In this issue:

Conference Aims at Chinese Currency Revaluation

China Limits Renminbi Purchases

Manila Won't Be Another Madrid, Arroyo Tells Interpol

South Korea Faces Terror Threat; Impeachment Fracas Continues

Koreans Rally in Support of Roh; Who Controls the Government?

Mahathir Blames Bush Policies for Madrid Bombings

New Kazakhstan Eurasian Railroad Planned

China's Growth Triggers Soaring Electricity Demands

Thailand: Mass Demonstrations vs. Energy Privatization

From Volume 3, Issue Number 12 of Electronic Intelligence Weekly, Published Mar. 23, 2004
Asia News Digest

Conference Aims at Chinese Currency Revaluation

C. Fred Bergsten's Institute for International Economics (IIE) held a conference March 16 on "Economic Relations Between the U.S., Japan, and East Asia," which focussed on demanding a revaluation of the Chinese renminbi. Bergsten is a leading player in the circles of Felix Rohatyn's synarchist bankers, committed to saving the bankrupt international financial system by any and all means necessary, including, prominently, the looting of China and Asia generally. He and his fellow IIE members presented various justifications for the U.S. demand that China revalue its currency.

Also speaking at the conference were Haruhiko Kuroda, former Japanese Vice Minister of Finance; Wu Jinglian, a senior fellow at the Development Research Institute Center of the State Council, and a leading architect of China's "opening up."

Kuroda's main theme backed the IIE group: That the U.S. recovery is robust, and will remain the great driver of the world economy for the forseeable future, although the rapid growth of China's trade is important. He also concurred with the IIE crowd in saying that the huge trade imbalances are primarily due to the overvalued renminbi. He warned that the undervaluation is creating an asset price bubble within China which is threatening to burst into severe inflation. He also said that Malaysia and Thailand will need to revalue as well.

Professor Wu, to the contrary, stated the official Chinese position in his speech, namely that there would be no early revaluation.

In discussion, Kuroda insisted that a dollar collapse was impossible—that the housing bubble in China was just as bad as that in the United States.! Wu, on the other hand, said emphatically that a dollar collapse was his greatest worry.

China Limits Renminbi Purchases

In a move designed to curb speculation on a possible revaluation of the renminbi against the dollar, the State Administration of Foreign Exchange (SAFE) in Beijing, has imposed restrictions on the amount of U.S. dollars non-residents in China can change into renminbi. This amount has been cut by half. As of March 15, non-mainland Chinese are limited to buying $10,000 worth of renminbi a day, down from $20,000 previously, and up to a maximum $50,000 a month, SAFE announced. Approval from the SAFE will be needed on a case-by-case basis for any amount in excess of new ceilings. The new rules applied to all designated foreign exchange banks.

Manila Won't Be Another Madrid, Arroyo Tells Interpol

The Philippines is another country facing extreme tension over last week's bombings in Madrid and the election results in Spain. Not only is President Gloria Macapagal-Arroyo a staunch supporter of the neo-con war in Iraq, with Philippine troops on the ground there, but she is facing a close and contentious election on May 10. Already there is a movement by former military leaders close to coup-master Fidel Ramos, called "No-El," demanding a cancellation of the elections and the immediate imposition of a junta to run the country (although Ramos has carefully distanced himself from his lifelong subordinates, who are running this blatant subversion).

Interpol Secretary General Ronald Noble adopted the "al-Qaeda did it" line vis-à-vis Madrid, and hinted that al-Qaeda might be training its sights on other staunch U.S. supporters, such as the Philippines. While Manila insists things are under control, the Manila Times reports an American intelligence source according to whom, "It's not a question of if, but when and where"—claiming that Hambali, the Indonesian terrorist undergoing secret interrogation by the U.S., has revealed that the next likely targets are the Israeli embassy in Manila, and a Manila hotel. Since no one else, not even the Indonesians, is allowed to see Hambali, there is no way to confirm such U.S. claims.

South Korea Faces Terror Threat; Impeachment Fracas Continues

Acting Korean President Goh Kun put Korea on "high alert" March 18, warning of attacks on public facilities following the Madrid bombings, as the saga of the impeachment of President Roh Moo-hyun continues. "Those countries which have their troops stationed in Iraq have become main targets for terrorist attacks," Goh said in a statement. Goh convened an emergency cabinet terror task-force meeting, including the Defense Ministry, the National Intelligence Service (KCIA), and the police. South Korea is due in April to deploy 3,000 troops to Iraq.

