November 2017

President’s Newsletter – November 2017

Greetings from Washington.  I have just returned to Washington after a trip to Vietnam and the Philippines where I attended the APEC CEO Summit and the ASEAN Business and Investment Summits.  I also had the honor of representing the Council at the State Dinner in honor of President Trump’s first visit to Hanoi.

President Trump completed a 12 day visit to Asia covering five countries including two in ASEAN – Vietnam and the Philippines.   In Vietnam, the President attended the APEC Summit and delivered the major speech of the trip outlining his vision for American engagement in the “Indo-Pacific”.  The President clearly set America’s direction southwest, which includes ASEAN as well as India, and stated that he offered a “renewed partnership” which he hopes will promote prosperity and security by creating a trading system that was “fair and reciprocal.”   The full speech can be found here.

During the President’s bilateral visit to Hanoi, he met with General Secretary Nguyen Phu Trong, President Tran Dai Quang, and Prime Minister Nguyen Xuan Phuc.  During his bilateral meeting with Prime Minister Phuc, the President offered to mediate the dispute between China and Vietnam in the South China Sea (East Sea).  President Trump and President Quang announced the “first-ever” visit of a U.S. aircraft carrier to Vietnam in 2018.

The President also visited Manila for the U.S. – ASEAN and East Asia Summits.  In fact, President Trump decided to extend his trip to the Philippines while he was traveling in Asia to be able to attend more of the East Asia Summit.  The U.S.-ASEAN Joint Statement reaffirmed the relationship between the United States and ASEAN on the 40th Anniversary of U.S. -ASEAN ties and during the 5th official U.S.-ASEAN Summit.  The Council was officially acknowledged in the Joint Leaders Statement as follows:  “We also reaffirm the role and contribution of the private sector and welcome greater private sector collaboration, including through the ASEAN Business Advisory Council and the U.S.-ASEAN Business Council in supporting economic growth and development in ASEAN.”   The full statement can be found here.

Since our last newsletter, Singapore Prime Minister Lee Hsien Loong visited Washington and met with President Trump on October 23.   The visit was Lee’s first to the United States since Donald Trump was elected President last November.  In addition to meeting with President Trump, the Prime Minister also met with Cabinet Secretaries, White House officials, and key members of Congress. During the bilateral meeting at the White House, Prime Minister Lee and President Trump affirmed the strong partnership between Singapore and the United States, a partnership that is a result of close economic, defense, security, and people-to-people ties. Both leaders cited the success of the United States-Singapore Free Trade Agreement (USSFTA) in strengthening economic relations between two countries. They also reemphasized the commitment of Singapore and the United States to ASEAN centrality and to strengthening the regional architecture so that transnational issues such as maritime security, cybersecurity, and countering violent extremism can be addressed effectively. Lastly, they recognized the 50th anniversary of ASEAN and the 40th anniversary of U.S.-ASEAN relations. The joint statement of the leaders and the press availability can be found here.

The Council co-chaired the U.S.-APEC Business Coalition with National Center for APEC and the U.S. Chamber of Commerce.  We held side meetings with President Quang of Vietnam, Prime Minister Najib of Malaysia, Trade Secretary Lopez of the Philippines and Chairman of the Indonesian Investment Coordinating Board (BKPM) Lembong.  To read the joint press statement, please click here

Just prior to leaving for the region, I was pleased to host a members-only roundtable discussion with the United States’ new Ambassador to Vietnam and a good friend of the Council, Dan Kritenbrink.  We were pleased that Ambassador Kritenbrink arrived in Hanoi just before President Trump and was able to attend APEC and meet many of our members.

In Washington on November 8, Council VP Marc Mealy spoke on Capitol Hill as part of a panel organized by the East-West Center, where he discussed U.S. and Southeast Asia relations on the eve of President Trump’s visit.  This coincided with the launch of an updated resource, the ASEAN Matters for America / America Matters for ASEAN one-pagers, which highlights the vital US-ASEAN partnership at the state and congressional district level with credible and nonpartisan information, graphics, and analysis.

Also in Washington earlier this month, I had the honor of joining our friends at the Royal Thai Embassy in paying our last respects to the late King Bhumibol Adulyadej during a cremation ceremony hosted at the Wad Thai Buddhist Monastery.

Looking ahead, we have our annual Board of Directors meeting on December 1, which will take place in Singapore this year.  The meeting will be preceded by a formal dinner in honor of the Board, and in recognition of ASEAN’s 50th anniversary on November 30.

As we look towards the end of yet another successful year, the Council will be engaging the ASEAN Telecommunications Ministers Meeting for the very first time on November 30 - December 1.  To register for the mission, please click here.

Finally, we will also be holding our last business mission of the year to Myanmar on December 6-8.  Requested meetings include: President U Htin Kyaw, State Counsellor Daw Aung San Suu Kyi, Key Cabinet Ministers, Members of Parliament including Speaker of the Pyithu Hluttaw (Lower House) U Win Myint, Myanmar Investment Commission, and the UMFCCI.  To register, please click here.

To all our friends and colleagues celebrating, I want to wish everyone a very happy Thanksgiving!

Highlights

Looking Ahead

• On November 30-December 1, the Council will lead an inaugural Business Mission to the ASEAN Telecommunications and Information Technology Ministers Meeting (TELMIN), in Siem Reap, Cambodia. Click here to register.  The deadline for registration is November 22.  The Council has submitted a proposal to engage all ten Ministers, in addition to pursuing key bilateral meetings.  If you have any questions or are interested in participating in the mission, please contact Shay Wester at swester@usasean.org or Mario Masaya at mmasaya@usasean.org.
• The Council's annual business mission to Myanmar will take place in Yangon and Nay Pyi Taw December 6-8. Requested meetings include: President U Htin Kyaw, State Counsellor Daw Aung San Suu Kyi, Key Cabinet Ministers, Members of Parliament including Speaker of the Pyithu Hluttaw (Lower House) U Win Myint, the Myanmar Investment Commission, and the UMFCCI.  To register, please click here.  If you have any questions or are interested in participating in the mission please contact Jack Myint at jmyint@usasean.org.

Advocacy

• The Council initiated an advocacy effort with Malaysia’s central bank (Bank Negara) regarding proposed regulations on Outsourcing Guidelines for Banks operating in Malaysia.  When Bank Negara announced it was seeking public comments on the proposed regulation, the Council successfully transmitted a request for an extension of the comment period.  In October, the Council requested recommendations and comments from members on the draft regulations.  Last week, the Council transmitted a letter to Bank Negara containing suggested revisions to the proposed regulations and shared the recommendations with other financial services industry associations (SIFMA & ASIFMA) to better cross-pollinate our advocacy messages. 
• The Council joined NCAPEC and the U.S. Chamber of Commerce in releasing a public statement on the importance of APEC to promoting U.S. economic and trade growth.  The statement underscored that America’s top four export markets in the world are APEC nations and that APEC offers a platform to address a range of issues that affect small, medium and large U.S. companies, and it has proven to be an essential and effective forum for building consensus on issues that affect U.S. growth, exports and jobs in our most competitive industries.
• Prior to U.S. President Donald Trump’s travel to Vietnam and the Philippines, the Council transmitted two letters to the Trump Administration requesting USG advocacy support to help address government policies, by each country, which do not treat U.S. businesses fairly.  The letters highlighted examples of tax policies in both nations, internet policies in Vietnam and agricultural policies in the Philippines which represent constraints on U.S. exports and investment.
• The Council continued its advocacy efforts with the Government of Vietnam on its Draft Cyber Security Law.  In partnership with AmCham Hanoi, BSA, CompTIA, DIGITALEUROPE, ITI, JEITA, SIA, and the U.S. Chamber of Commerce, the Council collected a range of inputs and recommendations from members and transmitted them to the Government of Vietnam.  The priority issues covered in the submission included required localization of data servers and restrictions on content.  

