Ashlyn Anderson, Lincoln Davidson, Lauren Dickey, William Piekos, and Ariella Rotenberg look at the top stories in Asia today.
1. Chinese government steps in to stop stock market slide. Authorities, who have spent the first half of the year crowing about high growth rates, launched a number of emergency measures aimed at slowing the market tumble. The People’s Bank of China announced this week that it would be helping the country’s margin trading service provider stabilize the market by buying more shares of small and medium enterprises. State-owned enterprises were ordered to not sell any of their stock, and corporate shareholders with stakes of more than 5 percent were banned from selling for six months. More than half the firms listed on the markets stopped trading, and another 38 percent hit the daily limit on price change, leaving just 11 percent of stocks in China tradable. Still, the rout of Chinese markets continued. Traders have responded with gallows humor, while some analysts have speculated that the precipitous drop in the markets might lead to social unrest. It’s unclear how far the markets will drop, but most analysts are predicting little systemic impact and a relatively quick return to growth.
2. Malaysian prime minister faces corruption allegations. Prime Minister Najib Razak is facing calls to resign after a Wall Street Journal report traced nearly $700 million of deposits into his personal bank account from the 1Malaysia Development Bhd. (1MDB), the country’s strategic development fund. Investigators have frozen bank accounts associated with the case and have raided the offices of 1MDB, while both 1MDB and Najib have denied wrongdoing. The fund, which is owned by Malaysia’s Finance Ministry, has financed itself by issuing more than $11 billion in debt. Though the fractured political opposition poses little threat to the prime minister, criticism from within his own governing party, and from political heavyweight and former Prime Minister Mahathir Mohamad, could threaten Najib’s continued leadership.
3. Pakistan hosts peace talks between Afghan Taliban and the government in Kabul. Pakistan hosted a meeting between the two sides in an attempt to facilitate an end to the thirteen-year war. The Taliban in Afghanistan has been trying to re-establish its hard-line Islamist regime since it was toppled by the U.S. military intervention of 2001. While there was informal contact between the two parties prior to these talks, this was the first official meeting between Afghan Taliban leadership and the Afghan President Ashraf Ghani. The Afghan Taliban political leader, Akhtar Mohammad Mansour, authorized the delegation to Islamabad despite opposition within his own party. Observers from the United States and China attended the talks, which took place on Tuesday and Wednesday; officials from both countries voiced their support for the process and hoped for a positive outcome to peace negotiations. At the conclusion of the meeting, the two sides agreed to meet again after the month of Ramadan.
4. North Korean sailors defect after ship goes astray. Three North Korean sailors have defected after their ship strayed into waters near Ulleungdo, an island off the northeast coast of South Korea. Their ship was sinking when the South Korean coast guard came to the rescue of the five sailors on board. While the North Korean government demanded that all five sailors be returned, only two will be repatriated via Panmunjom, the village contact point between the two nations. Meanwhile, with over seventy North Korean officials executed since Kim Jong-un came to power in 2011, reports of mid-ranking officials defecting to the south have increased, though such claims have been denied by officials in the South Korean Ministry of Unification.
5. China releases an initial draft of a long-expected cybersecurity law. The law (Chinese text and unofficial English translation) formally encodes a number of measures that have been implemented or announced as in the works over the last few months. To safeguard “cyberspace sovereignty”—Beijing’s term for the authority it claims over all Internet infrastructure, networks, and digital content within its borders—the law empowers officials to define standards for technical equipment and conduct security reviews of equipment procured by Internet service providers. Both measures may be used to keep foreign tech companies out of China and grow the domestic industry, a chief concern for Beijing as a result of both the Snowden revelations and China’s indigenous innovation policy. The law also gives provincial governments the authority to limit Internet access in the event of a “serious security breach.” That raises the prospect of a repeat of a 2009 telecommunications blackout in Xinjiang province, when authorities shut down the Internet for nine months in an attempt to suppress anti-government riots.
BONUS: Shanghai’s firefly fans disappointed by cancelled park opening. Chinese citizens enamored with fireflies for their romantic and nostalgic appeal hoped to interact with the bugs in a firefly-themed park opening in Shanghai. Unfortunately, a Shanghai news portal announced that the sold-out opening would be canceled due to safety concerns. It’s a win for conservationists, who have been working to oppose the parks throughout China because of dwindling wild firefly populations, which are often imported into the parks.