In this issue:

Pakistan Chief of Staff hits U.S., Musharraf

Pakistan Agrees To Send Troops to Iraq

Trans-Korean Industrial Project Breaks Ground

Samsung Institute: IMF 'Korea Model' in 'Freefall'

Putin Offers To Host North Korea Talks

Malaysian Anti-Terror Center Proceeds Without U.S.

Malaysian Plans To Begin Trade Based on Gold Dinar

Thai Authorities Step Up Pressure on Burmese Dissidents

From Volume 2, Issue Number 27 of Electronic Intelligence Weekly, Published July 8, 2003
Asia News Digest

Pakistan Chief of Staff hits U.S., Musharraf

General Mohammad Aziz Khan, the chairman of the Pakistan Joint Chiefs of Staff Committee, said on July 2 that the U.S. is "the number one enemy of the Muslim world and is conspiring against Muslim nations all around the world." He also attacked President Musharraf, without naming him, by saying that the politics should not be done in "uniform," a clear reference to Musharraf wearing two hats—those of President and Chief of Armed Services (COAS). A powerful section of the Pakistani Army, which Gen. Aziz represents, opposes Musharraf holding on to the COAS position.

Aziz's statement is particularly significant in light of the fact that Gen. Aziz, along with Lt. Gen. Mehmood Ahmed, then commander of 10 Corps, had played a stellar role in the coup against Prime Minister Nawaz Sharif in 1999 that brought Pervez Musharraf to power. Aziz's statement now indicates that the Mullah faction of the Pakistani army is up in arms against Musharraf for helping the United States to go after the pro-Taliban and pro-al-Qaeda terrorists. They are also worried that Musharraf is making a deal with President Bush in sorting out the Kashmir issue favorably for India.

Pakistan Agrees To Send Troops to Iraq

Pakistan President Pervez Musharraf, in Paris, told French President Jacques Chirac on July 3 that Pakistan has agreed in principle to send two Army brigades (this could add up to 10,000 troops) to Iraq, in response to Washington's request. Pakistan is the first nation of the subcontinent that has responded positively to the U.S. request. It is likely that Bangladesh may follow suit soon.

On the other hand, the Indian Foreign Secretary Kanwar Sibal, who is in Washington specifically to discuss the troop deployment issue, has informed the Bush Administration that India has not received requested clarifications on the troop deployment from Washington, and hence the issue cannot be decided now. A certain faction within India, it must be noted, is willing to send troops to Iraq to help the United States.

Trans-Korean Industrial Project Breaks Ground

The joint South-North ground-breaking ceremony for the Kaesong Industrial Complex in North Korea took place June 30 with the participation of some 320 leaders from South and North Korea. The Kaesong project is the "test case," on-the-ground industrial program for which the Seoul-Pyongyang "Kyongui Line" of the Trans-Korean Railway is being hurriedly reconnected. The ground-breaking ceremony, which has been scheduled and postponed half a dozen times in the last year, was another major milestone in Korean normalization. As with the June 14 reconnection of the railways, it is another step indicating that both Koreas have adopted Lyndon LaRouche's policy of "getting the physical economy moving together"—which actions make it increasingly difficult for the utopians to militarily attack North Korea.

The South Korean delegation, which includes Hyundai Asan chairman Chung Mong-hun, travelled to the North via the overland highway across the DMZ. The Kaesong industrial complex includes construction of an industrial park and a city surrounding the park in Kaesong City, 170 km south of Pyongyang and 70 km north of Seoul.

Samsung Institute: IMF 'Korea Model' in 'Freefall'

The Samsung Economic Research Institute (SERI) June 24 warned of a prolonged economic slump in Korea, such as those seen in Latin America, unless there is some "breathtaking momentum for growth." South Korea, billed as the IMF's "success story," after the 1997 Asia crisis, has since then subsisted on foreign hot-money inflows, and a huge new credit-card and mortgage-debt bubble, encouraged by the IMF. Now 15% of credit-card and mortgage-consumer debt is in default, and the hot money is leaving just as it came, thanks to the American Enterprise Institute's neo-con press campaign which has labelled South Korea unsafe for investment due to imminent threat of war.

"Facing a slew of contractions in various sectors, if the South Korean economy fails to find some breathtaking growth momentum, it could free-fall to underdeveloped-nation levels like Latin American economies did, unable to advance to become an advanced nation," SERI reported. The amount of individual debt hit a fresh high of 462.3 trillion won—almost U.S.$400 billion—in March, up from 455.1 trillion won last December, the Bank of Korea reported June 24.