Intelligence

• As reported in the President's Newsletter last month, on September 27 during the 35th ASEAN Ministers of Energy Meeting (AMEM) and Associated Meetings, utility companies from Laos (Électricité du Laos), Malaysia (Tenaga Nasional Berhad) and Thailand (Electricity Generating Authority of Thailand) signed Southeast Asia’s first multilateral cross-border electricity trading agreement, an important first step towards eventually realizing the ASEAN Power Grid.  According to the Energy Purchase and Wheeling Agreement (EPWA), Malaysia has the option to purchase up to 100 MW of hydropower-generated electricity from Laos.  The electricity will be transferred from Laos to Malaysia through Thailand’s national grid.  The two-year agreement will come into effect on January 1, 2018, as part of the first phase of the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP), which is considered a pathfinder for the ASEAN Power Grid (APG).  An Analytical Brief examining how the three signatories are likely to benefit from the agreement, as well as how the EPWA fits within the broader ASEAN Power Grid initiative, can be found here.
• On October 21-26, Singapore Prime Minister Lee Hsien Loong made an official working visit to Washington, DC, with the aim of building on Singapore’s and the United States’ 51-year-old wide-ranging and robust partnership.  The visit was Prime Minister Lee’s first to the United States since President Trump was elected last November, and he used it as a way to set up themes meant to inform President Trump’s trip to Asia this month.  In addition to meeting with President Trump, the Prime Minister also met with Cabinet Secretaries, White House officials, and key members of Congress.  During the bilateral meeting at the White House, Prime Minister Lee and President Trump affirmed the strong partnership between Singapore and the United States, a partnership that is a result of close economic, defense, security, and people-to-people ties.  Both leaders cited the success of the United States-Singapore Free Trade Agreement (USSFTA) in strengthening economic relations between two countries.  They also reemphasized the commitment of Singapore and the United States to ASEAN centrality and to strengthening the regional architecture so that transnational issues such as maritime security, cybersecurity, and countering violent extremism can be addressed effectively.  Lastly, they recognized the 50th anniversary of ASEAN and the 40th anniversary of U.S.-ASEAN relations.  An Analytical Brief that goes into greater detail on the main points on which Lee focused during his visit can be found here.

Relationship Building

• On December 15, the Council will organize a business roundtable with H.E. Nguyen Thien Nhan, Secretary of the Ho Chi Minh City Party Committee, in Washington, D.C.  Secretary Nhan, who is also currently a Politburo member, previously served as Chairman of the Vietnamese Fatherland Front, Deputy Prime Minister of Vietnam under former Prime Minister Nguyen Tan Dung, and Minister of Education.  Because seating will be limited, members should contact Hai Pham at hpham@usasean.org with questions or to express interest.
• In early Q1 2018, the Council will organize Health & Life Sciences Industry Missions to Vietnam and the Philippines.  Members should contact Hai Pham at hpham@usasean.org and Ying Hui Tng at yhtng@usasean.org with questions or to express interest.
• On November 17, the Council held its inaugural ASEAN Presidents’ Luncheon with Tommy Koh, Singapore Ambassador-at-Large and Former Ambassador to the United States.  Ambassador Koh also served as Chief Negotiator for the U.S.-Singapore Free Trade Agreement, among many other large-scale trade negotiations.  As Singapore prepares to take over as Chair of ASEAN, he will be speaking on ASEAN @ 50 and the incoming ASEAN Chairman's vision and agenda for 2018.  Please contact Shay Wester at swester@usasean.org for more information.
• On the sidelines of the APEC CEO Summit, the Council co-chaired meetings with President Quang of Vietnam, Prime Minister Najib of Malaysia, Trade Secretary Lopez of the Philippines and Chairman of the Indonesian Investment Coordinating Board (BKPM) Lembong

Promotion

• The U.S. State Department and the Singapore Government are currently identifying private sector participants for their Third Country Training Program (TCTP), entitled “Creating a 21st Century Digital Economy.”  Specifically, the organizers are seeking presenters for a session on e-Commerce and hosts for site visits.  If you are interested in participating, please contact Ella Duangkaew at eduangkaew@usasean.org or Mario Masaya at mmasaya@usasean.org.

Council in the News

• Voice of America did a feature piece on an interview with Council VP for Policy Marc Mealy on U.S.-ASEAN Trade : Q&A: US-ASEAN Business Council Vice President Marc Mealy Says US-ASEAN Trade to Increase | Voice of America, November 03
• Council President & CEO Alex Feldman was quoted in CBN News on President Trump’s Asia visit: Donald Trump in Asia: Mission Accomplished | CBN News, November 14

Regional Highlights

APEC

Major Developments

• Last week, Vietnam hosted the 2017 APEC Economic Leaders’ Week in Da Nang, this year under the theme “Creating New Dynamism, Fostering a Shared Future” with four priorities: sustainable and innovative growth, regional economic integration, modernization of SMEs, and food security in the context of climate change. Vietnamese President Tran Dai Quang hosted key events including the 25th APEC Economic Leaders’ Meeting, the APEC Business Advisory Council (ABAC) Dialogue with APEC Economic Leaders, and the APEC – ASEAN Informal Dialogue.  The Vietnam Business Summit was also held on November 7, followed by the APEC CEO Summit on November 8-10.  The series of events gathered more than 10,000 delegates including leaders from 21 of the world's largest economies and international organizations, global CEOs, as well as major media agencies.  As part of his tour to Asia, U.S. President Donald Trump traveled to Da Nang on November 10 to attend the APEC Economic Leaders’ Meeting and delivered a speech at the APEC CEO Summit on his vision for a free and open trade network in the region. He then traveled to Hanoi on November 11 for an official visit and bilateral dialogues with President Tran Dai Quang and other senior representatives.

View the Council's latest APEC updates

ASEAN

Major Developments

• U.S. President Donald Trump made his first official visit to ASEAN from November 10-13, with stops in Vietnam and the Philippines.  The President first attended the Asia-Pacific Economic Cooperation (APEC) Summit in Da Nang on November 10, before heading to Hanoi on November 11 for a bilateral engagement.  He then traveled to Manila for the U.S.-ASEAN and East Asia Summits on November 12-13, including a celebration of the 50th anniversary of ASEAN.  The readout of the trip can be accessed here.
• The annual ASEAN Business and Investment Summit (ABIS), organized by the ASEAN Business Advisory Council, took place in Manila November 13-14.  The event featured panels on infrastructure, financial services, sharing economy, entrepreneurship, and more (see the agenda here).  I had the privilege to speak on a panel entitled “Right Money + Open Markets = Prosperity for All,” discussing how the ASEAN Economic Community can increase access to finance for SMEs and make ASEAN a more attractive destination for foreign investments.
• At the conclusion of the 5th ASEAN-U.S. Summit, held in Manila on November 13, the United States and ASEAN released a Joint Statement, available here. The Joint Statement calls for stronger economic engagement and specifically mentions the Council’s role in promoting trade and investment, “reaffirm[ing] the role and contribution of the private sector and welcome[ing] greater private sector collaboration, including through the ASEAN Business Advisory Council and the U.S.-ASEAN Business Council in supporting economic growth and development in ASEAN.”

Looking Ahead

• Registration is now open for the Council’s inaugural Business Mission to the ASEAN Telecommunications and Information Technology Ministers Meeting (TELMIN), November 30 to December 1 in Siem Reap, Cambodia.  Click here to register.  The deadline for registration is November 22.  The Council has submitted a proposal to engage all ten Ministers, in addition to pursuing key bilateral meetings.  If you have any questions or are interested in participating in the mission, please contact Shay Wester at swester@usasean.org or Mario Masaya at mmasaya@usasean.org.

