From Volume 4, Issue Number 28 of EIR Online, Published July 12, 2005
Asia News Digest

U.S. Medical Team in Afghanistan Attacked

For the first time since U.S. troops occupied Afghanistan in the winter of 2001, a U.S. medical team was attacked by Afghan rebels. The medical team was attacked in the same region of eastern Afghanistan where a U.S. airstrike had killed 17 civilians. The attack on the medical team did not result in any casualties.

"It is incredible that the enemy would attack our forces while we are providing innocent Afghans with health care," U.S. military spokesman Lt. Col. Jerry O'Hara told reporters.

But things have soured badly for the U.S. in Afghanistan. The June 28 downing of a Chinook helicopter with 16 U.S. service members on board in Afghanistan's Kunar province indicates the enemy attacks have now metamorphosed to a different level. The Chinook incident will undoubtedly make anti-insurgency operations more difficult for the U.S.-led coalition, and could forestall plans to make NATO more involved in security management of Afghanistan.

China Grants Indonesia Soft Loans for Infrastructure

China is granting nearly $1 billion in soft loans for infrastructure projects in Indonesia, Antara reported June 29. An additional $200 million, on top of $700 million earlier granted, was extended during meetings in Beijing on the sidelines of the Asia Europe Meeting (ASEM). Indonesian Finance Minister Jusuf Anwar met with China's Prime Minister Hu Jintao and representatives of the Chinese Exim Bank to "discuss an alternative solution for funding infrastructure projects in Indonesia," according to Jusuf.

While Indonesia is seeking investors for billions of dollars for infrastructure, Western offers come with punishing conditions. "It seems that China is very cooperative," said Jusuf. "China will grow into a big state; thus we have to realize this, and benefit from it."

Projects to be funded include rail lines, coal-fired energy plants, dams, and the Surabya-Madura Bridge.

Unocal Does Most Business in Southeast Asia

While the U.S. China hawks scream about a possible Chinese buyout of the U.S. oil company Unocal, 60% of its business is in Southeast Asia, the New York Times reported June 29. Unocal operations in Thailand, Indonesia, Myanmar, and Vietnam make up half of the company's reserves and 60% of its production. Unocal provides 30% of Thailand's energy from natural gas. There has been no equivalent outcry against China's potential expansion in Southeast Asia from the region itself.

Philippines High Court Stops New VAT Tax

Financial markets in the Philippines were roiled by a Supreme Court decision to stop implementation of an expanded VAT (value-added) tax, the Inquirer reported July 4. The expanded VAT tax, lifting exceptions to the 10% tax (which previously exempted fuel, power, and travel costs), was scheduled to go into effect on July 1, but the Supreme Court issued a temporary restraining order and called for hearings later in the month. While this has undermined President Gloria Macapagal Arroyo's claim to have served the IMF faithfully, there are many who suspect Arroyo actually called on the Supreme Court to stop her own bill, since its implementation at this moment of crisis could well have been the last straw in the population's rage against her.

The "international community," however, was not amused. Fitch immediately threatened to lower the country's credit rating (the Philippines is already rated at between two and four levels below investment grade by the three rating agencies). The stock market fell by 4.2%, while bonds and the peso also fell.

Asian Nations Lack Means To Combat Bird Flu

Countries such as Indonesia, Vietnam, and Thailand have virtually no stocks of the medicine needed to treat the avian influenza (bird flu) virus. Since early 2004, bird flu has ravaged poultry flocks in nine Asian countries, and killed at least 55 people in Vietnam, Thailand, and Cambodia, while the World Health Organization warns that the virus could undergo a genetic change that would make it easier for humans to contract it; thus, this raises the specter of a pandemic, which could infect millions.

According to WHO officials, the biggest obstacle to overcome is the lack of vaccine. Europe has begun ordering sufficient quantities of the Tamiflu, at a cost of $40 per treatment, which is beyond the means of most of the world's population, including those in Asia, where dozens have already die.

Vietnam, which has been the hardest hit by bird flu, has been able to accumulate only enough medicine to treat 12,500 people, thanks to donations from Japan and Europe. Cambodia has been able to stockpile only enough oseltamivir for 800 people, and Thailand has approved funding to purchase up to 100,000 treatments. WHO, therefore, is attempting to accumulate stockpiles in the hope that by aggressively attacking any outbreak, fewer will be infected.

Guns for Teachers: No Way To Solve South Thai Violence

At least 2,000 teachers in three deep southern Thai provinces have requested guns for self-defense, and another 2,700 plan to apply for transfers, after the Education Ministry gave the green light for teachers to leave the provinces, where 24 teachers have been killed since January, the Bangkok Post reported July 5.

Education Permanent Secretary Kasama Varavar reported on July 4 the teachers' request for guns, which came after their colleagues were gunned down by insurgents.

Mekong River Nations Strengthen Regional Development

Prime Ministers of the six countries which share the Mekong River concluded their two-day summit July 5, by issuing the Kunming Declaration, pledging to strengthen their commitment to achieve an integrated, harmonious, and prosperous subregion through stronger partnerships.

The declaration states: "We pledge ourselves to closer and stronger partnerships for common prosperity. We are confident that with our concerted effort, the joint vision we embrace will, over time, come to full fruition."

The Prime Ministers of Cambodia, the People's Republic of China, the Lao People's Democratic Republic, Myanmar, Thailand, and Vietnam said significant progress was achieved over the past 13 years under the Greater Mekong Subregion economic cooperation program, which has been assisted by the Asian Development Bank since its inception in 1992.

Priority infrastructure projects worth around $5.4 billion have either been completed or are being implemented. These include upgrading the East-West Economic Corridor that will eventually extend from the Andaman Sea to the South China Sea.

Heads of State attending the summit included: Cambodian Prime Minister Hun Sen, Chinese Prime Minister Wen Jiabao, Myanmar Prime Minister Gen. Soe Win, Lao PDR Prime Minister Boun Nhang Vorachit, Thai Prime Minister Thaksin Shinawatra, and Vietnam Prime Minister Phan Van Khai.

China, Kazakhstan Reach Pipeline, Railway Agreement

China and Kazakhstan reached an agreement on building a gas pipeline and railway from Western China to the Caspian Sea, the Pakistani news service Jang reported July 5.

Chinese President Hu Jintao went to Kazakhstan on July 3 after his visit to Russia. After he met Kazakh President Nursultan Nazarbayev, Nazarbayev said, "We have signed a feasibility study memorandum to start work on a trans-Kazakhstan narrow-gauge railway to connect Western China and the Caspian Sea." Chinese press confirmed the discussion of the gas pipeline, but not the railway.

Nazarbayev also said, "We have reached mutual understanding on future investment and a feasibility study of a gas pipeline that would run from Kazakhstan to China."

An oil pipeline from the Caspian oilfields in Kazakhstan to China is already under construction, and Nazarbayev pledged that it would be finished on schedule, on Dec. 16.

Hu Jintao's visit to Russia was not productive on the energy front. Russia continues to stall on the Siberian oil pipeline, under discussion for some ten years. Last year, Russia decided to construct a pipeline to its Pacific coast, which would facilitate export of oil to Japan, rather than China.

All rights reserved © 2005 EIRNS