Connectivity 9.27.97

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"Connectivity 9.27.97", Aprenet, September 27, 1997,

Connectivity: Asia Pacific Trade, Environment, and Development Monitor

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September 27th 1997 Vol.1 No.11

Regional News 

Indonesian Fires Continue to Choke Region – News Roundup
September 9.10.97 – 9.25.97 – Sources: Agence France Presse, Associated Press, New York Times, Los Angeles Times, Reuters, South China Morning Post, Star, Straits Times, Utusan

According to the Indonesian Environment Minister, plantation and timber companies have to date burned more than 100,000 ha of forests in Sumatra, Kalimantan and Java.

Factories in Nilai, Malaysia were asked by the Department of Environment to slow down production until the haze emergency was over. Officials announced that they would be conducting spot checks on factories and lorries to ensure that they were within environmental compliance.

The Indonesian Air Force, with assistance from South Africa, Australia, and Thailand, began a 30 day cloud seeding operation.

Indonesian Environment Minister Sarwano urged the immediate evacuation of Rengat city due to the worsening haze. The city is home to over 50,000 people.

Indonesia’s Director General of Forestry Protection and Nature Conservation Soemarsono confirmed that 175 companies have been publicly blamed for starting forest fires in order to clear their land; of the 175 companies, 133 are oil and rubber plantation companies, 27 timber companies, and 15 transmigration sites.

Indonesian President Suharto apologized to neighboring countries today for the problems caused by the forest fires in Sumatra and Kalimantan. At the opening of a three-day ASEAN meeting to streamline environmental cooperation, Suharto said that the “sheer vastness of our bushes and forests and the prolonged drought has created insurmountable obstacles in our efforts to prevent the fires or bring them under control.”

Malaysia officially declared a state of emergency in the state of Sarawak, closing schools and giving government and private workers the option to stay at home.

Fifty activists protested what they felt was the government’s lack of urgency in dealing with the haze crisis.

Malaysian Science, Technology and Environment Minister, Law Hieng Ding urged citizens to report open burning or factories which release “excessive” fumes. “There is no denying that there is a lack of enforcement,” Law said. “But with the public’s help, we can control open burning.”

Sarawak will only be evacuated as a last resort, according to Malaysian Prime Minster Mahatir Mohamad.

Malaysian Airlines has canceled all flights to and from Sarawak.

The Sarawak Health Department warned residents to stay indoors if inclement weather strikes as it could bring “acid rains” harmful to human health.

The Sarawak Health Department announced that there has been an increase of upper respiratory throat infection cases from 1,184 on September 20 to 2,237 on the 24th. In the same period, bronchitis is up to 78 from 29, asthma from 194 to 289, and conjunctivitis from 58 to 202 cases.

Indonesia’s Coordinating Minister for People’s Welfare reported two deaths directly attributed to the smog.

On the 23rd of September Kuching’s air quality level peaked at 851 PSI. According to officials, exposure to an index level of 200-300 is equivalent to smoking 20 cigarettes.

According to Indonesian and Papua New Guinea officials, the drought, which is exasperating the current haze crisis, threatens up to one million people with famine. The report cited officials claiming that villagers across the Indonesian archipelago and other Pacific Islands could be forced to begin eating a famine diet of insects, roots and leaves.

Officials report that children are suffering throat infections, eye problems and diarrhea in Kuching as a result of the haze.

Malaysian companies implicated with large-scale land clearing in Indonesia have been requested to contact the National Security Division within 24 hours.

According to reports, an estimated 45,000 people have fallen ill due to the haze.

1,040 Malaysian firefighters arrived in Sumatra this week to assist Indonesian officials in extinguishing the forest fires.

Kuching’s air quality rose to over 800 PSI.

The pollution index hit 266 last week in Singapore and has averaged 226 the last four days in Kuala Lumpur.

The Center for International Forestry Research in Jakarta raised concerns over the possibility of the fires growing worse if the vast tracts of peat underneath Indonesia’s rain catch fire [peat burns for a long time]. Fires that began during the last severe drought in 1982-83 are still burning today, according to the report.

Thick smog has reached Palawan and Mindano, Philippines, grounding regular air traffic and preventing fishermen from setting out to sea.

Deputy Minister Anwar Ibrahim announced that the Government is prepared to divert millions of ringgit from allocations for other sectors to overcome the haze problem. ” I don’t think we should risk the security and health of our people and therefore millions more required for this effort will be cut from other allocations to be spent on fire fighting,” the deputy minister said.

