ability to undercut other developing countries, combined with
America's low overall savings rate. As China's economy moves rapidly
up the value chain, the U.S. will probably never again produce the
kinds of consumer goods that are the bulk of China's exports. "Even if
Wal-Mart had to stop buying microwave ovens, computers and shirts from
China they would buy instead from Indonesia, Thailand and Mexico, not
from North Carolina or Ohio," Rothman says.

Nor does China pose a threat to the global trading system. Asian
exports to the country are booming--raw materials and intermediate
goods that are processed for onward export, and also goods for
domestic consumption. Pan-Asian exports to China more than doubled
between 1995 and 2002, from $72 billion to $161 billion. Imports for
domestic consumption grew from $42 billion to $79 billion while
imports for reprocessing soared from $30 billion to $82 billion.
Imports for reprocessing account for 51% of China's imports from East
Asia, compared to 41% in 1995, Hale contends.

As a result, China is now running trade deficits with other East Asian
countries, essentially buying their raw materials and components and
processing them for shipment to North America and Europe, where China
runs trade surpluses. On the basis of Chinese data, Hale figures the
country has trade deficits of $13 billion with South Korea, $7.6
billion with Asean, $5 billion with Japan and $1.3 billion with
Australia. Taiwan says its trade surplus with the mainland reached $25
billion last year. Its exports to China now exceed 13% of the island's
GDP.

That's not a country with a massively undervalued currency. "If China
is less able to import, that's going to be bad news," says Chen
Xingdong, a Beijing-based economist with BNP Paribas.

Even if criticism of the renminbi's value is misguided, Beijing still
has to deal with U.S. perceptions that it competes unfairly with
American industry. There is a range of things China may use to placate
detractors ahead of forthcoming meetings--particularly during Wen's
U.S. trip. By early next year it will reduce export rebates from an
average of 15% to 11% for manufactured goods, says Li at the Chinese
Academy of International Trade and Economic Cooperation. He admits the
main reason for this is so the government can save on paying out
rebates to exporters, but it will lower margins for all China-based
exporters and thus China can still present it as a concession to
American critics.

Many argue China is likely to use typical mercantile diplomacy as
well. Wen could, for instance, head to the U.S. with an announcement
of a large purchase of Boeing aircraft over the coming years. China's
last big airliner order went to Airbus, so many aviation industry
officials figure that Boeing is in line to benefit next. Other
possibilities could be new licences for American companies in
insurance, or a long-awaited opening of the car-finance sector.

Li also points to recent low-level advances in the rights of private
citizens and companies to hold and transfer foreign currency abroad as
evidence that China is incrementally easing exchange regulations.
Another possibility: a move away from the current dollar peg to link
the renminbi to the currencies of its major trading partners, the
U.S., Japan and European Union. This basket arrangement, which Joseph
Stiglitz, former chief economist at the World Bank, advocated in
Shanghai in September, would more truly reflect the value of the
Chinese currency while still giving it a strong measure of stability.
"This is feasible and could be done within one or two years," says Li.

In the end, though, the pressure on the renminbi comes from the
growing fracas that is the U.S. election cycle. So the solution could
come from that direction as well, and the best hope for China would be
an upturn in the U.S. economy. "As long as the U.S. economy is weak,
people are going to be looking at China," says Anderson. "But if the
economy there goes into a strong recovery, then this issue could well
be forgotten about again."

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[Yap Yok Foo]

From The Australian
October 09, 2003

BALI: ONE YEAR ON
Fellow travellers in a terrible tragedy
By Peter Lalor

When it comes to certain stories the detached observer is a myth, or
at best a poor reporter. Could an Australian cover Cathy Freeman's
400m gold at the Sydney Olympics and not be swept up in the
excitement?

Any local reporter who failed to comprehend the rich emotional fabric
of that story was left to write: Cathy Freeman won the 400m final in
how-ever-many seconds last night. In second place . . . and so on.

It is the same case with those reporters who held their nerve and
remained in Baghdad. These correspondents were in a position to relate
the fears, injuries and impact on the Iraqi people because they could
relate to them – the journalists themselves were also in danger of
becoming victims of the coalition's "collateral damage", and on
certain occasions did.

And so it was for those reporting the Bali bombings last year. In
fact, it is hard to imagine a story, at least a local story – for that
was what it was despite the geography – that has touched so many
reporters working on it.

We were not only journalists, we were fellow countrymen, fellow
travellers and neighbours. We had been to Bali on holidays, we knew
these families and these people because they could so easily have been
our family, our friends. They were so much like us. This was a tragedy
that was on our street.

The last time I was at my local supermarket I ran into Bali victims
and we chatted near the frozen goods about the anniversary and
recovering. When they left, my eight-year-old was full of questions.

When I go for a drink with journalists from Fairfax I walk past a cafe
that is run by a family who lost members in Bali. I occasionally stop
for coffee and look at the photographs on the wall, photos of the dead
sisters Elizabeth and Dimmy Kotronakis. Talking with Dimmy's twin,
Maria Elfes, I remember when we got those films developed and the
tears as we sat in the foyer of a Nusa Dua hotel.

Most of us cried in Bali. Reporters and victims.

I remember colleagues sobbing in front of the lists of the dead and
missing at Sanglah hospital, hard-nosed reporters who had cracked
black jokes as we waited by the crime tape at murders and disasters
over the years.

I was interviewed on ABC radio from Bali and was embarrassed by how
emotional I sounded, unable to adopt the measured tones of the
seasoned observer. The radio host said it was great radio.

Bali was a terrible job. It was a time that made me examine what we do
and why we do it. I was uncomfortable from the moment I elbowed my way
off the plane – pushing past nervous travellers so I could be the
first to customs, the first to a cab and then the first of the
Australian-based reporters to file back.

It was worse at the hospital. It would have been hard to find anybody
contributing less in a desperate situation than the reporters in the
hospital that night. Doctors, nurses, backpackers, locals and even the
local taxi drivers seemed to have rolled up their sleeves, pitched in
and helped. We were there with note pads and pens to record the pain
of the burns, not ease it, to witness the slow deaths of our fellow
human beings, not to make their last moments any more comfortable.

That was so hard and to some extent impossible, you had to help in
some small way. You had to be involved, no matter how many times you
were told in cadet counselling not to become involved.

From there on it seemed to get tougher. The relatives began to arrive,
searching for hope among the terrible scenes. Some reporters became
champions of certain families, some held back, realising that for
their own sanity they had to keep a distance.

The grief and trauma of Bali was infectious and we all suffered. NSW
Police Commissioner Ken Moroney recalled recently how he and his men
had debriefed after the Strathfield massacre – Moroney had forked out
$50 for pizza and a slab of beer.

Today the police use professional counselling and for the first time
in my career so did most media organisations. Ironically, current
research indicates that the beer and pizza debrief is as effective, if
not more so, in dealing with stress than professional help after the
event.

In Bali we went out every night, drank, laughed and developed that
insular away-job humour that gets you through. Sometimes we laughed
too loudly and guiltily checked who else was in the restaurant –
usually they were empty – for fear of seeming callous in front of the
survivors.

That camaraderie worked wonders for us, we held it together and when
the counsellors turned up in our office there was little to debrief
from. That wasn't a universal experience; one colleague threw himself
so deeply into the trauma of Bali he seems as if he will never return.
Most of us who were there have a new level of camaraderie.

Having finished a particularly gruesome true-crime book a few weeks
before the bombing, I had thought a lot about exposure to trauma and
was conscious of it in Bali. I decided the story for me did not lie in
the morgue, but noticed many colleagues were drawn there time and time
again.

For them it was the story's ground zero, for others it lay in the
grieving people who wandered the streets every day, people such as
Maria Elfes who asked me if I thought her sisters and cousin could
still be alive somewhere. I didn't even have the courage to answer, I
was only equipped to ask questions.

And the almost unspeakable irony for most of us who were there is that
we would have crawled over broken glass to report from Bali, that we
feel it was a feather in our reporter's caps, that this is the sort of
story that comes along once in a lifetime.

Unfortunately for 202 victims, Bali was the end of a lifetime.

Peter Lalor covered Bali for The Daily Telegraph and News Limited
group.
++++++++++++++++++++++++++++++++++
Television remembers

The first anniversary of the Bali bombings will be a time to mourn,
remember and reflect.

Both Seven and Nine are dedicating the Friday editions of their news
and current affairs programs to the attack. Ray Martin will be in Bali
for A Current Affair (6.30pm, Nine) and will do crosses for the 6pm
National Nine News. It's a similar story at Seven, where Today Tonight
(6.30pm, Seven) host Naomi Robson will broadcast live from Bali.

On the first anniversary of September 11, Ten chose to air its
memorial program early and will do the same here. Cry Bali, a one-hour
documentary airing at 6.30pm on Saturday, canvasses events from the
bombing itself to the trials of the accused. The Sandra Sully-hosted
piece features moving stories told by the victims. Also on Saturday,
Seven's evening news bulletin will be broadcast from Bali.

On Sunday, both the two-hour Sunday Sunrise (8am, Seven) and an early
Sunday (8am, Nine; 7am, Perth; both are 30 minutes earlier in
Adelaide) will dedicate their programs to Bali. Both networks will
also broadcast the Bali Memorial Service from 10am (9.30am, Adel; 8am,
Perth), which will be attended by the Prime Minister, John Howard,
Opposition Leader, Simon Crean, and 500 Australians, many survivors
and families of the victims.

Nine's 60 Minutes (7.30pm) will focus on the Bali bombing, with Peter
Overton talking to survivors.

As well as an extended, 45-minute evening news bulletin, Seven will be
running Australia Remembers: 88 Seconds of Silence (6.45pm), which
talks to the survivors and the relatives of those who didn't make it.
As the title suggests, the program will finish with 88 seconds of
silence, one for each of the Australians who died in the attack.

The ABC will air the documentary Life After Josh in its Compass slot
at 10.05pm on Sunday. Brian Deegan, an Adelaide magistrate who lost
his 22-year-old son Josh in the attack, has been one of the most
outspoken people in the aftermath and this moving piece chronicles the
past 12 months of his life.

Taking a more upbeat approach is Backyard Blitz (6.30pm, Nine), which
is making over the yard of survivor Therese Fox.

On pay TV, SkyNews will cover the Bali Memorial Service live and
Australian Agenda will focus on Bali at 7.30am on Sunday. The History
Channel has commissioned shorts on different aspects of the bombing,
to air on Sunday at 7.30pm.

Kerrie Murphy

http://www.theaustralian.news.com.au/
http://www.canberratimes.com.au



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 16 October 2003

Bush Catches Up With Asia

President George W. Bush's extended tour of Asia later this month
gives him a chance to address economic issues and again plug the war
on terrorism
By Murray Hiebert/WASHINGTON and Shawn Crispin/BANGKOK

SOUTHEAST ASIA IS ABOUT TO be hit with a rare burst of sustained
American presidential attention. An Asia-Pacific economic summit in
Bangkok from October 20-21 has provided the impetus for United States
President George W. Bush to stop off in six countries later this
month--Japan, the Philippines, Thailand, Singapore, Indonesia and
Australia.

His challenge: to keep the U.S. engaged in the many economic changes
sweeping the region, including China's economic rise and the
hotchpotch of initiatives on trade and investment, while cajoling
allies to stay the course on counter-terrorism issues.

"It's exceptional that a president takes this much time, makes this
many stops and pays so much attention to Southeast Asia," says Derek
Mitchell, an Asia expert at the Centre for Strategic and International
Studies in Washington. Part of Bush's agenda will be to thank his
staunchest friends in the region--where, as one senior official says,
"things are going pretty well for us"--for their support in the war
against terrorism. But he will also use the 10-day trip to urge some
allies to get cracking on economic reform and others to tackle the
domestic roots of terrorism.

The Asia tour will also allow Bush to focus on issues other than Iraq,
which is denting his popularity 13 months before the next presidential
election. "I don't think the trip will make people in the U.S. forget
about Iraq," says James Lindsay, a political analyst at the Council on
Foreign Relations in New York. "But what it can do for the president
is broaden the perception about what his agenda is," he adds, citing
economic issues and the broader war on terrorism.

The high point of the trip will be the summit in Bangkok with leaders
of the other 20 member nations of the Asia Pacific Economic
Cooperation forum, or Apec. Thailand has cleaned up the city and
mobilized 20,000 security personnel to provide protection. One of the
key topics in Bangkok will be how to revive trade-liberalization talks
after the collapse of the World Trade Organization meeting in Cancun,
Mexico, last month. Washington is still debating the priorities of
U.S. trade policy in the wake of the WTO breakdown. "Should our
strategy at this stage be to pursue a network of bilateral trade
agreements? Or should we give increased emphasis to regional trade
agreements . . . or resuscitate the Cancun process?" the senior U.S.
official wonders.

For American officials these questions have important strategic
implications. "A lot of trade stuff in Asia is happening without us,"
notes another U.S. official, pointing out that China, India and Japan
are all talking about launching free-trade negotiations with the
10-member Association of Southeast Asian Nations. "They're moving
toward an Asian trade and finance network that's going on outside
Apec."

Thai and U.S. officials say that another economic issue on the agenda
will be energy security, including stepped-up efforts to develop a
strategic-reserve system in case key oil-production facilities or
shipping lanes are disrupted. Other topics will focus on protecting
intellectual-property rights and increasing transparency in government
procurement and market access while reining in corruption.

Global terrorism and security issues will dominate many of the
meetings. North Korea's nuclear-weapons programme will be a key topic
in Bush's bilateral meetings with South Korean President Roh Moo Hyun
and Chinese President Hu Jintao. Bush is also expected to raise with
Hu the frustration in the U.S. with China's low exchange rate, which
many American manufacturers blame for the loss of nearly 3 million
manufacturing jobs in the U.S. in recent years.

Bush will pay a state visit to Thailand the day before the Apec summit
opens. U.S. and Thai official say the two sides are expected to
announce plans to begin negotiating a free-trade agreement in April
2004. Washington will push for greater access to Thailand's banking,
insurance and telecommunications markets, while Bangkok hopes to win
preferential treatment for its export-oriented electronics and
computer-parts companies.

Thailand has responded to U.S. calls to shore up its
intellectual-property protection regime by launching a new "war on
piracy" campaign. Opening up their agriculture markets to each other
could prove to be a difficult sticking point, but officials from both
sides believe a deal can be negotiated in two to three years.

U.S. officials also expect Bush to announce during the visit that he
will notify Congress that Thailand will be designated as a major
non-North Atlantic Treaty Organization ally, which will give Bangkok
increased access to U.S. military hardware and stepped up
intelligence-sharing with Washington.

The Bush administration is rewarding Thailand for agreeing earlier
this year not to extradite U.S. citizens accused of war crimes to the
International Criminal Court in The Hague. That opened the way for the
U.S. to conduct sometimes controversial counter-terrorism operations
in Thailand--such as the apprehension and extradition of alleged
Indonesian terrorist leader Hambali in August--without due process of
law.

Bush will stop in the Philippines on his way to Bangkok. Officials say
he wants to show appreciation to President Gloria Macapagal-Arroyo for
her robust support of the U.S. in its wars in Iraq and Afghanistan and
the war on terrorism. Bush is expected to offer U.S. aid to help
Manila implement military reform and deal with domestic terrorist
groups, while voicing support for the peace talks between Manila and
the Moro Islamic Liberation Front, officials say.

TOUGH LOVE MESSAGE
They add that the U.S. president will likely deliver a speech to the
Philippine legislature that will include a "tough love" message urging
the country's leaders to get serious about economic reform. "The
Philippines problems are systemic--they all involve the choke-hold
that the elite has on society and power," a U.S. official says.

After Bangkok, Bush will spend a night in Singapore, a key strategic
partner with which the U.S. has just ratified a free-trade agreement,
before travelling to the Indonesian resort island of Bali, scene of
last October's nightclub bombings in which 202 people died. Bush will
want to encourage Jakarta's continued cooperation in the war against
terrorism. Washington has been pleased with Jakarta's investigation of
the Bali bombings and this year's deadly attack on the Marriott Hotel
in the capital. "They do less well in being able to identify the
source of their [terrorist] problems and move proactively to deal with
them," a U.S. official says.

Bush begins and ends his trip by meeting his two closest allies in
Asia: Prime Minister Junichiro Koizumi of Japan and Prime Minister
John Howard of Australia. "This gives Bush an opportunity to show
Koizumi and Howard how much he appreciates their strong support on
Iraq," says Ralph Cossa, head of the Pacific Forum think-tank in
Hawaii. Bush and Howard may use their meeting to remind their
negotiators that they expect their free-trade agreement to be
completed by the end of the year so that it can be ratified by the
U.S. Congress before mid-2004, when the U.S. lawmakers mount their
re-election bids in earnest.

Koizumi hopes that Bush's visit will enhance his stature as a world
statesman, particularly if the Japanese premier calls a lower-house
election for early November as expected. But there's also a potential
downside for Koizumi, prompted by his pushing through a controversial
bill last July that allows Japan to send troops to Iraq. No Japanese
soldier has been killed in action since World War II, and there were
shockwaves at home when a Japanese civilian policeman was killed while
serving with the United Nations in Cambodia in 1993. Because of this,
analysts believe Koizumi might announce Japanese financial aid for
Iraq during Bush's visit, but put off releasing details about the
dispatch of a Japanese noncombat contingent until after the election.

Some analysts criticize the annual Apec summits as having morphed into
little more than a "talk shop." But others believe that function
remains useful. "Apec brings the president to the region . . . and
helps him find out what's happening," says Lindsay of the Council of
Foreign Relations. "Personal relations provide the grease that allows
diplomacy to run."

Sebastian Moffett in Tokyo contributed to this article

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 16 October 2003

'Rectifying' Taiwan's Name
By Lee Teng-hui

The writer was president of Taiwan from 1988 to 2000

In early September, over 150,000 people gathered in front of the
Presidential Office in Taipei to support a proposal for what is called
the "rectification" of Taiwan's name--in other words, to discard the
"Republic of China" moniker. Why has such a demand surfaced?

