President's Newsletter - January 2016

Amb. Ted Osius
Amb. Ted Osius
President & CEO
US-ASEAN Business Council

2016 is off to a swift start, with major political transitions in Laos, Myanmar, and Vietnam, and fast approaching, momentous visit of the ASEAN Leaders to the U.S. for the US-ASEAN Leaders Summit in Sunnylands California, February 15 and 16.

As you have hopefully heard, the Council is then hosting a major conference on the AEC in San Francisco on February 17. The conference, Asia’s Best Kept Secret: the ASEAN Economic Community, will feature some of the best minds that focus on ASEAN from business and government, and will be attended by a wide range of leading business, academic, government, and media figures. Check out the agenda here.

We hope to have confirmation soon on the leaders who will be joining us for the conference, but we have confirmed participation from:

  • The Honorable Michael Froman, US Trade Representative
  • The ASEAN Economic Ministers
  • ASEAN Secretary General Le Luong Minh
  • The Honorable Nina Hachigian, US Ambassador to ASEAN
  • Air Asia Founder and Group CEO Tony Fernandes

You can see our full confirmed speaker list here.

There are still many opportunities to sponsor and have your company represented among this incredible group of ASEAN experts and leaders. Contact our membership director Harry Surjaridja at hsurja@usasean.org for more information.

Please help us spread the word by sharing information on purchasing tickets to anyone in your organization and beyond who you think may be interested. Individual tickets can be purchased here.  

As always, you can check out the calendar at the Council website to get a sense of our many upcoming events in Southeast Asia and Washington, D.C. 

Highlights

Advocacy

  • The Council, in partnership with the Software & Information Industry Association (SIIA) is exploring doing a joint advocacy effort on a draft Creative Economy bill which has been tabled in Indonesia’s Parliament.  The bill if enacted into law would include provisions affecting ownership and use of intellectually property & innovations produced in Indonesia.
  • The Council is developing an advocacy campaign to change the implementation of an insurance industry regulation in Vietnam which requires all insurance products to be “registered”.
    The Council’s representatives met with MOIT on January 21 requesting further clarification on the regulations. MOIT/VCA said the new Decision is a level-4 e-government administrative procedure service, which is a paperless automatic online system. The Agency confirmed their support to either the sector or the consumers, saying that it guaranteed the process of providing comments would be finished within 20 working days.
  • The Council held a meeting with Assistant Secretary of State Tom Malinowksi, Deputy Assistant Secretary Andrew Keller, Sanctions Coordinator Ambassador Dan Friend, and Acting Deputy Director of OFAC Andrea Gacki to discuss USG sanctions policy on Myanmar. The Council is working on a white paper discussing the effect of U.S. sanctions policy and the SDN list on U.S. companies. For more information, contact Matt Solomon at msolomon@usasean.org.
  • The Council transmitted a letter on behalf of our members to the Philippines Department of Agriculture in response to a recent ruling by the Supreme Court of the Philippines on the use of Bt Eggplant in the country.  The Council urged the Department of Agriculture to provide a clear Administrative Order to all key stakeholders, especially farmers that the SC ruling does not affect previously approved GM corn varieties.  The letter noted that without such a clarification, the SC ruling could cause a break in the production of corn which would disrupt the flow of feed in the food production supply chain in the Philippines.

If you have questions about the Council’s advocacy efforts, please reach out to Marc Mealy at mmealy@usasean.org.

Intelligence

  • The Lao People’s Revolutionary Party completed its 10th congress, elevating Bounnhang Vorachit, former Vice President, to the Presidency and leadership of Laos. National Assembly Chairwoman and former central bank governor Pany Yathotu is expected to become Vice President. Former Deputy Prime Minister and Minister of Foreign Affairs Thongloun Sisoulith will take on the role of Prime Minister.
  • The Council’s Vietnam team provided a thorough analysis of the changes in leadership that took place after the party congress. See our full Vietnam Analytical Update for more information.
  • On January 12 the Philippine Supreme Court ruled to uphold the constitutionality of the Enhanced Defense Cooperation Agreement (EDCA) with the United States, opening the door for closer bilateral military cooperation between the Philippines and the United States. The Council's overview of the decision and its implications can be found here.