Malaysia will not demand compensation from Indonesia for losses caused by the haze, according to Science, Technology and Environment Minister Datuk Law Hieng Ding.

According to sources, satellite data shows the fires in Indonesia worsening rather than dying out. According to the report the extent of the damage was worse than previously thought, with between 600,000 and 800,000 hectares of tropical rainforest and plantations destroyed by the fires.

Conditions in Sarawak improve with visibility improving and the Air Pollutant Index (API) dropping to 286, the lowest recorded since the haze emergency was declared eight days ago.

World Bank offers emergency funding to help countries in the region overcome the haze problem.

Indonesian Garuda flight from Jakarta to Medan crashes in haze, killing all 234 people on board.

Wolfensohn Warns of Equity ‘Time Bomb’
September 24, 1997 – Source: South China Morning Post

World Bank President James Wolfensohn opened the annual IMF/World Bank meeting with a warning to countries to reduce disparities in income between and within countries. “The message for countries is clear: educate your people, ensure their health, give them voice and justice, financial systems that work and sound economic policies, and they will respond and they will save and they will attract the investment, both domestic and foreign, that is needed to raise living standards and fuel development,” Wolfensohn said. IMF chief Michael Camdessus called for greater co-operation between Asian economies to prevent a “repetition of the recent turmoil that gripped regional equity and currency markets. ” Both leaders concluded with an upbeat economic forecast for Asia, which, according to the leaders, will serve as a model for other developing countries.

Asia Hits Record High FDI Last Year
September 23, 1997 – Source: The Star

According to the annual UNCTAD World Investment report, released this week at the World Bank-IMF meeting in Hong Kong, Asia attracted a record US$ 81 billion in foreign direct investment in 1996, up 25% from the previous year. According to the report, South, West and South-East Asia received about two-thirds of the US$129bil of investment that flowed into developing countries during the year; China was the largest recipient, attracting US$42bil; and Singapore was the second largest, with inflows totaling US$9bil, followed by Hong Kong, South Korea and Taiwan which attracted a combined US$2.5bil. Indonesia, Malaysia, the Philippines and Thailand had inflows totaling US$17bil, up 43% from 1995. However, the report noted that Southeast Asia’s share of FDI inflows to Asia fell from 61% in 1990 to 31% in 1994. The report attributed the decline to “domestic capacity constraints, infrastructure bottlenecks and, in particular, stiff competition from other economies.”

Malaysia and Indonesia Guarantee Healthy Forestry Sector
September 23, 1998 – Source: Reuters

According to a Reuters report, Indonesia and Malaysia have agreed to adopt sustainable forestry policies to meet the International Tropical Timber Organization (ITTO) requirement that all timber exports must come from sustainably managed forests by the year 2000. Malaysian Primary Industries Minister Lim Keng Yaik said the government will spend US$1.3 billion to renew its forests over a five-year period. Malaysia has a total land area of 32.9 million hectares, of which 58 percent, or 19.2 million hectares, are forested. Under ITTO rules, if timber exports are felled after 2000 in an unsustainable fashion, they will face an export ban.

Developing Countries Make Progress on Environment
September 22, 1997 – Source: Reuters

“Interest in the environment has declined in the last five years in OECD countries,” said Andrew Steer, former director of the World Bank’s environmental department and now country director for Vietnam; “One of the things about developing countries, however, is there really has been a remarkable change in the perceptions of policymakers,” Steer said at the opening of the World Bank/IMF meeting. In Asia, according to Steer, environmental problems associated with industrialization, such as water pollution and toxic waste, are being effectively addressed with changes in government policy and tangible injections of government funding. According to the World Bank’s annual report, released last Friday, the bank is currently lending US$11.6 billion for programs for protecting and improving the environment.

‘Developing Countries Should Emulate APEC’
September 19, 1997 – Source: Bangkok Post

According to Indonesian academic, Mari Pangetsu, developing countries should draw up their own plans, based on the 1995 Osaka agenda, to liberalize their trade and investment regimes, while the APEC process continues. “Commitment to the plan may raise some initial domestic opposition from parts of the business community who see themselves losers from liberalization in the shorter term, but when business sees the plan is certain and credible it is likely to anticipate coming policy changes and make adjustments accordingly,” said Dr. Pangetsu, The remarks made by Pangetsu, Director of the Centre for Strategic and International Studies (CSIS), were made at a seminar of the United Nations Economic and Social Commission for Asia and the Pacific.

