Category: Economy

In a bid to enhance regional security amid rising tensions in the South China Sea, Japan and Malaysia signed a comprehensive security assistance deal on Saturday. The agreement, celebrated on the sidelines of a Tokyo summit marking 50 years of Japan-ASEAN ties, solidifies the relationship between the two nations.

Under the terms of the deal, Japan will extend a grant of 400 million yen ($2.8 million) to Malaysia, focusing on boosting maritime security capabilities. The aid package includes the provision of essential equipment such as rescue boats and supplies aimed at fortifying Malaysia’s maritime defenses.

Japanese Prime Minister Kishida expressed his satisfaction with the deepening of ties, heralding the elevation of the Japan-Malaysia relationship to a “comprehensive strategic partnership,” according to a statement from Japan’s foreign ministry.

This move follows similar security agreements between Japan and the Philippines and Bangladesh earlier this year. It aligns with Japan’s broader initiative announced in April to provide financial assistance to developing countries to strengthen their defense capabilities.

As tensions escalate in the South China Sea, where ASEAN members, including Malaysia, the Philippines, Vietnam, Indonesia, and Brunei, contest territorial claims with China, Japan’s strategic support aims to counterbalance an increasingly assertive China. The three-day summit in Tokyo seeks to bolster ASEAN’s international standing and facilitate diplomatic relations, particularly in managing ties with major players like China.

The assistance deal, along with Kishida’s planned individual meetings with each ASEAN leader during the ongoing summit, underscores Japan’s commitment to regional stability and collaborative efforts to address shared security concerns among Asian nations.

Prime Minister Narendra Modi inaugurated the Surat Diamond Bourse, now recognized as the world’s largest and most modern center for international diamond and jewelry business. The grand opening followed the inauguration of a state-of-the-art integrated terminal building at Surat airport earlier in the day.

Located in Khajod village near Surat city, the Surat Diamond Bourse is housed in a colossal building, boasting over 67 lakh square feet of floor area—the largest office complex globally. This monumental structure will serve as a global hub for the trading of both rough and polished diamonds, as well as exquisite jewelry.

The inauguration marks a significant stride in India’s position in the international diamond and gemstone trade, solidifying Surat’s status as a key player in the industry. The bourse’s strategic location and cutting-edge facilities are set to attract traders and businesses from around the world.

This development aligns with the government’s vision to boost economic growth and promote India as a global leader in the diamond and jewelry sector. The Surat Diamond Bourse is poised to redefine the landscape of international diamond trading, contributing to the nation’s economic prosperity and global influence.

South Korean President Yoon Suk Yeol embarked on a trip to the Netherlands, focusing on enhancing semiconductor cooperation between the two nations. President Yoon highlighted the critical role of high-tech chips in the global economy, with South Korea contributing approximately 60% of the world’s memory chip supply.

The Netherlands hosts ASML, a key player producing lithography equipment essential for semiconductor manufacturing. Despite geopolitical tensions impacting the semiconductor industry, Yoon emphasized the longstanding collaboration between South Korea and the Netherlands, crucial for maintaining stability in global semiconductor supply chains.

President Yoon acknowledged the strategic importance of the semiconductor industry amid growing global competition for technological dominance. The visit aims to solidify a “chip alliance” between South Korea and the Netherlands involving government, business, and academic sectors.

“As competition between countries and regions intensifies to gain hegemony over emerging technologies, the semiconductor industry is strategically more important than ever before, which makes this visit to the Netherlands especially meaningful,” Yoon said.

During the visit, Yoon plans to tour ASML’s facilities, marking a historic moment in the “Korea-Netherlands semiconductor alliance.” Discussions on chip cooperation take precedence as the president strives to establish a well-organized institutional framework to address global semiconductor supply chain challenges. South Korea’s commitment to boosting semiconductor collaboration extends to major countries, including the Netherlands, the United States, and Japan. The visit underscores the industry’s significance as a strategic asset, shaping the geopolitical landscape in terms of industry, technology, and security.

Philippine lawmakers are deliberating potential amendments to the Constitution to ease restrictions on economic ownership.

“We want to lift the restrictive provisions vis a vis the economy,” House Speaker Martin Romualdez said in an economic briefing.

Congressional leaders from major political parties convened on December 11 to address procedural challenges that have impeded previous attempts to amend the Philippines’ 1987 constitution. The proposed amendments aim to grant lawmakers the authority to regulate economic sectors, providing flexibility for increased foreign investment.

Foreign business chambers have long advocated for the revision of current restrictions, particularly the 60-40 rule, limiting foreign ownership in local enterprises to 40%. The anticipated changes could pave the way for a more open investment environment.

Despite past unsuccessful endeavors to amend the constitution, Speaker Romualdez expressed determination in facilitating the process. However, critics have voiced concerns, suggesting that constitutional amendments might inadvertently lead to the lifting of term limits for elected officials.

As discussions unfold, the focus remains on striking a balance between fostering foreign investment and addressing potential pitfalls associated with constitutional modifications.

Singapore sealed its first-ever agreement with Papua New Guinea on December 8, allowing Singaporean companies to purchase carbon credits from projects in Papua New Guinea to offset a portion of their carbon tax liability. The agreement, signed at the COP28 climate conference, is deemed significant as both nations are part of the Alliance of Small Island States (Aosis).

Minister for Sustainability and the Environment, Grace Fu, signed the agreement alongside her counterpart, Papua New Guinea’s Minister for Environment, Conservation, and Climate Change, Simo Kilepa. The accord mandates project developers to cancel 2% of authorized carbon credits for global emission mitigation and allocate 5% of the proceeds to climate adaptation efforts in Papua New Guinea.

