World

China’s economy baffles the experts; ABC changes overseas; what Princely reward for Charles? By Hamish McDonald.

All eyes on Japan’s Shinzō Abe for VP Day anniversary

Japan’s Prime Minister Shinzō Abe this week.
Credit: AFP

Saturday being the 70th anniversary of Japan’s surrender in the Pacific, attention will be on the speech due to be delivered by Shinzō Abe and whether he can move his country and its neighbours on from the bitter memories of war and occupation.

“All signs are that Abe will not say what needs to be said because he seeks to end what revisionists deride as Japan’s apology diplomacy and masochistic history,” wrote Temple University Japan’s Jeff Kingston in a commentary on the Japan Focus website this week.

The revisionists’ narrative is getting challenged in unexpected places. The panel Abe picked to advise him on his speech included a reference to Japan’s “reckless war” and questioned their line that Japan set out to liberate Asia from Western imperialism. Earlier this month the national broadcaster NHK − despite Abe having stacked its top management with like-minded nostalgists − showed a documentary giving sympathetic treatment to a wartime imperial navy officer who, after capture, worked with the Allies in Brisbane to persuade others to surrender.

But if Abe follows the panel’s advice he will also quibble at whether Japan’s pre-1945 actions constituted “aggression”, play up Japanese suffering in Hiroshima and Nagasaki and from earlier fire-bombing, and chide South Korea’s president, Park Geun-hye, for her “emotion-based diplomacy” over the Korean and other “comfort women” coerced into imperial army brothels.

If so, this will be another missed opportunity. As it is, Abe’s revisionism has clouded aspects of Japan’s continuing emergence from wartime shadows, such as the wider role for its military forces he is pushing through the Diet, and the spread of Japanese capital and soft power (epitomised in last month’s acquisition of Britain’s Financial Times by Japan’s Nikkei newspaper group).

China’s economy baffles the experts

Chinese economics continues to be a field where normal rules don’t seem to apply, at least on first sight. The shift in exchange rate policy by the People’s Bank of China this week has left analysts worldwide flummoxed about what it portends.

The central bank itself painted the sudden 4 per cent devaluation of the yuan against the US dollar over Tuesday to Thursday, under its managed rate-setting system, as a move to a greater role for the market in valuing the currency. Yet China insists its economy is still growing at 7 per cent a year, more than twice the rate in most big economies. Its leader Xi Jinping says he is trying to transform the economy from one driven by exports and state investment to one based on domestic consumption. So on the first criterion, the yuan should be strengthening by sucking in capital. On the second, it’s not a good time to be pushing the yuan down and boosting exports: already foreign politicians are talking of China joining the currency war.

The answer is probably to look behind the official statistics. Growth may be much weaker than Beijing insists (7 per cent has long been a magic number, below which political stability is threatened), and money is flowing out of China. The collapse in the domestic property market, the crash of the sharemarket, and Xi’s widening anti-corruption purge have helped create a stampede. Anecdotal reports say a black market in US dollars is doing a roaring trade.

The People’s Bank alluded to this in statements after the devaluation. “…under the complex international economic and financial condition, we are seeing increasingly large and volatile cross-border capital flow,” its spokesman said, foreshadowing a crackdown in which authorities “will severely punish illegal FX transactions, including underground banks, and maintain a compliant and orderly capital flow.”

More bad news for gambling tycoons such as outgoing Crown chairman James Packer and partner Lawrence Ho in Macau, where casinos had previously been a tolerated route for Chinese to get their money out of the mainland. Under Xi’s crackdown, Macau’s gaming revenues have dropped for 14 straight months. 

Still, the Chinese are ingenious at moving their capital, as our own real estate market shows. This week’s modest yuan devaluation will suggest to many of them it’s time to shift their money, if they can, before there are more.

ABC changes OS

Japan is Australia’s “best friend in Asia”, according to Tony Abbott, while India is with us in a “strategic partnership” of “growing depth”. 

So why then, after going ballistic at the appearance of a former jihadist on the ABC’s Q&A program, have we heard not a peep from the government at the national broadcaster’s reduction of resources in these two key countries?

On top of the closure of the Tokyo bureau, located in the NHK headquarters, the ABC has just shut its bureau in Delhi, laying off long-serving staff such as field producer Simi Chakrabarti and office manager John Peter. 

Savings will go to building up “major multi-platform content hubs” in London, Washington, Beijing and Jakarta, and opening a new bureau in Beirut, allowing journalists there to report around the clock and carry out more original reporting from the field, including in other countries of the region. 

The bureaus in Tokyo, Delhi, and Jerusalem become “home-based posts” with one video-journalist and a “broadly skilled local producer” on staff. “Correspondents will be travelling and covering the region as regularly and extensively as previously,” we are assured. Already the same approach has been applied to Bangkok and Port Moresby, but not to Auckland (New Zealand is now covered, or not, from Australia). The international assignments budget is increased, both for foreign and home-based reporters, and a “digital contributors fund” set up for freelancers.

It all looks very logical. But I suspect the end result will be less and less reporting from the “home-based” Max Headrooms making it to the ABC news bulletins, as they struggle with the logistics and cultural obstacles of very idiosyncratic places.

What princely reward for Charles?

Tony Abbott will have to be more imaginative than first thought if he wants to outdo New Zealand’s John Key in conferring honours on Prince Charles later this year. 

The heir apparent’s father, Prince Philip, already holds the titles of admiral of the fleet, field marshal of the army, and marshal of the air force in Australia, and has since 1954, when your world editor recalls being led out of school to wave at Queen Elizabeth and the prince, passing suburban Jannali in the royal train up from Wollongong to Sydney.

It looks like it will have to be an Australian knighthood, like the one awarded to Prince Philip on Australia Day this year. But will Prince Charles have to kneel before Sir Peter Cosgrove at Yarralumla for a tap on the shoulder with the governor-general’s sword? Or will it be done, as with Sir Phil, by the Queen at Buckingham Palace, with Lord Downer of the Australian high commission in attendance?

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This article was first published in the print edition of The Saturday Paper on Aug 15, 2015 as "All eyes on Abe for VP Day anniversary". Subscribe here.

Hamish McDonald
is The Saturday Paper’s world editor.