Relationship Building

We are very proud of the US-ASEAN Business Alliance for Competitive SMEs which is a powerful way to support the growth of small businesses in ASEAN.  The Business Alliance was created at the request of the ASEAN Economic Ministers and cooperation with US-AID. You can find more information on the Business Alliance for Competitive SMEs website.  Please contact Mario Masaya at mmasaya@usasean.org for more information.

Promotion

Help us spread the word about Asia’s Best Kept Secret: The ASEAN Economic Community, our upcoming conference in San Francisco on February 17. Forward this link for registration, or use #asiasbestkeptsecret on twitter!

APEC

Major Developments

More highlights from the 2015 APEC year.

Looking Ahead

  • February 25: The National Center for APEC will be hosting an Executive Forum in San Francisco that focuses on Connecting the Asia-Pacific: Innovation, Disruption and Growth with members of the APEC Business Advisory Council (ABAC) and APEC Senior Officials.  Participants will discuss the potential for new technologies to address society’s epic challenges – climate change, health, and aging populations; implications for policymakers and traditional industries of the Internet of Things, what is needed to foster entrepreneurial innovation and creative disruption, and the role trade agreements play in promoting innovation and technological advances throughout the region. If you have any questions, please contact Arissan Ugles at augles@ncapec.org.
  • February 24-28: APEC Business Advisory Council (ABAC) I meetings will be held in San Francisco. 

Full list of upcoming APEC events.

View the Council's latest APEC updates

ASEAN

Major Developments

ASEAN officially announced its vision for the completion of the ASEAN Economic Community and the pathway to 2025. More information on Vision 2025 and what has been achieved so far. 

Advocacy

The Council is preparing a paper entitled “Ways to Enable ASEAN Cross-Border E-Commerce Trade". To provide feedback on the draft, please contact Shay Wester at swester@usasean.org.

Looking Ahead

  • The Council will hold its second exclusive dialogue with the ASEAN-BAC on February 3. Members interested in proposing engagements or joint projects with the ASEAN-BAC should contact Anthony Nelson at anelson@usasean.org.
  • The ASEAN Online SME Academy is a fantastic opportunity to share content with a wide variety of SMEs and contribute to the lasting success of the US-ASEAN Business Alliance for Competitive SMEs.  To contribute to the Academy, please contact Mario Masaya at mmasaya@usasean.org to discuss opportunities and check out the Alliance on the web. 

View the Council's latest ASEAN updates

TPP

In Malaysia, both the Parliament and Senate approved a motion to ratify the TPP. This will politically help PM Najib to secure Cabinet approval for ratifying it.  We expect Malaysia to participate in the signing ceremony on February 4.

View the Council's latest TPP updates

Customs

Looking Ahead

  • The 2016 ASEAN Directors-General of Customs Meeting will occur from May 25 to 27 in Phnom Penh, Cambodia. The Council looks forward to bringing a delegation to present the private sector’s priorities for customs integration and trade facilitation in ASEAN to the assembled Directors-General. The Council will also arrange bilateral meetings with priority customs departments as they are available. Logistical details and a full invitation will be distributed closer to the date of the Mission.
  • The Customs Committee will host its first 2016 quarterly planning call on February 25 at 9:00 - 10:00 PM (Washington, DC time) / February 26 at 10:00 - 11:00 AM (Singapore time). The call will cover our 2016 policy themes, the ASEAN Directors-General of Customs Meeting, developing engagements with the ASEAN Customs Working Groups, and other proposals from members. Members may register for the call at this link.
  • The Customs Committee is also leading the development of a cross-sectoral policy paper on e-commerce development in ASEAN. Please contact Fatimah Alsagoff at falsagoff@usasean.org for more information on the project.
  • Please visit our Customs Committee webpage for continuing coverage of industry developments, including the approaching passage of the Philippines’ long-awaited Customs Modernization and Tariff Act.

