Pesek on Asia: China Trumps Germany
Good morning. Here's my take on some of the stories driving the debate in politics, finance and social issues across Asia today:
Where China trumps Germany.
Is Xi Jinping being more cooperative on the global economy than Angela Merkel? Germans would surely shudder at the idea that China's Communist Party, with its mercantilist ways and blatant flouting of trade norms, is shaming them on the rebalancing front. But this Quartz item makes a good, and thought-provoking, argument that China is having far more success in reducing its addiction to exports than many economists realize -- or might still be willing to accept. Since 2006, "China has done even more," Quartz argues, "reducing exports as a share of its economy by 12 percentage points, a feat made more impressive by the fact that its economy has continued growing like gangbusters." And Germany? Its reliance on exports has only increased, surging to 51 percent of GDP in 2012. Surprise, surprise.
America ups South Korea defenses.
The political wild card that is the Kim Dynasty is the 800-pound gorilla in the room whenever North Asian officials confer about regional security. Overnight, the Obama administration served up its own 800-strong response to Kim Jong Un's recent antics, including the bizarre execution of powerful uncle Jang Song Thaek. Dispatching that number of additional U.S. troops with upgraded equipment to South Korea sends a timely message to Pyongyang: We have Seoul's back. But it also lets Beijing know that if it doesn't do its part to rein Kim in, the price will be more U.S. boots on the ground in North Asia. Your move, President Xi.
You might want to rethink that Thai holiday.
The fix for another Bangkok lockdown is in. The People's Democratic Reform Committee (whose name screams contradiction in terms) has scheduled "Operation Bangkok Shutdown" to begin Jan. 13 and go on indefinitely. Considering the election isn't until Feb. 2, this closure of one of Asia's most popular cities could last even longer than one in 2008, a chaotic event that continues to undermine tourism flows. Another prolonged shutdown would have executives around the globe reconsidering production operations in Southeast Asia's second-biggest economy. As political forces go, there's little about this one that's democratic or reformist.
China is down on Japan Inc.
Anyone who thinks Shinzo Abe's Dec. 26 Yasukuni Shrine visit won't dent Japan's economy should consider this new Nikkei poll. Fully 60 percent of Chinese executives say they simply can't do business with Japanese companies, while the same percentage of South Koreans plan to keep business with Japan Inc. to a minimum. That belies Prime Minister Abe's contention that his provocative jaunt to the site that houses the souls of 14 Class A war criminals from World War II won't damage his revival program. Good luck with that talking point, Abe-san. Your most important customers see things differently.
Sake brewing a growth industry for Japan.
And in better news for Japan Inc., there's growing global demand for sake. As Japanese culture spreads its tentacles with sushi, manga comics, anime and, of course, Hello Kitty, its rice wine brewers are becoming the toast of foodies near and far. This Bloomberg News piece looks at how Russian consumers can't get enough of the stuff and how it's pumping some much-needed life into rural regions like western Japan. Cheers!
(William Pesek is a Bloomberg View columnist. Follow him on Twitter.)