Obama Meets China, Japan Leaders as Sea Spats Threaten Trade
By Daniel Ten Kate and Margaret Talev - Nov 19, 2012 11:26 PM CT
President Barack Obama met with leaders from China and Japan today as Asian countries struggle to resolve territorial disputes in sea lanes vital to world trade that threaten to disrupt economic ties.
Obama called the U.S.-Japan alliance the “cornerstone” of regional security in a meeting with Prime Minister Yoshihiko Noda, who emphasized the importance of relations given the “increasing severity” of the security environment in Asia. Chinese Premier Wen Jiabao said he wanted his meeting with Obama to send a “positive message to the world.”
“It’s important that our two countries cooperate to build a more secure, prosperous future” for the Asia-Pacific region and the world, Obama told reporters as he began the meeting with Wen in Phnom Penh, Cambodia. “As the two largest economies in the world we have a special responsibility to lead the way in ensuring sustained and balanced growth.”
Tensions over China’s territorial claims risk disrupting commercial ties between Asia’s biggest economies as Europe’s sovereign debt crisis and the U.S. fiscal cliff threaten global growth. Japan this month said it would bolster military ties with the U.S. after its purchase of islands claimed by China rattled a $340 billion trade relationship.
Southeast Asian nations yesterday split over handling maritime conflicts with China, reflecting divisions that surfaced in a July meeting when the Association of Southeast Asian Nations failed to release a communique for the first time ever. Obama, on a three-day trip to the region, will head back to the U.S. after the meetings today.
“We are not going to allow the issue to cloud or to affect other pursuits that we are doing here,” Surin Pitsuwan, Asean’s secretary-general, told reporters today, referring to the island disputes. “But of course any other member states who would like to carry this issue in its own way, to pursue its own interests, those states have the right to do so.”
After the meetings with Wen and Noda, Obama will attend the East Asia Summit, which also includes leaders from Asean, South Korea, India, Australia and New Zealand. Obama last year called the event the “premier” arena to discuss maritime security concerns, a subject China has sought to keep out of international summits.
‘Sign of Weakness’
“Anything that Obama says about the South China Sea will be interpreted by Beijing as an interference, as American pressure on China,” said Li Mingjiang, an associate professor at the Singapore-based S. Rajaratnam School of International Studies. “If Obama doesn’t mention it, it will be a sign of weakness on the part of the U.S.”
Noda yesterday told Asean leaders he would seek to resolve differences with China in a “calm and peaceful manner,” according to a government statement, after the countries sparred over the islands at a summit of European and Asian leaders in Laos earlier this month. Noda will only raise the island dispute at today’s meetings if China brings it up, Hikariko Ono, a spokeswoman for the Japanese prime minister’s office, said by phone.
China has demanded that Japan withdraw from its September purchase of the islands, known as Senkaku in Japan and Diaoyu in China. Anti-Japan protests have reduced China sales at Toyota Motor Corp. (7203), Nissan Motor Co. and Honda Motor Co.
Wen yesterday urged Asean members to avoid discussing island disputes because China prefers to deal with individual claimants directly, foreign ministry spokesman Qin Gang told reporters. China proposed setting up a group of experts to find ways to resolve sea tensions, he said.
“China and Asean countries share a lot of things in common, particularly in making joint efforts to keep the good momentum of economic growth in this region,” Qin said. “All parties, including China, we have felt the pressures from the slowdown in the world economy.”
Southeast Asia is growing more reliant on trade with China, which is a gateway for shipments to advanced economies, according to the Organization for Economic Cooperation and Development. The euro-area economy succumbed to a recession for the second time in four years, as governments imposed tougher budget cuts and leaders struggled to contain the debt turmoil.
Asean leaders are set to start talks today on a regional trade agreement with China, Japan, India, South Korea, Australia and New Zealand, an area with more than 3 billion people representing about a quarter of the world economy, according to data compiled by Bloomberg. China has been Asean’s largest trading partner since 2009.
China, Japan and South Korea trade ministers will also meet today in Cambodia to announce the start of negotiations, according to an e-mailed statement from South Korea’s Ministry of Foreign Affairs and Trade.
Asean’s differences over handling territorial disputes emerged yesterday after the Philippines, a U.S. ally, disputed Cambodia’s assertion that the bloc agreed to limit discussion of maritime claims in the South China Sea at international forums. Cambodia hung banners hailing the country’s close ties with China on a wall outside the summit venue.
“The Philippines looks to China to set the example of wise and peace-seeking leadership,” President Benigno Aquino told reporters last night. “Our region is very diverse and its harmony can easily be disrupted by sheer political, military, or economic might.”
