Pesek on Asia: The Australian Oasis
Good morning. Here's my take on some of the stories driving the debate in politics, finance and social issues across Asia today:
Australia beats the skeptics -- again.
Australia is the world's Teflon economy. No matter what challenge you throw at it, nothing sticks. It's steered around every global crisis of the last 20 years like none other. And fresh news from the Reserve Bank of Australia suggests its nonstick reputation will remain unblemished this year too. By raising its economic growth and inflation forecasts, the central bank is effectively saying the days of interest-rate cuts are over. Just so long as officials in Canberra and Sydney don't get cocky. China's economy is slowing, and Australia has made a huge bet on Chinese demand for its resources. For now, though, Down Under is an oasis of calm in a world of financial turmoil.
Tokyo wants to spin sex-slave controversy.
Japan has an unlikely strategy to address its World War II sex-slave problem: Washington spin. Tokyo is watching anxiously as Asian-American groups urge Capitol Hill to pressure Tokyo to go further to apologize for its forced brothels. Now, the Hill newspaper reports that Japan has paid Washington-based lobby firms Hogan Lovells and Hecht Spencer & Associates $523,000 and $195,000, respectively, to keep tabs on the issue among U.S. lawmakers. The money might be better spending on training Japanese politicians to stop putting their feet in their mouths.
Water's troubling scarcity .
China shows how changing weather will bump up against rising living standards in the years ahead. Severe droughts are imperiling wheat crops in the world's largest producer and creating shortages of drinking water both for China's 1.3 billion people and their livestock. It's a reminder that water is the next oil. Here's a timely plea from Asian Development Bank President Takehiko Nakao for China, India and the rest of developing Asia to pool efforts to increase water security. This runs counter to the every-nation-for-itself mindset that pervades the region. Nakao is absolutely right that "we need to think differently about water and its uses for food and energy production -- and take action." The sooner, the better.
Rogoff's yen warning for Asia.
Harvard's Kenneth Rogoff doesn't shy away from controversy, as his roles in recent debates over the merits of austerity policies and predictions of a Chinese crash attest. Now, the former International Monetary Fund staffer warns that Prime Minister Shinzo Abe's yen devaluation is hitting emerging-market nations. "Japan's Abenomics is ... important for some countries, as the sharp depreciation in the value of the yen puts pressure on Korea in particular and on Japan's Asian competitors in general," he writes in a Project Syndicate op-ed. In the long run, a Japanese resurgence would be beneficial to Asia. Yet the short run could be a rough one for Japan's neighbors.
Asia's Olympic hopes.
On a lighter note, here's a great Wall Street Journal roundup of the region's best chances for gold, silver and bronze -- or crushing defeat -- in Sochi, Russia over the next two weeks. The medals tables may matter more than ever given heightened geopolitical tensions in North Asia. Expect any marquee event in which Chinese or South Koreans compete with Japanese -- especially figure and speed skating -- to generate even more passionate flag waving than usual. Perhaps the odd ruckus in the stands, too.
(William Pesek is a Bloomberg View columnist. Follow him on Twitter at @williampesek.)
This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.
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