View the Council's latest Customs updates

Defense & Security

Major Developments

The Supreme Court of the Philippines ruled the Enhanced Defense Cooperation Agreement with the United States was legal, paving the way for a substantial uptick in defense ties between the two countries. Read the Council’s full update for more.

Looking Ahead

The Singapore Air Show will be held February 16 to 21, 2016. The Council will be organizing side meetings during this event. Please contact Ezani Mansor at emansor@usasean.org for more information. 

View the Council's latest Defense & Security updates

Energy

Major Developments

  • Hoping to meet its stated targets for the utilization of renewable energy, the Indonesian government is currently considering creating a new utility company that would purchase power solely from renewable energy sources. Read the Council’s coverage of the issue.
  • Seeking to build upon Singapore's role as a liquefied natural gas (LNG) trading hub and position the country as an important regional LNG pricing hub, the Singapore Exchange Ltd. (SGX) on January 25 launched LNG futures and swaps contracts linked to FOB Singapore SLInG—the exchange's local spot price index for LNG traded in Asia. More information on SGX’s FOB Singapore SLInG can be found here.

Looking Ahead

  • The Indonesian Ministry of Energy and Mineral Resources is holding the Bali Clean Energy Forum (BCEF) on February 11 and 12 in Nusa Dua, Bali. The forum will also mark the launch and introduction of the Center of Excellence on Clean Energy.
  • On March 17, the Geothermal Energy Association will hold its 2016 U.S. & International Geothermal Energy Showcase at the Ronald Reagan and International Trade Center in Washington, DC.

Advocacy

The Council is organizing a mission to this year's ASEAN Energy Ministers Meeting in Yangon, Myanmar. At last year's meeting, the Council submitted a proposal and recommendations to the ASEAN Senior Officials and Ministers for Energy to raise the level of cooperation between the U.S. Energy private sector and ASEAN. As part of this proposed enhanced engagement the Council’s Energy Committee will continue to work to support the US government’s interagency efforts to support trade and investment between the U.S. and ASEAN.

View the Council's latest Energy updates

Financial Services

Looking Ahead

  • The 2016 ASEAN Finance Ministers and Central Bank Governors Meeting (AFMGM) will occur from April 1-4 in Vientiane, Laos. The Council looks forward to bringing a delegation to present the private sector’s priorities for financial sector development in ASEAN to the assembled ministers and bank governors. The Council’s Luncheon Meeting with the AFMGM is scheduled for April 4 and delegates are also invited to join the AFMGM’s formal dinner on April 3. The Council will also arrange bilateral meetings with priority ministers and governors as they are available. Logistical details and a full invitation will be distributed soon.
  • The Financial Services Committee will host its first 2016 quarterly planning call on February 2 at 9:00 - 10:00 PM (Washington, DC time) / February 3 at 10:00 - 11:00 AM (Singapore time). During the call, we will cover priority areas for work in 2016 and begin developing our agenda for the AFMGM. Members may register for the call at this link.
  • Please visit our Financial Services Committee webpage for continuing coverage of industry developments, including Vietnam’s introduction of a more flexible exchange rate mechanism, Thailand’s forthcoming reductions in its barriers to foreign investment in the financial sector, and Indonesia’s new Loan Guarantees Act.

