2018ASIA-PACIFIC

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Vietnam urges further promotion of border trade exchange with China On Nov. 18 Vietnam’s vice minister on Friday called for further promotion for boarder trade with China as the border area is considered as a gate of the country’s northern key economic zone, according to Xinhua news. Vietnam’s Deputy Minister of Industry and Trade(MIT) Nguyen Cam Tu told a conference on boarder trade in 2006-2011 that the trading activities in the border areas with China have not been promoted in recent years. According to a report by head of MIT’s mountainous trade department, Tran Bao Giam, the land borderline with China runs through seven Vietnamese provinces and two Chinese provinces. During the period from 2006 to 2011, the Vietnamese government and relevant agencies have issued appropriate policies and regulations in accordance with the border trade development, including providing favorable conditions for goods exports that contributed to promoting economic development in both countries, Giam said in the report. With the ASEAN-China free trade area, the project “two corridors, one economic belt,” and the expansion of the “ cooperation in the sub-Mekong region,” the Vietnam-China border gates help boost trade exchange not only between the two countries, but also between Vietnam and other countries, said an MIT report. According to MIT, trade turnover during 2006-2010 in Vietnam’s seven northern border provinces with China, namely Quang Ninh, Lang Son, Cao Bang, Ha Giang, Lao Cai, Dien Bien and Lai Chau, annually increased 16.6 percent, with a total value of more than 23.85 billion U.S. dollars. Trade activities in the northern border areas should be further promoted and put under mid- and long-term strategies, with close control over programs to develop border trade with China, particularly expansion of the exports, said the deputy minister. MIT suggested building a mechanism for re-investment from the state budget aimed at developing technical infrastructure in the border areas and encouraging more investors to invest in building goods distribution and transit centers and working as contacts for trade exchange of goods, Tu added. Sino-ASEAN trade likely to reach$400b Xinhua reports that on Nov. 21 China’s trade volume with the Association of Southeast Asian Nations(ASEAN) is likely to reach $400 billion this year, Pre- mier Wen Jiabao said. Wen made the remarks during a speech at Universiti Brunei Darussalam upon his arrival in Brunei for an official visit, the first by a Chinese premier since the two nations established diplomatic ties two decades ago. “The biggest breakthrough we made in those years(in economic cooperation with ASEAN nations) was the establishment of the free trade area,” he said. Brunei is a member of the 10-nation regional bloc. “That has led to the rapid development of trade between China and ASEAN, which is likely to reach $400 billion this year. That means the trade volume between China and ASEAN will surpass that between China and Japan.” According to official figures, trade between China and ASEAN reached $295.9 billion in the first 10 months of this year. China has become ASEAN’s top trading partner, while ASEAN replaces Japan as China’s third-largest trading partner. Still, there is huge potential for Beijing to beef up its economic ties with ASEAN as deals with China only account for 11 percent of its overall trade, Wen added. The premier also raised specified proposals to deepen economic ties with Brunei, including cooperation in offshore oil and gas exploration, as well as upstream and downstream energy cooperation. Brunei is the third-largest oil exporter in Southeast Asia and the fourth-largest natural gas exporter in the world. The Foreign Ministry said earlier that energy deals will be signed during the visit, without giving details. Wen arrived in Brunei on Sunday after he spent three busy days on the Indonesian resort island of Bali at the ASEAN and East Asia summits. The premier told the audience at the university that he came to Brunei to celebrate the 20th anniversary of bilateral diplomatic ties. Ties between the two nations have grown in a stable way mainly because the two countries “respect and treat each other with equality”. Located on the northern coast of the island of Borneo in Southeast Asia, Brunei has an area of 5,765 sq km and a population of 406,000. Sultan Hassanal Bolkiah hosted a welcome dinner for Wen on Sunday evening. The two leaders will have an official meeting on Monday before Wen returns to Beijing. Though it has a dispute with China over a small area of the South China Sea, Brunei has maintained a low-profile stance on the issue and stressed it should be settled through mutual consultation. Lu Jianren, an expert on Asia-Pacific studies at the Chinese Academy of Social Sciences, said joint exploration of oil and gas with Brunei is both “a win-win choice and a peaceful way to solve the territorial issue”. He added that through closer trade and economic ties with Brunei, one of the initiators of the Trans-Pacific Partnership, China could show its sincerity and openness toward regional economic integration.  