‘APEC is Diplomatic Success, Not a Trade Success’
September 18, 1997 – Source: Bangkok Post

According to Bijit Bora of Flinders University in Australia, APEC’s success has largely been diplomatic, while success on the trade and investment liberalization front remains questionable. To rectify the situation, Mr. Bora suggested that APEC’s Asian members take a leading role in the WTO to “minimize the developed versus developing country antagonism prevalent in the Uruguay Round of negotiations,” Mr. Bora said. His comments, made at a recent ESCAP conference on APEC, were buttressed by calls from Thai Deputy Foreign Minister Pitak Intrawityanunt, who urged APEC to re-examine the downside of globalization, and asked if there could be a regional effort to mitigate the vulnerabilities faced by developing countries in the process.

APEC Women Leader’s Network
September 16, 1997 – Source: Central News Agency (Taiwan)

At the conclusion of the APEC Women Leaders Network, economies called for governments to remove barriers to the full participation of women in business and society. The statement emphasized, gender as a crosscutting issue in all APEC forums and the need to integrate a gender perspective at all levels of APEC work; approved an APEC Ministerial Meeting in the Philippines in 1998 to address women’s concerns more effectively; and called for full and equitable participation of women at all levels of APEC.

UNCTAD: Globalization Causing Greater Inequalities
September 16, 1997 – Sources: Reuters, The Star, Wall Street Journal

This year’s United Nations Conference on Trade and Development (UNCTAD) Trade and Development Report ’97 warns that globalization is not spurring fast-enough economic growth and is the cause of increasing inequalities between income strata. Specifically the report states that: the world economy is still growing too slowly to generate sufficient employment in developed countries and alleviate poverty in developing states; gaps between countries are growing in 1965, average GNP per capita for the top 20 per cent of the world’s population was 30 times that of the poorest 20 per cent but in 1990 it was 60 times greater; the share of income accruing to capital has gained over that assigned to labor; and job and income insecurity is spreading, which further cripples labor’s bargaining power; and the wage gap between skilled and unskilled labor is now a global problem. The report recommends that countries take a more cautious approach to liberalization, given their capabilities to manage shocks from the global economy, re-invest profits back into job-creating initiatives, and spark greater interest in trade liberalization by developing countries.

Australia Wins Climate Tussle With South Pacific Forum
September 16-22, 1997 – Sources: Reuters, Sydney Morning Herald

Already under stiff criticism from the international community over its stance on reducing greenhouse gas emissions, Australia faced its toughest audience to date this week at this year’s South Pacific Forum, and won. According to a Reuters report, Australia was able to squash the forum’s push binding emission targets at this year’s 16 nation forum, by emphasizing the South Pacific’s reliance on Australia’s economic and political influence in the region. Prior to the meeting, the Association of Small Island States (AOSIS) proposed binding international obligations for 20 per cent reductions of 1990-level greenhouse gas emissions by 2005, a target far greater than those thus-far proposed by the European Union, Australia’s chief rival on the issue. Australia claims that with its relatively small population and energy-intensive economy it is warranted “special” consideration. The small island states’ spokesman, Tuvalu Prime Minister Bikenibeu Paeniu, was reported as saying, “Being small, we depend on them so much we had to give in.” The South Pacific Forum includes Australia, the Cook Islands, the Federated States of Micronesia, Fiji, Kiribati, the Marshall Islands, Nauru, New Zealand, Niue, Palau, Papua New Guinea, Samoa, the Solomon Islands, Tonga, Tuvalu and Vanuatu.

ECO ’97 Conference
September 7,1997 – Source: Kyodo News Service

At the Sixth Environment Congress for Asia and the Pacific, or Eco Asia ’97, the upcoming climate change negotiations dominated the discussion, as expected. On the first day of the meeting, however, the gathering struck a unique chord in its overt calls for developing countries to expect to suffer sacrifices as well. Joke Waller-Hunter, of the United Nations Development Program in charge of sustainable development affairs, said developing countries must be prepared to “follow suit without hesitation.” “To make it a success is in the hands of all of us, developed and developing countries alike,” according to Waller-Hunter. Similarly, Toshiaki Tanabe, Japan’s ambassador for global environmental affairs, said developing countries must also be prepared to act on curbing their own greenhouse emissions once the developed countries take the lead. “We believe a constructive partnership has to be demonstrated at COP 3 between developed and developing countries,” Tanaka said. “Prevention of global warming is a common global agenda.”