View the Council's latest Financial Services updates

Food & Agriculture

Major Developments

Prime Minister Nguyen Tan Dung spoke on Vietnam’s agriculture sector’s 2015 performance, 2016 development plan, and his vision for the next five years at a conference in Hanoi on January 5th. PM Dung applauded the sector, which is a main pillar of Vietnam’s socio-economic development, for achieving a growth rate of about 3.1 percent despite economic difficulties like extreme weather, falling prices of farming products and tougher competition. For 2016, PM Dung asked the Ministry of Agriculture & Rural Development (MARD) to improve the legal framework and review policies, strategies and planning to better support farmers and firms as well as crack down on violations. PM Dung also called for reforms to promote the application of science and technology, urging the sector to build specific mechanisms and policies to facilitate the application of science and technology to increase productivity, and create high-quality and competitive products. Further, he called for continued efforts to implement the national target program on building new-style rural areas, with focus on renovating production models to increase farmers’ income and mobilizing social resources for investment in rural areas. In the last four years, nearly USD $38 billion was spent on developing these new-style rural areas. Finally, MARD Minister Cao Duc Phat said that 2016 would see more restructuring in agriculture to increase value and efficiency of agriculture production, and called for more investments for the processing industry, modernizing post-harvest storage to reduce post-harvest loss, and add value for Vietnamese farming products. 

Looking Ahead

The Council will be organizing an inaugural Food & Agriculture Industry Mission to Indonesia on Thursday, March 31.  Please contact Sunita Kapoor at skapoor@usasean.org for more information.

View the Council's latest Food & Agriculture updates

Health & Life Sciences

Major Developments

The Singapore government has announced government funding of S$19 billion (US$13.2 billion) for research, innovation and enterprise (RIE) activities over the next five years. The health and biomedical sciences is one of the four technology domains that the project (RIE2020) plans to target. This new plan will emphasize public-private collaboration involving multi-national companies (MNCs), large local enterprises (LLEs) and small-to-medium enterprises (SMCs). It will also focus on R&D commercialization and scaling up for global markets. The government hopes to see an increase in private-sector investment in R&D from the current 1.5 percent of Singapore’s GDP to 1.8 percent.  

Advocacy

On December 22, the Council – as part of a delegation of international business chambers - met with the Ministry of Religious Affairs (MoRA) for dialogue on the implementation of Law No. 33 of 2014 on Halal Product Guarantee (Halal Product Law). In particular, the meeting focused on opportunities for providing input as the government deliberates implementing regulations. Categories of products that will require halal certification will be regulated in stages: food products are expected to be regulated from 2017, while cosmetics, pharmaceuticals, and products utilized by people (barang gunaan) will be regulated by 2019. The Ministry of Religious Affairs (MoRA) plans to issue the draft regulations for public consultation in February at the latest. Once available, the Council will share the draft regulations and consolidate member input for submission to the government. 

View the Council's latest Health & Life Sciences updates

ICT

Major Developments

Thailand and Indonesia are likely to significantly expand access to 4 g this year, creating more opportunities for e-commerce and mobile companies to expand their base of customers. Read the Council’s update on Indonesia’s launch of its 4g network here. With the recent fourth generation (4G) spectrum auction in Thailand and an ongoing, large-scale government-led broadband infrastructure project, access to mobile network services is likely to increase significantly this year.  As a result, increased online opportunities for businesses and consumers in Thailand is expected to follow. Read the Council’s full update on opportunities in Thailand here.

View the Council's latest ICT updates

Indonesia

Major Developments

The House of Representatives (DPR) approved 40 proposed bills for inclusion in the 2016 National Legislation Program (Prolegnas 2016) on January 26. The full list of proposed bills may be found at this link (in Indonesian).

Looking Ahead

  • The Indonesia Committee will host its first 2016 quarterly planning call on February 3 at 9:00 – 10:00 AM (Washington, DC time) / 9:00 – 10:00 PM (Jakarta time). The call will open with a briefing by U.S. Ambassador to Indonesia, the Hon. Robert Blake and then cover our 2016 work plan and major upcoming opportunities like the ASEAN Economic Community Conference in San Francisco (February 17), proposed industry missions to Indonesia, and the development of the Indonesia Human Capital Development Forum (date TBD). Members may register for the call at this link.
  • Please visit our Indonesia Committee webpage for continuing coverage of critical developments, including the government’s stimulus and deregulation packages, food supply management policies, and the soon to be unveiled revisions of the negative investment list.

View the Council's latest Indonesia updates

Laos

Major Developments

The Lao People’s Revolutionary Party completed its 10th congress, elevating Bounnhang Vorachit, former Vice President, to the Presidency and leadership of Laos. National Assembly Chairwoman and former central bank governor Pany Yathotu is expected to become Vice President. Former Deputy Prime Minister and Minister of Foreign Affairs Thongloun Sisoulith will take on the role of Prime Minister. 