As I worked to advance the cause of freedom and democracy in Taiwan
during my 12 years as president, I met with many difficulties and
obstacles that brought me to the conclusion that Taiwan is not a
"normal country." A normal country's path towards development is
influenced by its history and by its geography. People seek the most
advantageous course by reflecting upon their past and considering
where they are situated in the physical world. But over the past two
centuries, Taiwan has been ruled by external powers. Its goals and
political system, in particular, have been imposed by outside regimes,
without any influence by the people of Taiwan, without any heed of
their views and needs. For a very long time, outside powers dictated
the way life was lived by Taiwan's people.

Even now--three years after the democratic transfer of political
power--we suffer from the debilitating effect of this historical
burden. The people of Taiwan still are unable to muster the
determination to be their own masters, to shoulder the
responsibilities they alone ought to bear, to deliberate on the
nation's future goals, to bravely face challenges and pursue ideals.
This is a cause for regret, and it must be remedied.

While, admittedly, the establishment and progress of a nation cannot
be shackled by history, it cannot completely dissociate itself from
the past. History cannot be changed, but the future is for us to
define. How we define our identity is an exercise made against the
backdrop of our antecedents. One reason Taiwan is not a normal country
is because it has not been able to come to terms with its own history
and to establish a Taiwan-centric frame of thinking. Creating a
Taiwan-centred environment and realizing the ideals of a normal
country are the goals towards which Taiwan should strive.

During my administration, we carried out six amendments to the
constitution. I also advocated the idea of a "Republic of China on
Taiwan" and promoted the "New Taiwanese" doctrine in the hope that
everyone, without distinctions of ethnicity and length of residency,
would identify with Taiwan, cherish Taiwan and work together to create
a good life in Taiwan. The results have been less than hoped for.

Whether in the area of domestic governance or foreign diplomacy, I
came to realize that all the difficulties Taiwan encountered are
linked to its impractical official name, "Republic of China." To
resolve its problems, Taiwan must begin by correcting its name, making
the nation and its official name consistent with reality.

Recently, I said: "The Republic of China no longer exists." I based
this on three points. First, when the Republic of China was
established in 1912, it by no means encompassed Taiwan. Next, after
World War II, the Republic of China was a military occupier of Taiwan,
and Taiwan's actual status ought to be deemed a land belonging to no
country, whose international status has yet to be defined--not as a
part of the Republic of China's already-existing territory.

Lastly, after 1949--when Chinese communists took the mainland
territory of the Republic of China--the Republic of China in fact no
longer possessed any territory, with only its name continuing to
exist. Although the name "Republic of China" was hung on Taiwan, ever
since the People's Republic of China supplanted the Republic of China
in the United Nations in 1971, the Republic of China vanished from the
international community. People should realize that the "Republic of
China" is just an official name, not a nation.

Through democratization, Taiwan has finally established a native,
Taiwan-rooted democratic regime. Such a native government ought to
plan for the well-being of all Taiwan's inhabitants, serve the people
and work hard to act on the public's demand for rectification of
Taiwan's name. Meanwhile, the people must gain a clearer understanding
of their history, work together to set national goals, cooperate with
government-reform initiatives and strive for the establishment of a
normal country founded on a Taiwan-centric consciousness.

What's in a name? A name is an affirmation of one's identity. Only
through the rectification of Taiwan's name can Taiwan truly set goals
for its development. Only with goals can there be a direction to focus
Taiwan's efforts. And only with direction can Taiwan have the strength
to persevere.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 16 October 2003

TRAVELLERS' TALES
By Nury Vittachi

The Call of the Wild
Mobile phones in Asia are being used to solve crimes, locate strays,
repel insects, and--just possibly--make calls, too

HAVE YOU PHONED your mother lately? If not, do so now. If you have
called the old dear recently, go to question two: Have you phoned your
dog recently?

Japanese consumers, having wired up their spouses, children, aged
parents and domestic servants, are making sure dogs aren't left out of
the loop. The fact that pets can't talk is not a problem. You keep in
touch with them by using the phone's transmission capabilities to
track their movements. Japan's telecoms network will tell you that Rex
is wandering around the park, drinking from your toilet, watering the
neighbour's plants or whatever. Might Rex lose his cellphone? No: The
maker of the doggy-phones, Secom Co. of Tokyo, supplies them in
pouches tied securely around the pet's neck. Next: Japanese consumers
flock to buy cellphones for their pet rocks.

The mobile phone's move towards global domination goes to show that
communication devices are no longer limited to their original purpose:
as fashion accessories for poseurs. (A secondary use, as hand-combat
weapons for triad and yakuza members, died out in the early 1990s when
unthinking designers shrank the products out of a lucrative niche
market.)

Recently, people in Asia have found another use for the phones: as
crime-fighting tools.

Police investigating an armed raid on a security van in the
Philippines last week were stumped. How did the gang work out the
truck's route? Who were the robbers? The answers came just a few hours
after the raid when the bank robbers' leader decided to make use of
mobile-phone technology. He started sending text messages to the
cellphone of his man on the inside--one of the security guards.

Unfortunately for him, that particular phone was at that moment in the
hands of fearless police detective Dionicio Borromeo, who was
investigating the raid. The officer sent a text message reply to the
gang leader. Several other messages were then exchanged, detailing
where the guard's share of the loot could be collected. The cop
promptly arrested the guard, collected the money and sent his officers
in search of the gang leader, whose name and number they now had.

A phone also proved the downfall of a kidnapper in Japan last week. An
unemployed man from Fukuoka prefecture abducted an 18-year-old
schoolgirl, forcing her into his car. Pretending to check something on
her phone, she punched out an e-mail to her mother. Shortly
afterwards, a squad of police cars and a helicopter caught up with the
car and the suspect was hauled off to jail. Those parents are never
going to complain about their daughter's phone bill again.

A mobile phone solved a crime beyond the grave in Thailand recently. A
pair of armed men boarded a truck in Phuket town in the early hours of
the morning and shot the driver. But the tense conversation they had
had just before the shooting was broadcast to the trucker's
boss--because, at the first sign of trouble, the victim-to-be had
quietly pressed the one-touch dial button on his Nokia 3310. Shortly
after the driver's death, police caught up with the truck and arrested
the murderers.

Not all the new uses for mobile phones are quite so dramatic. A South
Korean company is charging customers $2.50 to beam to their phone a
noise that irritates mosquitoes and thus keeps them at a distance. If
only they could make a phone that repels financial advisers,
chain-smokers, penurious ex-friends, insurance salesmen, and so on,
I'd buy one. But, if you'll excuse me, I have to stop here. My dog is
on the other line wanting help with his text messages.

--------------------------------------------------------------------------------
A report of a mobile phone having a comical misspelling
......"multimedia massage service"

TOUCH-SENSITIVE: This report in an Indonesian weekly magazine, sent in
by reader John Soe, announces yet another new phone feature: It can
apparently give you a massage.


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[t***@notrashmagix.com.sg]

Post by Yap Yok Foo
HAVE YOU PHONED your mother lately? If not, do so now. If you have
called the old dear recently, go to question two: Have you phoned your
dog recently?
Japanese consumers, having wired up their spouses, children, aged
parents and domestic servants, are making sure dogs aren't left out of
the loop. The fact that pets can't talk is not a problem. You keep in
touch with them by using the phone's transmission capabilities to
track their movements. Japan's telecoms network will tell you that Rex
is wandering around the park, drinking from your toilet, watering the
neighbour's plants or whatever. Might Rex lose his cellphone? No: The
maker of the doggy-phones, Secom Co. of Tokyo, supplies them in
pouches tied securely around the pet's neck. Next: Japanese consumers
flock to buy cellphones for their pet rocks.

So the new catchphrase is "Give the dog a phone" istead of "Give the
dog a bone"

With a kinick knack, paddywhack......
SIAOGU

Girls when they went out to swim
Once dressed like Mother Hubbard
Now they have a bolder whim
They dress more like her cupboard

[Yap Yok Foo]

From The Australian
October 15, 2003

Winning back the neighbours' trust
by Paul Kelly

The decision by South-East Asia last week to commit to a regional
community with aspirations towards the European Union model has an
important message for Australia.

At present we are in the region but not of it. Despite our deep,
diverse and growing ties with East Asia, inner sanctums of Asian
regionalism still shut on Australia.

This is not our decision; it is the region's decision. It is not just
a reaction against John Howard despite distrust of his Government
within the region. The problem transcends Howard. It predates his 1996
arrival in the Lodge and will outlive his departure. This is a
challenge for Australia.

The 10-nation strong ASEAN is famous for providing high-sounding
declarations. Sometimes they are prophetic and sometimes they are
hollow. Australia has judged ASEAN to be operating from weakness since
the 1997 East Asian financial crisis. But it would be a mistake to
misjudge the new sense of Asian regionalism or to think that it cannot
lead to substantive results.

There are powerful forces behind the ASEAN declaration last week in
Bali that its 2020 vision includes "a single market and production
base with free flow of goods, services, investments and labor and
freer flow of capital". ASEAN is not a new EU in the making. But it
wants to head towards a single market and it is driven by a mix of
forces - the shock of the 1997 crisis, suspicion of Western-based
global economic institutions, an increase in intra-regional trade, the
rise and rise of China and ASEAN's compulsion to find a more effective
strategy to respond to the redirection of investment towards China.

The Howard Government says in this year's foreign policy white paper
that it seeks entry into the ASEAN plus-three (China, Japan and Korea)
summit process, a process that has now opened a window to India. The
white paper says that "Australia goes out to the region not as a
supplicant but as a partner seeking to work with our neighbours for
mutual benefit."

Yet the symbolism for Australia is uncomfortable. At Bali its regional
nemesis, Malaysia's Mahathir Mohamad, was feted as a visionary by
Indonesia's Megawati Sukarnoputri, who was polite but deferential.
"The mark of his personal statesmanship has been imprinted so deep in
our consciousness that in a large sense he will always be with us,"
she said. President Megawati noted that Mahathir "never hesitated to
say the unpleasant".

That resonates with Australia. Mahathir has waged a successful
campaign to exclude Australia from regional forums on the basis of
race and culture. His ASEAN farewell saw Mahathir brand Australia as a
"transplant from another region".

It was nothing like his racist attack on Howard over the PM's
pre-emption blunder late last year. On that occasion Mahathir said
"This country stands out like a sore thumb trying to impose its
European values in Asia ... as if it is still the good old days when
people can shoot Aborigines ... actually, for them (Australia)
anything goes, including assassination." On the same theme of
pre-emption Mahathir said an arrogant Howard "thinks that he is the
white man sheriff in some black country". He had previously said that
Australia was "unsafe for Muslims".

Howard and Alexander Downer refused to be provoked. Such comments
reveal the historical baggage that Australia carries. They also reveal
the insecurities of a region still in a postcolonial mind set with its
own profound racial, cultural and security tensions.

Shadow foreign minister Kevin Rudd, unburdened by office, said that
from the point of view of all Australians "the sooner the region sees
the back of Mahathir the better". Branding the latest Mahathir remarks
as "offensive' Rudd said that "Mahathir needs to be told that and told
that to his face". While Labor had fundamental objections to many
aspects of Howard's foreign policy, Mahathir "goes way beyond the pale
with this stuff".

However, the Mahathir remarks stretching back years remain on the
public record as a rationale for the region's stand against Australia.
This does not help Australia and it certainly does not help Asia in
the eyes of Australians. The truth is that no Australian PM would talk
like this (though many in Asia wrongly believe that Howard has).

It is folly to think that Mahathir's retirement will transform the
situation. It won't. Australia just faces a more complex and
challenging situation in the region.

Witness President Megawati's unsurprising view that it was inadvisable
for her to attend the Australian-orientated Bali memorial service.
Howard was right to play this down, just as Simon Crean was right to
play down the snub he got from Megawati the previous week when she
refused to meet him. So much for years of Labor's sustained advocacy
of closer ties with the region and Indonesia.

Howard said at the Bali service the recent crisis had brought the
peoples of Australia and Indonesia "closer together". It is a heroic
claim.

Australia needs a strategy of sustained effort, combined with patience
in our dealings with a region made even more difficult by the rise of
Islamic terrorism. However we also need to find a new language to talk
to the region that better explains the basis of our multicultural
democracy. This goes to the heart of how we treat Muslims in our
community and the principles binding diversity and unity that have
given so many people from Asia a stake in this country. Frankly, it is
a shock to visit the region in 2003 and find decision-makers still
talking about Pauline Hanson's influence.

Australia needs to continue its campaign to join the ASEAN plus-three.
The truth is that Australia has been an integral part of the region
for a long time - operating not as the US's deputy or pretending to be
an Asian country - but being itself.

http://www.theaustralian.news.com.au/
http://www.canberratimes.com.au



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 23 October 2003

TRAVELLERS' TALES
By Nury Vittachi

EATING CROW: A massive flock of gourmet crows is terrorizing parts of
Tokyo. The 25,000 large, black birds have abandoned their usual diet
of berries and insects and are wolfing down bits of leftover Kobe
tenderloin instead. Many members of the flock have also developed a
"sweet tooth" (despite not having teeth) and are swooping down on
plates of gateau.

The city birds' favourite foods, in order, are meat, cake and deep
fried items--exactly the same as the average Japanese couch potato.
They have even acquired a taste for mayonnaise on their food.
Scientists are amazed, as this is nothing like their normal diet.

The scary thing is that these birds are a violent lot, staking out
territories and not hesitating to attack people. It will only be a
matter of time before they get the best tables at Ginza restaurants,
by force if need be.

A Tokyo Metropolitan Government study showed that the number of crows
in the centre of the city had leapt from just 7,000 in 1985 to 25,000
last year, with 10,000 making their home in the western suburbs of
Tama.

The obvious answer to the problem is for humans to vacate the city and
move into the forests, but city leaders are resisting this idea. Tokyo
Governor Shintaro Ishihara wants to try lowering the quality of food
garbage. If there were no goujons in champagne sauce left lying
around, the birds might abandon the city. He told the Mainichi Shimbun
people should "not put high-calorie foods out with the garbage."


--------------------------------------------------------------------------------

BEING WATCHED: Closed-circuit cameras have been installed in a Bangkok
temple, because the gods weren't scary enough to deter evil-doers.
Visitors have got into the habit of abandoning cats and dogs at the
219-year-old Temple of the Emerald Buddha, Reuters reported. The
presence of holy statues failed to stop people unloading unwanted pets
at the site. So religious staff decided to go the hi-tech security
route. "Offenders captured on camera will be banned from our
compound," temple worker Thirarat Chandra-songkham told The Nation
newspaper.


--------------------------------------------------------------------------------
Sign above shop
68% Perfect Shop
Menjual barang baru dan bekas
(selling new things & containers)

GOOD ENOUGH: Reader Charles Herbert found this interesting shop in
Medan, Indonesia. "Who needs perfection when 68% perfection will do?"
he asks.


--------------------------------------------------------------------------------

FISH BRAINS: Fishnappers in Austria targeted imported Japanese carp as
their victims. The pair broke into a pet shop in the town of Wels and
splashed about in a pond, eventually scooping up four Japanese koi
carp worth more than $1,800, the local press reported. But the
villains were caught. In a move that proved them worthy of joining the
long line of spectacularly dumb criminals celebrated on this page, one
of the villains left his wallet in the pond, complete with driving
licence and ID card.


--------------------------------------------------------------------------------

A DOG'S LIFE: A man decided to take revenge on his neighbour by buying
a dog and naming it after her. Fang, a resident of Wulong in
Chongqing, China, bought a dog and named it Ling Ling--almost the same
name as the woman who lived next door to him, who was known as Lin
Ling. He then got into the habit of making loud remarks at home and in
public places about the dreadful behaviour of Ling Ling. He even
uttered curses against Ling Ling, the Chongqing Morning Post reported.
Lin is demanding the equivalent of $100 in compensation for a damaged
reputation.


--------------------------------------------------------------------------------

GOT A POINT: A dragon has been signed up for a course of acupuncture
treatment in Singapore. Tirto, a Komodo dragon almost three metres in
length, is receiving twice-weekly treatments with sterilized needles
to help with an eating disorder. "Tirto is now more relaxed and is
beginning to enjoy his treatments," a spokesman for the Singapore
Zoological Gardens, Vincent Tan, told the Associated Press. Next:
aromatherapy for antelopes and ear-candling for elephants.


--------------------------------------------------------------------------------

POP CORN: Headline in a Japanese newspaper last week: "Scientists make
10 optical discs from single corncob." It wasn't a joke. Sanyo Mavic
Media Co. claims it can turn a single ear of corn into a 10-pack of
CDs, the Mainichi Shimbun reported. Oh well, I suppose a corn-based
disc will be perfect for storing episodes of Japanese television
dramas.


--------------------------------------------------------------------------------
Chinese sign with English words underneath
"coffin sandwich"

DEAD FUNNY: Americans may call cylindrical sandwiches "submarines" but
people in Taiwan have an even less appetizing name for them. (Spotter:
Kevin Voigt.)

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 23 October 2003

A Tango Speeds Asean Integration

Singapore and Thailand have forged a new approach to economic
cooperation that could lead to real integration of the 10-member
Association of Southeast Asian Nations and save the regional bloc from
economic irrelevance
By Michael Vatikiotis/SINGAPORE and John McBeth/JAKARTA

SMART LEADERSHIP and nimble deal-making is helping to break down
barriers to true integration of the Association of Southeast Asian
Nations and could save the regional bloc from economic irrelevance
amid mounting competition from China and India.

THE GOH AND THAKSIN WAY

• Lead by example. Use peer pressure to speed up integration
• Start to liberalize, and then invite other Asean members to join
• Forge bilateral free-trade pacts to make up for slow tariff-cutting
in the region

With the ink barely dry on a regional accord that is supposed to
transform the 10-member Asean into a European-style common market by
2020, some leaders said they wouldn't wait that long. In a move that
some Asean officials predict will accelerate trade liberalization,
Thailand and Singapore have skirted traditional consensus-driven
decision-making by forging bilateral trade agreements and launching
bold unilateral measures that they hope will pull the rest of Asean
along in their wake.