View the Council's latest ASEAN updates

TPP

Major Developments

On the sidelines of the APEC Summit, the Ministers of Trade from the eleven members of the TPP agreement announced that an agreement in principle for a revised TPP-11 agreement was reached.  The nations agreed to:

1. Rename the TPP to the Comprehensive and Progressive Trans Pacific Partnership

2. Require that only six of the eleven nations must ratify the agreement to bring it into force

3. The original provisions on labor and environment were not included in the agreed-on list of provisions that would be temporarily suspended in the new agreement

4. Most of the temporary suspended provisions were related to items requested by the United States

5. The e-commerce chapter and commitment related to cross-border data flows were retained in full 

Looking Ahead

The 11 nations have narrowed down the list of issues which remain to be finalized before the new agreement’s complete list of suspensions are completed and the agreement would then be signed.  They are:

1. State Owned Enterprises, Annex 4

2. Services and Investment NCM’s, Annex 2 regarding coal

3. Dispute Settlement, Article 28.20

4. Cultural Exceptions 

View the Council's latest TPP updates

Industry Highlights

Customs

Major Developments

Following a smuggling scandal and the subsequent appointment of Isidro Lapena as the new Commissioner of the Philippines Bureau of Customs (BoC) on August 30, the Philippines is continuing an intensified campaign against corruption in the BoC.  Several port district collectors and chiefs were removed in October and BoC is coordinating closely with Commissioner Lapena’s former staff at the Philippine Drug Enforcement Agency (PDEA).  Over the past weeks, the BoC has made a number of changes and revisions with regard to customs procedures, including stricter valuation procedures, Green Lane suspension, thresholds for verification of container shipments, requirements and time frames for alert orders, pre-shipment inspection, and X-ray inspection in the Red Lane, which at least initially led to significant clearance delays.  Importers qualified for BoC’s Super Green Lane are not affected by the changes.  The BoC says it is aware of growing concerns over increasing port congestion. Stakeholders should remain vigilant of the government’s gradual adjustment and modifications in customs law in response to these concerns.

Alongside these developments, the Philippines is also preparing to launch its national single window, TradeNet, in December.  Using the cloud to provide traders and economic agencies with automated, real-time access to import-export data, TradeNet will allow government agencies to monitor issuances and service delivery, and enhance integrity and accountability in transactions.  TradeNet will initially process clearances for seven types of goods that make up half of total trade volume:  rice, sugar, used motor vehicles, chemicals, frozen meat, medicines, and cured tobacco.  TradeNet will eventually be integrated into the ASEAN Single Window.

Advocacy

On October 25-26, a Council delegation joined the ASEAN Coordinating Committee on Customs (CCC) in Manila for a consultation with the assembled senior customs officials.  During the plenary, the delegation received feedback from ASEAN Member States on the low-value proposal, which proposed policies to facilitate trade for low-value goods.  Representatives from ASEAN Member States also updated the Council that implementation of ASEAN self-certification will take place in January 2018 and that they are also working on ASEAN Seamless Trade Facilitation Indicators which will complement existing international trade facilitation indicators carried out by organizations like the World Bank and OECD.  The delegation also met bilaterally with Indonesia's Directorate General of Customs and Excise, the Royal Malaysian Customs Department, and the Philippines Bureau of Customs.  We are following up with the Royal Malaysian Customs Department on their suggestion to organize a capacity-building workshop on brand protection.  Members who wish to support this should contact Ying Hui Tng at yhtng@usasean.org and Ian Saccomanno at isaccomanno@usasean.org. 

View the Council's latest Customs updates

Defense & Security

Major Developments

On October 23-24, the Philippines hosted the 11th ASEAN Defense Ministers Meeting (ADMM) and the 4th ADMM-Plus in Angeles City.  The agenda was wide-ranging, covering topics from progress on confidence-building exercises, humanitarian assistance, disaster relief and maritime security and regional interests, such as the situation in the Korean Peninsula and the South China Sea.  The ADMM adopted two key documents, the 11th ADMM Joint Declaration (which can be accessed here) and the Joint Statement of Special ASEAN Defense Ministers’ Meeting On Countering Violent Extremism, Radicalization and Terrorism (which can be accessed here).

Singapore assumed the chairmanship of the ADMM on October 24 and will focus on pushing new regional efforts to combat violent extremism and promote peace and stability.  Defense Minister Ng Eng Hen said in a statement by the Ministry of Defense that Singapore will focus on three key issues: 1) promoting regional counter-terrorism collaboration, 2) growing collective capability for chemical, biological and radiological threats and 3) promulgating the use of practical confidence-building measures to aviation and maritime domains.  He also indicated that Singapore, in its efforts to step-up counter-terrorism efforts, will hold special sessions on terrorism “in the highest levels of leadership”.  Dr Ng said that Singapore will “push for confidence-building measures” in the interest of building understanding among the ASEAN nations and encourage information sharing in terms of how each nation can handle chemical, nuclear and radiation attacks, taking into account growing instability in the Korean peninsula.

U.S. Secretary of Defense Jim Mattis attended the 4th ADMM Plus meeting and met with his counterparts from Australia, China, India, Japan, New Zealand, the Republic of Korea and Russia in addition to the ten ASEAN defense ministers.  He commended the Philippine military on its liberation of Marawi from ISIS terrorists, stating that “the Philippine military sends a very strong message to the terrorists.”  He further noted that there were no allegations of human rights violations during the fighting.  Secretary Mattis reiterated the United States’ support of ASEAN and its commitment to regional peace and stability.

View the Council's latest Defense & Security updates

Energy

Major Developments

• As reported in the President's Newsletter last month, on September 27 during the 35th ASEAN Ministers on Energy Meeting (AMEM) and Associated Meetings, utility companies from Laos (Électricité du Laos), Malaysia (Tenaga Nasional Berhad) and Thailand (Electricity Generating Authority of Thailand) signed Southeast Asia’s first multilateral cross-border electricity trading agreement, an important first step towards eventually realizing the ASEAN Power Grid.  According to the Energy Purchase and Wheeling Agreement (EPWA), Malaysia has the option to purchase up to 100 MW of hydropower-generated electricity from Laos.  The electricity will be transferred from Laos to Malaysia through Thailand’s national grid.  The two-year agreement will come into effect on January 1, 2018, as part of the first phase of the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP), which is considered a pathfinder for the ASEAN Power Grid (APG).  An Analytical Brief examining how the three signatories are likely to benefit from the agreement, as well as how the EPWA fits within the broader ASEAN Power Grid initiative, can be found here. 
• The International Energy Agency’s (IEA) Southeast Asia Energy Outlook 2017 forecasts that the region will experience a growing deficit of fossil fuels by 2040, resulting in an increase in energy imports to meet rising demand.  According to the report released in October, the supply shortages of oil, natural gas and coal are likely to result from three intersecting trends: declines in the production and reserves of primary energy sources in the region, rising demand for energy from a growing population, and the implementation of regulations intended to inhibit fossil fuel production.  Since 2000, Southeast Asia’s energy demand has increased 60 percent, even though per capita primary energy demand still lags behind the global average.  Nevertheless, ASEAN country governments will have to rely increasingly on imports to meet projected global demand, a reliance that will result in higher import bills.  More information on the IEA’s Southeast Asia Energy Outlook and its main projections can be found here.