Looking Ahead

  • In 2016 Laos will host the ASEAN Finance Ministers and Bank Governors Meeting (expected late March/April), the ASEAN Economic Ministers Meeting (expected August), and the East Asia Summit, ASEAN Summit and ASEAN Business and Investment Summit (expected September).
  • The Council is planning the 2016 Laos Business Mission in March, to be combined with an SME event. We will send more updates as the planning gets underway.

View the Council's latest Laos updates

Malaysia

Major Developments

MITI conducted a cost benefit study which concludes it is in Malaysia’s national interest to ratify the TPP. The Senate approved a motion for the nation to sign on to the TPP January 28, clearing the way for Minister of Industry and Trade Mustapa to travel to New Zealand to sign the agreement February 4. Read the Council’s full update on Malaysia and the TPP.

View the Council's latest Malaysia updates

Myanmar

Major Developments

  • As the new National League for Democracy (NLD)-led Parliament prepares to sit for the first time next Monday, the composition of the democratically-elected party’s leadership structure is beginning to emerge. Party leader Daw Aung San Suu Kyi confirmed this week that U Win Myint, a longtime member of the NLD inner circle, will be the nominee for the influential lower house speakership. More surprising is the nomination for deputy speaker of the lower house, U T Khun Myat, a member of the outgoing USDP party. This adds to previous reconciliatory gestures from NLD leadership, such as recent meetings with the Commander in Chief. Concerns remain, however, about the balance of power between the civilian government and the military, as the latter retains control of three powerful ministries and 25% of parliamentary seats. Despite broad speculation on the likely presidential nominee, there is no official word on who will occupy the top spot. It has been made clear, however, that whoever it is will still answer to Aung San Suu Kyi. More information on the NLD’s expected substantive agenda can be found in our most recent Myanmar Update here.
  • U.S. Ambassador-Designate to Myanmar Scot Marciel was approved by the Senate Foreign Relations Committee January 28. The next step will be confirmation by the full Senate. 

Looking Ahead

U.S. Ambassador to Myanmar Derek Mitchell will meet with Council members in Singapore February 17. Please click here to register.

View the Council's latest Myanmar updates

Philippines

Major Developments

Looking Ahead

  • The Council is partnering with Leverage International (Consultants) Inc. to hold Protect 2016, an international exhibition and conference that will showcase the latest technologies, solutions and services needed to meet today's evolving security challenges. Protect 2016 will be held March 2 and 3, in Manila.
  • The 2016 general election is slated for May 9. The Council is planning the 2016 Philippines Business Mission so that participants can engage the new government. At this time, the mission is tentatively scheduled for September.
  • The Philippines is one of the countries that the Council’s 2016 Asia-Pacific President’s Mission will visit. 

View the Council's latest Philippines updates

Singapore

Major Developments

  • The recently formed Committee on the Future Economy (CFE) held its inaugural meeting on January 11 and announced the sub-committees for the areas on which it intends to focus. The government-formed CFE will provide economic policy guidance intended to spur innovation and increase the resiliency of Singaporean businesses. The Council's overview of the CFE and its five areas of focus can be found here.
  • On January 27, Prime Minister Lee Hsien Loong announced a range of measures aimed at making the political system more open and accountable so that it better serves Singapore's populace. The Council's coverage of Prime Minister Lee's announcement can be found here.
  • On January 18, 2016, the Ministry of Communications and Information (MCI) announced its plan to merge and restructure the Infocommunications Development Authority of Singapore (IDA) and Media Development Authority of Singapore (MDA) into two regulatory bodies tasked with overseeing the rapidly converging infocommunications and media sectors. The Council’s coverage of this merger can be found here.

