from Asia Unbound

Chinese Carrier in the Strait, Philippine Birth Control, $100 Billion SoftBank Fund, and More

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January 13, 2017

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Rachel Brown, Sherry Cho, Lorand Laskai, Gabriella Meltzer, and Gabriel Walker look at five stories from Asia this week.

1. China’s aircraft carrier sails through Taiwan Strait. Early Wednesday morning, China’s sole aircraft carrier, the Liaoning, sailed into the Taiwan Strait, leading Taipei to scramble F-16 fighter jets and ships to “surveil and control” the movement of the Liaoning and its accompanying five warships. The carrier ship group was returning to Qingdao after training exercises in the South China Sea, and did not technically veer into Taiwanese waters during its ten-hour journey through the Taiwan Strait. This new military posturing by China comes at a delicate time in cross-strait relations. On her way to a diplomatic visit in Central America, Taiwanese President Tsai Ing-wen recently met with prominent U.S. politicians such as Senator Ted Cruz in a visit that, unsurprisingly, met with Chinese censure. Tsai’s Central America visit was itself intended to shore up support from Taiwan’s dwindling number of diplomatic allies after São Tomé and Príncipe’s recent diplomatic recognition of China, which left Taiwan with just twenty-one diplomatic allies. Since last May, when Tsai refused to acknowledge the 1992 Consensus in her inauguration speech, relations between China and Taiwan have deteriorated. China views the consensus, a tacit agreement that there is only one China, with each side having its own interpretation, as crucial to ensuring stable cross-strait ties. An unprecedented phone call between Tsai and U.S. President-Elect Donald Trump last month injected further uncertainty into China-Taiwan relations. And while Beijing may continue to claim that its recent maneuvers are normal training exercises, China’s most recent round of military exercises in the disputed South China Sea continues to sustain tensions with its Pacific neighbors in a theater already full of fraught enmities and uneasy allies.

2. Philippines to expand birth control access. Philippine President Rodrigo Duterte authorized his government to increase contraception availability for approximately 6 million women currently lacking access. The government’s first priority will be assisting 2 million women living in poverty over the next year by partnering with civil society organizations. Birth control is already available in the Philippines, but it is often prohibitively expensive, making it accessible only to middle- and high-income individuals. Family planning poses a conundrum for the Philippines, which is 81 percent Catholic and the only Asian country to experience a rise in the rate of teen pregnancies over the past twenty years. In 2008, 54 percent of pregnancies were unintended, most of which occurred among poor women. Abortion is illegal in all circumstances. While the Philippines passed the Responsible Parenthood and Reproductive Health Act in 2012, which would have provided nationwide birth control access, it has been stalled by a temporary restraining order from the Supreme Court. The order stopped issuance of implanted birth control devices, and budgets for birth control provision have been cut independent of the court’s ruling. Duterte’s latest move to promote contraception access will likely anger the Catholic Church as well.

3. $100 billion SoftBank Vision Fund takes shape. Last October, Japanese telecommunications multinational Softbank made headlines by announcing a plan to create a $100 billion fund to invest in new technologies—the largest such fund in history. Now, with a number of investors and leaders in place, the fund is beginning to take shape. So far, investments have come from Saudi Arabia’s sovereign wealth fund ($45 billion) and SoftBank itself ($25 billion), along with Qualcomm, Apple, and others. The sovereign wealth fund of Abu Dhabi may soon join as well. In addition to SoftBank Chief Executive Masayoshi Son, many of the fund’s leaders are Wall Street veterans, including the fund’s head Rajeev Misra who formerly worked at Deutsche Bank. The Vision Fund is expected to invest in a range of new technologies including robotics, artificial intelligence, and the “Internet of Things,” and will likely make investments in larger companies as well as start-ups. With the fund, Son will endeavor to build off previous technology investment successes including deals with Alibaba and Yahoo! Japan. Some have speculated, however, that the fund may also serve as a way for SoftBank to cozy up to the incoming Trump administration by investing large sums in the United States.

4. China offers to remove compulsory IUDs. For more than thirty years, the Chinese government has required many women be fitted with an intrauterine device (IUD) in order to comply with the country’s controversial one-child policy. But now with the country’s birth rate declining, the government has replaced the one-child policy with a “two-child” policy and is offering women that were forced to receive an IUD a free surgery to remove the device. But many women are not accepting that gesture graciously: after years of being subjected to forced family planning, the government’s about-face without an apology has left many women indignant. Since the inception of the one-child policy, over 300 million Chinese women were fitted with IUDs and more than 100 million underwent tubal ligations. The enforcement of the one-child policy, which Nobel Prize-winning author Mo Yan portrays in Frog, a novel about the most intense years of forced sterilization and abortion in a fictional village, has had a brutal history. Over three decades later, its victims’ scars have not yet healed.

5. Australia and East Timor tear up maritime agreement. On Monday, Australia and East Timor, a nation of just over a million citizens that became a sovereign state in 2002, agreed to terminate a decade-old treaty in favor of negotiating a new maritime boundary. Under the 2006 treaty, the two countries agreed to suspend boundary talks for fifty years and split the tax revenues of the Greater Sunrise oil and gas field equally—a tract closer to East Timor’s coast with up to $40 billion in hydrocarbons. Now, according to a joint statement, the governments have committed to negotiate a new maritime boundary under the auspices of The Hague’s Permanent Court of Arbitration. But this time around, East Timor will likely demand a boundary line equidistant between the two countries and, as a result, a greater share of the oil and gas revenues from the region. For East Timor, the revenues are practically a matter of life and death: without new sources of income, some predict that the fledgling nation could be bankrupt within a decade.

Bonus: Benefits of China’s “anti-smog” teas debunked. Chinese citizens in Beijing are finally finding relief after a period of dangerous smog that forced a red alert for twenty-three cities throughout northern China and shut down schools, construction sites, and factories. The smog extended 3.9 million square miles, which is roughly the area of the continental United States. In an effort to protect themselves from pollution levels ten times greater than those advised by World Health Organization guidelines, many Chinese have turned to “anti-smog” teas, sold widely in medicine shops, pharmacies, and online for about $2.90 per pack. Listings claim that the tea’s combination of traditional Chinese herbs, including dried chrysanthemum and honeysuckle, can boost overall health and remove smog-induced impurities from the body. However, a recent state report on CCTV featuring Liu Quanqing, president of the Beijing Hospital of Traditional Chinese Medicine, attacked these claims as false, saying that the “digestive and respiratory systems are separate” and that many of these teas contain ingredients that in fact can cause “health problems if taken for a long time.” China’s Centers for Disease Control instead recommends face masks and air purifiers to combat smog.

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