Leading the charge are Singapore's Prime Minister Goh Chok Tong and
his Thai counterpart, Thaksin Shinawatra. "There's acute awareness now
that if you don't hang together, you're going to hang separately,
given the competition from China and, later on, India," Goh told the
REVIEW a week after the early October Asean summit in Bali that
endorsed the common-market plan. His and Thaksin's solution is simple:
Implement their own trade liberalization measures that don't need
approval by all 10 members of Asean, then invite everyone else to sign
on.

The two leaders are taking their cues from a long-established European
practice of using peer pressure to accelerate economic integration.
The two-speed approach to European integration, pushed by the Germans
and the French, was key in accelerating progress at various stages of
the European Union's history.

"It is not an exclusive club. We hope once both of us [Singapore and
Thailand] are able to tango, then others can join us on the dance
floor," Goh explained. "In the past, nothing moved unless all 10
countries agreed to an idea. So now we turned it around to say 'two
plus x.' So any two countries that have an idea can present their idea
to the Asean leaders and the two countries alone can carry on, but
they must be open to other members who wish to sign up on a reciprocal
basis."

For Asean, a grouping whose only real economic achievement has been
the establishment of the Asian Free Trade Area, or Afta, the move is
revolutionary--"like using a crowbar to open up the box," as Asean
Secretary-General Ong Keng Yong puts it. But while some observers say
it's a shot in the arm for Asean, which has seen faltering levels of
intra-regional trade, others believe that bold action by some members
will generate tension and produce initiatives that eventually get
bogged down in bureaucratic wrangling.

Nevertheless, some analysts believe that Singapore and Thailand must
continue to lead by example if there is to be progress. "The countries
that are more ready to move on integration are leading the way, which
provides some healthy momentum to the programme. It doesn't mean the
group is divided--the whole group is committed to being on this train.
It's just that some will be in the front carriages and some in the
back," says Adam Schwarz, a senior consultant at international
consultancy McKinsey and Company. In a study commissioned by Asean and
presented in August, McKinsey determined that deeper and faster
economic integration is crucial to enhancing Asean's competitiveness.

In the first example of how the new process works, just before the
Bali summit, Thailand floated an air-cargo agreement doing away with
cumbersome customs and commercial regulations that typify the kinds of
non-tariff barriers holding up trade and investment in the region.

Goh's description of how quickly the agreement was reached indicates
just how effective the new mechanism could become as a tool of trade
liberalization. The premier says he and Thaksin thought, "Why don't we
examine an open-skies policy for passengers and air cargoes? But
passenger traffic requires some time to resolve because every country
has its own aviation industry to protect.

"So Thaksin said: 'air cargo, no problem.' I said no problem, let's
work on this. But that's only two countries." So, Goh says, he told
Philippine President Gloria Macapagal-Arroyo about the idea and she
asked her transport minister if it was feasible for Manila. "He said,
for air cargo, he can go along. So she said she will sign on," recalls
Goh, adding that Cambodia and Brunei also signed on.

And there's more to come, says Asean chief Ong. Discussions are under
way on waiving visa and work-permit requirements in certain service
sectors like health care and communications technology. "This way we
can clear the way for the free flow of skilled professionals," Ong
explains. Small areas as these may seem, they encompass industries
that the region needs to stay competitive.

All this sounds encouraging to businessmen like Tony Fernandes, CEO of
the region's first budget airline, AirAsia, based in Malaysia. "It's a
start, but there's a long way to go. I certainly see a new openness in
some countries, but are we anywhere near Europe?" Fernandes points to
different aviation laws in the region that he says drive up the cost
of doing business. Ernest Bower, president of the United States-Asean
Business Council in Washington, is more sanguine. "It's a process of
competitive liberalization," he says, pointing to the way that
Singapore has set off a scramble to conclude free-trade agreements
after its landmark pact with the U.S. earlier this year.

Thailand and Singapore have forged ahead with bilateral trade
agreements to make up for the slow progress of tariff-cutting on the
regional and global front, negotiating deals with China and the U.S.
Thailand has just concluded a free-trade agreement with India, while
Thaksin has directed his officials to negotiate a string of others.

Yet for all the optimism Thaksin and Goh have generated with their
bold approach to making economic integration happen, there are fears
that their unorthodox approach may not work. Thailand and Singapore
are more developed economies than Asean partners such as Burma,
Cambodia, Laos and Vietnam. And these poorer countries, which under
the Afta pact have more time in which to cut tariffs, are less likely
to embrace integration with open arms. But even with 90% of tariffs
already cut under the scheme, analysts say non-tariff barriers are
among the main reasons why intra-Asean trade has remained static at
about 22%-23% of total regional trade over the past five years.

In fact, Indonesian and foreign trade experts see the larger states
presenting the most resistance. "Singapore and Thailand may want to
push, but others--particularly Indonesia, the Philippines and
Malaysia--are still reluctant to take the plunge," says economist Hadi
Soesastro of the Jakarta-based Centre for Strategic and International
Studies.

There are also worries that by steaming ahead on their own, Singapore
and Thailand will run into obstacles at the bureaucratic level when
they try to persuade neighbours to join them on the dance floor. "Some
leaders want to make sure that the bureaucratic structure won't be
thrown out of the window--it's definitely a rupture in the mindset of
the old Asean way," says Asean's Ong.

The problem is greater in Indonesia and the Philippines where the
ruling elites, which favour protectionist policies and use nationalist
arguments to rally popular support, do what they like without much
risk of serious internal dissent. The trade experts also point out
that the things that have held back both countries economically, such
as corruption and bureaucratic red tape, are the very things that have
to go if integration is to work. As one put it: "You can't have a
solid free-trade argument when you don't have a proper customs
regime."

For countries like Cambodia, Laos and Burma, resistance to integration
might weaken so long as the more developed members lend a helping
hand. Speaking at a World Economic Forum meeting in Singapore in
mid-October, Cambodian Prime Minister Hun Sen endorsed the idea of
"two plus x" so long as "such flexibility will not lead to a wider
economic gap." Singapore's answer to that is, again, to get out in
front with funding for capacity-building in the less-developed member
states--providing aid for such things as education and institutional
reform.

Another problem is that even if the new approach speeds up economic
cooperation, there still isn't much of an institutional framework to
govern closer integration. The McKinsey report recommended bolstering
the Asean Secretariat in Jakarta, and this was addressed in part at
the Asean summit in Bali. The final summit declaration recommended the
establishment of a legal unit within the secretariat to provide advice
on trade disputes. It also proposed enhancing the capability of the
secretariat to conduct research and analytical studies related to
trade, investment and finance.

But for reasons of sovereignty and history, Asean members are wary of
a supranational, EU-type body. Still, the decisions made in Bali
reflect an understanding that "to make economic integration work,
Asean needs to improve the processes by which it makes decisions and
begin to build institutions that can truly represent the region." says
McKinsey's Schwarz.

Perhaps that's too much to expect from a grouping that likes to keep
its policies vague and flexible. "Integration is process-driven and
led by personalities. We can bring the institutions in later," says an
aide to Goh.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 23 October 2003

LETTERS

ON MAHATHIR

Prime Minister Mahathir Mohamad presents some thoughtful remarks
regarding the role of Islam in the contemporary world. [Returning to
Islam's Roots, The 5th Column, Oct. 9.] But there is no going back to
"the one Islam brought by the Prophet." Not because it would be an
anachronism, but for the simple reason that such a pristine Islam is
irretrievable. Islam's primary sources were only standardized and
agreed upon after they had passed through the hands of the first
generation of Muslims. Moreover, for a religion to remain a "living
tradition," continuous interpretation is a precondition. The
misinterpretations or outright abuses that go with it are historical
facts of life.

A plea for a return to Islam's roots does not solve anything:
traditionalists, fundamentalists and liberal Muslims alike claim to be
doing just that. Instead, Muslim intellectuals and political leaders
should explicitly state that pluralism is the benchmark for rating
Islam's relevance in today's world.

CAROOL KERSTEN

Chiang Mai

Congratulations on surpassing yourself once again in the snooty
condescending tone you use to describe Mahathir Mohamad's early life.
[The End of An Era, Oct. 9.] Particularly objectionable is the way you
demean his father's accomplishments as "lower middle class," and then
portray Mahathir as some sort of nouveau riche arriviste because he
bought a Pontiac, a quintessential middle-class car. Is there
something wrong with owning a car? How would you prefer him to have
gone through his medical rounds?

When I lived in Malaysia in the 1990s, I often found that Malays in
particular would often speak of Mahathir's father's accomplishments
with more respect than they would of Mahathir's. As far as they were
concerned, Mahathir, when compared with their own kampung upbringing,
was born with all the advantages in the world. He then made the most
of these in a way that brought enormous benefit to the country. But as
far as many people were concerned, he could only do this because he
was born into an educated family.

Your article would have provided better insight into the man's career
if you had delved into how the experience of being a doctor in a poor
rural area shaped his political agenda. From what I understand,
because he had grown up in a town as part of a middle-class family, he
never really understood the extent of the poverty in the countryside
until he started travelling around visiting people on his medical
rounds.

And as for your concerns over checks and balances, Malaysians can
figure out for themselves how they want to balance power within their
society. They don't need someone reciting rote theories of Western
liberalism to achieve this.

CHRISTINE HILL

New York

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From The Far Eastern Economics Review
Issue 23 October 2003

A Chip Off the Old Mahathir Block

The name Mahathir isn't likely to vanish from the Malaysian government
any time soon. Prime Minister Mahathir Mohamad may be due to retire at
the end of the month after more than two decades at the country's
helm, but officials from the United Malays National Organization, the
leading party in the ruling coalition, say one of his offspring is
expected to carry on the family tradition and run for parliament at
the next general election. Businessman Mokhzani Mahathir, 43, the
second son of the premier, is tipped to run in Merbok, a parliamentary
constituency in the northern state of Kedah, they say. The next
election must be called by early 2005. Merbok's current incumbent is
Daim Zainuddin, a former finance minister who has indicated that he
wants to withdraw from politics. If elected, Mahathir junior is likely
to form part of the next administration as he enjoys close relations
with Deputy Prime Minister Abdullah Ahmad Badawi, who is due to become
prime minister on October 31.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 23 October 2003

Is Islam a Drag on Growth?
By Marcus Noland

The writer is a senior fellow at the Institute for International
Economics in Washington. The following is based on results from a
recent study, "Religion, Culture and Economic Performance"

One hundred years ago, the German sociologist Max Weber coined the
phrase "Protestant work ethic" to describe the religious basis of the
rise of capitalism in the Protestant-dominated areas of Western
Europe. His followers went on to investigate the theological
compatibility of religion and commerce, filling libraries with books
extolling the business acumen of Jews and Quakers in the West and,
among Asians, the Parsees and Jains of India, to name just a few
groups. In their telling, Confucianism was bad for business, though it
belatedly surfaced as a virtue in the Asian-values debate. Now,
evidence suggests that Islam may actually be good for growth as well.

Interest in the possible impact of religious belief on economic
development is reviving, in part because the growing number of opinion
surveys allow social scientists to probe directly respondents'
attitudes towards economic life. Interestingly, responses from one
survey, the World Values Survey, reveal that Buddhists are unique
among adherents to the world's major faiths in not ascribing poverty
to laziness--so, conversely, wealth isn't identified with a work
ethic. However, the real interest recently centres on the possible
impact of Islam on economic performance and, by extension, political
stability in the "arc of instability" that stretches from Marrakech to
Mindanao.

It is not implausible that Islam could be a drag on development. The
Koran proscribes certain business practices (such as the charging of
interest) and prescribes others (taxing for alms), and, worldwide,
Muslims are on average poorer than non-Muslims. Not surprisingly, some
ascribe this state of affairs to "anti-market" attitudes embedded in
the faith. Yet one could argue that at least among the Abrahamic
religions, Islam is the least hostile to commerce. After all, the
Prophet Muhammad himself was a merchant, and historically the Muslim
world surpassed the West in commerce for an extended period. How does
one reconcile these apparently conflicting pieces of evidence?

Statistical analyses across different countries reveal that while
religious belief may have an impact on economic performance, generally
speaking there is no strong relationship between adherence to any one
religion and economic performance, once economic fundamentals are
taken into account. In the case of Islam, the results indicate that
the religion typically has an insignificant impact on performance.
These statistical results hold whether one examines long periods of
time (say, most of the 20th century), or studies the possibly
culturally attenuated orthodoxy of Muslims in Southeast Asia or
Africa, far from the Middle East.

But cross-national analysis is hazardous work--it is difficult to
"control" for, or strip out, the impact of factors like exchange rates
and trade policy, much less the quality of political institutions. But
these obstacles largely disappear when one examines regional data for
a single country--everyone faces a common currency, the same set of
tax and trade policies, a common commercial code and the same
judiciary. Under such circumstances, multiethnic countries become a
natural laboratory for investigating the impact of race, ethnicity and
religious adherence on economic performance.

India, for example, is a large multiethnic country with the world's
third-largest Muslim population. When rates of per-capita income or
productivity growth are examined at the state level, the size of the
state's Muslim population does not correlate with their economic
performance. That said, and keeping to India, while the conventional
wisdom about Islam may be wrong, Weber may have got it right about the
Jains. By carefully stripping out the effects of a slew of economic,
geographic and meteorological factors, the impact of Jainism is large
and positive. A doubling of the Jain's share of the population is
associated with a 0.75 percentage-point increase in the per-capita
growth rate. Perhaps they are the model minority.

While there are many Muslims in India, they make up a relatively small
share of the population. The same cannot be said in Malaysia. Yet
similar results are obtained. Once the influences of a variety of
socioeconomic factors at the local level are carefully accounted for,
the impact of Islam on economics is, if anything, positive. And this
is not simply a result of pro-bumiputra affirmative-action policies.
When the analysis is redone with ethnicity replacing religious
affiliation, the result disappears.

Thus, it appears that where adherence to Islam affects economic
outcomes, it has a positive effect. Rather than the sociology of
religion, those seeking to explain below-average economic performance
would be better advised to study fiscal policy and other conventional
challenges to economic development and prosperity. Islam apparently is
no drag on economic growth

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 23 October 2003

Money And Monks

Marginalized in an increasingly materialist society, Buddhist monks in
Thailand are finding it ever harder to shun the twin attractions of
power and wealth
By Shawn W. Crispin/HUA HIN, SOUTHERN THAILAND

AT WAT KHAO TAKIAB, a shiny Buddhist temple with panoramic views of
the resort town of Hua Hin, Luang Pipat Vorakit sits at ease among his
worldly possessions, which include three mobile phones, two new
computers, a wide-screen television and a Mercedes-Benz.

In his plush, red-carpeted living quarters, expensive white bear skins
lie draped over upholstered couches; across the abbot's stomach, a
thick gold chain supports a big Buddha amulet. "All our money comes
from people who have faith in us," says Pipat, 67, puffing on a
Dunhill cigarette. "Poor people may come up to my place and say,
'Wow.' But this is how I live . . . there is no reason monks can't be
up to date."

Buddhism forbids clergy from accumulating wealth or even touching hard
currency, a golden rule central to the faith for more than 2,500
years. Nowadays, though, in Thailand, Buddhism and business often
overlap. That's happening more and more as capitalism spreads into
rural Thailand, where cash has traditionally been scarce and faith
often blind.

To be sure, Thailand has seen mercantile monks before. In the 1990s,
the charismatic Phra Yantra shocked his many loyal followers when
evidence of his worldly ways came to light, including alleged
credit-card receipts from massage parlours in New Zealand. An even
bigger controversy surrounds Wat Dhammakaya, a giant temple on the
outskirts of Bangkok. Its contrarian abbot tells his tens of thousands
of devotees they can secure a soft landing in the hereafter through
breathing meditation and by making cash donations to his temple--the
more the better.

Of course, donating to monks, usually in the form of food and robes,
has long been a duty for Buddhists. But the unorthodox idea that
financial prosperity can help pave the way to spiritual salvation has
captured the imagination of many educated urban professionals in
recent years, and is now reaching the hinterland.

That's not surprising: With the rise of mass consumerism, Buddhism's
core message that devotees should shun materialism is losing its
resonance. At the same time, urbanization means the mall is taking
over from the temple as a community meeting place, while
Western-influenced schools have long since replaced temples as
Thailand's main centres for education.

According to Buddhist scholars, Thailand's 300,000-or-so registered
monks are finding it progressively harder to stay relevant, which is
causing some to stray from the religion's ancient middle path of a
life of denial and chastity toward a more modern material existence.

"Buddhism's values have always been contrary to society's values,"
says Sulak Sivaraksa, a Buddhist scholar and social critic. "But
today's rampant consumerism has given our monks an inferiority
complex. To maintain their status in modern society, many monks feel
like they need to have money and power."

Wat Khao Takiab's abbot, Pipat, is a case in point. The portly
English-speaking monk holds an economics degree from the University of
London. His temple rakes in $25,000 a year in donations from
devotees--a princely sum in an area where local fishermen make only
around $2,000 in a good year. According to local press reports, which
Pipat denies, his temple made $1.2 million earlier this year from
merit-makers eager to catch a glimpse of a holy relic borrowed from
Sri Lanka: a supposed bone splinter from the Buddha himself.

For his steady cash flow, Pipat relies on income from the temple's
seaside real estate. Pipat collects $1,250 a month in rentals from a
local businessman who runs a restaurant and tourist bungalows on the
temple's grounds. According to the restaurant's managers, the profits
are split 50-50 with Pipat's temple.

At one point, business at the restaurant was so brisk that Coca-Cola
offered to build a five-storey Coke-bottle statue on the temple's
hilltop grounds to draw in thirsty customers. That plan--and a rival
proposal from Pepsi--is now on hold due to business disputes. Instead,
the site for the giant bottle will be used to support a 12-metre
statue of a widely-respected dead monk.

Pipat insists his temple is a "non-profit organization," and that
almost half the money he makes is used to pay utility bills, maintain
the grounds and help the poor. The other half goes to "develop the
people's minds," he says, without elaborating.

Critics say that across Thailand, a lack of transparency and
accountability over temple funds has opened the way for wayward monks
to accumulate huge wealth. Take Phra Khru Nanthaphiwat, a provincial
monk known for his retinue of bodyguards, who was found shot dead in
June, leaving behind $3 million in cash apparently pilfered from his
temple.