Looking Ahead

  • The biennial Singapore Airshow 2016 will be held from February 16 to 21, 2016 at the Changi Exhibition Centre. Billed as Asia’s largest and one of the most important aerospace and defense exhibitions in the world, the Singapore Airshow will be bringing together high-level military and government delegations and leading industry players from airlines, airport operators, aircraft manufacturers and related industries.
  • The Council is again supporting The Economist Events’ Health Care Forum: War on Cancer which will take place in Singapore, March 17. At the forum, leaders from government, industry and academia at the forum to learn about new and cost-effective measures being used to attack cancer in Asia and discuss how they can be improved for the benefit of patients.
  • On March 22, the US-ASEAN Business Alliance for Competitive SMEs will hold a workshop entitled "Supply Chain Readiness - Medical Technology Sector" in Singapore, in partnership with UPS Asia Group Pte. Ltd.
  • The Council is organizing a Singapore Business Mission for this year. The business mission is tentatively scheduled for April.

View the Council's latest Singapore updates

Thailand

Major Developments

On January 29 the Constitution Drafting Committee (CDC) released a draft constitution—Thailand’s 20th in 84 years—which will come up for referendum in July. It is available in Thai here. Despite a promise from Prime Minister Prayut Chan-o-cha this week that the 2017 elections would proceed even without an approved draft (see the Council’s most recent update for more background), the CDC chairman said that the government roadmap for a mid-2017 election would be delayed by a "minimum of two to three months." The Council will continue to follow the development of the new constitution. 

Looking Ahead

The first Thailand Committee Quarterly call of 2016 will take place on February 2 (DC)/February 3 (Bangkok). The call will feature a half-hour briefing from the new U.S. Ambassador to Thailand, Glyn T. Davies, followed by a discussion of the Committee's priorities and upcoming opportunities for 2016. Please click here to register.

View the Council's latest Thailand updates

Vietnam

Major Developments

The Communist Party of Vietnam (CPV) concluded Thursday its 12th national congress and announced a new leadership that pledges to press ahead with reforms. The CPV congress elected a new Central Executive Committee (CEC) that includes 200 members from which cabinet members will be drawn in the next government to be announced in early August. The new CEC has also elected a new Politburo which includes 19 members who will hold top positions in the State, Government and National Assembly, among others, including president, prime minister and chairperson of the National Assembly.

While the new power structure will see the exit of Prime Minister Nguyen Tan Dzung and state president Truong Tan Sang, two best known charismatic reformers in the current leadership, the new Politburo has also been expanded to include many technocrats who are younger and more capable than the departing old guards. Some of these new faces include Deputy Prime Minister and Minister of Foreign Affairs Pham Binh Minh, State Bank Governor Nguyen Van Binh and Minister of Transport Dinh La Thang. These individuals have revolutionized their respective portfolios over the past five years and played a key role in turning the economy around.

According to CPV plans, Deputy Prime Minister Nguyen Xuan Phuc (pronounced Fook) will be the next Prime Minister, Minister of Public Security Tran Dai Quang the next president and National Assembly vice Chairwoman Nguyen Thi Kim Ngan the next Chairwoman. Unlike Mme. Ngan, who is a charismatic leader and known to have a good grab of modern economics, both Mr. Phuc and Mr. Quang have not had any significant public record for economic policy making but are known more for their law-and-order performance. Nonetheless, these men are known to be strong supporters and enforcers of reforms in their respective portfolios. While these three individuals are nowhere near their respective future predecessors in terms of domestic political influence, the new team is expected to perform better with the inclusion of many other younger and more competent members.

Following the CPV congress, Vietnam will hold the National Assembly elections on May 22, 2016 when members of the new government will be chosen from the personnel choices of the new CEC. The new government is expected to make its debut in the first week of August. Most ministries will have new ministers, including such key business-related ministries as Ministry of Industry and Trade (MOIT), Ministry of Planning and Investment (MPI), Ministry of Information and Communications (MIC), State Bank of Vietnam (SBV), Ministry of Transport (MOT) and Ministry of Health (MOH).

Please click here to see the full Vietnam Analytical Update.

View the Council's latest Vietnam updates