Advocacy

 On October 26, the Council and the ASEAN Centre for Energy (ACE) organized a roundtable entitled "20% in 2020 - Unlocking ASEAN's Energy Efficiency Potential" at the Singapore International Energy Week (SIEW) 2017.  SIEW is one of the premier conferences in Asia for energy professionals, policymakers and commentators to discuss and share best practices within the global energy space.  The roundtable provided an open platform for policymakers, technology developers and financial institutions to discuss major technology hurdles, financial constraints and social challenges in putting together the regulatory frameworks that can be developed to unlock the true potentials of energy efficiency in the region.  Participants included Dr. Ir Saleh Abdurahman, Secretary General of the National Energy Council of Indonesia; YBhg. Datin Badriyah Hj. Abd. Malek, Deputy Secretary General (Energy & Green Technology) at the Ministry of Energy, Green Technology & Water (KeTTHA) of Malaysia; Mr. Kwek Chin Hin, Head of the Industrial Energy Efficiency National Environmental Agency (NEA) of Singapore, and Mr. Pongphat Munkkunk, Director of Human Resource Development Bureau at the Department of Alternative Energy Development and Efficiency in the Ministry of Energy of Thailand.  The panel also included Dr. Ir Sanjayan Velautham, Executive Director at the ASEAN Centre for Energy, and representatives from General Electric, UL, the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ), and the Institution of Engineers Singapore (IES).  More information on the roundtable, including presentations made by the panelists, can be found here.

View the Council's latest Energy updates

Financial Services

Major Developments

• Later this month, the Bangko Sentral ng Pilipinas (BSP), the central bank of the Philippines, plans to launch a peso debt market development roadmap aimed at establishing an integrated financial market in the country.  The agenda will initially focus on benchmark markets and includes an 18-month time frame with specific targets for regulatory and institutional milestones.  The market agenda reform roadmap is specifically aimed at increasing the volume of treasury bills, developing a systematic set of obligations, rights and incentives for market markers, and providing stable, predictable and transparent issuance of government securities.  The roadmap will include three main operational priorities:  deepening the local bond market by adopting reforms in the government securities eligible dealer (GESD) system, increasing supply of short-term securities, and developing an effective framework on derivatives and repo markets.  The BSP also hopes that a peso debt market will create a reliable financial benchmark and establish an integrated financial market infrastructure for corporate debt and infrastructure bonds.  Infrastructure bonds will be important for funding future infrastructure development.
• On October 21, the 24th APEC Finance Ministers Meeting was held in Hoi An, Vietnam under the chairmanship of Vietnam’s Minister of Finance, H.E. Dinh Tien Dung. The four priorities of the meeting were long term investment in infrastructure, base erosion and profit shifting (BEPS), disaster risk financing, and insurance and financial inclusion. During the meeting, the ministers endorsed a policy statement on Diversifying Financing Sources and Fostering Private Sector Involvement in Infrastructure Investment in APEC Member Economies (Annex A can be accessed here).  These recommendations include using blended finance to mobilize private investment, strengthening policy frameworks and regulations to promote reliable long-term funding, and promoting infrastructure as an asset class.
• On October 30, the Monetary Authority of Singapore (MAS) released an industry transformation map (ITM) for financial services that outlined growth strategies, programs for upgrading skills, and an agenda for continued innovation and technology adoption.  MAS intends to encourage financial institutions to improve connectivity and FinTech innovation through application programming interfaces and collaborate to create common utilities.  It also intends to simplify regulatory compliance through new technology.  In insurance, MAS is working to transform the marketplace through centralized blockchain platforms and create specialist insurance solutions to address emerging risks in the region.  The full roadmap can be found here.

Looking Ahead

On October 31, the Council’s Financial Services Committee held a quarterly committee call to begin planning the themes for the 2018 ASEAN Finance Ministers and Central Bank Governors Meeting and review other committee activities.  The Committee is currently exploring AFMGM discussion themes around data management, FinTech developments, and financial markets integration projects like the Working Committee on Payment and Settlement Systems, infrastructure finance, and disaster risk financing.  The 2018 AFMGM is scheduled for the week of April 2 in Singapore.

View the Council's latest Financial Services updates

Food & Agriculture

Major Developments

• On November 2, U.S. Ambassador to Indonesia Joseph Donovan expressed concerns over Indonesia’s severe restrictions on agricultural imports in recent years, leading to a continuing decline in U.S. export value.  These concerns were raised in response to Indonesian President Joko Widodo's push for national self-sufficiency through import limits on the number of commodity products, including agriculture, plantation, and livestock, beginning in early 2015.  Arguing that this protectionist policy will help domestic producers grow, the government has since established temporary import restrictions on corn, rice, sugar, animal feed and beef—products that serve as crucial raw materials for many of Indonesia’s key sectors.  The country’s most recent restrictions on rice and corn in 2016 and 2017 resulted in various disruptions to the global supply chain of U.S. agricultural trading companies.  Many industry stakeholders are now worried that the government will apply similar measures to soybean imports to achieve the planned goal of self-sufficiency in soybeans by 2020.
• To modernize the agricultural sector in Thailand, which accounts for nearly 40 percent of the workforce but only 12 percent of GDP, the Royal Thai Government plans to expand business incentives and tax breaks to promote higher farm productivity.  Under new Secretary-General Duangjai Asawachintachit’s leadership, the Board of Investment is introducing a new investment category called “smart farming services” with preferential policies towards the development of advanced irrigation systems, fertilizers and crop distribution.  The framework also encourages farmers and businesses to obtain international certification on food safety and sustainability through additional tax incentives.  In addition to existing aid programs for rice farmers, the board’s new initiatives will focus on education and high-tech development to positively transform the sector and ultimately accelerate GDP growth.

Advocacy

• The Thai Excise Department has implemented an excise sugar tax on certain beverages to reduce consumption of sugar and increase health consciousness.  According to Director General of the Excise Department Somchai Poolsavasdi, this new tax will cause “moderate” increases in the prices of various products including sugary drinks.  The scope of the specific tax on sugar content includes added sugar and natural sugar, but excludes non-sugar sweeteners.  Carbonated drinks with sugar will cost 0.13 to 0.50 baht higher per bottle, while sugar-free soft drinks with sugar substitutes will be taxed less by 0.28 to 0.36 baht per bottle.  After two years, taxes on sugary drinks will increase proportionally with the level of sugar content per unit.  Passed by the legislature under the new Excise Tax B.E. 2560 (2017), the new regulation went into effect on September 16, 2017, and is expected to generate about 12 billion baht (US$360 million) in tax revenue—a 2 percent increase for the government.

View the Council's latest Food & Agriculture updates

Health & Life Sciences

Major Developments

• On October 26, Philippine President Duterte appointed Government Service Insurance System (GSIS) Chairman Francisco Duque III to the position of Secretary of the Department of Health (DOH).  Duque previously served as Secretary of Health under former President Gloria Arroyo from June 2005 to January 2010.  Before joining the DOH, Duque was appointed President and CEO of the government-owned Philippine Health Insurance Corporation (PhilHealth) from 2001 to 2005.  Duque’s initial priorities as DOH secretary include the rebuilding of Marawi City and the strengthening of its health system and developing a long-term strategy focused on reducing the national maternal mortality rate and ensuring quality healthcare is accessible to all Filipinos.  He has also noted that he would like to make PhilHealth more sustainable.  Duque’s appointment follows the Commission on Appointments (CA)’s rejection of the ad interim appointment of Heath Secretary Paulyn Ubial on October 10.  Undersecretary Herminigildo Valle, head of the DOH Office for Field Implementation and Management, was designated officer-in-charge of the DOH after the CA rejected Ubial’s appointment.

Advocacy

• On October 30, the Council held a preliminary brainstorming call for the proposed capacity-building workshop for Indonesia’s Ministry of Health (MOH) and National Public Procurement Agency (LKPP).  The Council has been engaging members and the Indonesian government on the latter’s e-Catalogue.  The primary objective is to help regulators understand the importance of innovation and quality for medical devices.  The format may include a plenary session on cross-cutting issues across all care areas before having breakout sessions.  The Council has communicated with the POKJA to seek alignment of their priorities with target care areas, but more information is needed about who is attending and the structures of the MOH and POKJA to tailor the content accordingly.  Full call notes are available here.
   
