Sharone Tobias and Will Piekos look at the top five stories in Asia this week.
- China’s economy seems a little shakier. A surge in bad-credit loans within the country has China trying to clean up liquidity without slowing growth. China’s plethora of bad loans and unsustainable levels of debt has led Fitch to downgrade China’s yuan-dominated debt from AA- to A+. It is the first time since 1999 that China’s sovereign credit rating was cut. Part of the reasoning for the downgrade was low average incomes, poor standards of governance, and a rapid expansion of credit.
- Progress on the Senkaku/Diaoyu Islands… sort of. Japan and Taiwan agreed to allow Taiwanese fisherman access to Japanese-administered water near the Senkaku/Diaoyu islands in the East China Sea. After seventeen years of negotiations, the accord allows Taiwan to fish within twelve miles of the islands. China is “extremely concerned” about the fishery agreement, fearing that the deal grants Taiwan nation-like status and that Japan and Taiwan will cooperate further in the East China Sea. In unrelated maritime news, Chinese President Xi Jinping visited the navy’s South Sea fleet in Sanya in the largest display of military strength since he took office in March. The visit came after Xi met with fishermen who work in disputed areas of the South China Sea.
- Kerry visits South Korea. U.S. Secretary of State John Kerry began his first official visit to Asia as Washington’s top diplomat; his first stop was Seoul, where he asserted that “North Korea will not be accepted as a nuclear power.” His visit comes as a report from the Defense Intelligence Agency concluded, with “moderate confidence,” that North Korea now has the capability to miniaturize a nuclear weapon to be delivered by a ballistic missile. Meanwhile, Pyongyang continued its bellicose rhetoric and is likely to test-fire a missile in the near future as the country prepares to celebrate founder Kim Il-sung’s birthday on Monday.
- Bird flu scare continues. Another person has died from the H7N9 bird flu virus, bringing the total number of deaths to eleven. A total of 40 people have been infected by the virus thus far. And a study by Chinese researchers on the first three patients to contract H7N9 is doing little to allay fears; it paints a grim portrait of the virus’ effects on the human body. Though many have praised China’s transparency and response to the virus, Caijing has reported that officials have detained at least thirteen people for spreading rumors about H7N9.
- Myanmar begins auctioning oil and gas exploration rights. For the first time since the junta took power, Myanmar opened bidding for thirty offshore oil and gas blocks for exploration for foreign companies. Oil and gas make up 34 percent of Myanmar’s exports and is expected to be a major contributor to growth as the country opens its economy to foreign investment. Gas will begin flowing to China through a new pipeline beginning next month, and an oil pipeline will begin operating next year.
Bonus: ‘Django’ rechained in China. The Hollywood hit Django Unchained was mysteriously pulled from theaters in China on opening day. Officials in Beijing claimed the film was pulled for unspecified technical reasons; some speculate that censors were offended by nudity and excessive violence in the film.