China has resisted talks with Asean on a legally binding code of conduct in the South China Sea, where it has deployed maritime surveillance ships to assert its territorial claims. The Philippines and Vietnam, which have awarded exploration contracts to Exxon Mobil Corp. (XOM), Talisman Energy Inc. (TLM) and Forum Energy Plc (FEP), reject China’s map of the sea as a basis for joint development of oil and gas.
Australian Prime Minister Julia Gillard, who is also attending the meetings, called for the South China Sea disputes to be resolved according to international law.
“We are talking about an area of the world that our shipping needs to go through to take our goods to the world,” she told reporters today. “This is a very heavily used trade route for Australia and consequently what happens there in terms of maritime security is important to us.”
To contact the reporters on this story: Daniel Ten Kate in Phnom Penh at email@example.com; Margaret Talev in Phnom Penh at firstname.lastname@example.org
To contact the editor responsible for this story: Peter Hirschberg at email@example.com
Obama Faces Pressure to Lead on ‘Fiscal Cliff’ After Win
By Kathleen Hunter and Roxana Tiron - Nov 7, 2012 8:21 AM CT
The Fiscal Cliff and President Obama’s Legacy
President Barack Obama’s victory positions him to claim a mandate for pushing a proposal through Congress that would let tax cuts expire for top earners and avert $1.2 trillion in automatic spending reductions.
Obama now must decide how to contend with opposition from congressional Republicans who demand a tax-cut extension for all income levels.
Obama defeated Republican Mitt Romney to win a second term that will begin with the same balance of power in Congress: Democrats controlling the Senate and Republicans holding the majority in the House. Republicans were counting on a Romney victory or a Senate takeover to improve their negotiating posture.
Emboldened by the election results, Obama “will offer a brand-new plan of his own,” Steve Bell, senior director of the Economic Policy Project at the Bipartisan Policy Center, said in an interview.
Bell said one option the Obama administration is considering is pushing anew for a “balanced” plan to cut as much as $100 billion in spending as a deficit-reduction down payment while letting the George W. Bush-era tax cuts expire for top earners.
“In the coming weeks and months, I am looking forward to reaching out and working with leaders of both parties to meet the challenges we can only solve together: reducing our deficit; reforming our tax code; fixing our immigration system; freeing ourselves from foreign oil,” Obama said in his victory speech early today.
Congressional aides have previously said that lawmakers in both parties are discussing fallback plans for $60 billion to $100 billion in deficit reduction.
Senate Finance Chairman Max Baucus, a Montana Democrat, said this week that he expected Obama to call on Congress soon after the election to pass a deficit-reduction plan that includes revenue increases and spending cuts.
“There’s a mandate for a balanced approach, and that means it’s got to be a combination of revenue and cuts,” former Representative Tom Perriello, a Virginia Democrat, said in an interview. He said he would like to see Obama “put a very bold plan out there.”
Unless Congress acts, automatic spending cuts, known as sequestration, will begin in January and the Bush tax cuts will expire Dec. 31. Obama and congressional Democrats want to let the tax cuts expire for top earners, while Republicans advocate extending them for all income levels. The spending reductions and tax increases, amounting to $607 billion in 2013, are known as the “fiscal cliff.”
To help bring Republicans to the table, Obama also may propose “minor changes” to entitlement programs, such as a temporary change in the formula used to calculate annual benefit adjustments, Bell said.
“Obama will certainly be very proactive,” he said.
A big question is the degree to which Republicans will back off from their opposition to tax increases.
“For two years, our majority in the House has been the primary line of defense for the American people against a government that spends too much, taxes too much and borrows too much when left unchecked,” House Speaker John Boehner said yesterday at an election event in Washington. “With this vote, the American people have also made clear that there is no mandate for raising tax rates.”
Boehner indicated before the election that the House may be willing to pass short-term legislation to make time for broader talks on reducing the deficit and averting automatic spending cuts over the next decade.
“The American people re-elected the president, and re- elected our majority in the House,” Boehner of Ohio said in a statement. “If there is a mandate, it is a mandate for both parties to find common ground and take steps together to help our economy grow and create jobs, which is critical to solving our debt.”
The speaker plans to make a statement on the fiscal cliff at 3:30 p.m. Washington time today, according to an e-mailed statement issued by his staff. He’ll make the statement after holding a conference call with House Republicans to discuss the fiscal cliff and the election results, according to a House Republican leadership aide, who spoke on condition of anonymity about the private meeting.
Eric Ueland, chief of staff to former Senator Bill Frist when the Tennessee Republican was majority leader, said Obama “has a responsibility to step forward quickly and express his specific interest in what he wants to see happen in December and then let Congress react to that.”