• The Council has been engaged with the Vietnam Ministry of Health and Office of the Government on challenges members are facing with the implementation of Decree 36 regarding the system of medical equipment registration and approvals.  Currently, phase 2 of Decree 36 has significantly delayed product registration, causing disruption to the supply chain and market.  The Council is working with the Government of Vietnam to extend the transition period or deadline for getting approvals, and looking further to create a new system that would allow for better flow of important products.

Looking Ahead

• In early Q1 2018, the Council will organize Health & Life Sciences Industry Missions to Vietnam and the Philippines.  Members should contact Hai Pham at hpham@usasean.org and Ying Hui Tng at yhtng@usasean.org with questions or to express interest.

View the Council's latest Health & Life Sciences updates

ICT

Major Developments

• On October 3, Director-General Datuk Seri Subromaniam Tholasy said that the Royal Malaysian Customs Department (RMCD) expressed intentions for the Goods and Services Tax (GST) to apply to cross-border digital trade.  The new tax measures are expected to target major foreign digital platform providers operating in Malaysia that sell online goods and services, including video streaming services, but not small businesses.
• The Indonesian Directorate General of Taxation is also expected to issue a tax regulation for e-commerce.  The new regulation will extend taxes to e-commerce sales, but is expected to be lower than the normal ten percent value-added tax (VAT).  E-commerce platform owners would reportedly be responsible for collecting the tax and the Ministry of Communication and Information Technology (KOMINFO) would oversee registration.  The draft regulation is still under review and is expected to follow the Ministry of Trade’s e-trading draft regulation, which is currently being finalized.
• On October 7, Thailand’s National Broadcasting and Telecommunications Commission (NBTC) elected General Sukit Khamasunthorn as the new Chairman, succeeding Air Chief Marshal Thares Punsri.  A new board will also be appointed after all seven commissioners on the existing board end their six-year term in October.  The Council will continue to monitor the leadership transition and the potential implications for ongoing policy reforms, such as those related to Over-the-Top (OTT) services and future spectrum license auctions.

Advocacy

• On October 6, SPRING Singapore issued a call for input on the draft Singapore Standards, which includes revised Cloud Outage Incident Response (COIR) standards.  Among other revisions, the recommendations on data breach have been removed.  BSA | The Software Alliance and the Council are presently analyzing the revised standards.  Please contact Shay Wester at swester@usasean.org for more information.
• On October 9, the Council held a meeting in Singapore to discuss pending OTT regulations in the region.  Members discussed potential interest in regular consultation with the ASEAN Telecommunications Regulators’ Council (ATRC) and possible avenues of engagement at its next meeting.  If you are interested to learn more, please contact Shay Wester at swester@usasean.org.
• On October 17, Council members met with Indonesia’s Minister of Communication and Information Technology (MCIT) Rudiantara for an update on revisions to Government Regulation 82 of 2012 (GR82).  The Council will seek input from members when the draft of GR82 is available and submit comments as part of the public consultation.  Detailed meeting notes can be found here.
• On October 12, BSA, the Council and members met with the Cyber Security Agency (CSA) of Singapore to discuss the licensing component of the draft Cybersecurity Bill.  CSA provided updates on the timeline for the Bill. More detailed meeting notes are available here.
• BSA and the Council submitted joint comments on Singapore’s proposed amendments to the Personal Data Protection Act (PDPA) and followed up by meeting with the Commission to discuss technical aspects of the amendments on November 2.
• On November 7, the Council submitted additional joint comments to Vietnam’s Ministry of Public Security (MPS) regarding its updated version (“Draft 14”) of the Draft Law on Cybersecurity (English translation here).  These comments follow a joint industry letter on the previous version of the draft law.

Looking Ahead

• The U.S. State Department and the Singapore Government are currently identifying private sector participants for their Third Country Training Program (TCTP), entitled “Creating a 21st Century Digital Economy.”  Specifically, the organizers are seeking presenters for a session on e-Commerce and hosts for site visits.  If you are interested in participating, please contact Ella Duangkaew at eduangkaew@usasean.org or Mario Masaya at mmasaya@usasean.org.
• Registration is now open for the Council’s inaugural Business Mission to the ASEAN Telecommunications and Information Technology Ministers Meeting (TELMIN), November 30 to December 1 in Siem Reap, Cambodia.  Click here to register before November 22.  The Council has submitted a proposal to engage all ten Ministers, in addition to pursuing key bilateral meetings.  If you have any questions or are interested in participating in the mission, please contact Shay Wester at swester@usasean.org or Mario Masaya at mmasaya@usasean.org.

View the Council's latest ICT updates

Infrastructure

Advocacy

On October 11-13, the Council conducted its business mission to the 23rd ASEAN Transport Ministers Meeting (ATM), with eight U.S. companies discussing the impact of info-communications technology (ICT) on infrastructure development in ASEAN with key transport officials.

This year marks the Council's second meeting with all ten ASEAN Transport Ministers, Senior Transport Officials, and the Deputy Secretary-General of ASEAN.  During the mission, the Council delegation focused on leveraging technology in the realm of infrastructure development in ASEAN countries and discussed the future direction of infrastructure development, which is shifting from hard infrastructure projects to utilizing ICT to improve existing infrastructure and reframe new infrastructure requirements.

The Council supports the view that by adopting technological software and processes, government infrastructure projects can save significant costs and time, as well as increase visibility and transparency.  World class technological systems can also be harnessed to improve the quality and delivery of services by providing a source of readily accessible, relevant and valid information on ongoing infrastructure projects.

Companies participating in the mission included 3M, Autodesk, Bechtel, Caterpillar, FedEx, Harris Corporation, Uber and UPS. The mission report outlining synopses of the working luncheon with the ASEAN Ministers for Transport, and individual bilateral meetings with Cambodia, Indonesia, Malaysia, Myanmar and the Philippines can be reviewed here.

Looking Ahead

In Manila on November 20, the Council will partner with the U.S. Commercial Services to host Philippines Secretary of Transportation Arthur P. Tugade for a discussion on the Philippines' "Build, Build, Build" projects.  Please contact Sunita Kapoor at skapoor@usasean.org for more information or to express interest .

View the Council's latest Infrastructure updates

Country Highlights

Brunei

Major Developments

The Government of Brunei stated that it remains committed to its diversification efforts, with particular focus on opportunities in the downstream oil and gas sector, halal industry and tourism.  Brunei’s energy sector is still the main contributor to the country’s economy, although Brunei sees FDI as a means of maintaining its sustainable growth and global competitiveness of the downstream sector.  Recently, Hengyi Industries, a China-Brunei joint venture, committed US$12 billion to develop the second phase of its Pulau Muara Besar (PMB) refinery and petrochemical plant, making Brunei the destination of its largest foreign investment to date.  The government expects that diversification will add more value to produced oil and gas through the development of new refinery and petrochemical industries as well as aid in resisting price fluctuations in the upstream sector.  To that end, the government is actively seeking more downstream opportunities in the coming years.  Brunei is also looking into expanding its halal industry, tourism, ICT and business services sectors. 

View the Council's latest Brunei updates

Cambodia

Major Developments

In mid-October, the Garment Manufacturers Associate of Cambodia (GMAC) submitted a petition to the United States to request preferential trade treatment for Cambodian footwear exports under the U.S. Generalized System of Preference (GSP). This follows the August 24 request announced at the meeting between Cambodia’s Secretary of State of the Ministry of Commerce Ok Boung and Marta Prado, Director for Southeast Asian and the Pacific at the Office of the United States Trade Representative (USTR).  Currently, about 80 percent of Cambodia’s $2.8 billion exports to the United States are textiles and footwear, which have been exported to the United States under its most-favored nation program.  Footwear was likely singled out for GSP review because of the recent growth in the American footwear market.  However, most footwear is prohibited by U.S. law (19 USC 2463) from receiving GSP treatment.  Cambodia presently receives GSP status for 82.7 percent of its products, such as vehicles, machinery, animal feed, fur and non-woven textiles.  In July 2016, the U.S. government added Cambodian travel goods to the list of GSP imports.  GSP status for Cambodian footwear would benefit Cambodia by making one of its most prominent industries more competitive in the United States, and benefit American consumers by making footwear less expensive.