Beginning March 24, the new Korean bullet train to be inaugurated April 1, and all rail, airport, and other public locations nationwide, will undergo armed anti-terror drills, Goh announced, in a series of actions half-militarizing the nation. The Ministry of Transportation said it would carry out anti-terror drills at subway stations in Seoul, at the giant new Incheon International Airport, and at the country's 83 major public transportation sites. Anti-terrorism drills will be held in major cities to prepare people for terrorist attacks.

Koreans Rally in Support of Roh; Who Controls the Government?

Candlelight rallies in Seoul, South Korea charging that President Roh's impeachment was a coup, have fallen off from 50,000 nightly to 1,500 as of March 18. Roh is riding high in the polls, with a 70% approval rating for the April 15 elections. However, as Lyndon LaRouche said recently, nothing is predictable in the Korean situation, given the explosive world environment.

Just who is now in control of South Korea's government is entirely unclear. The question of whether or not the rallies will be suppressed, has become a daily tug-of-war battle within government agencies. Neither the elected Roh progressive cabinet, nor the domestic Korean neo-cons who control large chunks of the career bureaucracies, have control. Neo-con sympathizers in the Seoul police on March 15 threatened to arrest all rally leaders, as the crowds grew, saying political demonstrations after dark are illegal. But Roh's Home Affairs Minister Huh Sung-kwan announced March 16 that the vigils would be classed as "cultural events" to bypass the law, since use of force would injure the thousands of women and children in the crowds.

On March 18, the Supreme Public Prosecutors' Office overruled the government, proclaiming the rallies formally illegal. President Goh's office then said that while it must accept the judicial ruling, the Executive Branch would nonetheless refuse to use force.

Mahathir Blames Bush Policies for Madrid Bombings

In an interview with Agence France Presse on March 18, former Malaysian Prime Minister Dr. Mahathir bin Mohamad accused President George W. Bush of making the world a more dangerous place. He charged that Bush had "a closed mind," refusing to heed warnings that invading Iraq would lead to increased terrorism.

"He wants to do something and he doesn't care about what others say. It's quite obvious that lots of people were against the invasion of Iraq, but he just ignored all this." He told AFP that he had written to Bush before the invasion, seeking to warn him that it would increase terrorism. Asked if the Madrid attacks proved him right, Dr. Mahathir replied, "I think so. That's what I told President Bush. It's the wrong move in the fight against terrorism, to invade Iraq—but what is my voice?

"This thing is escalating. If you believe in confrontation and beating down your enemy, and then he hits back, we are not going to have peace in this world."

New Kazakhstan Eurasian Railroad Planned

A new Kazakhstan Eurasian Railroad will connect to Bangladesh and India, announced Kanat Zhangaskin, vice president of the Kazahkstan National Railway Company, in Hong Kong March 12, the Taipei Times reported. The new railroad, over 3,000 kilometers long, will branch to either Iran or Russia on the western Kazakh border. The Russia route would be the fastest from China to Europe. He said that a parallel project will run from Bangladesh through the Indian subcontinent, and on to Iran. Then, a tunnel through the Turkish Bosporus Straits would connect to Europe.

China's Growth Triggers Soaring Electricity Demands

Over the past two years, China's electricity consumption has increased 25%, an increase equal to the total power consumption in Brazil, according to Cambridge Energy consultant Scott Roberts, as reported in the New York Times on March 14. "They are adding a middle-sized country every two years in terms of energy consumption," Roberts said. China's energy needs are expected to double by 2020, and the Communist Party is rolling out plans for at least 100 new power plants, including nuclear (20 plants), hydropower and coal-fired plants. Today, nearly 70% of China's power comes from coal. Last year, China also accounted for almost one-third of the world's consumption of finished steel, and has built so many new cars, factories, airports, and high-rise buildings, that it has surpassed the U.S. as the world's top steel importer. Its oil imports also rose by one-third last year.

Thailand: Mass Demonstrations vs. Energy Privatization

Half a million trade unionists plan to demonstrate in Thailand against the privatization of the state power company, The Nation reported March 17. Prime Minister Thaksin Shinawatra insists that he will proceed with the partial stock offering for the Electricity Generating Authority of Thailand (EGAT), although it has been stalled once already by protests by EGAT employees and sympathizers, which have been ongoing for over three weeks, as of March 17. The opponents want to force the government to hold a referendum on the issue before privatization is implemented.

Energy Minister Prommin Lertsuridej argued that the privatization will be "implemented cautiously to ensure fair allocation of shares to the public and fair benefits for workers," and said the public can be "assured that floating EGAT will not lead to runaway charges, power outages, and other maladies as feared." But union leaders say the government had yet to explain how its privatization plans would serve the public instead of stock-market players. The results of privatization of power around the world has been one disaster after another, as documented in EIR.

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