Ms. Fu highlighted the dual focus on both mitigation and adaptation actions to align with the goals of the Paris Agreement. The carbon crediting projects are expected to bring sustainable development benefits to local communities, promoting job creation, enhanced energy security, and reduced pollution.

Companies in Singapore can offset up to 5% of taxable emissions by purchasing credits if the projects meet Singapore’s eligibility criteria for real and permanent emissions reductions. Singapore has previously concluded similar implementation agreements with Bhutan, Paraguay, Ghana, and Vietnam, creating a diversified portfolio of credits.

Ms Fu added that the agreement will set up a bilateral framework to allow for the transfer of carbon credits between the two countries, with measures in place to prevent double counting.

“This will create the avenue for worthwhile climate mitigation projects to be financed,” she added.

“High-integrity carbon markets can contribute to much-needed climate action globally, and it is imperative that the environmental integrity of carbon credits under the implementation agreement meets internationally recognised standards,” said Ms Fu.

Singapore has inked a historic free trade agreement (FTA) with four South American countries—Argentina, Brazil, Paraguay, and Uruguay—a group known by the Spanish acronym Mercosur. This marks Singapore’s first trade pact with these nations and Mercosur’s first such deal with a South-east Asian nation.

The Mercosur-Singapore Free Trade Agreement (MCSFTA) aims to facilitate increased trade by reducing tariffs and establishing transparent investment conditions.

The agreement, signed at the 63rd Summit of Heads of State of Mercosur and Associate States in Rio de Janeiro, Brazil, targets enhanced entrepreneurship, accelerated digitalization, sustainable development, and food supply security. The deal is expected to benefit small and medium-sized enterprises (SMEs) across the five economies.

The accord, a result of over four years of negotiations, was signed by Foreign Minister Vivian Balakrishnan and ministers from the Mercosur nations. The focus is on streamlining customs procedures, boosting investor confidence, facilitating digital trade, and supporting SME internationalization.

The signatories will now move forward with domestic ratification processes to implement the agreement. Dr. Balakrishnan highlighted the significance of the MCSFTA, describing it as a bridge between Southeast Asia and South America, bringing the regions closer together.

The pact expands Singapore’s trade relations with Latin America, fostering economic opportunities and collaboration in various sectors, including e-commerce, agri-trade, and government procurement. The Mercosur bloc collectively represents the world’s eighth-largest economy, with a combined GDP of $2.7 trillion and a market of 272 million people.

Indian Prime Minister Narendra Modi announced a $250 million Line of Credit (LoC) to Kenya for the modernization of its agriculture sector. The announcement came following extensive discussions with Kenyan President William Samoei Ruto, who is on a three-day visit to India aimed at enhancing overall relations between the two nations.

In its foreign policy, India has always given high priority to Africa and has expanded its overall ties with the continent on a mission mode in the last nearly one decade, Modi said in his media statement after the talks.

During the talks, both leaders acknowledged terrorism as the most serious challenge facing humanity and pledged to intensify counter-terrorism cooperation. The economic collaboration between India and Kenya was also a focal point, with the assurance from Prime Minister Modi that both nations would explore new opportunities to fully realize their economic potential.

“I am confident that President Ruto’s visit to India will not only strengthen bilateral ties but will give a new momentum to our engagement with Africa,” stated Prime Minister Modi in a media statement following the discussions.

In a bid to draw in more tourists, Thailand’s cabinet has approved a ministerial regulation that extends the opening hours of nightclubs and entertainment venues in key tourist hotspots. This latest initiative is part of the government’s ongoing efforts to attract more visitors and boost economic growth.

Under the new regulation, entertainment establishments, including clubs, karaoke bars and other venues in popular tourist destinations such as Phuket, Bangkok, Pattaya, Chiang Mai, and Samui will now be permitted to stay open for an additional two hours. Thereby extending their opening hours until 4 AM.

Thailand’s Prime Minister Srettha Thavisin had previously said the new rules would start on December 15.

Recognizing the tourism industry as a vital economic driver, particularly in the face of sluggish economic growth, the Thai government has been implementing various measures to rekindle interest from international travelers. One such initiative was the decision in September to waive visa requirements for Chinese visitors, a move intended to bolster tourism, given the significance of Chinese tourists to Southeast Asia’s second-largest economy.

According to current tourism statistics, Thailand has welcomed 24.5 million foreign tourists this year, with a projected total of 28 million by the end of the year. Despite these positive numbers, the figures still fall short of the pre-pandemic peak in 2019 when Thailand recorded a staggering 39.9 million tourists.

The Karnataka government has approved 62 industrial investment proposals valued at Rs 3,607.19 crore, aiming to generate employment for 10,755 individuals within the state.

These proposals received approval from the State Level Single Window Clearance Committee, headed by Large and Medium Industries and Infrastructure Development Minister, Mr. M. B. Patil, during a meeting held on Tuesday.

Key investors involved in these approved projects include Texcon Steels, Hundri Sugars and Ethanol Private Limited, Bren Life Sciences, Alpine Ethanol, Virupaksha Laboratories, and Qualcomm India, among others.

Eight of them envisaged more than Rs 50 crore investment, totaling Rs 2,088.44 crore. This substantial investment has the potential to create 6,360 jobs, as declared by the committee on Wednesday.

Among the 62 proposals, 51 investment projects fall within the range of Rs 15 crore to Rs 50 crore, amounting to Rs 941.40 crore. These projects are expected to contribute to the employment of 4,395 individuals in Karnataka.

Additionally, the committee approved three projects with an extra investment of Rs 577.35 crore.