View the Council's latest Cambodia updates

Indonesia

Major Developments

• On October 25, the Indonesian House of Representatives approved the 2018 state budget, which focuses on addressing inequality and accelerating the rate of GDP growth, with a fiscal deficit target of 2.19 percent of Indonesia’s GDP, lower than the official 2017 budget deficit which was officially set at 2.92 percent.  For the 2018 budget, the government is aiming for IDR 2,220.7 trillion in spending and expects revenue of IDR 1,894.7 trillion, based on an assumption of a 5.4 percent GDP growth. While the revenue target for 2018 is modest, the actual revenues for 2017 will reach only about 90 percent of the 2017 target which would mean that the 2018 target is in fact 20 percent higher than this year’s projected revenues.  While this is not impossible, it poses a challenge, particularly given how revenue collection has gone in the past.
• Indonesia made considerable progress by climbing 19 positions to 72nd out of 190 countries in the World Bank’s 2018 Ease of Doing Business Report.  The improvement in ranking is credited to the Indonesian government’s efforts to improve its regulations, such as tax reform programs pioneered by Finance Minister Sri Mulyani Indrawati and her Ministry team, although improvements in various sectors are still needed.  According to Coordinating Minister for Economic Affairs Darmin Nasution, the government’s next steps will focus on improving the indicators where Indonesia is toward the bottom of the ranking list, which are mostly related to business regulations, including starting a business, dealing with construction permits, registering property, paying taxes and trading across borders.

View the Council's latest Indonesia updates

Laos

Major Developments

• On November 1, the Lao National Assembly passed the amended Law on Citizenship.  The law expands the number and type of government bodies that are allowed to grant Lao citizenship to foreigners, and extends special privileges to “highly educated and qualified” foreigners seeking Lao citizenship.  Qualifying applicants can receive Lao citizenship after only five consecutive years, instead of the normal ten.  This indicates that decisions regarding Lao citizenship, particularly relating to foreigners, can be made more swiftly and by a wider selection of people and organizations, demonstrating a more favorable outlook towards foreigners in Laos, which may bode well for the presence of international businesses in Laos.  For more information see our recent update here.
• On September 27, during the 35th ASEAN Ministers on Energy Meeting (AMEM), utility companies from Laos (Électricité du Laos), Malaysia (Tenaga Nasional Berhad) and Thailand (Electricity Generating Authority of Thailand) signed ASEAN’s first multilateral cross-border electricity trading agreement, an important first step towards eventually realizing the ASEAN Power Grid. According to the Energy Purchase and Wheeling Agreement (EPWA), Malaysia has the option to purchase up to 100 MW of hydropower-generated electricity from Laos.  The electricity will be transferred from Laos to Malaysia through Thailand’s national grid. The two-year agreement will come into effect on January 1, 2018, as part of the first phase of the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP), which is considered a pathfinder for the ASEAN Power Grid (APG), an integrated regional grid system for Southeast Asia.  The agreement will be reviewed in 2020. The official announcement about the agreement from Malaysia's Ministry of Energy, Green Technology and Water (KeTTHA) can be found here.  A separate Analytical Brief (found here) looks at how the three signatories are likely to benefit from the agreement, as well as how the EPWA fits within the broader ASEAN Power Grid initiative.

View the Council's latest Laos updates

Malaysia

Major Developments

• The Malaysian 2018 Budget was announced by Prime Minister Najib Razak on October 27.  The budget, themed “Prospering an Inclusive Economy, Balancing Between Worldly and Hereafter, for the Wellbeing of Rakyat (Citizen), Towards the TN50 (National Transformation 2050) Aspiration,” focuses on a sweeping approach covering the interests of multiple segments of society while intensifying the efforts for national economic growth.  Click here for an analytical update on the budget.
• On October 19, Prime Minister Najib made an announcement that Malaysia will introduce the “Cloud First” Strategy to its national agenda.  The strategy was an expansion to existing digital transformation programs and shall kick-off with the Malaysian public sector adopting cloud-related solutions in its operations and services. Click here for a recent analytical update on Malaysia’s intensifying digital transformation.
• On September 27, during the 35th ASEAN Ministers on Energy Meeting (AMEM), utility companies from Laos (Électricité du Laos), Malaysia (Tenaga Nasional Berhad) and Thailand (Electricity Generating Authority of Thailand) signed ASEAN’s first multilateral cross-border electricity trading agreement, an important first step towards eventually realizing the ASEAN Power Grid. According to the Energy Purchase and Wheeling Agreement (EPWA), Malaysia has the option to purchase up to 100 MW of hydropower-generated electricity from Laos.  The electricity will be transferred from Laos to Malaysia through Thailand’s national grid. The two-year agreement will come into effect on January 1, 2018, as part of the first phase of the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP), which is considered a pathfinder for the ASEAN Power Grid (APG), an integrated regional grid system for Southeast Asia.  The agreement will be reviewed in 2020. The official announcement about the agreement from Malaysia's Ministry of Energy, Green Technology and Water (KeTTHA) can be found here.  A separate Analytical Brief (found here) looks at how the three signatories are likely to benefit from the agreement, as well as how the EPWA fits within the broader ASEAN Power Grid initiative.

Advocacy

• The Council is currently finalizing comments to Bank Negara Malaysia on the new Exposure Draft on Outsourcing.  The framework updates and strengthens risk management rules for outsourcing arrangements by banks.  Particular focus is paid to updating rules to account for a more global and digital financial industry.  Contact Ian Saccomanno at isaccomanno@usasean.org for more information.
• The Council is also finalizing a letter to the Ministry of Communications and Multimedia and Malaysian Communications and Multimedia Commission on new Guidelines on IPv6 Implementation and Compliance Test.  The guidelines mandate that technical equipment undergo type approval and be certified according to the IPv6 Technical Code (current global transition from IPv4 internet protocol to IPv6).  Contact Kim Yaeger at kyaeger@usasean.org for more information.

View the Council's latest Malaysia updates

Myanmar

Major Developments

Myanmar’s four long-delayed intellectual property laws, in draft form since at least 2010, have been submitted to Parliament and may be approved during the current session. Please click here for unofficial English translations: Draft Copyright Law; Draft Trademark Law; and the Draft Industrial Design Law.  The Council will circulate a translation of the Draft Patent Law when it becomes available. There was no public consultation on the most recent versions.  Instead, Myanmar language drafts were released periodically in one local newspaper.  Now that the drafts are submitted to Parliament, it is unlikely that major substantive changes will be made.  However, during the Council’s upcoming Myanmar Business Mission December 6-8, a meeting with the Speaker of the Lower House of Parliament will be a timely opportunity for members to raise any concerns, and to underscore that a strong IP framework is critical to economic development and high-quality foreign investment.  Please contact Jack Myint at jmyint@usasean.org with any feedback on the laws.

Looking Ahead

The Council's annual business mission to Myanmar will take place in Yangon and Nay Pyi Taw December 6-8.  Requested meetings include: President U Htin Kyaw, State Counsellor Daw Aung San Suu Kyi, Key Cabinet Ministers, Members of Parliament including Speaker of the Pyithu Hluttaw (Lower House) U Win Myint, the Myanmar Investment Commission, and the UMFCCI.  To register, please click here.  Please contact Jack Myint at jmyint@usasean.org with any questions or to express interest.