Ueland said Obama’s victory increases pressure on him to reach across the aisle.
“While he’ll have the ability to argue that he received an endorsement of his positions, he also has the responsibility of working with the Republicans in the House and Senate,” Ueland said.
Some congressional Republicans, especially in the Senate, have said they may be willing to consider eliminating some tax breaks to help pay for eliminating automatic cuts to defense programs.
To the extent that Obama “wants to move to the political center, which is where the work gets done in a divided government, we’ll be there to meet him halfway,” Senate Minority Leader Mitch McConnell, a Kentucky Republican, said in a statement. “That begins by proposing a way for both parties to work together in avoiding the ‘fiscal cliff’ without harming a weak and fragile economy.”
Obama wants to boost top income tax rates to the levels they reached when President Bill Clinton left office in 2001 -- at 36 percent and 39.6 percent. He also wants higher taxes on capital gains and dividends than now and a smaller estate tax exemption and higher rate.
In July, the Senate, which Democrats now control 53-47, passed legislation to extend through 2013 the tax cuts for individual income up to $200,000 a year and income of married couples up to $250,000. Above those thresholds, taxpayers would face higher rates for ordinary income, capital gains and dividends.
‘Gridlock and Delay’
Senate Majority Leader Harry Reid, a Nevada Democrat, said yesterday in a statement that voters rejected “the strategy of obstruction, gridlock and delay” he has accused Republicans of employing.
“This is no time for excuses,” Reid said. “This is no time for putting things off until later. We can achieve big things when we work together, and the middle class is counting on us to achieve big things in the months ahead.”
The Republican-led House passed legislation in May to avert defense spending cuts and voted in July to extend all of the expiring tax cuts. Neither measure advanced in the Democratic- controlled Senate. Obama opposed them, too.
The automatic cuts over 10 years would be split equally between defense and non-defense programs. Democratic and Republican lawmakers have raised concerns about the cuts and say they want to avert them.
Representative Chris Van Hollen, a Maryland Democrat, said in an interview before lawmakers left Washington in September to campaign that he was optimistic lawmakers could at least find a short-term solution to allow time for talks on a larger deficit- cutting plan.
“The keys are in the Republican hands,” Van Hollen said. “The minute they decide to take a balanced approach to deficit reduction we can get there.”
To contact the reporters on this story: Kathleen Hunter in Washington at firstname.lastname@example.org; Roxana Tiron in Washington at email@example.com
To contact the editor responsible for this story: Jodi Schneider at firstname.lastname@example.org
China nuclear firm plans IPO as projects resume November 2, 2012
Enlarge The Qinshan nuclear power plant in Haiyan, in eastern China's Zhejiang province. A Chinese nuclear power plant builder said it plans to raise 1.8 bn yuan from a stock offer, as Beijing moves to restart projects frozen after Japan's atomic disaster last year. A Chinese nuclear power plant builder said it plans to raise 1.8 billion yuan ($288 million) from a stock offer, as Beijing moves to restart projects frozen after Japan's atomic disaster last year.
China Nuclear Engineering Co. has passed an environmental inspection required before its initial public offer (IPO), the company and the Ministry of Environmental Protection said late Thursday. The company, a unit of state-owned China Nuclear Engineering Group, will use funds from the offering for nuclear power-related construction and other projects, according to a statement.
Enlarge The Qinshan nuclear power plant in Haiyan, in eastern China's Zhejiang province.
China last month said it had lifted a ban on new nuclear power stations imposed after the Fukushima disaster in Japan last year, but the government would only approve projects proposed for coastal areas.
China last month said it had lifted a ban on new nuclear power stations imposed after the Fukushima disaster in Japan last year, but the government would only approve projects proposed for coastal areas. "The development plan, which will resume approvals for some new projects, created a favourable policy environment for the company and cleared hurdles for its planned IPO," said an analyst at a Chinese brokerage, who declined to be named.
China Nuclear Engineering Co. first filed an application for an IPO to securities regulators in early 2011, but the plan was shelved after Beijing halted projects, state media has reported. Global fears about nuclear safety increased following a series of nuclear meltdowns at Japan's Fukushima Daiichi nuclear power plant in 2011 after it was struck by the March 11 earthquake and tsunami. The company is the second Chinese nuclear firm to announce a planned listing in the past six months, after China National Nuclear Power Co. said in June it had received environmental approval. It has yet to list.
China, the world's largest energy consumer, is eager to increase the amount of nuclear power it uses to drive its economy. (c) 2012 AFP