An even bigger controversy erupted at the Maha Mongkut Ratchaviyalai
Foundation, which manages more than $175 million in donations
collected at the ancient Bowonniwet Vihara temple, and is overseen by
a group of senior Thai monks. In February, the monks on the board of
trustees sacked a respected local banker working with the foundation
after he tried to introduce a more transparent method of asset
management.

"Any closed system breeds corruption . . . even Buddhism," says
Sanitsuda Ekachai, author of a book about Thai Buddhism. "Out of
respect, Thai people don't like to interfere in holy people's
business."

Historically, Thailand's Buddhist clergy, or sangha, have been largely
insulated from public scrutiny due to their ceremonial role.
Thailand's revered king appoints the supreme patriarch of the sangha,
while other senior monks play a key role in administering important
Buddhist rituals and rites that the king presides over every year.

Critics say that insulation can provide cover for abuse. "The sangha
are supposed to discipline wayward monks," says Sathienpong Wannapok,
a fellow of religious studies at the Royal Institute in Bangkok, an
independent think-tank. "But they don't see anything wrong with what's
happening because they also live with money and material comforts.
They don't want to change . . . They are comfortable."

Sathienpong believes the problem of monks making money has reached
crisis proportions. He says the general public's lack of knowledge
about Buddhism's core teachings allows monks to interpret the religion
as they see fit. "The people believe what they are told," says
Sathienpong. "But many Thai monks are great pretenders."

However, at Wat Khao Takiab, there are signs that karma might be
catching up with Pipat. Recently, the municipal government claimed
Pipat doesn't own the land he rents out and intends to use for future
commercial ventures, including a planned bungee-jump attraction for
tourists.

Reluctant to sue a monk, the city fathers are going after the
restaurant, whose proprietor, in turn, is suing Pipat for 300 million
baht ($7.6 million) for breach of contract. "He is a monk so we don't
like to bother him," says the mayor of Hua Hin, Jira Pongphiboon. "But
he is running many businesses with girls and karaoke. That's not
proper."

Pipat plans to fight the claim in court. He says, "I don't know where
I could ever get that kind of money." Taking a deep drag on another
cigarette, he adds with a laugh: "All I have are debts."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 23 October 2003

From Russia With Love

Asia's military-aircraft market is still dominated by the United
States, but that may not last for long if Alexey Fedorov gets his way
By S. Jayasankaran

AT THE AGE OF 22, Alexey Fedorov was sent to Siberia. Leonid Brezhnev
was president of the Soviet Union when the young Fedorov began work as
a design engineer at Irkutsk Aviation Industrial Association in
Irkutsk, Siberia. That was a lifetime ago. Now 51, Fedorov is the
president of Irkut Corp., the restructured--and decidedly
capitalist--successor of his former employer and one of Russia's
biggest companies, and it's turning its attention to Asia.

"In the old days it was very centralized and Moscow told us what to
make," says Fedorov in a low rumble. "Later, we had to adjust to a
market economy, create a marketing department and a philosophy that
was never around to begin with."

To compensate, Fedorov went to that bastion of capitalism, the United
States, where he graduated from Oklahoma City University's business
school in 1996. "We needed to understand concepts like management and
international marketing," he explains. "Those were some of the reasons
why few Russian companies had any success in international markets
previously."

He's been a quick study. Last year, Irkut Corp.'s sales topped $500
million, while its order book for this year has reached $3.5 billion.
Indeed, with 50% of its military and civilian aircraft and parts sold
outside Russia, the company has become an important source of hard
currency for Moscow.

Irkut derives 90% of its profits from military-aircraft sales, which
is one reason why it takes the Asian market very seriously. Consider
this: Asia is now the world's biggest market for fighter aircraft,
with a 40% market share.

The U.S. currently rules the roost in sales out here. Of the total
number of fourth-generation fighters--which are the top-of-the-line
combat aircraft used by most air forces--sold in Asia, 8% are French,
34% are Russian-designed and the rest originate in the U.S. But
according to an October, 2003 report by Infomost, a military-aircraft
journal, the Russians are set to take over. "Over the next 10 years,"
the report predicted, "Russia will increase its presence up to 47%,
the USA will decrease down to 46% while France will decline to 7%."

Irkut's Fedorov agrees. "We compete on two things," he says. "Quality
and price. Our Sukhoi-30s are just as good as the American F-18s and
we can sell them a little cheaper." Indeed, the Sukhoi family of
fighters are made up of extremely manoeuvrable, multi-role aircraft
that compare favourably to U.S. fourth-generation fighters. Meanwhile,
a 2001 report by the Journal of the Air Force Association, a
not-for-profit, civilian, U.S.-based publication, estimates that the
Sukhois could be $20 million-30 million cheaper than their American
competition. While priced in U.S dollars, the Sukhois' costs are in
roubles, which depreciated more than 35% against the greenback in
1999.

It's one reason why Asian countries are taking to them so favourably.
Irkut's biggest customer, India, has a continuing $3 billion programme
for the purchase of a fleet of Su-30 variants designed with Indian
input. In July, 2001, Beijing placed an order for 40 Su-30s at a cost
of $2 billion. Last year, Malaysia signed a $900 million agreement for
18 Su-30s to be delivered over the next five years. Indonesia had
planned a squadron, but in the end plumped for four after their
economic problems forced Jakarta's military to curtail spending.
Having got his foot in the door, however, Fedorov is hopeful, saying:
"They are thinking of buying more."

Fedorov is planning to move aggressively into Asia by setting up
regional centres in the region to alleviate concerns about reliable
service and spare parts--one of the main complaints about Russian
military hardware in the early 1990s.

"Our biggest competitor is Boeing while Eurofighter is also a strong
competitor," he says, referring to the major fighter makers in the
U.S. and the European Union respectively, both of which have branches
throughout the region. "We already have big centres in India. Now we
intend to set up one in Malaysia next year to serve the Southeast
Asian region."

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[Yap Yok Foo]

From The Australian
October 17, 2003

Mahathir urges Muslims to fight Jews
By Rohan Sullivan in Malaysia

Malaysian Prime Minister Mahathir Mohamad today told a summit of
Islamic leaders that "Jews rule the world by proxy" and the world's
1.3 billion Muslims should unite, using nonviolent means for a "final
victory."

His speech at the Organisation of the Islamic Conference summit, which
he was hosting, drew criticism from Jewish leaders, who warned it
could spark more violence against Jews.

Mahathir, who is known for his outspoken, anti-Western rhetoric,
criticised what he described as Jewish domination of the world and
Muslim nations' inability to adequately respond to it as he opened the
meeting of Islamic leaders from 57 nations.

"The Europeans killed 6 million Jews out of 12 million, but today the
Jews rule the world by proxy," Mahathir said. "They get others to
fight and die for them."

Malaysia, a democratic nation which has a large non-Muslim population
and does not enforce strict Islamic law, has long been a critic of
Israel's occupation of Palestinian territories and of US policy in the
Middle East, including the war in Iraq and its strong backing of the
Jewish state.

Mahathir, 77, who is retiring on Oct. 31, has used almost every
international podium to lambaste the West for two decades, winning a
reputation as an outspoken champion of Third World causes.

"For well over half a century we have fought over Palestine. What have
we achieved? Nothing. We are worst off than before," he said. "If we
had paused to think, then we could have devised a plan, a strategy
that can win us final victory."

The prime minister, who has turned his country into the world's
17th-ranked trading nation during his 22 years in power, said Jews
"invented socialism, communism, human rights and democracy" to avoid
persecution and gain control of the most powerful countries.

Mahathir added that "1.3 billion Muslims cannot be defeated by a few
million Jews," but he suggested using political and economic tactics
instead of violence.

Israeli Foreign Ministry spokesman Jonathan Peled expressed
disappointment in the remarks but said he wasn't surprised.

"It is not new that in such forums there is always an attempt to reach
of the lowest common denominator which is Israel bashing," he said in
Jerusalem. "But obviously we'd like to see more moderate and
responsible kind of declarations coming out of such summits."

Rabbi Abraham Cooper, associate dean of the Simon Wiesenthal Center in
Los Angeles, said Mahathir has used anti-Israel statements in the past
to prove he's tough on the West. But, he said, today's speech was
still worrisome.

"What is profoundly shocking and worrying is the venue of the speech,
the audience and coming in the time we're living in," Cooper said
during a visit to Jerusalem. "Mahathir's speech today is an absolute
invitation for more hate crimes and terrorism against Jews. That's
serious."

US Ambassador to Malaysia Marie Huhtala declined to comment on
Mahathir's speech. Washington was angered over a speech he made in
February, as host of the Non-Aligned Movement of 117 countries, in
which he described the looming war against Iraq as racist.

Afghan President Hamid Karzai said he supported Mahathir's analysis,
which also included steps for how Muslim nations can develop
economically and socially.

"It is great to hear Prime Minister Mahathir speak so eloquently on
the problems of the ummah (Muslim world) and ways to remedy them,"
Karzai said. "His speech was an eye-opener to a lot of us and that is
what the Islamic world should do."

The summit is the first since the Sept. 11, 2001, terror attacks
reshaped global politics and comes at a time when many Muslims — even
US allies — feel the war on terrorism has become a war against them.

"It is well known that the Islamic community is being targeted today
more than at any other time before in its creed, culture and social
and political orientation," said Qatar's ruler, Sheikh Hamad bin
Khalifa al-Thani, who hosted the US headquarters in the Iraq war.

The status of Iraq also proved a divisive issue. Malaysia resisted
inviting the US-picked Iraqi Governing Council, describing it as a
puppet of American occupation. But Arab countries that have recognised
the interim body prevailed and council representatives were attending
the summit.

Leaders attending the summit included Jordan's King Abullah, Syrian
President Bashar Assad, Morocco's King Mohammed VI, Pakistani
President Pervez Musharraf and Indonesian President Megawati
Sukarnoputri.

Russian President Vladimir Putin and Philippine President Gloria
Macapagal Arroyo are attending as special observers because of their
large Muslim minorities.

http://www.theaustralian.news.com.au/
http://www.canberratimes.com.au



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 30 October 2003

One Angry Man

Malaysian leaders hosted the recent summit of Muslim nations and
pushed a message of peace and economic cooperation. But outgoing Prime
Minister Mahathir Mohamad overshadowed the effort by describing the
challenge for the Muslim world as a battle with the Jewish people
By Michael Vatikiotis/PUTRAJAYA

WITH THE WORLD desperately looking for a way to curb Islamic extremism
and push for peace in the Middle East, hopes were pinned on the first
formal summit of Muslim leaders since the terrorist attacks of
September 11, 2001. Optimists had looked to Malaysian Prime Minister
Mahathir Mohamad, the summit's host and chairman, because he has
steered Malaysia along a path towards moderate Islam, drawing strength
from economic development--a prescription many Muslims see as a cure
for their ills.

"This is the opportunity," former Thai Foreign Minister Surin
Pitsuwan, himself a Muslim, told the REVIEW ahead of the mid-October
Organization of the Islamic Conference (OIC) summit. "Mahathir has the
prestige, the clout and the legitimacy because he has come up with a
successful model for the Muslim world. The leaders will be bound to
listen."

But what the leaders of 57 Muslim nations who had gathered in
Malaysia's new administrative capital of Putrajaya listened to were
the words of an angry and frustrated man intent on stirring Muslims to
action: "1.3 billion Muslims cannot be defeated by a few million
Jews," he thundered. In Mahathir's view, the Jews have managed to turn
the world against Muslims. "The Europeans killed 6 million Jews out of
12 million, but today the Jews rule the world by proxy. They get
together to fight and die for them."

The inflammatory comments obscured a more useful message--at the core
of Mahathir's speech was a strong call for an end to violence. "The
world is looking at us," he began, "it is we who must act." He decried
the senseless violence that terrorists have launched, which he said
Muslim governments can do nothing to stop. "The attacks solve nothing.
The Muslims simply get more oppressed." Mahathir called on Muslims to
pause and make a "strategic retreat to calmly assess our situation."

Yet far from assuring a world already nervous about Muslim anger,
Mahathir sounded a distinctly menacing note. European leaders were
quick to condemn the comments. Several days later, United States
President George W. Bush, in Bangkok for a summit of Asia-Pacific
leaders including Mahathir, called the remarks "reprehensible" and
"hateful."

Adding to the concern, according to a senior Western diplomat in Kuala
Lumpur, were statements in Mahathir's speech that were seen to
advocate conflict using the Muslim world's vast oil resources. "Even
today, we have sufficient assets to deploy against our detractors,"
Mahathir said.

"That suggests he supports the use of oil as a weapon against us,"
says the diplomat. Thirty years ago, Middle East oil producers raised
the price of oil and cut production, greatly affecting oil-dependent
Western economies.

Perhaps it was unrealistic to expect the world's only pan-Muslim body
to sound benevolent, given the anger over the U.S.-led invasion of
Iraq and the worsening conflict between Palestinians and Israelis. But
the summit also featured strong voices calling for a new direction,
one leading away from violence and conflict. "We have to decide
whether militancy, extremism and confrontation will lead us to our
emancipation, or a focus on our socio-economic well-being will benefit
us," Pakistan's President Pervez Musharraf said. Musharraf pointed out
that all 57 nations represented at the summit could only muster a
combined GDP of $1.4 trillion, compared to Japan's GDP of about three
times that sum.

Indeed, the summit's final communique reiterated a commitment to
combat terrorism. But rather than focusing on the terrorist threat
from within, the leaders angled their communique on perceived double
standards--arguing for a distinction between terrorism and the
legitimate struggle for self-determination.

Malaysia will chair the OIC over the next three years, under Abdullah
Ahmad Badawi, who is to take Mahathir's place as prime minister at the
end of this month. Behind the scenes, Malaysian officials struggled to
turn the OIC into a more active forum to promote tolerance and
economic cooperation. That includes getting the business community
more involved in the process of framing initiatives.

"If we want to avoid being marginalized, it is important that we
focus, other than politics, on economics and trade," said Malaysian
Foreign Minister Syed Hamid Albar.

Mirroring a process that has already taken place in the context of the
Asia-Pacific Economic Cooperation forum and within the Association of
Southeast Asian Nations, Abdullah proposed a second-track mechanism to
reflect the concerns of the business community.

This idea struck a chord. "We are being marginalized under the World
Trade Organization regime, and there should be dialogue and more
meetings between Islamic ministers of finance," says a Pakistani
businessman attending a business forum on the sidelines of the
leaders' summit.

Malaysia has suggested various mechanisms to make this happen, which
also mimic Apec and Asean. These include inviting nonmember countries
with sizeable Muslim populations, like Russia and India, into the OIC
as dialogue partners as a measure to build confidence with the
non-Muslim world, and proceeding with economic initiatives without
seeking agreement from all member countries. "As far as Asia is
concerned, we are more familiar with how to deal with diversity," says
Malaysian Youth and Sports Minister Hishamuddin Hussein. "We should
not be looking for full endorsement, but if a proposal is realistic,
let's not wait, and go do it."

Rhetoric aside, small steps were taken at the summit by leaders
towards shifting the centre of gravity in the Muslim world away from
political issues centred on the Middle East. Of course, it remains to
be seen just how much dialogue and economic cooperation Malaysia can
promote in a community facing divisive and emotional political issues
like Iraq and Palestine. Despite Mahathir's offensive rhetoric, there
are those who argue that a Muslim world guided by Asian Muslims known
for their tolerance and hard-nosed pragmatism, as well as for
generally avoiding conflict, is at least a start. "Southeast Asia is a
workable model," argues Surin, the former Thai foreign minister. "The
main body of Muslims in this region are very moderate, rational and
tolerant."

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 30 October 2003

Dying to Succeed

Nobody wants to talk about death. But one Malaysian company does just
that, and has still managed to turn itself into a stockmarket
favourite
By S. Jayasankaran/KUALA LUMPUR

THE FINAL RESTING PLACE of Pai Gung, a Chinese singer-actress who
moved to Malaysia in the 1970s, is away from the main road, accessible
by a tiled footpath set amid flowers. A slab of black marble bearing a
photograph of a pretty, smiling Chinese woman rises above the tomb.
Behind the slab is an alabaster piano in front of which are curiously
shaped indentations. Step on them and a 1930s-style Chinese show tune,
tinny as an ancient recording, rings out.

It echoes across the cemetery, surreal and faintly eerie in the
afternoon heat; the dead actress seeming to sing her most famous song
from the depths of her 500,000 ringgit ($131,578) tomb. "She was the
Marlene Dietrich of the East," says Isaac Chong reverently. "I'd say
she went out in style."

Chong works for NV Multi Corporation, Southeast Asia's only listed
undertaker, and Pai Gung is one of 15,000 customers buried in the
company's Nirvana Memorial Park, Asia's largest graveyard, which is
set amid 535 acres of verdant landscape about 25 kilometres southwest
of Kuala Lumpur. And this is just one slice of 1,160 acres of burial
land that the company owns in Malaysia, underscoring the rude health
of the business of death. "We used to wait for walk-in customers, so
to speak," says Kong Hon Kong, the managing director of NV Multi,
which racked up sales of more than 150 million ringgit in 2002. "Now
80%-85% of our sales are to the living."

The success of NV Multi illustrates how long-held taboos among
Malaysia's 30% Chinese population are breaking down in the face of the
community's growing affluence. While it's common in the West for
individuals to buy a burial plot while still alive, it was unheard of
in this part of the world until quite recently. But fantastic
cemeteries filled with dragons, waterfalls and designer graves, along
with tasteful ad campaigns and the skilful marketing of "burial
packages" as future inflation-hedges, have helped break down
inhibitions.

Moreover, it's been given the thumbs-up by the community's seers.
"Culturally it was considered a bad omen," says Joey Yap, a
much-respected feng shui, or geomancy, expert in Kuala Lumpur. "But
metaphysically it's a good thing; you don't leave the burden to your
children. It's a sign of acceptance."

NV Multi's Kong hopes that acceptance will be widespread. The reason:
In Malaysia alone, the potential business may be to die for. "There
are around 1.5 million Chinese who are 50 years or older," he reasons.
"Assuming they pay for the cheapest service, which is about 20,000
ringgit apiece, we're talking 30 billion ringgit out there." (Members
of the country's predominantly Muslim Malay community are
traditionally buried in Muslim-only cemeteries and shun ostentatious
burial.)

