China-ASEAN Monitor Weekly
Politics and Security
China joins ASEAN led military exercise
China has sent a missile destroyer to join the fourth military drills for the ASEAN Defence Ministers’ Meeting-Plus (or ADMM-Plus). The maritime security and anti-terrorism exercises is taking place in the waters off Brunei and Singapore through May 12th. Around 18 navy vessels, 17 helicopters, 2 maritime patrol aircrafts and many special operation teams from the ten ASEAN members and eight partners – China, Russia, the US, Japan, South Korea, Australia, New Zealand and India – are participating the exercise.
China won’t allow chaos or war on Korean peninsula: Xi
China will not allow chaos and war to break out on the Korean peninsula, Chinese President Xi Jinping told a group of Asian foreign ministers on 28 April. North Korea’s drive to develop a nuclear weapons capability, in defiance of UN resolutions, has angered China and raised tension in the region. China is North Korea’s sole major ally but it disapproves of its development of nuclear weapons and backed harsh new UN sanctions imposed against North Korea in March.
China-ASEAN Senior officials gather to discuss hot issues
The 22nd China-ASEAN Senior Officials’ Consultation opened in Singapore on 27 April. China’s Vice Foreign Minister Liu Zhenmin co-hosted the 2-day meeting with Chee Wee Kiong, Permanent Secretary for Foreign Affairs of Singapore. China’s foreign ministry said the meeting would discuss the implementation of the Declaration on the Code of Conduct on the South China Sea.
Trade and Investment
China tightens its grip on foreign NGOs
China has passed a controversial law imposing new regulations on foreign NGOs and charities, forcing over 7,000 foreign NGOs operating in China to submit to police supervision and declare their sources of funding. US officials and human rights groups have criticized the law, saying it amounts to a crackdown on civil society. “The new law will have severe consequences for freedom of expression, peaceful assembly, and association, which are already sharply curtailed under existing laws and policies,” Amnesty International said.
Low labor costs in emerging ASEAN eroding China’s competitivenes
Base salaries among emerging ASEAN economies are substantially lower than those in mainland China, which is losing its labour-cost competitiveness to them, according to new research by leading global professional services company Willis Towers Watson. China’s base salaries across all job grades are between 5% and 44% higher than in Indonesia, which is the most expensive labour market among the emerging ASEAN economies covered in the research (the Philippines, Vietnam, Malaysia, Thailand and Indonesia). Furthermore, the report revealed that entry-level white-collar professionals in China receive, on average, an annual base salary of approximately US$21,000, approximately 30% more than their peers in Indonesia, who receive approximately US$16,000.
The Chinese Economy
China lending inflates real estate, stocks and even egg futures
China is pouring money into its economy in a new effort to support growth. Some of it is going into roads and bridges and other big projects that will keep the economy humming. The latest lending deluge has sent money into unlikely places, such as the financial market in Dalian where investors can place bets on the future productivity of the country’s hens. This has caused egg futures to have surged by as much as one-third since March even though the actual market price of eggs has fallen from a year ago. The unusual jump is related to China’s tendency to experience investment bubbles when the government steps up spending and lending, as was seen when the government’s last efforts to bolster growth unexpectedly sent money into real estate and the stock market – markets that had unexplained rises followed by striking drops.