from Asia Unbound

Samsung Scandal, Chinese Coal, Islamic State in Asia, and More

jay-lee-samsung

January 20, 2017

jay-lee-samsung
Blog Post
Blog posts represent the views of CFR fellows and staff and not those of CFR, which takes no institutional positions.

More on:

China

Japan

Asia

South Korea

Energy and Environment

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

1. Sprawling influence-peddling scandal spreads to Samsung leadership. Last week, the de facto leader of Samsung, Lee Jae-yong, faced a twenty-two-hour interrogation regarding allegations that Samsung paid, and promised to pay, a total of 43 billion won (roughly $36.4 million) in bribes to South Korean President Park Geun-hye and her close confidante, Choi Soon-sil, in exchange for the government-controlled National Pension Service’s support of a contentious 2015 merger of two Samsung affiliates. This Monday, South Korean prosecutors sought a warrant for Lee’s arrest. Although the warrant was summarily denied by judges, legal experts say that the court decision may propel prosecutors to strengthen their case. Analysts say the $8 billion merger between Samsung C&T and Cheil Industries in July 2015 was critical to the third-generation transfer of power in Samsung by consolidating Lee’s control over Samsung Electronics. The bribery crisis continues to dominate the news cycle in South Korea, where Samsung and other chaebols, or family-run conglomerates, are deeply embedded in Korean politics. The country’s largest chaebols are no strangers to legal battles and convictions, but these episodes often end with pardons due to the close collusion between the South Korean state and the powerful chaebol. Although there is little past evidence to suggest the immunity from true punishment hurts chaebol performance, a recent poll showed that a majority of South Koreans disapprove of third-generation heirs. This growing censure of the South Korean elite may lead to problems in the future for Lee and other chaebol heirs, regardless of the bribery scandal’s final outcome.

2. China cancels new coal. As President Trump promises to resuscitate America’s waning coal industry, China is taking a very different tack with its own. This week, the Chinese National Energy Administration announced plans to halt the construction of over a hundred coal-fired power plants in fifteen regions across the country, according to calculations by Greenpeace. This amounts to cutting around 120 GW of potential capacity, over a third of all the coal capacity in the United States and double that of Germany. Though the cancellations will cost around $30 billion, mainly affecting developers whose finances are already tied up in ongoing projects, the move is an important step in achieving China’s broad national energy goals put forth in the 13th Five-Year Plan (2016–2020). The country currently has around 900 GW of coal-fired capacity, and aims to peak at no more than 1,100 GW by 2020—still far more capacity than is actually utilized. On other fronts, in recent weeks China has also fined hundreds of coal-fired power plants for breaching environmental regulations and announced plans to spend $360 billion on renewable power through 2020.

3. Potential for Islamic State presence increases in the Asia Pacific. At a security conference in New Delhi this week, Admiral Harry Harris, commander of U.S. Pacific Command, counseled Asian officials to closely monitor the risks posed by violence from the self-proclaimed Islamic State (IS) in the Asia-Pacific region. Already, IS has inspired attacks in the Philippines, Malaysia, and Bangladesh. Of particular concern now is the threat fighters returning from Syria and Iraq present as IS’s territory shrinks. According to the Soufan Group, an estimated 600 individuals have traveled to Iraq and Syria from Southeast Asian nations including Malaysia and Indonesia, and IS has actively recruited from the region. Additionally, sixty Indians are also believed to have joined IS. While much concern centers on South and Southeast Asia, China has also seen more than one hundred Uighurs depart for IS-controlled areas. Southeast Asian governments have been actively cooperating on intelligence and prevention, but risks remain surrounding everything from militant recruitment in prisons to lone-wolf attacks.

4. China protests over Japanese hotel CEO’s Nanjing Massacre denial. One of Japan’s largest hotel chains, the APA Group, has faced an outpouring of criticism after it was revealed online that the hotel chain is refusing to remove copies of a radically right-wing and historically revisionist book from its hotel rooms despite increasing protest and furor. The book, titled Theoretical Modern History II–The Real History of Japan, was written by its CEO, Toshio Motoya, under a pen name, and denies the veracity of the Nanjing Massacre. The killing of Chinese citizens by Japanese troops in 1937, which later became known as the “Rape of Nanjing,” continues to be one of the biggest points of contention in a China-Japan relationship that is already far from amicable. Beijing claims up to 300,000 people were killed in the massacre, while many right-wing Japanese nationalists have denied the existence of the massacre or expressed doubts of the high body count. Motoya has stated that the killing of 300,000 people was impossible because Nanjing’s population at the time was only 200,000.

5. Bhutan takes a unique approach to social development. Dasho Karma Ura currently serves as the president of the Center of Bhutan Studies and GNH Research. Ura, a renowned economist, historian, and philosopher, has dedicated his life to defining GNH, or gross national happiness, as a development indicator to supplement, or even supplant, traditional metrics such as a gross domestic product. GNH is developed from thirty-three indicators under nine domains. Bhutan’s democratic constitution was ratified in 2008, and guides the nation’s leaders to abide by GNH’s four pillars: good governance, sustainable socioeconomic development, preservation and promotion of culture, and environmental conservation. Bhutan boasts 91.2 percent of its citizens reporting narrow, extensive, or deep happiness, with urbanites and men reporting higher levels than their rural and female counterparts. Ura’s development philosophy has spread far beyond the borders of the remote Himalayan kingdom and forms the basis of the United Nations-sponsored World Happiness Report, in which Denmark currently ranks first. Ura notes that in a moment in history defined by “more guns, bullets, and bombs,” it is “imperative that countries devise indicators that look beyond economics.”

Bonus: Japanese techno-toilets get new buttons. In a historic display of multilateral cooperation, nine manufacturers of advanced Japanese toilets joined forces this week to announce an unprecedented effort to standardize the digital bathroom experience of the future. The high-tech washroom devices, which often come equipped with warmed seats, bidets, sterilized water, and more, have an array of controls that confuse many foreign visitors. Starting soon, the firms have agreed to begin using the same eight pictograms to standardize and streamline the restroom experience. Industry representatives hope that the move will make the devices more accessible for hapless tourists, and help the toilets catch on overseas. Some consumers, it seems, need no convincing: Japanese toilet seats are already a hot buy for plenty of Chinese tourists during holiday shopping season.

More on:

China

Japan

Asia

South Korea

Energy and Environment

Close