Others applaud the all-men-are-cremated-equal thesis. Last year, the
Rating Agency of Malaysia upgraded NV Multi's long-term debt from AA3
to AA1, right up there with gilt-edged bonds. And in mid-August,
accounting firm KPMG ranked NV Multi 18th among the top 75 listed
Malaysian companies in terms of creating shareholder value. "It's a
captive market and it's damn profitable," says the research head of a
European brokerage in Kuala Lumpur. "It's a no-brainer."

GRAVEYARD EPIPHANY
Born to rubber-tapper parents who raised 10 children, Kong dropped out
of high school in central Pahang state to work, first as an assistant
in a pawn shop and then as a van driver. He went into the sundry-goods
business at age 21 and steadily prospered until the mid-1980s
recession sent him back to square one.

The businessman's epiphany came in 1985 when his father-in-law passed
away. "I didn't know how to handle it," recalls Kong. "And when we
finally buried him, it was scary, the lallang (long grass) was taller
than I was. There had to be a better way."

But Malaysia's land code had no provisions for privately owned
graveyards. At the time, clan associations ran most Chinese
graveyards: Plots could not be booked in advance and graves were often
scattered around in untended areas. Kong began agitating for a change
in the law. It came five years later, by which time the optimistic
businessman had already identified land parcels and cajoled owners
into prospective joint ventures with him. "You could say I engineered
the first privatized graveyard in Malaysia," says Kong with some
pride.

But the word trips uneasily off him; he clearly prefers "memorial
park" to describe his operation. It's not an overstatement either.
Nirvana began as a 50-acre plot, but Kong began buying surrounding
land to multiply its acreage 11-fold. And he did it with an eye
towards tradition. "The place has got good feng shui," says geomancy
expert Yap. "Undulating land surrounded by hills and water features
like lakes."

SOMETHING FOR EVERYONE
To buttress that good fortune, Kong threw in everything but the
kitchen sink. Nirvana has something for everyone, Buddhist or Taoist:
There are gazebos, artificial waterfalls, fountains and lakes
punctuated by statues of the Buddha, the Goddess of Mercy and huge
symbols representing the Chinese signs of the zodiac--all set amid
neatly manicured and flowering greenery.

It's topped off by a gigantic 300-metre red-and-gold dragon with an
interior, air-conditioned temple and compartments for over 6,000
urns--and, yes, it is the world's largest dragon. Lest anyone feels
left out, a smaller part of the development is devoted to Christians,
who make up 9% of Malaysia's Chinese population. (Almost 90% of
Malaysia's Chinese claim to be Buddhist though that's mixed with
various elements of Taoism.)

Marketing was the hard part. At first Kong waited around for clients
to come to him, but in 1993 he began direct marketing, with agents
pitching burial packages to customers as a hedge against inflation. A
25,000 ringgit package today, the brochure says, could cost 40,000
ringgit in 10 years. The hard sell has been relentless: A slick Leo
Burnett ad campaign that aired over Chinese-language television early
this year, for example, emphasized the importance of "peace of mind."

NV Multi has also tied with insurance firms that sell funeral packages
to existing policy holders. Even the banks are in on the business.
Customers at Alliance Bank can finance a plot and future funeral
expenses through monthly instalments. Good customers get a gold credit
card free. "It's a lot like selling insurance," says Kong.

Rates vary widely: Twenty-thousand ringgit buys a basic package, while
for 2 million ringgit, customers get stretch-limousines for their
family at the interment and ornate mausoleums with a small house that
family members can use while visiting the deceased on holidays.

Indeed, NV Multi claims its service is completely integrated--it
handles everything from the death certificate to embalming to the
thank-you cards. Now Kong is expanding locally--a funeral parlour in
every state--and overseas. "We already have offices in Hong Kong and
we're seriously thinking of exporting our services to China, Indonesia
and Vietnam," Kong says. "We like places where the affluence is
rising."

Sitting in his glass-and-leather office in downtown Kuala Lumpur, Kong
radiates life and vigour as he sips warm Chinese tea. A plaque on the
wall proclaims NV Multi to be a member of the International Cemetery
and Funeral Association. "The big thing was the taboo, and that was
easy to break because it's in the Chinese culture anyway," reflects
Kong. "We are prepared to spend for bereavement. Do you know there is
a saying among old people? 'Spend my savings if you must but don't
touch my coffin money'."

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 30 October 2003

Letters : MAHATHIR'S RECORD

Your article, Lasting Achievements [Oct. 9], made an important
observation. Any student of basic economic statistics knows that
having two events correlate over time does not mean one causes the
other. That Mahathir Mohamad was around when the Malaysian economy
grew does not necessarily support the conclusion that he was causal to
Malaysia's prosperity and development. It is granted that Mahathir's
defiance in the face of International Monetary Fund policy
prescriptions (in terms of imposing a fixed exchange-rate regime with
capital-flow controls) saw Malaysia through the shallowest recession
in the Asian Crisis relative to its neighbours. However, as many have
argued, such Band-Aid economic solutions cannot be sustained
indefinitely. Prolonged patch-up jobs run the risk of domestic
inefficiencies overtaking Malaysia's international competitiveness.

Malaysia, post-Mahathir, must take stock and make good use of its
moment under the sun to engineer a market economy supported by truly
democratic political processes and transparent corporate governance.
Malaysians must begin to look beyond the shiny monuments and colossal
projects to grasp a more profound meaning of "Malaysia Boleh."

TIMOTHY KAM

Crawley, Western Australia

Mahathir Mohamad's retirement saddens me, but I wish him a happy life.
He deserves it after 22 years leading Malaysia. The nine perspectives
you published are simply marvellous, showing the variety of views
about Mahathir [Pride and Despair: Nine Views of Dr. M, Oct. 9]. I
especially like Clyde Prestowitz's remark, that "one reason Americans
have had difficulty with him is that he is so American." I totally
agree with this comment. [Dr. M, The American.]

Mahathir's successor, Abdullah Ahmad Badawi, seems to have a different
demeanour. Malaysians are eager to know if his administration will
continue Mahathir's policies or make some changes.

KHOO YING HOOI

Petaling Jaya

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[adchin]

Not for the worse I hope.

Post by Yap Yok Foo
Mahathir's successor, Abdullah Ahmad Badawi, seems to have a different
demeanour. Malaysians are eager to know if his administration will
continue Mahathir's policies or make some changes.
KHOO YING HOOI
Petaling Jaya

[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 30 October 2003

TRAVELLERS' TALES
By Nury Vittachi

MONEY OR YOUR LIFE: A female moneylender in India gave one of her
debtors a choice: Pay up or marry her. Paravya, a 50-year-old widow
from Karwar, Karnataka, gave the equivalent of $600 to 55-year-old
labourer Sharanappar, a widower in need of cash. Although they became
firm friends only after the funeral of Paravya's husband, their
relationship actually had its roots in the distant past--they had been
youthful sweethearts in a different town 30 years earlier, The Times
of India reported. After he comforted her during her bereavement, she
made the money-or-marriage offer. Sharanappar accepted her proposal.
The newspaper said the bridegroom was not as keen as she was on the
wedding, but liked the idea more than having to pay back the massive
loan. This may not seem the ideal basis on which to start a marriage,
but in India people tie the knot for all sorts of reasons. Regular
readers of this column may recall the Indian bride who was jilted at
the altar and married a last-minute volunteer so as not to let the
wedding preparations go to waste.


--------------------------------------------------------------------------------

EARTH MOTHER: A woman in China has eaten 10 tonnes of soil. That's as
much dirt as a good-sized backyard, or even a small park. Hao Fenglan,
from Zhangwu county, Liaoning province, started eating mud as a
child--as many children do. The difference between her and the rest of
the world's kids is that she never stopped. She dined on chunks of
earth virtually every day from the age of eight to the present day.
Since she is now 78 years old and in good health, it seems the mud has
done her good, the South China Morning Post reported. She said she
felt uncomfortable if she didn't get her daily dose of crumbled mud.
Most people these days eat ground beef. She eats ground ground.


--------------------------------------------------------------------------------
Snippet from a press report
"For three nights only on October 15th, 16th, 17th and 18th, KEE is
proud to present ERUPTION, a .........."

THREE'S COMPANY: A guest singer performed at the popular Kee Club in
Hong Kong on October 15, 16, 17 and 18 "for three nights only." I
guess the fourth night she just hung out.


--------------------------------------------------------------------------------

HE'LL BE BACK: Following the report about the politician named Adolf
Hitler, reader Rajeshwari Singh tells me that the mayor of Madras is
named M.K. Stalin. "He could become chief minister of Tamil Nadu or
prime minister of India," she said. A few weeks ago I would have
dismissed that as being as ludicrous as the idea of Arnold
Schwarzenegger winning an election.


--------------------------------------------------------------------------------

SLOW THINKERS: A Japanese gangster stole an ATM machine--but it was so
heavy to transport that his vehicle was soon overtaken by police cars.
A 37-year-old member of a crime syndicate used earth-moving machines
to smash into a supermarket in the middle of the night and grab a
cash-dispensing machine. He and his gang loaded the device onto a
two-tonne truck and drove it away. But the truck was no match for a
squad of 30 police cars chasing him. When the villain realized this,
he tried to make a break on foot, but he was caught by fleet-footed
officers. There was ¥96 million ($870,000) in the machine, but the
gang had not managed to extract any of it, the Mainichi Shimbun
reported. So near, yet so far.


--------------------------------------------------------------------------------

ONE-STOP SHOP: Malaysian women are so hard to woo that the country's
bachelors are choosing wives out of catalogues instead, the China
Press reported. The guys pick a pretty face from a book of photographs
and then agents sell them "one-stop wife packages." For 33,000 ringgit
($8,680), you get the works: a bride aged 18 to 21; a six-day,
five-night trip to the country of the bride's origin (usually China,
Indonesia or Vietnam); a certificate of virginity; a hotel stay;
meals; an instant wedding; a crash course in Bahasa Malaysia, or
Malay, for the bride and a course of sex education (also for the
bride). A Star report on the practice said: "Malaysian bachelors
prefer to fork out money marrying foreigners rather than spent time
and effort to woo local women."


--------------------------------------------------------------------------------

WELL DONE TIM: Adding to our collection of Asian English, reader Tim
Hill tells me he ate at Halia, a restaurant in the Botanic Gardens in
Singapore. He ordered a steak. The waitress replied: "What done would
you like?"


--------------------------------------------------------------------------------
Picture of a man pushing a bicycle with a trailer carrying some 8 huge
bags of stuff


BAGS OF FUN: Reader Robby Nimmo sent me this picture from China. And
you thought driving a car in Asian cities was challenging.


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[David A. Allan]

Post by Yap Yok Foo
From The Australian
October 27, 2003
Bitter remarks not so wrong
By Kimina Lyall

<snip>

Interesting article - thanks for posting it. (Just wondering where the
"Western media is biased and anti-Malaysia" trolls are now?)

David

[Mr_Magoo]

Post by David A. Allan

Post by Yap Yok Foo
From The Australian
October 27, 2003
Bitter remarks not so wrong
By Kimina Lyall

<snip>
Interesting article - thanks for posting it. (Just wondering where the
"Western media is biased and anti-Malaysia" trolls are now?)

Care to repost the whole article again? Coz I didn't get it. Thanks.

Rgds,

Mr Magoo

[Yap Yok Foo]

From The Australian
October 29, 2003

US ammends Malaysia aid

The US Senate tied $1.2 million in military aid for Malaysia to
religious freedom there in a response to criticism of Jews by the
Southeast Asian nation's prime minister.

Before money could be spent, the State Department would have to
determine that Malaysia "supports and promotes religious freedoms,
including tolerance for people of the Jewish faith."

The stipulation could be waived for national security reasons.

The restrictions were approved Monday by voice vote as an amendment to
the $18.1 billion foreign aid bill being considered by the Senate.
After the bill's approval, it will have to be reconciled with a $17.1
billion version approved by the House of Representatives in July.

In an October 16 speech to a summit of Islamic countries, retiring
Malaysian Prime Minister Mahathir Mohamad said Jews "rule the world by
proxy. They get others to fight and die for them."

Mahathir, who leaves office Friday, shrugged off the new restrictions
Tuesday, saying it doesn't need the help. He also accused America of
trying to run the world.

"It doesn't make any difference to us," Mahathir said. "We don't
really need that money."

Asked by a reporter on Tuesday if the Senate's action was justified,
Mahathir replied: "Whether it is justified or not, it is their
viewpoint. They are very annoyed about what I said about the Jews.
This is their reaction, so what I said is true."

He added, "They want to dictate to the world. We are all being run by
the US Senate."

The sponsor of the Senate amendment, Senator Mitch McConnell, said
Mahathir's October 16 remarks "are dangerously wrong, and they play
directly into the hands of the radical Islamic extremists throughout
the region."

"This is not an issue of free speech," said McConnell, of Kentucky,
the number two Republican in the Senate. "His anti-Semitic remarks
lent credence and legitimacy to the hateful message of local
terrorists that seek to sow mayhem throughout the region."

A State Department report on religious freedom last year said
Malaysia's constitution provides for religious freedom. "However," it
said, "the government places some restrictions on this right."

Mahathir has remained unrepentant, saying the criticism shows he is
right by exposing a double standard in the West that allows Muslims to
be criticized but protects Jews.

Earlier Tuesday, Malaysian Foreign Minister Syed Hamid Albar said the
Senate vote was an example of the United States trying to "discipline
the world in their own mold."

"So, now it is another Muslim country that is being zeroed in (on) for
their so-called disciplining," Syed Hamid told The Associated Press.

Mahathir, 77, has spearheaded Malaysia's development from a British
colonial backwater into a modern, multicultural society and for years
has seen himself as a spokesman for the developing and Muslim worlds.

He is known for his acerbic and provocative statements about the West
and the US-led fight against terrorism.

Malaysia, one of Southeast Asia's wealthiest and most developed
nations, gets no economic or development aid from the United States.
Military aid goes toward training and counterterrorism programs, the
State Department says.

AP

http://www.theaustralian.news.com.au/
http://www.canberratimes.com.au



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[Yap Yok Foo]

From The Australian
October 31, 2003

Mahathir goes out holding tongue
By Kimina Lyall, Southeast Asia correspondent

It had nothing of the punch - or controversy - of his most recent
public outbursts, and that in itself was the greatest surprise of
Mahathir Mohamad's final speech as Malaysian Prime Minister.

His live television audience, used to being chastised for its cultural
failings, or listening to vibrant tirades against Western powers,
instead was subjected to a 135-minute description of Malaysia's
economic performance.

Dr Mahathir, making a rare appearance in parliament, was delivering
the "mid-term review of the eighth Malaysia plan", in which he
described a nation more economically vibrant than it was at
independence in 1957, and than when he took over 22 years ago.

In the low-key day, an attempt to start a round of applause upon his
arrival was curbed by the Speaker beginning prayers, and another upon
his departure was cut short because Dr Mahathir had used up every
minute of the 15-minute extension he had been given to complete his
speech.

Reading as if he would remain in charge, he vowed the Government would
crack down on contractors who failed to deliver projects on time and
with quality.

He also promised that "while we will also continue to promote foreign
direct investment, more attention will be paid to local sources of
investments", citing agriculture, metal fabrication and infrastructure
skills exports as a target for incentives.

He did not elaborate on what the incentives would be, but leaving what
could be interpreted as a "to-do" list for his successor, Abdullah
Badawi, who takes over the prime ministership today, he said "we will
try to change the globalisation agenda through the WTO", reduce the
cost of business and increase and limit public sector investment as
the economy recovers.

In his last message to constituents, he urged Malaysians to be
"diligent, disciplined, in control of their feelings and (be) prepared
to face challenges and overcome obstructions".

In a veiled reference to fundamentalist Islamists, he said "extremist
groups" were trying to increase the separation of Malaysia's ethnic
Malays, Chinese and Indians and urged them instead to to mix together
more for the "peace and well-being of the nation".

Asked later if the lack of fire in his speech was an indication he now
intended to retire quietly, Dr Mahathir said: "I can go out with a
bang if you like. I say nasty things. Ask me nasty questions, I will
give you a nasty answer." But instead the largely Malaysian media
contingent appeared to be more interested in their group photograph
with the man who has clamped down on free speech.

Before he headed to party headquarters to formally hand over party
leadership to Mr Abdullah ahead of this morning's ceremony at the
palace, Dr Mahathir posed with members of parliament, parliamentary
staff, cleaners and, finally, the media.

While all were greedy for the "old man's" attention, it was the
journalists who managed to persuade Dr Mahathir to sign his autograph
in their notebooks.

http://www.theaustralian.news.com.au/
http://www.canberratimes.com.au



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue 30 October 2003

TRAVELLERS' TALES
By Nury Vittachi

Death by Memo

Be really nice to us or we won't stay in your jail, prisoners are
telling their wardens in the Indian state of Bihar

WE INTERRUPT this magazine to bring you an urgent newsflash. There has
been a spate of incidents in Asia of people brazenly subverting the
Natural Order. In Asia, officials rule. We rabble do as we are told.
But perhaps no more.

Take the recent jail protest in India. Inmates in Bihar are demanding
that luxuries confiscated from them must be returned or they will
stage a walk-out. The dispute follows a clampdown in which wardens
removed a colour television, mobile phones and other items from cells,
I heard from reader Sunil Prasad. In turn, jailbirds threatened to
embarrass the authorities by abandoning the scene. "We are issuing a
warning that if our things are not returned then the doors will be
broken and we will all escape," spokesman Sunil Pandey said.

Officials, anxious to avoid seeing their prisoners decamp en masse,
have been negotiating. They said they would give the television back
if it could be classified as an official prison item. "I am going to
authorize them to make it the official jail TV," Baswan Bhagat,
minister for jails, told the Patna news agency.

The prisoner-warden relationship has also been subverted in Japan. In
that country, researchers asked imprisoned mainland Chinese jailbirds
whether their spell behind bars had scared them straight.