S. Korea’s rare earth imports from China growing South Korea’s dependency on Chinese supplies of rare earth materials seems to have grown, driven by an increase in demand on the back of stable prices in China, customs data showed according to Xinhua report.. Imports from China jumped by 37.1 percent to 324 tons in September compared to the month before, according to a report by the Korea Customs Service. In September, South Korea imported a total of 418 tons of rare earth materials including scandium and yttrium, up 32.8 percent from the previous month, the report showed. About 77 percent of South Korea’s imports of rare earth materials came from China, and 12.6 percent from Japan and 8.6 percent from France, according to the report. The Korea Customs Services explained that imports from China increased greatly as a stable trend was observed in prices of rare earth materials in China. Chinese firms power on with Indonesia plan According to China Daily, Chinese companies are likely to continue to participate in Indonesia’s second 10,000 megawatt (mW) national power development plan, following a record of successful cooperation during the first program, said officials and corporate leaders from both countries. “It is very likely that we will continue to cooperate with Chinese companies on the projects for the second power program,” said Dahlan Iskan, president director of PT Perusahaan Listrik Negara (PLN), the Indonesian state-owned power utility and also the owner of the first power plan’s projects. “Indonesia still has a power shortage of 35,000 megawatts.” Nine out of 10 projects in Indonesia’s first fast-track power program are managed by Chinese consortia or companies, according to Zhang Weidong, executive vice president of the China Export & Credit Insurance Corp(Sinosure). He said as a State policy financial organization, Sinosure has been leading financing negotiations involving many power plants, amounting to $4 billion, and the company plans to expand cooperation with the Indonesian government and local companies. Zhang also said that some Chinese companies are holding talks with Indonesian officials and companies to develop the second power program. “They may invest, build and operate these power plants, becoming a shareholder instead of merely a contractor,” he said. The first large-scale power plant built under the first program with Chinese participation in Indonesia was completed on Oct 12. That plant will greatly ease electricity shortages in the region, said Coordinating Minister of Economy Hatta Rajasa. The Indramayu coal-fired plant in West Java was one of the earliest projects in the 10,000 mW fast-track power construction program created by the Indonesian government to ease local electricity shortages. The project was started in 2007 in Indramayu, West Java. The owner is PLN and the contractor is a consortium composed of China National Machinery Industry Co Ltd (Sinomach), China National Electric Engineering Co Ltd (CNEEC) and an Indonesian local company. Ren Hongbin, chairman of Sinomach, said the company sees Indonesia as a strategic market and plans to expand its business in the country. “We have participated in many local infrastructure projects in Indonesia in recent years,” said Ren. The project is a successful example of the overseas business model of Sinomach and also a turning point in CNEEC’s overseas development, said Zhao Ruolin, president of CNEEC, the company in charge of the completion of the project. “We are not only focusing on particular projects but also the potential of the market here,” said Zhao. “We have given much respect and importance to the local people’s faiths and habits. We built a mosque near the power plant for the local workers to pray conveniently.” Rajasa said the project is “the best energy project in the Indonesian power plant construction history so far”. He said the government plans to ensure every island in Indonesia has sufficient power supply by the end of 2014, which will require an annual increase in capacity of 3,000 mW. The Indonesian 10,000 mW power plant program is a good example of bilateral cooperation. The completion of the first project has shown the competitiveness of China’s equipment manufacturing and engineering technology, said Wang Shengwen, deputy director of China’s Ministry of Commerce. He said that Chinese companies should make full use of the business opportunities created by the ChinaASEAN Free Trade Area and increase investment in Indonesia. “The Chinese government will keep supporting domestic companies to participate in infrastructure construction including roads, bridges, harbors, power plants and the communications sector in Indonesia,” said Wang.“Meanwhile, we hope that the Indonesian government can provide policy support to Chinese companies for more investment.” According to the ministry, bilateral trade has grown by an average of 22.8 percent annually since 2000. In 2010, bilateral trade reached $42.75 billion. More than 1,000 Chinese companies have established factories in Indonesia with a total investment of more than $6 billion.