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July 24, 2020

ASIA: Weekly politics update

BY Tobias Harris, Bob Herrera-Lim, Gabriel Wildau

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( 5 mins)

Below is the weekly update of political developments across East Asia. Please do not hesitate to contact us if you want to discuss any of the countries mentioned in more detail.

JAPAN: Surging case numbers put Abe on the defensive

For two consecutive days, Japan has reported record-high numbers of new Covid-19 cases nationwide (795 Wednesday, 981 Thursday), which included Tokyo reporting more than 300 new cases for the first time and Osaka reporting more than 100 cases for the first time on Wednesday and again on Thursday. The surge further spoiled Wednesday’s launch of the “Go To” domestic tourism campaign, already marred by the controversy over Tokyo’s exclusion from the program. The growing caseload not only forced Chief Cabinet Secretary Yoshihide Suga to recommend that some Japanese not participate in the travel program, but the government also announced that it would delay lifting restrictions on crowd size at mass gatherings from the end of July until late August. Meanwhile, medical experts have warned that, although the new infections have not yet overwhelmed the medical system, this four-day holiday weekend could push case numbers to a more critical level.

The prospect of a “second wave” may already be having political consequences. Prime Minister Shinzo Abe is once again under pressure for his handling of the outbreak, not least for having failed to hold a press conference in more than a month. Shigeru Ishiba, Abe’s longtime rival and the popular favorite to succeed, has criticized the government for failing to ease concerns about the healthcare system. On Wednesday, Natsuo Yamaguchi, leader of junior ruling coalition partner Komeito, strengthened his party’s opposition to speculation that Abe will call a snap election, explicitly stating that the public would harshly judge the government for calling a snap election to exploit opposition weakness when there are so many pressing national issues – an argument that Liberal Democratic Party (LDP) secretary-general Toshihiro Nikai made the previous day. The window may also be closing on opposition disunity: talks between the opposition Constitutional Democratic Party (CDP) and the Democratic Party for the People (DPP) have advanced to the point that they are now haggling over the new party’s name. Even if the newly unified opposition party did not receive a strong bump in polls, it could make opposition candidates more competitive in marginal races and increase the risk to Abe that a snap election could backfire.

US/China: Election politics in the driver’s seat

China’s foreign ministry has pledged to respond to the US closure of the Chinese consulate in Houston. Reports indicate that Beijing may force the closure of US consulates in either Wuhan or Chengdu. Another possibility is that Beijing would cut staff at the US consulate in Hong Kong. Hu Xijin, editor of the state-owned Global Times, said it was “too obvious” that Washington used the Hong Kong consulate as an intelligence center. The exact reason for the US decision to move against the Houston consulate remains unclear. The US State Department accused Beijing of using the consulate as a base for “massive illegal spying and influence operations” but provided few details. US federal prosecutors alleged in court filings on 20 June that a Chinese medical researcher who committed visa fraud by concealing her links to the Chinese military has taken refuge at the San Francisco consulate to avoid arrest. It’s possible that US authorities suspect the Houston consulate may also be sheltering fugitives.

US election politics appear to be increasingly driving Washington’s actions against Beijing, as US President Donald Trump seeks to position himself as tough on China. The White House is reportedly considering a blanket ban on Chinese Communist Party members and their families entering the US. That idea has received heavy pushback in the US as an overreaction and remains unlikely. Given that Trump is trailing severely in the polls, however, this or other extreme steps aimed at shifting US election dynamics cannot be ruled out.

PHILIPPINES: Weak economy could cause Duterte to hesitate to re-impose business, movement restrictions

There is increasing speculation in the Philippines that the government may order a return to tighter business and movement restrictions in the greater metropolitan area of Manila should the increase in the number of Covid-19 cases continue through the end of the month. The country currently has 74,390 cases, adding between 1,500 to 2,000 per day, with an increasing positivity rate.

However, unlike in March, when the stay-at-home regime mandated by the enhanced community quarantine (ECQ) was first imposed, there is now significantly less support for such a move, even from within the cabinet and the business community. For instance, the influential head of President Rodrigo Duterte’s economic team, Finance Secretary Carlos Dominguez, maintains that there must be “a reasonable balance between safeguarding public health and restarting the economy.” Business groups are also lobbying against a return to the ECQ, such as the manufacturing organization Federation of Philippine Industries. Rather, the government will likely tighten the enforcement of social distancing and other safety rules or, as has happened in the past few weeks, coordinate with local governments on targeted shutdowns.

The main reason Duterte will hesitate to return to a broad-based lockdown is the evidently weak state of the economy and the limited stimulus being planned (on track to be the smallest as a percentage of GDP among the large Southeast Asian countries). Anecdotally, retail foot traffic remains low in the capital, which accounts for about 40% of the country’s GDP. Construction tied to the large infrastructure projects, which the government is banking on as an additional stimulus, would also slow down significantly in case the ECQ is re-imposed. Also, inter-provincial travel remains difficult and a Manila lockdown would further reduce the already limited recovery in unemployment, which stood 17.7% in April, during the peak of the lockdown.

MALAYSIA: Is five decades of politics over?

( 6 mins) The political dynamics that had kept Malaysian politics stable since the 1970s have been unravelling gradually over the past decade. The return of a United Malays National Organization (UMNO) politician to the prime ministership is

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