The reference, however, to "some breathtaking growth momentum" is important, as the LaRouche movement in Korea and Japan—including in discussions with the corporate sector—has been actively promoting just such a major jump in active construction of the Trans-Korean Railway and the Eurasian Land-Bridge as the only way out of Asia's economic mess.

Samsung's warning came as the Seoul government announced that GNP growth for 2003 will fall from the original prediction of 5% to under 3%, due in part to SARS but more to a "drastic slowdown in domestic demand," that is, the bankruptcy of the consumers.

Putin Offers To Host North Korea Talks

Russia's President Vladimir Putin June 21 repeated Moscow's pivotal call for a "security guarantee" for North Korea, first announced in April by Defense Minister Sergei Ivanov, and said that Russia is also willing to host talks in Moscow to address the nuclear standoff, reports Radio Korea International (RKI). In a BBC "Breakfast with Frost" interview, ahead of a visit to London, Putin stressed that North Korea must become a member of the international community, adding that by doing so, it will be able to transform its national structure, its society, and the overall situation on the Korean Peninsula, RKI said.

On June 21, Putin also told a Kremlin news conference that "Pyongyang's interests should be taken into account in an attempt to solve the North Korean nuclear crisis peacefully—adding that North Korea should not be driven into a corner." While normally in negotiations, the interests of both parties are expected to be considered, the U.S. neo-cons have made clear that they are making unilateral demands on North Korea, not holding negotiations in which Pyongyang's interests need be taken into account. Putin, in pointing out that this is abnormal, is echoing similar criticisms of the neo-cons, coming from the U.S. Institute for Peace and other traditional diplomats in Washington.

Putin "stressed the necessity of guaranteeing Pyongyang its security in order to peacefully overcome the current crisis on the Korean Peninsula," RKI notes. "Putin noted that all six interested parties—the two Koreas, Russia, the United States, China, and Japan—should participate in multilateral talks. Russia says it supports both bilateral and multilateral talks on North Korea's nuclear issue." The Russian Foreign Ministry also said that the North's nuclear dispute must be resolved through dialogue, adding that direct talks between Pyongyang and Washington are most effective at the current stage. This later comment is another slap at the neo-cons, who are deliberately provoking Pyongyang by refusing bilateral talks no matter the context.

Malaysian Anti-Terror Center Proceeds Without U.S.

Malaysian Foreign Minister Syed Hamid Albar officiated at the opening of a new counterterrorism center on July 1, before an audience of more than 100 foreign diplomats and law enforcement representatives. Malaysia had agreed to host the center after President Bush mentioned the idea during last year's APEC forum, but Hamid made clear that the U.S. has no formal involvement, even if its expertise would be welcome. Hamid put it delicately: "It's not a question of excluding the U.S." He also said that opening the counterterrorism center did not mean foreign agencies would be setting up "bases" in Malaysia. He added that the center will be open to all 10 ASEAN members.

For now, Malaysia is providing the staff and paying the bills for the center, but other governments might be invited to help in funding and other future programs. The first event will be a discussion in August on terrorist funding and money-laundering.

Malaysian Plans To Begin Trade Based on Gold Dinar

Trade between Malaysia and Iran based on the gold dinar may begin as early as this year, as a first step in decreasing dependency on the U.S. dollar in international trade, Prime Minister Mahathir Mohamad said July 1, after opening an international convention on the currency. Mahathir proposed more than a year ago that the gold dinar be used for international trade to prevent a repeat of the currency crisis which devastated Asia in 1997-1998. The Malaysian Premier said that local gold prices would determine the exchange rate for the local currency against the dinar. Mahathir acknowledged that Malaysia was more enthusiastic about switching to the gold dinar than most other countries. "We are ready, but many other countries aren't. Maybe they don't quite understand the concept yet, or they find it hard to change existing systems," he said.

Besides Iran, Libya, Morocco, and Bahrain are also said to be interested.

Thai Authorities Step Up Pressure on Burmese Dissidents

Thai Prime Minister Thaksin Shinawatra warned Burmese dissidents in Thailand on June 30 that they face deportation if they continue protest movements on Thai soil against the Myanmar government. He added that he has lost patience with the dissidents. Thaksin spoke after calling on the UN High Commissioner for Refugees to work with Thai authorities to restrict the dissidents' movements to designated areas. The Thai government is disturbed that the dissidents, mostly self-exiled students, are given UNHCR refugee cards, but are otherwise not monitored. Some have turned to selling drugs.

Thai Foreign Minister Surakiart Sathirathai is to meet the UNHCR representative to discuss requiring government approval before distributing refugee cards. Some 1,500 cards have been issued, with no record of names or addresses. Surakiart said 17,000 foreign nationals, including Burmese, are in Thailand with no refugee cards, along with another 120,000 displaced people.

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