No, they replied. "Japanese prisons are clean and you can watch
television as well. The standard of life is better than regular life
in China," one prisoner said. If you have to be arrested somewhere,
Japan was better even than America. "I'd love to go to the United
States, but there is a risk of getting shot by policemen over there,"
another villain said.

The National Police Agency issued a white paper warning that the
Japanese penal system was no longer effective in scaring off migratory
criminals.

An example of a particularly Asian sort of subversion against
authority comes from Madyha Pradesh state in India. There, a civil
servant denied advancement threatened to kill himself on the job, but
first applied in writing to his bosses for permission. The authorities
have been unsure about how to react to Vinod Shukla, whose threat to
commit suicide could mess up his office, but whose application for
permission in duplicate showed an admirable level of respect for
protocol.

Shukla, an undersecretary in the finance department of the state
government, sent memos to the state governor and the chief minister
asking for clearance to terminate his post and his life, the Hindustan
Times reported.

Officials reacted by doing what they do best--sending out a flurry of
their own memos. These went to the principal secretaries in the home,
finance and general administration departments, asking them to check
whether a protest suicide during working hours should be classified as
a workplace issue.

Getting permission from your boss to kill yourself may seem odd to
most of us, but perhaps not in Thailand. For decades in that country,
an ancient rule required civil servants to seek the permission of
palace officials in writing before they could pass away. This applied
not only to suicides but also to people dying of illness or accidents.

Although we don't know if the rule is still enforced today, reporters
did ask this in 1998, and were told it had never been rescinded.
Farewell notes "must be sent along with a bouquet of flowers and joss
sticks to the Royal Ceremonial Affairs Division to be proposed to His
Majesty," an official said then.

What should the authorities in India do with people who die without
permission? That's a tricky one, since you can hardly punish a corpse.
Bosses at least have options in the opposite instance, when it comes
to punishing people who get permission to die and then refuse to
follow through. These people are at least alive to be thrown into
jail.

But don't expect them to stay locked up in Bihar, please, unless you
remember to provide colour televisions and personal cellphones.


--------------------------------------------------------------------------------
Sign
WHOOPEE
BLOCK BUSTER
PERSONAL.COM WORKS
DON'T EVER CALL US!


WARNING SIGN: Reader Charles Allord, Jr., saw this signboard in Tokyo.
It neatly subverts the normal message of advertising billboards by
urging customers never to contact the company concerned. "Now we know
why some Japanese companies are having a hard time these days,"
Charles said.

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 06, 2003

The New Way: Think Small

Mahathir Mohamad ruled Malaysia with a 'think big' credo. Prime
Minister Abdullah Badawi will distinguish himself by getting back to
basics. Here's what to expect from Abdullah as he works to earn his
credentials as a national leader

By S. Jayasankaran/KUALA LUMPUR


AT A MEETING WITH senior government officials early this year,
Malaysia's incoming Prime Minister Abdullah Ahmad Badawi made his
feelings clear: "I'm not into big projects," he said.

GETTING BACK TO BASICS
• Expect Abdullah to distance himself from his predecessor's big
vision
• He'll support rural development--good for growth, good for Abdullah
• He'll nurture manufacturing and woo investment
• He'll play politics: There's an election in 2004

And so Abdullah began to separate himself from the policies of
retiring Prime Minister Mahathir Mohamad and his "think big" economic
credo for Malaysia. "To be noticed when you are small, sometimes you
have to stand on a box," Mahathir once said. Malaysia got noticed
during Mahathir's 22-year tenure, building, among other things, what
were the tallest towers in the world, one of Asia's showiest airports
and a grandiose new federal capital at Putrajaya.

Abdullah, taking over from Mahathir on October 31, wants to get back
to the basics. Officials close to Abdullah say he intends to
de-emphasize the costly, high-profile infrastructure projects and
stress improved grass-roots economics and human-resource development.

"I'd like to go back to the grass roots, look at agriculture and
agriculture-based industries for a start," Abdullah said at the
meeting with officials, according to several aides who were present.
And when asked recently which government ministry he considered the
most important, Abdullah replied without hesitation: "Education."

Abdullah's policy shifts aren't likely to be abrupt or drastic. He's
likely to continue to nurture Malaysia's domestic manufacturing sector
and woo foreign direct investment, which have helped power growth
since the late 1980s. But even Mahathir knew FDI has been slipping in
the last five years, and had begun giving incentives to small and
medium-sized enterprises. Abdullah, say government officials, is
likely to build on that thrust.

Abdullah's pursuit of smaller-scale development comes not merely
because the new leader thinks that Malaysia's infrastructure is
already adequate. His reasoning may also be influenced by a political
imperative to distance himself from his predecessor.

The Asian financial crisis, which tripped up many of Malaysia's
politically favoured tycoons, pointed up the weaknesses of Mahathir's
strategies: Flawed privatization and heavy-industry projects, lax
banking supervision and corporate governance, and poorly planned
attempts to promote entrepreneurship.

To his critics, Mahathir became a leader who favoured an elite group
of Malaysians over the mass of poorer rural Malays. Malaysia's
conservative Islamic Party, or Pas, has used the issue to make
impressive electoral gains in the country's Muslim heartland, where it
runs the state governments in Terengganu and Kelantan.

Distancing his new government from Mahathir's could help Abdullah, who
faces a general election in 2004 but lacks the raw political clout
Mahathir exercised while in power.

Expect Abdullah to focus on rural development by reasserting the
importance of a sector Mahathir generally disdained: agriculture,
which currently accounts for 9% of GDP. The motivations are not just
economic: the majority of rice farmers and small rubber and oil-palm
cultivators are ethnic Malays, who form the core constituency of the
United Malays National Organization, Malaysia's dominant political
party, which Abdullah will lead.

Malay support for Umno faltered in the late 1990s following the widely
denounced sacking and subsequent jailing for sodomy and abuse of power
of former Deputy Premier Anwar Ibrahim. In the 1999 general elections,
for example, Umno lost 20 parliamentary seats to the opposition and
only managed to retain its two-thirds parliamentary majority because
of non-Malay support for the National Front. (The ruling National
Front is a coalition of 14 parties led by Umno).

Favourable recent trends have given Abdullah some breathing space.
Malaysia is expected to surpass its projected 4.5% growth in
inflation-adjusted GDP this year because of a global recovery and
increased government spending. The stockmarket is enjoying a bull run
(up 24% since January) and Malaysia's financial system has been
returned to health, having shed most of the bad loans racked up after
the Asian financial crisis.

There is a future bonus as well: U.S. independent contractor Murphy
Oil recently discovered the equivalent of 22% of the country's current
oil reserves (about 4.5 billion barrels) in deep water off eastern
Sabah state. However, it will take at least three to four years before
revenues from this find begin contributing to national income.

While Abdullah faces no immediate economic crisis, the future is less
certain. The incoming premier has repeatedly said that his blueprint
for Malaysia will continue to be Mahathir's "Vision 2020"--a plan that
calls for 7% real GDP growth a year for the next 17 years with the
goal of making Malaysia a fully developed economy by 2020.

But economists like Rajeev Malik of JPMorgan Chase in Singapore say
that Malaysia's "years of blazing growth" are over. In the 1990s,
Malaysia averaged 9% in annual growth rates, largely due to an
export-oriented economy driven by global multinationals.

That approach no longer works, with China, and perhaps India, looming
as ferocious competitors for foreign investment. The test for Abdullah
is to identify and develop Malaysia's next growth engine. "We
definitely have to look at creating new sources of growth," says one
of Abdullah's economic advisers.

One route might be to build on Mahathir's strategy of promoting
information technology, epitomized by his Multimedia Super Corridor, a
wired hi-tech zone south of Kuala Lumpur that he envisaged would
evolve into Malaysia's version of Silicon Valley.

But industrial growth in the corridor has been unspectacular and,
unlike Mahathir, Abdullah isn't particularly knowledgeable about
information technology. On the other hand, his advisers say that he is
interested in biotechnology--especially where it can be applied to
agriculture.

"Agriculture will be very important because it's all about putting
money in the small man's pocket," says the economic adviser. "People
in the lower income levels have a propensity to spend and that will
help consumption."

That's easier said than done. Manu Bhaskaran, a Singapore-based
economist with the U.S.-based Centennial consulting group, cautions
that biotechnology is a long-term investment that will not put any
money in anyone's pocket soon. "Malaysia has got agriculture right,
anyway," argues Bhaskaran. "It has to concentrate on the stuff it does
best like contract manufacturing and pitch for stuff others
outsource."

Signs of Abdullah's political sensitivity to agriculture policies are
already surfacing. The deputy premier has, for example, opposed the
listing of state-owned Felda Holdings, first proposed by Mahathir in
September. Felda was a 1960s creation that transferred state-owned
land to landless farmers to grow oil palm and rubber.

The listing of Felda, which also subsidizes land schemes it runs for
settler-farmers, was aimed at raising 1.5 billion ringgit ($395
million) for the government and would give farmers--who own 51% of
Felda through a cooperative--a direct stake in a profitable listed
company.

Felda nurtures over 100,000 settler families, most of them Malay. An
Umno official says Abdullah was not convinced that these families
could accept the market risks that would come with a listing. "The
plan has been shelved," says the official. "Abdullah thinks that its
political impact on Umno should be carefully considered."

Abdullah could also change another hallmark of the Mahathir era: the
emergence of a coterie of politically influential tycoons who
dominated Malaysia's corporate scene on the strength of big government
contracts and privatization deals. Some of Abdullah's advisers have
claimed, for example, that cronyism will be a thing of the past.

Indeed, no big businessman in Malaysia can be said to be an Abdullah
protégé except, perhaps, for his only son, Kamaluddin, who is a
passive investor in a successful listed oil-and-gas company called
Scomi Group.

Even so, few analysts think that the patronage that characterizes
Malaysian politics and business will completely disappear. But they
concede that its degree could diminish.

Abdullah is also unlikely to water down Malaysia's long-standing
affirmative-action policies that give business and other privileges to
ethnic Malays. The 32-year-old policy is aimed at improving the
economic lot of Malaysia's majority race and has been criticized for
distorting economic growth. "No Umno leader would dare to repeal the
policy," says a former Umno minister. "And Abdullah wouldn't even
try."

The new premier is also likely to be more orthodox than Mahathir in
his views of financial markets. Faced with the Asian financial crisis,
Mahathir banned offshore ringgit trading, imposed capital controls to
limit currency movements and pegged the ringgit to the U.S. dollar.

Abdullah may not be so confident. "I don't think he is especially bold
on economic matters," says economist Jomo Sundaram. "He will play to
the market so he wouldn't try things like capital controls, for
example."

But then again, Mahathir thrived on crisis management. Abdullah Badawi
must be hoping that all he'll have to manage is success.

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 06, 2003

BG Lee Opens Up to Singapore Press

Lee Hsien Loong has been receiving great exposure in Singapore's
pro-government media ever since Prime Minister Goh Chok Tong announced
in August that he would hand over power to his deputy at least two
years before the next general election, slated for 2007. But all the
press attention is now generating new speculation: Is Goh coming under
pressure to step down earlier than 2005? In tightly run Singapore,
where debates and disagreements between leaders are virtually never
aired, it's impossible to know. Officials close to Goh, however, claim
that the ruling People's Action Party worries about losing a measure
of support from the growing ranks of unemployed. The ebullient Goh is
seen as a better vote-getter than the technocratic Deputy Prime
Minister Lee, who has tried to open up in a series of exclusive
interviews with The Straits Times in recent weeks. The eldest son of
Singapore's founding father, Lee Kuan Yew, he answers questions on
everything from losing his first wife, to his fight with cancer, to
fatherhood. He also addresses criticisms of his leadership style and
sensitive questions on the Lee family's involvement in politics.

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 06, 2003

Underground

Armed with inexpensive digital videocameras, a new generation of
Malaysian film-makers is tackling issues long ignored by the country's
mainstream cinema
By John Krich/KUALA LUMPUR

EARLY this year, Malaysian independent cinema came of age. Just off
Merdeka Square, where Malaysia was born, an audience packed into the
Actors Studio Theatre for the premiere of The Big Durian. Named after
a tongue-in-cheek term for Kuala Lumpur, this personal essay is the
most mature work so far by journalist-turned-film-director Amir
Muhammad, 30, who has become the informal ringleader of a new
generation of cinematic taboo-busters.

This film focuses on the racial jitters and political machinations
surrounding an incident in 1987, when a Malay army private named Adam
ran amok with a gun, killing one and injuring two. Made for less than
$5,000 in just nine days, the film mixes real and re-enacted
interviews to offer a straight-on but witty examination of
ultra-sensitive issues--racial tensions, a national herd
mentality--that Malaysians avoid discussing. Not surprisingly, despite
screenings at overseas film festivals, The Big Durian is unlikely to
be released in Malaysia.

Ironically, films like the The Big Durian are only being made because
of Malaysia's push for hi-tech industry and cutting-edge computer
skills. Spearheaded by recent graduates of the Multimedia University,
a growing coterie of young film-makers, armed with inexpensive digital
videocameras and film-editing software, has begun holding a mirror to
issues previously kept in the dark.

"A revolution is going on here--and it's long overdue," says Hassan
Multhalib, who created the country's first animated feature 20 years
ago. Vernon Emuang, producer of Lips to Lips, Amir Muhammad's 2000
comic debut, says: "A new generation is pushing the boundaries of our
cultural landscape--and with each push, legitimizing another sector of
society."

He's not just talking about intellectuals, homosexuals, feminists,
criminals, rebels or rockers--but Chinese and Indians who make up 38%
of Malaysia's population. While few of the independents' subjects are
overtly radical, their recent output finally puts on screen the
concerns of an upwardly mobile multi-ethnic middle class, largely
educated abroad and, says Emuang, "as metropolitan as any in the
world."

Actor and film-maker James Lee, 30, whose 2003 film Room to Let, a
tale of bored and alienated young Malaysians, has been shown at
several overseas festivals, says: "The only way to get a clear picture
of Malaysia is for all our races to contribute. This country doesn't
need East vs. West, Islam vs. non-Islam, we need 10 perspectives on
everything."

Already limited by its small market to around a dozen movies a year,
mainstream Malaysian productions have always been made in Bahasa
Malaysia and are usually formulaic love stories or epics extolling the
heroes of the majority Malays. The government censorship board--"a
cultural Taliban," says Lee--approves these scripts and tightly
controls the content.

Most of the new generation of guerrilla film-makers don't even bother
applying for official licences. The new, mobile technology allows them
to make full-length features cheaply and quickly, before the
authorities even notice. As for distribution, most get around the
content restrictions applied to commercial releases by cultivating a
growing coterie of enthusiasts at not-for-profit screenings that are
publicized over the Internet.

True, some of the works are crude, their stories fumbling and
imitative, and audiences are too small to provide any serious
box-office returns. But the local mainstream industry isn't doing that
much better: Between 1997 and 2002, 38% of the country's screens
closed. In 2003, films in English from Hollywood outgrossed those in
Bahasa by five to one. Piracy is rampant.

"The pirates have actually helped educate us in film. My aunt in a
village now watches Kurosawa," points out Dhojee Roshishan, a book
publisher. He has ambitious plans to set up a distribution network for
independent films on campuses and to market direct to DVD. He's also
tested the limits of censorship by co-producing Gedebe (Kelantanese
slang for "Bad Ass"), an adaptation of a stage production by Nam Ron
that depicts a Shakespearian power struggle with parallels to the
ousting of Deputy Prime Minister Anwar Ibrahim.

"So far, no one has come to my house to take me away," says director
Ron, 33. That wasn't the case for social iconoclast Hishamuddin Rais,
director of the 1998 road movie From Jemapoh to Manchester, who wound
up serving two years in jail.

AT THE SHARP EDGE
Another film-maker who knows all about working at the sharp edge is
Osman Ali. The soft-spoken Ali, considered the most talented
independent, was barely out of film school when he began work on an
educational video for a gay, anti-Aids organization in the capital.

He found his cast through tryouts at Aids clinics and managed to shoot
Bukak Api--"to light a fire," street slang for a sexual encounter--in
just 12 days in 1998. Local police tried to interfere, saying the film
encouraged prostitution; neighbourhood gangs had to be won over; and
the film could only have its world premiere inside the protected
ground of Kuala Lumpur's Australian High Commission. "What a pity it
can't be shown here," Ali says. "Video is a such great tool for
exposing real life."

Still, there are signs the establishment is coming to appreciate that
the core of 20 directors may be the ones to spur an industry revival.
TV-7, a major Kuala Lumpur station, funded and broadcast a season of
original 45-minute dramas by top independents, which was produced by
Ali. And while the censorship board shows no signs of loosening up,
another arm of government, the film-development board Finas is
offering individual grants to several in the "underground."

As one Finas official, Hamzah Hussein, 76, points out: "If people want
to see our true faces, these kids can show them."

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 06, 2003

PROVING HE DESERVES THE JOB
By S. Jayasankaran

In its first meeting in 1999, the Supreme Council of the United Malays
National Organization, the highest policymaking body of Malaysia's
ruling party, was offered some pointed reflections on life's little
ironies by the party's president, Mahathir Mohamad. "Actually, some of
you should not be here," Mahathir told the gathering, according to
several officials who were present. "Even the person seated next to
me."

The prime minister was referring to his newly appointed deputy,
Abdullah Ahmad Badawi, who had been sacked from the cabinet after he
supported an unsuccessful bid to topple Mahathir in 1987.

For Abdullah, 63, it's been a circuitous climb to power. That may
actually help: Malaysia's majority (60%) Malay-Muslim population,
which is Umno's core constituency, places great stock in the concept
of takdir--God-ordained destiny.

Still, the politician isn't about to depend on fate to keep him there.
Abdullah was unopposed in his 2000 elevation to Umno deputy president
largely because Mahathir willed it. He has rarely articulated views
that set him apart from Mahathir. Now he will have to prove his
legitimacy, and he's taking no chances.

Over the year, the deputy premier has appointed key aides to run
Malaysia's national news agency and the country's biggest private
television station. Umno officials say that the putative premier will
buttress his political position and some have even flagged his likely
moves.

First, they assert, will be a significant remoulding of Umno's 183
divisions throughout Malaysia. To keep power in the party, Abdullah
will need to maintain the loyalty of the divisions and the 2,300-or-so
Umno delegates who decide the face of Malaysia's Umno-led government
every three years.