View the Council's latest Myanmar updates

Philippines

Major Developments

• On October 23, Secretary of National Defense Delfin Lorenzana announced that all combat operations against the Maute group, an ISIS-inspired insurgent group in Marawi, had ended.  The announcement came exactly five months after insurgents attempted to take over the city – the largest predominantly Muslim city in the Philippines – on May 23, resulting in a prolonged military siege of insurgent-held areas of Marawi and the declaration of martial law across the whole island of Mindanao, where the city is located.  The United States, Australia, China and Russia assisted the Philippine military’s combat operations in Marawi, which left more than 900 militants dead, including Abu Sayyaf leader Isnilon Hapilon and Maute group leader Omar Maute.  As many as 165 troops and policemen and 47 civilians were also killed in the fighting, while more than 200,000 of Marawi’s residents were displaced.  Martial law remains in place across Mindanao, and it is likely to stay that way as the military carries out follow-up operations targeting any remaining pockets of insurgents in and around Marawi.  The Philippine Government’s focus now turns towards rebuilding the city, which was heavily damaged during the five months of fighting.  The administration of President Rodrigo Duterte recently pledged an additional P14.5 billion (US$283 million) to the rebuilding efforts, on top of an earlier announced P10.3 billion (US$201 million).  The Government’s success in rebuilding Marawi will be crucial to ensuring the stability of the area, as a prolonged delay could serve as a catalyst for resentment against the Government and potentially the radicalization of those who are most affected.    
• The Philippine Senate faced yet another delay as it seeks to pass the P3.77 trillion (roughly $73.6 billion) national budget and the Tax Reform for Acceleration and Inclusion Act (TRAIN) before the end of the year.  The TRAIN Act is the first component of the Department of Finance’s proposed Comprehensive Tax Reform Package and is one of the most ambitious government efforts to date to overhaul the country’s tax system.  The Philippines House of Representatives already approved its version of the TRAIN Act in May 2017 (House Bill No. 5636), but the Senate is still deliberating its own version of the bill (Senate Bill No. 1592).  The most recent delay in passing the bills resulted from the ASEAN Summit, which took place November 13-15.  The inability of the Senate to convene on those days means that Congress will have only four weeks to pass the 2018 national budget and the TRAIN bill before its end-of-year adjournment.  Out of the two bills, the Congress is likely to prioritize the budget.  If the 2018 national budget is not passed before the end of 2017, the Philippines has to operate under a reenacted budget for the year.  This means that it is increasingly likely that the Senate will not be able to pass its version of the TRAIN Act until after the New Year.  Once the Senate passes its version, the two versions of the bill will have to be reconciled in a Bicameral Conference Committee before being presented to President Duterte for his signature.
• On October 26, President Duterte appointed Government Service Insurance System (GSIS) Chairman Francisco Duque III as the Secretary of Health, a position he previously held from June 2005 to January 2010 during the administration of former President Gloria Macapagal Arroyo.  From 2010 to 2015, Duque served as the Chairperson for the Civil Service Commission under then President Benigno Aquino III, and from 2001 to 2005 he was president and CEO of the government-owned Philippine Health Insurance Corporation (Philhealth).  Duque’s priorities as Secretary of Health include the rehabilitation of Marawi City and the strengthening of its health system, the development of a long-term strategy focused on reducing the national maternal mortality rate, and ensuring quality healthcare is accessible to all Filipinos.  Duque’s appointment follows the Commission on Appointments (CA)’s rejection of the ad interim appointment of Heath Secretary Paulyn Ubial on October 10.  More information on Duque’s appointment can be found here.

Advocacy

Ahead of U.S. President Donald Trump's trip to the Philippines for the U.S.-ASEAN summit and the East Asia Summit November 13-14, the Council submitted a letter to the Trump Administration highlighting two main ways in which the policies of the Government of the Philippines make it more difficult for U.S. companies to participate in the Philippine market – the lack of equal treatment of U.S. companies doing business in the Philippines and import barriers imposed by the Government on products made in the United States.  To underscore the lack of equal treatment for U.S. companies, the Council mentioned the Philippine Government's VAT refund policy and provisions in the first tax reform package that favor the domestic sugar industry over imported caloric sweeteners.  The Council emphasized the import barriers imposed by the Philippine Government by mentioning the Minimum Access Volume system, which imposes a range of tariff and non-tariff barriers on numerous U.S. agricultural products.  The Council recommended that President Trump consider attempting to address these two challenges as he seeks to further strengthen bilateral trade ties between the United States and the Philippines.

View the Council's latest Philippines updates

Singapore

Major Developments

• On October 21-26, Singapore’s Prime Minister Lee Hsien Loong made an official working visit to Washington, DC, with the aim of building on Singapore’s and the United States’ 51-year-old wide-ranging and robust partnership.  The visit was Prime Minister Lee’s first to the United States since President Trump was elected last November, and he used it as a way to set up themes meant to inform President Trump’s trip to Asia this month.  In addition to meeting with President Trump, the Prime Minister also met with Cabinet Secretaries, White House officials, and key members of Congress.  During the bilateral meeting at the White House, Prime Minister Lee and President Trump affirmed the strong partnership between Singapore and the United States, a partnership that is a result of close economic, defense, security, and people-to-people ties.  Both leaders cited the success of the United States-Singapore Free Trade Agreement (USSFTA) in strengthening economic relations between the two countries.  They also reemphasized the commitment of Singapore and the United States to ASEAN centrality and to strengthening the regional architecture so that transnational issues such as maritime security, cybersecurity, and countering violent extremism can be addressed effectively.  Lastly, they recognized the 50th anniversary of ASEAN and the 40th anniversary of U.S.-ASEAN relations.  An Analytical Brief that goes into greater detail on the main points on which Lee focused during his visit can be found here.
• On October 30, as part of the Government of Singapore’s (GOS) ongoing Industry Transformation Program, the Monetary Authority of Singapore (MAS) released an industry transformation map (ITM) for financial services.  The Industry Transformation Programme takes a targeted approach to economic restructuring efforts by seeking to deepen engagement between the GOS, firms, industry stakeholders, and trade associations.  For the financial services industry, the ITM aims to position Singapore as a leading global financial center by encouraging innovation and the adoption of technologies that increase efficiency, reduce costs and create opportunities.  The ITM is meant to position Singapore as a “leading international wealth management hub,” an “Asian hub for fund management and domiciliation,” and a “global forex price discovery and liquidity center in the Asian time zone.”  Additionally, blockchain and its use in cross-border transactions is one of the key examples of FinTech on which MAS plans to focus as part of the financial services ITM.  More information on the financial services ITM and how the MAS plans to expand its use of blockchain technology can be found here.

Advocacy

• On October 24, the Council hosted Ms. Stephanie Syptak-Ramnath, Chargé d'affaires, a.i., of the U.S. Embassy in Singapore, for a roundtable at its offices in Washington, D.C.  The following are key points that were transmitted to the Chargé during the roundtable:
  • Prime Minister Lee continues to advocate for strong U.S. engagement in the Asia Pacific, in economic, security and diplomatic terms.
  • To counter a perception or concern about U.S. presence in region, the U.S. private sector can help to highlight its economic footprint and how investment by U.S. companies has helped raise the living standards in Southeast Asia in particular.
  • Key messages from the Trump Administration during President Trump's upcoming Asia trip will be:
    • Rallying support for the U.S. position on North Korea's violation of United Nations sanctions
    • A free and open Indo-Pacific (emphasis on security issues, especially free navigation of the South China Sea)
    • Increasing American prosperity (emphasis on economic issues)
  • The Trump Administration is working from the same pivot strategy as the previous administration, it is just that different aspects of this pivot are being emphasized.