Appointments to division committees have been delayed until after
Mahathir leaves, allowing Abdullah to use the opportunity to bolster
his position. The premier, as party president, will have the final say
over any division's list of office bearers and can replace foes and
reward loyalists.

Round two will come in the run-up to the general election, expected in
the first quarter of next year. Although all states prepare their own
candidate lists, the party president has veto power over those picked
and those dropped. New faces, say Umno officials, will owe their
allegiance to Abdullah, thus helping the party president obtain a
compliant council.

Still, it will have to be a balancing act of sorts as the premier
cannot afford to alienate too many Umno "warlords," says one of
Abdullah's supporters. "You run the risk of a backlash," he concedes.
"But we have been thinking this through for a long time."

Even so, the immediate scrutiny will focus on his first cabinet
reshuffle, when he will have to appoint his deputy and fill the
finance portfolio vacated by Mahathir. Most analysts expect a
no-surprises cabinet with Defence Minister Najib Razak as deputy
premier and Abdullah himself taking on the finance portfolio.

Another significant political concern for Abdullah will be the fallout
over the sacking and jailing of former Deputy Premier Anwar Ibrahim,
which divided Malay support for Umno. There may be little hope that
Abdullah, a long-time political rival of Anwar, will bring closure to
the affair, even, as some suggest, by allowing Anwar to go abroad for
medical treatment. Says an official close to Abdullah: "The Anwar
issue has been addressed by the courts. There is nothing left to
consider." But another Umno official suggests that when Abdullah is
"politically confident enough" he could move to rehabilitate Anwar.

Abdullah supporters are hopeful that his Islamic credentials, the
selection of the right Umno candidates in general elections and zero
tolerance for corruption in the new administration will appease the
Malays. "Also, don't forget much of the Malay anger was against
Mahathir then," says a member of Umno's Supreme Council. "With him
gone, much of the anger will dissipate." Either way, Abdullah has a
tough job on his hands.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 06, 2003

PROVING HE DESERVES THE JOB
By S. Jayasankaran

In its first meeting in 1999, the Supreme Council of the United Malays
National Organization, the highest policymaking body of Malaysia's
ruling party, was offered some pointed reflections on life's little
ironies by the party's president, Mahathir Mohamad. "Actually, some of
you should not be here," Mahathir told the gathering, according to
several officials who were present. "Even the person seated next to
me."

The prime minister was referring to his newly appointed deputy,
Abdullah Ahmad Badawi, who had been sacked from the cabinet after he
supported an unsuccessful bid to topple Mahathir in 1987.

For Abdullah, 63, it's been a circuitous climb to power. That may
actually help: Malaysia's majority (60%) Malay-Muslim population,
which is Umno's core constituency, places great stock in the concept
of takdir--God-ordained destiny.

Still, the politician isn't about to depend on fate to keep him there.
Abdullah was unopposed in his 2000 elevation to Umno deputy president
largely because Mahathir willed it. He has rarely articulated views
that set him apart from Mahathir. Now he will have to prove his
legitimacy, and he's taking no chances.

Over the year, the deputy premier has appointed key aides to run
Malaysia's national news agency and the country's biggest private
television station. Umno officials say that the putative premier will
buttress his political position and some have even flagged his likely
moves.

First, they assert, will be a significant remoulding of Umno's 183
divisions throughout Malaysia. To keep power in the party, Abdullah
will need to maintain the loyalty of the divisions and the 2,300-or-so
Umno delegates who decide the face of Malaysia's Umno-led government
every three years.

Appointments to division committees have been delayed until after
Mahathir leaves, allowing Abdullah to use the opportunity to bolster
his position. The premier, as party president, will have the final say
over any division's list of office bearers and can replace foes and
reward loyalists.

Round two will come in the run-up to the general election, expected in
the first quarter of next year. Although all states prepare their own
candidate lists, the party president has veto power over those picked
and those dropped. New faces, say Umno officials, will owe their
allegiance to Abdullah, thus helping the party president obtain a
compliant council.

Still, it will have to be a balancing act of sorts as the premier
cannot afford to alienate too many Umno "warlords," says one of
Abdullah's supporters. "You run the risk of a backlash," he concedes.
"But we have been thinking this through for a long time."

Even so, the immediate scrutiny will focus on his first cabinet
reshuffle, when he will have to appoint his deputy and fill the
finance portfolio vacated by Mahathir. Most analysts expect a
no-surprises cabinet with Defence Minister Najib Razak as deputy
premier and Abdullah himself taking on the finance portfolio.

Another significant political concern for Abdullah will be the fallout
over the sacking and jailing of former Deputy Premier Anwar Ibrahim,
which divided Malay support for Umno. There may be little hope that
Abdullah, a long-time political rival of Anwar, will bring closure to
the affair, even, as some suggest, by allowing Anwar to go abroad for
medical treatment. Says an official close to Abdullah: "The Anwar
issue has been addressed by the courts. There is nothing left to
consider." But another Umno official suggests that when Abdullah is
"politically confident enough" he could move to rehabilitate Anwar.

Abdullah supporters are hopeful that his Islamic credentials, the
selection of the right Umno candidates in general elections and zero
tolerance for corruption in the new administration will appease the
Malays. "Also, don't forget much of the Malay anger was against
Mahathir then," says a member of Umno's Supreme Council. "With him
gone, much of the anger will dissipate." Either way, Abdullah has a
tough job on his hands.
===========================

ABDULLAH'S CAREER PATH

1939 Born to a prominent family in northwest Penang state, his father
a founding member of the United Malays National Organization, the
party that negotiated Malaya's independence from the British

1964 Obtains degree in Islamic studies from University Malaya. Begins
career in government as an assistant secretary in the Public Service
Department

1965 Joins Umno

1969-71 Principal secretary to the National Operations Council, which
effectively ran Malaysia during emergency rule under Abdul Razak
Hussein, who later became premier

1974 Resigns as deputy secretary-general of the Ministry of Culture,
Youth and Sports to enter national politics

1978 Elected as a lawmaker for Kepala Batas, Penang in the general
elections. Makes parliamentary secretary in the now-defunct Federal
Territory Ministry, handling the newly created territory of Kuala
Lumpur

1979 Made deputy minister of Federal Territory

1981 Elected to the Umno Supreme Council, the first member from Penang
to be voted onto the council in 20 years. Appointed a minister in
Premier Mahathir Mohamad's first cabinet

1984 Minister of education. Umno elects him as one of three party
vice-presidents

1986 Minister of defence

1987 Sacked from cabinet after supporting Tengku Razaleigh Hamzah's
unsuccessful challenge of Mahathir for Umno's presidency. Retains his
vice-presidency

1987-91 Continues to serve as MP for Kepala Batas, Penang, but is out
of government

1991 Returns to government as minister of foreign affairs

1993 Loses Umno vice-presidency amid wave of support for candidates on
the Anwar Ibrahim ticket. As consolation, Mahathir appoints him to the
Umno Supreme Council

1996 Re-elected Umno vice-president. Only Defence Minister Najib Razak
gets more votes

1998 Deputy Premier Anwar Ibrahim is sacked for alleged "moral
misconduct." Abdullah has nothing to do with the decision, but backs
Mahathir and takes a step closer to the position of deputy premier

1999 Deputy prime minister and minister of home affairs

2000 Returned unopposed as Umno deputy president

2002 Chosen by Mahathir to succeed him and become Malaysia's fifth
prime minister

2003 Handover is set for the afternoon of October 31

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[Yap Yok Foo]

From The Australian
November 01, 2003

Mahathir sighs off into history
By Kimina Lyall, in Kuala Lumpur

Malaysian Prime Minister Mahathir Mohamad lost the seat of power
yesterday but gained his country's highest title - Tun - after
fulfilling his pledge to quietly and peacefully hand over power to
Abdullah Badawi.

In a 30-minute ceremony in the throne room of the National Palace,
Malaysia's King Tuanku Syed Sirajuddin Syed Putra Jamalullail formally
witnessed Abdullah Ahmad Badawi's oath of office.

Dr Mahathir, 77, went not with a "bang" as he had jokingly promised
earlier in the week, but with a sigh. He was left to watch from a
front-row seat, the first time in 22 years he has been on the
sidelines of a major display of Malaysian political power. When Mr
Abdullah, 64, was announced Malaysia's sixth prime minister, the "old
man" of politics gave a little gulp and a sigh but seemed otherwise
unmoved.

Minutes later, he was back in the centre again to receive his
country's rarely bestowed highest title.

The two men had earlier prayed together at the grand mosque that forms
part of the Putrajaya government office complex Dr Mahathir built on
his way to stamping his mark with buildings and public works
throughout the country.

Then, Mr Abdullah, who has been deputy since 1999 after the sacking of
Anwar Ibrahim, stood quietly behind Dr Mahathir.

But an hour later, the man known in Malaysia as "Pak Lah" - an
affectionate diminutive for "Mr Abdullah" - finally emerged from Dr
Mahathir's shadow, finally standing front and centre of Malaysian
politics as he took his oath, dry-eyed, and signed himself into
office.

After the ceremony, he exited the room with the king and queen, while
Dr Mahathir departed with his cabinet members, the 13 chief ministers
of Malaysia's states, and his family.

Although Dr Mahathir demanded Malaysians make no statues or lasting
monuments to his generation-long rule, newspapers printed dozens of
pages of glowing tributes yesterday. But world leaders were more
muted. Asked for a farewell message for Dr Mahathir, John Howard
declined.

"I don't have any comments to make except to re-emphasise the fact
that the links between Australia and Malaysia are very long, very deep
... almost 200,000 Malaysians were educated in Australian
universities," the Prime Minister said.

"Those links will be more productive and more enduring than the
contribution made by heads of government, be they Malaysian or
Australian," he said, referring obliquely to the long history of
tension between the top posts of the two countries during Dr
Mahathir's rule.

A US embassy spokesperson in Kuala Lumpur also said there was no
farewell message on offer from the White House.

After the palace ceremony, attended only by the men's families and
Malaysia's official media, the two friends travelled to the grand
prime ministerial office at Putrajaya, where they held a private
handover ceremony before Dr Mahathir punched out his work card to
formally mark his last moment in the job.

He had introduced the clock-in system in his first month of office, in
1981, but his aides yesterday would not say how many hours he had
logged over the years.

He is due in parliament at 9am on Monday as a backbencher, but his
record of attending parliamentary sessions is not good and he is
expected to retire from his seat before the general election due
within a year. His successor, on the other hand, will by then be
firmly settled in the prime minister's office.

Mr Abdullah has vowed to stamp out corruption but has so far been
silent on human rights. Activists yesterday expressed hope their new
Prime Minister would immediately move to increase the independence of
the judiciary as a first step to social reform.

http://www.theaustralian.news.com.au/
http://www.canberratimes.com.au



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[Yap Yok Foo]

From Newsweek Magazine
Issue 3 November 2003

‘The Threat is Real’
Abdullah’s biggest challenge is to defeat the Islamist opposition
party PAS. His ruling-party machinery should help
By Joe Cochrane
NEWSWEEK

Nov. 3 issue — On paper, Abdullah Badawi has a dream job. Malaysia’s
next prime minister will inherit a prosperous, moderate Muslim country
with a vibrant multiracial, multireligious society. But his
predecessor has also left to Abdullah the problem of a growing
fundamentalist movement that threatens to alter Malaysia’s political
balance. “It’s the core political issue,” says one senior Western
diplomat. “The threat is real.”

THE PROSPECT OF the country’s leading opposition party, Parti
Islam se-Malaysia (PAS), ever seizing national power seems remote. The
ruling Barisan Nasional coalition, led by Abdullah’s United Malays
National Organization (UMNO), has run the country since independence
in 1957—and, with the support of minority Indian and Chinese parties,
controls a two-thirds majority of Parliament. But in 1999, during the
last national elections, PAS took control of a second state assembly,
and anecdotal evidence suggests that support for PAS has grown in the
Malay heartland in the north of the country. “Abdullah will have to
check the influence of PAS because he will be affected politically if
they make gains,” says Syed Hussein Alatas, an expert on Malaysian
Islam.

Ruling-party politicians are privately terrified that PAS
could make further gains in both parliamentary and state elections
expected early next year. Indeed, one of outgoing Prime Minister
Mahathir Mohamad’s chief tasks after retirement will be to campaign up
north, especially in the swing state of Kedah, where he was born. PAS
cannot win an outright majority in the next national parliamentary
election, but if the Islamists win enough seats to break the ruling
coalition’s two-thirds majority, Abdullah could face a leadership
challenge as early as next June’s UMNO conference. “The results will
determine if Abdullah can consolidate his power after seven months in
office, or is a weak, temporary leader,” says another senior Kuala
Lumpur-based diplomat. “It’s more an election for UMNO to lose rather
than PAS to win.”

Abdullah supporters profess not to be worried, insisting that
the opposition rhetoric only drives more Malaysians into their camp.
“How can you accept a party that says women cannot sing in public?”
says Tourism and Culture Minister Abdul Kadir. Although PAS supports
economic modernization, it’s taken a hard line on social policy. Party
leaders demand an Islamic state with Sharia, and they want to ban the
sale of alcohol, as well as nightclubs and movie theaters, nationwide.
(They’ve enforced the alcohol ban in the two states they control,
Terengganu and Kelantan, but have been blocked from implementing
Sharia by the federal government, which said it violates the federal
Constitution.) Ever since 9/11 the government has sought to underscore
the more extreme elements in the PAS platform—a campaign well suited
to Abdullah, a noted Islamic scholar.

PAS leaders, on the other hand, frame their challenge to the
ruling party as a drive for clean government and transparency, themes
that play well among poor, rural Malay Muslims. And their appeal is
bolstered by the lack of any other credible opposition. “UMNO has
maintained its grip on power by constraining democracy and enacting
laws to keep themselves in power,” says opposition leader Hadi Awang.
PAS has tempered its social message by saying women are entitled to
equal rights, and that any constitutional amendment to mandate Sharia
would not apply to Malaysia’s Chinese and Indian minorities. “This is
the wish of the people,” Awang says.

Ultimately Abdullah will have to use his grass-roots
popularity and the UMNO political machine to regain the trust of rural
Malays, many of whom have never cashed in on Malaysia’s economic
development. In addition, Abdullah must be more vigorous about
tackling government corruption, and showing more accountability, than
the powerful Mahathir did, analysts say. But party operatives will
continue to play the Islamist card as well. “The government is trying
to frame [the next] election as Sharia versus secular,” says a
diplomatic source. “Do you want to live under the Taliban, or do you
want to live in a prosperous, multicultural, moderate Islamic state?”

Malaysia has thus far avoided the bitter religious strife and
terrorist attacks that have plagued its sister country Indonesia.
There is no militant movement in the country, and a majority of
citizens are eager to keep it that way. “There are still these fears
about what will happen if PAS is put into power,” says political
analyst Chandra Muzaffar. That fact should help Abdullah, and is
likely to keep his party in power for years to come.

--------------------------------------------------------------------------------
With Lorien Holland in Kuala Lampur

http://www.time.com
http://www.msnbc.com/news/



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[Dave Baker]

From Newsweek Magazine
Issue 3 November 2003
(They’ve enforced the alcohol ban in the two states they control,
Terengganu and Kelantan,

Newsweek should be fairer about this. I was in Trengganu a short while ago,
and never had trouble getting a beer in all the places I frequented.

Dave

[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 13, 2003

LETTERS

DEFENDING MAHATHIR

At the recent Organization of the Islamic Conference summit in Kuala
Lumpur, Mahathir Mohamad only spoke the facts about the Jewish people.
[One Angry Man, Oct. 30.] But look at the repercussions. If what
Mahathir claimed isn't true, why harp on about it? Dismiss it as
disinformation.

But no. The Simon Wiesenthal Centre is reported to have called on
foreign companies to boycott investments in Malaysia. This is exactly
what Mahathir was talking about. What is to be gained from that call?
That Malaysians' standard of living will come down? That we will lose
jobs? That we will learn a lesson so we will be very careful in the
future? The essence of this is nothing but an inane, out-of-date
mentality. It is crass belligerence.

A man who dares to speak his mind has nothing to gain except the
satisfaction that he spoke the truth. He steps down knowing he hid
nothing, and that he gave his best.

JACOB ZACHARIAH

Klang

In your report on Mahathir's speech, you overlooked the fact that the
now retired prime minister stressed Muslim countries' overall need to
modernize and study science and technology, instead of focusing only
on religious education. This was a courageous and different message to
send out in the face of the growing stranglehold that conservative
Muslim clerics seem to have on the thinking and political control of
Muslim nations.

PROMODH MALHOTRA

Washington

The point that Mahathir tried to make was not that people should
despise Jews. Nor was he trying to rally Muslims against them. It was
to bring to Muslims' attention the hard work of the Jewish people,
which has earned them a noteworthy place in the world. They excel in
all fields. They should be emulated by everybody, including Muslims.

M. SAEED CHAUDHARY

San Jose, California

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 13, 2003

TRAVELLERS' TALES
By Nury Vittachi

DOWNED TOOLS: Criminals in Patna, India, took a week's holiday from
lawbreaking. They went straight for seven days to mark Chhath, an
important holy day. The crime rate in Bihar, a state known for its
lawlessness, dropped dramatically last month. Police, who are normally
stretched to breaking point, were delighted.

Senior officers credit the criminals' decision to three factors.
First, there were so many traditional activities that villains'
families kept them busy. "There is enormous work for every citizen,
right from cleaning the roads to managing the show at the ghats
[shrines]," officer O.N. Bhaskar told The Times of India.

Then there was the general "feel good" atmosphere of the sun god
festival, said another officer, Arshad Zaman. "Everyone wants to do
something good to win the blessings of the god. The consciousness
about good work forces the criminal elements to shun crime during the
festival," he said.

Thirdly, rumours swept the gangs that the sun god would punish any
robber who didn't take a vacation from villainy by giving him white
skin. Some have been hit by leucoderma--a disease that gives people
pale patches.

Police said that because of the lull in criminal activities, for a
week Bihar becomes a great place to live in. "Though women wear costly
ornaments during Chhath, they never become victims of snatchings," an
officer boasted.


--------------------------------------------------------------------------------
Sign with Chinese name on top with the following below
GOOD APPETITE OVERFEEDING

TOO MUCH: Reader David Hill found this interestingly named restaurant
in Hou Jie town in Dongguan, China. There may be more positive ways to
express the concept of generous portions, but at least you know you
won't get nouvelle cuisine.


--------------------------------------------------------------------------------

DOGGONE: A guard dog in China ate the cash it was supposed to be
guarding. The one-year-old dog was left in front of a pile of
banknotes worth the equivalent of $360 in Honghu, Hubei province. Sun
Xiaoshan, a mason, had earned the cash by helping another villager
build a house. But when he and his wife came home, they discovered
that the dog had consumed almost all the money, the Beijing Morning
Post reported. Sun, furious, killed the dog and cut it open. He and
his wife were able to piece together only about 14 notes. My heart
bleeds--for the dog.


--------------------------------------------------------------------------------

BEST FOOT FORWARD: A man whose house was searched by police contained
440 nonmatching shoes, the Daily Yomiuri reported. He was arrested on
suspicion of theft, since a nearby hospital had been reporting for
years that shoes had been going missing. The man may have difficulty
explaining his collection--all the shoes were for the left foot only,
and all were women's shoes.


--------------------------------------------------------------------------------

SMALL BUT POWERFUL: An army of bugs in Japan brought a train to a
halt. The single-carriage train was chugging up a slope on a mountain
line in Hyogo prefecture when it encountered a huge swarm of
millipedes that had taken over a 400-metre stretch of the track,
according to The Age newspaper. Despite the fact that they were
tiny--the largest millipede was only six centimetres long--there were
so many of them that the train was halted. There's a moral here, if
only there had been a Zen master nearby to pontificate on it.

BHINDI-FINGERED: Eating soybeans and okra may make men effeminate, a
study in Malaysia warns. Research at University Malaya Medical Centre
was carried out on a few "normal" men, the Berita Harian newspaper
reported. It revealed that eating soybeans and okra (commonly called
ladies' fingers or bhindi in Asia) caused an increase in estrogen, a
primary female hormone. "Normal" men have a small amount of the
hormone but larger amounts would cause them to exhibit more feminine
characteristics, Dr. Mustafa Ali Mohammed reportedly told the press.
Debates about sexual mores in Malaysia never fail to amaze
Asia-watchers.


--------------------------------------------------------------------------------
Name of Cemetery
"Guest to be Input"

JOIN US: Reader Claas Feye took this photo at an ancient graveyard in
Northern Sulawesi, Indonesia. "The English sign reads as if guests
visiting this place might end up becoming buried here too," he said.


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[Pan]

Post by Yap Yok Foo
From The Far Eastern Economics Review
Issue cover-dated November 13, 2003
TRAVELLERS' TALES
By Nury Vittachi

[snip]

Post by Yap Yok Foo
DOGGONE: A guard dog in China ate the cash it was supposed to be
guarding. The one-year-old dog was left in front of a pile of
banknotes worth the equivalent of $360 in Honghu, Hubei province. Sun
Xiaoshan, a mason, had earned the cash by helping another villager
build a house. But when he and his wife came home, they discovered
that the dog had consumed almost all the money, the Beijing Morning
Post reported.

[snip]

LOL!!!!!!!!!!!!!!!

Michael

If you would like to send a private email to me, please take out the TRASH, so to speak. Please do not email me something which you also posted.

[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 13, 2003

TRAVELLERS' TALES
By Nury Vittachi

Life and Death Issues

Live people who have stopped breathing are causing a stink, but they
are less troublesome than dead people who are still walking around

IT CAN'T BE EASY being a coroner in India. How can one officially
certify who is dead and who is alive in a place where people won't
abide by the normal requirements of being in one condition or the
other?

The whole issue has been particularly difficult recently, thanks to an
officially live person who appears to be stone-dead, and an officially
dead person who appears to be in perfect health.

The live dead person is Avtar Singh, a resident of Ropar in Haryana.
He was bitten by a snake, he got sick, his heart stopped beating and
he stopped breathing.

But the family examined the body and concluded that Avtar was not dead
but--like Monty Python's parrot--only resting. India being India, vast
numbers of people in the local community accepted this, rejoiced at
the good news and gathered to watch the stiffening corpse get up and
get on with life.

When the "resting" man failed to rise from his sick bed after some
hours, help was summoned. First to arrive were witchdoctors, who swept
him with brooms dipped in medicine and chanted mantras over him. The
snake that bit him was taken to his bedside and ordered to suck the
poison back out of him (it appeared reluctant to comply). Then a man
with divine powers performed rituals over him, the Tribune of
Chandigarh reported.

Avtar did not budge during any of those ceremonies, and, I suspect, is
probably still spending his days being astonishingly inactive (rather
like members of the Beijing Politburo, Britain's House of Lords, and
so on).

The dead live person is Lal Bihari, whom we have written about in this
column before. Bihari of Uttar Pradesh was declared dead in 1976 by
unscrupulous relatives who wanted his money and property. Bihari has
spent years trying to convince officials that he is alive.

He recently received an IG Nobel Prize--a joke award given out by a
group at Harvard University--for his achievements, I heard from reader
Sunil Prasad. Bihari, who has changed his name to Lal Bihari Deceased,
founded the Association of Dead People in 1999 to draw attention to
the large numbers of officially dead people walking around in India.

The ironies of life in that country cannot be better illustrated than
by the recent tale of an Indian movie star whose fans threw him into
the air--and then failed to catch him. Dhanush, who only uses one
name, was mobbed when he arrived in Chennai, formerly known as Madras.
Screaming fans tossed him up, but he landed badly and was rushed to
hospital. Had he died, fans would surely have refused to accept the
fact and we would have had another Avtar Singh.

Incidentally, I read last week in the Malaysian press that women there
have also a great liking for Indian film idols, although they have not
killed or hurt any. An official in the Perak state Religious
Department warned women not to marry people from the Subcontinent.
"Many local women, especially Malay women, are easily attracted to and
end up marrying men from Pakistan, India and Bangladesh because they
apparently look like Bollywood stars," state Islamic Affairs and
Education Committee chairman Abdul Malek Hanafiah told the Berita
Harian newspaper.

Malek urged Malaysia's womenfolk to follow the fine example set by
Japanese women, who would not marry such foreigners, preferring to
stick to their own kind. These men only wanted work permits, he said.
After their contracts were completed, these elusive husbands
disappeared back to India. It was proving difficult to track them
down.

Perhaps he's looking in the wrong place in India? Some may be alive
and well, enjoying fame and the good life on the lists of the recently
deceased.


--------------------------------------------------------------------------------
Sign with the following
"We make Hole in Ears with gun"

GUN LAW: Reader P. Yesuthasen saw this sign in a shop window in
Musoorie, north India. The English version is not altogether inviting,
perhaps.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 20, 2003

Hidden Weakness

While the overall economy is on the mend, the weak electronics sector
reflects structural problems
By Leslie Lopez

Signs abound that the Malaysian economy is on a firmer footing.
Commodity prices are up, tourism arrivals are rising and the recent
stockmarket rally has pushed up equity prices to their highest levels
in three years. The smooth handover of power by Prime Minister
Mahathir Mohamad to his successor, Abdullah Ahmad Badawi, on October
31 has also boosted optimism.

There's just one bugbear: Malaysia's recent export numbers. For the
three months to September 30, exports plunged 20% on a seasonally
adjusted annualized rate over the previous three-month period ending
on June 30, according to JPMorgan Chase Bank in Singapore. It was the
worst performance in two years, much of it a result of Malaysia's
weakening electronics sector. On a three-month seasonally adjusted
rate, Malaysia's electronics sector contracted by 39% at the end of
September after falling 14.5% in the second quarter of this year.

The numbers confirm one disturbing fact: The relocation of electronics
companies, which produce personal computers, cellphones and routers,
from Malaysia to more cost-competitive production centres,
particularly China, is starting to take its toll. While the global and
regional economic rebound will ensure sustained growth in the medium
term, relocations, such as those taking place in the electronics
sector, could hurt the country's export recovery and present some
downside risks for the economy, which the government says should
expand by 4% this year.

The export data also reveals deeper problems. For one things,
Malaysia's weak performance in the electronics sector is in stark
contrast to some very encouraging data emerging from other electronic
export centres such as South Korea, Taiwan and Singapore.

Some economists fret that the troubles brewing in the electronics
sector expose a structural flaw in the Malaysian economy, which has
long been reliant on foreign direct investment and exports to spur
growth. They note that while the country has spent vast sums of money
investing in physical infrastructure, it has lagged in terms of
harnessing the nation's human capital through higher standards of
education and health.

To be sure, Malaysia has been successful in providing basic education
and health to its population. Consider these numbers: Enrolment at the
lower secondary schools has risen from 52% in 1970 to more than 85%
currently, while in the upper secondary level enrolment numbers have
jumped to more than 73% from 20% in 1970. But education standards
haven't kept pace; some economists argue that the government should
allow for the proliferation of private schools, which would provide
direct competition to public schools and offer Malaysians a choice.

Senior officials in Prime Minister Abdullah's new administration
concur that reform in the education and health sectors will be
crucial. But these reforms will take time.

In the meantime, Abdullah's administration is likely to focus on rural
development and promote primary industries to help push exports.
Agriculture and mining account for about 15% of employment in
Malaysia, and some economists such as Rajeev Malik of JPMorgan Chase
in Singapore believe that by focusing on these sectors the government
could boost its political support among the rural groups. Enhancing
rural incomes would also help generate more domestic demand and spur
economic growth.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 20, 2003

History Lesson

Look to the global chain reaction of the early 1990s for some lessons
about Asia's economic future
By Tom Holland

In an attempt to shake off recession, the developed world's central
banks slash interest rates while governments ramp up deficit spending.
Economic growth picks up in response, but recovery is slow and few new
jobs are created. The extra liquidity is a shot in the arm for
stockmarkets, however, which head higher in a long-awaited rally. To
enhance their returns, institutional investors turn to Asia as a
leveraged play on the global recovery. Regional markets soar as the
funds flow in and Asian economies enter an investment-fuelled boom
period.

If that sounds like summary of the last 12 months, think again. It's a
description of the global economy 10 years ago, in 1993. That was a
great year for investors in Asian stockmarkets. The Bangkok
stockmarket added 90%, Kuala Lumpur 100% and Hong Kong's Hang Seng a
mighty 120%. In an echo of those times, Asia's star markets so far
this year are Jakarta and Bangkok, up 46% and 86% respectively.

But while 1993 was good, 1994 wasn't nearly so pretty. Just one month
into the new year, Alan Greenspan took away the punchbowl, and the
party came crashing to a halt. Early in February the United States
Federal Reserve raised its key short-term interest rate to 3.25% from
its 30-year low at 3%. It was the first of seven successive hikes,
which were to double the Fed-funds rate to 6% within a year.

In Asia, 1993's stars crashed to earth. Bangkok fell 20%, Kuala Lumpur
24% and Hong Kong 31%. Economic growth held up for a couple more
years, but in the search for double-digit returns foreign funds were
directed towards ever more speculative investments. The whole house of
cards collapsed in the Asian Crisis of 1997.

History doesn't always repeat itself. But there are enough red flags
flying in the current environment to justify a close look at whether
2004 could turn out to be a re-run of 1994 for Asian economies and
markets.

The Fed holds the key. Conventional wisdom dictates that the Fed is
still more worried about possible deflation than rising prices. Most
observers believe it will keep its benchmark short-term interest rate
on hold at its 45-year low of 1% until after next November's
presidential election, or at least until next August.

But the global tightening cycle has already begun. Early in November
both the Reserve Bank of Australia and the Bank of England hiked their
key rates. And after the U.S. turned in an astonishing 7.2% growth
rate in GDP in the third quarter, fears are mounting that U.S. rates
may head higher sooner than observers had expected.

True, consumer prices remain subdued. Commodity prices, however, are
up strongly, with copper prices up by a third over the last 12 months:
a classic advanced indicator of emerging price pressure. Meanwhile,
there are signs that the corporate sector in the U.S. is beginning to
invest again and that new jobs are being created, suggesting the
economic recovery is more broad-based than previously thought.

RECOVERIES CAN HURT
That's important, because with recovery entrenched, U.S. monetary
policymakers may find inflationary pressure is not the only reason to
raise interest rates.

Neither Britain nor Australia faces big price rises any time soon, but
both the Reserve Bank of Australia and the Bank of England cited the
need to rein in consumer-credit growth as grounds for a rate rise. If
household debt is a concern in Britain and Australia, then it must be
a potential worry in the U.S., too, where average debt also exceeds
100% of income. With a broad-based economic recovery in place in the
U.S., it will become increasingly likely that the Fed considers
raising rates to make credit less attractive in order to stave off
future instability.

Most economists still dismiss the chance of an early Fed-rate rise,
but the futures market-as good a guide as any to Fed moves-does not.
Short-term interest futures are pricing in a 25 base-point rise by
about April 2004, sooner than the majority of economists expect.

If the Fed does move early, a hike will not come as quite the shock it
was in 1994. In recent years, policymakers have attempted to signal
their intentions in advance. Even so, the Fed has found it remarkably
difficult, if not impossible, accurately to manage market
expectations. And so it is a risk well-worth considering now that a
hike in U.S. rates early next year, or even a switch in the Fed's
bias, could trigger a sharp sell-off in Asian stockmarkets.

http://www.feer.com/



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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 20, 2003

INTELLIGENCE

Education Enigma in Singapore

For a country that has signed as many free-trade agreements as
Singapore, a quirky non-tariff trade barrier in educational services
could smudge the republic's image. Singaporeans who want to study
overseas to become teachers cannot find out before they embark on
their foreign degree whether or not it will be accepted in Singapore.
That turns studying abroad into a huge gamble. The Ministry of
Education concedes that it doesn't publish a list of recognized
universities and argues it's up to each employer to decide whether a
particular degree is acceptable. The practice differs significantly in
other disciplines such as medicine. If a Singaporean wants to attend a
medical school abroad, for example, the Singapore Medical Council
publishes a list--posted on the Ministry of Health's Web site--that
tells them which foreign degrees are acceptable. For Singapore, which
wants to become an educational-services hub and compete for
international students, it's a strange message to send to foreign
degree providers. A tendency to hire Singaporeans with similar
backgrounds and attitudes also enforces the kind of "group-think"
prevalent at many Singaporean schools--where creative thinking
typically gets sidelined in favour of rote learning and the pressure
to obtain strong exam results.

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[Yap Yok Foo]

From The Far Eastern Economics Review
Issue cover-dated November 20, 2003

MUSLIMS AND JEWS

Mahathir Mohamad's speech at the Organization of the Islamic
Conference was flawed [One Angry Man, Oct. 30]. The failure to
differentiate between Jews and Zionists displays a shallow
understanding of the sociopolitical aspect of Islam. Throughout Muslim
history, Muslims have never been anti-Jew. In fact, Muslims and Jews
have coexisted in all countries ruled by Muslims. It was the Zionists
who usurped Palestine and who have become the declared enemy of
Muslims. Not the Jews. Mahathir's speech may have ended up doing
nothing except sow suspicion among Muslims towards Jews and vice
versa.

HISHAMUDDIN YAHAYA
Kuala Lumpur

I read with interest your article on Mahathir's comments. The
politically correct and financially astute line taken by
government-dominated newspapers in Malaysia essentially is that
Mahathir is correct and that the Jews deserve such opprobrium. Never
mind the fact that most Malaysians have never met a Jew, been to
Israel (they are forbidden to travel there) or have bothered to read
up on Judaism. I should know, as my Malaysian Hokkien-Chinese fiancee
never met one before she met me. (And let me add that I have enough
trouble dominating my fiancee, let alone the Kuala Lumpur Stock
Exchange.)

PETER COHEN
Garden City, New York

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[sabeng]

bullshit comment from FEER.

what do they know about the
conflict between muslims and Jews. It did not start in 1912.
It has started earlier, during the birth of Ismael from Hajar
and worsen by the Prophethood of Prophet Mohammad
who is an arab, not a Jew like previous prophet such as Moses,
Jesus, etc. Since than the Jews are waiting for the messiah
and he is expected to arrive once all the Jews gather
in the promised land which is nowadays called Israel.

Post by Yap Yok Foo
From The Far Eastern Economics Review
Issue cover-dated November 20, 2003
MUSLIMS AND JEWS
Mahathir Mohamad's speech at the Organization of the Islamic
Conference was flawed [One Angry Man, Oct. 30]. The failure to
differentiate between Jews and Zionists displays a shallow
understanding of the sociopolitical aspect of Islam. Throughout Muslim
history, Muslims have never been anti-Jew. In fact, Muslims and Jews
have coexisted in all countries ruled by Muslims. It was the Zionists
who usurped Palestine and who have become the declared enemy of
Muslims. Not the Jews. Mahathir's speech may have ended up doing
nothing except sow suspicion among Muslims towards Jews and vice
versa.

[Pan]

Post by sabeng
bullshit comment from FEER.
what do they know about the
conflict between muslims and Jews. It did not start in 1912.
It has started earlier, during the birth of Ismael from Hajar

I suppose that's the Qur'an's take on this? In the Torah, we are
taught that Ishmael was blessed by God as the Father of a great
Nation: The Edomites, and subsequently, the Arabs. Isaac and Ishmael
precede Muhammad by many centuries, and thus, cannot be differentiated
as Jews vs. Muslims. Do you not accept Isaac as a Muslim?

Post by sabeng
and worsen by the Prophethood of Prophet Mohammad
who is an arab, not a Jew like previous prophet such as Moses,
Jesus, etc. Since than the Jews are waiting for the messiah
and he is expected to arrive once all the Jews gather
in the promised land which is nowadays called Israel.

It's rather the other way around: That after the Messiah comes, God
will ingather all the exiles into the Land of Israel. If you want to
read such-like prophecies, read the Books of Prophets (Neviim) in the
Bible. Without checking, I think Isaiah will be a particularly useful
source for you.

Michael

If you would like to send a private email to me, please take out the TRASH, so to speak. Please do not email me something which you also posted.