Looking Ahead

On November 17, the Council held its inaugural ASEAN Presidents’ Luncheon with Tommy Koh, Singapore Ambassador-at-Large and Former Ambassador to the United States.  Amb. Koh also served as Chief Negotiator for the U.S.-Singapore Free Trade Agreement, among many other large-scale trade negotiations.  As Singapore prepares to take over as Chair of ASEAN, he will be speaking on ASEAN @ 50 and the incoming ASEAN Chairman's vision and agenda for 2018.  Please contact Shay Wester at swester@usasean.org for more information.

View the Council's latest Singapore updates

Thailand

Major Developments

• From October 25-29, Thailand held a five-day Royal Cremation Ceremony for the late King Bhumibol Adulyadej, who passed away on October 13, 2016.  The ceremony consisted of an elaborate procession that transported the King’s body from the Grand Palace to Sanam Luang, the site of the royal crematorium, and culminated in the late king’s son and successor, King Maha Vajiralongkorn, lighting a pyre to represent the sacred center of the universe.  The day of the King’s cremation, October 26, was declared a national holiday in Thailand, and millions of Thais from around the country came to Bangkok to pay their respects to the late king.  In addition, dignitaries and royal families from 42 countries attended, including U.S. Secretary of Defense James Mattis, Prince Andrew from Britain, Prince Akishino from Japan, and royalty from Sweden, Spain, the Netherlands and Belgium. The king was the world’s longest-reigning monarch, having reigned for 70 years, and for many Thais was the only king they knew in their lifetime.  He was deeply beloved for his dedication to the Thai people, having undertaken thousands of projects to improve the lives of Thais in every corner of the country.  The Royal Cremation Ceremony marks the end of the year of mourning for Thailand, though the late King will always be deeply missed.
• Thailand landed at number 26 in the World Bank’s 2018 Ease of Doing Business Report (found here), released on November 1, up 20 spots from last year.  Thailand has the third highest ranking of the ASEAN countries, behind Singapore at number two, and Malaysia at number 24.  The World Bank report cites many improvements that Thailand has made in the ease of doing business, including reducing of the time it takes to start a business from 27.5 days to 4.5 days, eliminating the requirement that companies must obtain a company seal, and eliminating the requirement that a company must obtain approval of its work regulations from the Labor Department.  Prime Minister Prayut credits the improvement to public and private sector cooperation and improvements to the working procedures of many government agencies.  The improved ranking demonstrates the Thai government’s commitment to supporting and facilitating ease of doing business in Thailand, and its openness to foreign business presence in the country.  This stance was supported by the Prime Minister’s messages during his visit to the United States in October.  The improved ranking should boost investor confidence in Thailand, which can lead to greater levels of foreign investment and business presence in the country.
• On November 1, Thailand’s Minister of Labor General Sirichai Distakul resigned.  The Minister’s resignation is seen by some as a harbinger of a forthcoming cabinet reshuffle, likely to favor non-military officials—a move that a government source in the Bangkok Post says is meant to “shake off the regime’s ‘junta’ image’ by reducing the number of military officers in the cabinet.”  The make-up of a reformulated cabinet, and the roles civilians will play in it, will be critical given the cabinet’s key responsibilities with regard to planned 2018 elections and the government as a whole.
• On October 7, Thailand’s National Broadcasting and Telecommunications Commission (NBTC) elected General Sukit Khamasunthorn as the new Chairman, succeeding Air Chief Marshal Thares Punsri.  A new board will also be appointed after all seven commissioners on the existing board end their six-year term.  This is in accordance with the new NBTC Act, which came into effect on June 23, and hands six-year, non-renewable terms to appointed commissioners.  Whether there will be a change in policy direction in the NBTC is still an open question.  The Council will continue to monitor the leadership transition and the potential implications for ongoing policy reforms, such as those related to Over-the-Top (OTT) services and future spectrum license auctions.  For more information, see our recent update here.
• On September 27, during the 35th ASEAN Ministers on Energy Meeting (AMEM), utility companies from Laos (Électricité du Laos), Malaysia (Tenaga Nasional Berhad) and Thailand (Electricity Generating Authority of Thailand) signed ASEAN’s first multilateral cross-border electricity trading agreement, an important first step towards eventually realizing the ASEAN Power Grid. According to the Energy Purchase and Wheeling Agreement (EPWA), Malaysia has the option to purchase up to 100 MW of hydropower-generated electricity from Laos.  The electricity will be transferred from Laos to Malaysia through Thailand’s national grid. The two-year agreement will come into effect on January 1, 2018, as part of the first phase of the Laos-Thailand-Malaysia-Singapore Power Integration Project (LTMS-PIP), which is considered a pathfinder for the ASEAN Power Grid (APG), an integrated regional grid system for Southeast Asia.  The agreement will be reviewed in 2020. The official announcement about the agreement from Malaysia's Ministry of Energy, Green Technology and Water (KeTTHA) can be found here.  A separate Analytical Brief (found here) looks at how the three signatories are likely to benefit from the agreement, as well as how the EPWA fits within the broader ASEAN Power Grid initiative.

View the Council's latest Thailand updates

Vietnam

Major Developments

• On October 26, the U.S. Senate officially confirmed Daniel Kritenbrink as the new U.S. Ambassador to Vietnam, succeeding Ambassador Ted Osius.  Ambassador Kritenbrink assumed his post in Hanoi on November 4 just before President Donald Trump arrived for the APEC Summit and subsequent state visit to Hanoi and bilateral engagement with President Tran Dai Quang and the Vietnamese government.  A career member of the Senior Foreign Service, Kritenbrink has two decades of experience overseas and in Washington working on Asian affairs as a policy maker, analyst and practitioner.  He served as senior director for Asian affairs for President Barack Obama’s National Security Council and was most recently the Senior Advisor for North Korea Policy at the State Department.  Ambassador Kritenbrink had been praised by Ambassador Osius and U.S. Senator Ben Sasse of Nebraska as someone capable of taking diplomatic relations with Vietnam to a new high.  Ambassador Kritenbrink pledged to continue to enhance the ties between the two countries with a focus on security, trade and other fields at a reception hosted by Vietnamese Ambassador to the United States Pham Quang Vinh. The two ambassadors agreed to coordinate closely and strengthen the comprehensive partnership between the U.S. and Vietnam.

Advocacy

• On November 7, the Council submitted additional joint comments to Vietnam’s Ministry of Public Security (MPS) regarding its updated version (“Draft 14”) of the Draft Law on Cybersecurity (English translation here).  These comments follow a joint industry letter on the previous version of the draft law.
• The Council has been engaged with the Vietnam Ministry of Health and Office of the Government on challenges members are facing with the implementation of Decree 36 regarding the system of medical equipment registration and approvals.  Currently, phase 2 of Decree 36 has significantly delayed product registration, causing disruption to the supply chain and market.  The Council is working with the Government of Vietnam to extend the transition period or deadline for getting approvals, and looking further to create a new system that would allow for better flow of important products.

Looking Ahead

• On December 15, the Council will be organizing a business roundtable with H.E. Nguyen Thien Nhan, Secretary of the Ho Chi Minh City Party Committee, in Washington, D.C.  Secretary Nhan, who is also currently a Politburo member, previously served as Chairman of the Vietnamese Fatherland Front, Deputy Prime Minister of Vietnam under former Prime Minister Nguyen Tan Dung, and Minister of Education.  Because seating will be limited, members should contact Hai Pham at hpham@usasean.org with questions or to express interest.
   
• In early Q1 2018, the Council will organize a Health & Life Sciences Industry Mission to Vietnam to continue its engagement with the Vietnam Ministry of Health (MOH), building on the positive momentum created by the MOU with the MOH.  Members should contact Hai Pham at hpham@usasean.org with questions or to express interest.

View the Council's latest Vietnam updates