Howard: Poor Countries Should Do Their Part to Cut GHG
September 23, 1997 – Source: Associated Press, South China Morning Post

The world’s poor countries should not be freed of their responsibilities to reduce greenhouse gas emissions, according to Australian Prime Minister John Howard. The Prime Minister’s remarks were made following widespread criticism for Australia’s rebuff of the South Pacific Forum’s call for binding targets for reducing emissions. During the talks, the Prime Minister accused small Pacific island states of exaggerating the threat to their existence from rising sea levels caused by global warming. When asked if Australia would oppose uniform targets even if it meant small island states would be destroyed, Howard said: “I think that is an extremely exaggerated statement and not one that impresses me.”

Australian Toxic Waste to HK
September 23-24, 1997 – Source: South China Morning Post

Hong Kong authorities will investigate three containers of allegedly hazardous Australian computer scrap which Greenpeace says was to be dumped in China. Greenpeace claims the containers contain computer scrap such as circuit boards, cables and plastic casings containing toxic substances such as lead, mercury and dioxin. “Because of high labour costs and strict health and safety standards in many developed countries, scrap computers are exported to developing countries that have cheaper labour and weaker health and safety regulations,” said Greenpeace Australia representative Simon McRae.


China’s Green Future
September 23, 1997 – Source: China Daily

“There is both good news and bad news in China’s drive to clean water and sky,” said Andrew Steer, Director of the Environment Department of the World Bank. The bad news, according to Mr. Steer, is that inadequate technology and management in the face of China’s rapid in>

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ere environmental problems, particularly in urban areas. The good news is that with economic growth, and subsequent increases in income, demand for a better living environment also increases, Steer said. Xie Zhenhua, Administrator of the National Environmental Protection Agency (NEPA), said the country is striving to meet this demand by adopting two major policy initiatives this year: keeping the total pollutant discharge at the current level and implementing a plan to invest 180 billion yuan (US$21.7 billion) in a project to treat the most heavily polluted rivers and lakes. The comments were made at a seminar entitled, “China’s Environment: Growing Greener?”

World Bank: China’s Pollution Hampers Economic Growth
September 18, 1997 – Source: Reuters

According to the World Bank, pollution in China is costing the country US$54 billion a year in premature deaths, sickness, and damage to productive resources. The report, a supplement to the Bank’s “China 2020” outlook, suggested China could reduce these costs by reforming state enterprises, abide by the polluter pays principle, and by using market principles such as taxes and levies. These measures, the report added, would not compromise China’s economic growth. “A (pro-environment) strategy…could reduce emissions in 2020 below today’s levels, improve air and water quality, and lower pollution-related health costs by 75 percent — even as China grows by six to seven percent a year for the next two decades,” the bank said. The report concluded that environmental problems were causing 178,000 premature deaths a year, and high-sulfur coal regions of southern and southwestern China may have reduced crop and forestry productivity by three percent and are threatening damage to 10 percent of the land area.

Unemployment a Serious Problem in PRC
September 18, 1997 – Source: Central News Agency (Taiwan)

According to the Central News Agency (Taiwan), unemployment in China is reaching serious levels as 135 million people are now officially out of work. Although economic growth in China has been, according to the World Bank, “spectacular” the job market has shrunk substantially, with only 36 million job opportunities in cities for 54 million new job seekers and 22 million laid-off workers. The Chinese labor force of 723 million people is 1.9 times the total of that of developed countries and 29 percent of the world’s total, CNA reports.

PRC – Japan Acid Rain
September 16, 1997 – Source: Daily Yomiuri

A study by the Japanese National Institute for Environmental Studies says they have proven that most of the Japanese archipelago is subject to hazardous acid rain originating from industrial regions in mainland China. The source of Japan’s acid rain problem continues to remain a source of controversy between Japan, China, and Korea with the latter two countries claiming a lack of evidence. In recent talks between Japanese Prime Minister Ryutaro Hashimoto and Chinese Premier Li Peng earlier this month, the “Japanese-Chinese Environmental Protection Cooperation project” was proposed by Hashimoto. The proposal outlinesd Japan’s readiness to provide 100 Chinese cities with computers to help promote the Japanese government supported “East Asia Acid Rain Monitoring Network,” according to the report. This will work in concert with current efforts by Japan to equip Chinese factories with desulfurization devices.


Indonesia to Curb Projects
September 20, 1997 – Source: The Economist

Following a similar move by Malaysia, Indonesia announced that it would postpone large infrastructure projects until the economy recovered from the current crisis.


Japan Risks Failure at Climate Talks
September 24, 1997 – Source: Reuters, Environmental News Network

“Japan must make the conference a success — for the world, of course, but also for Japan itself,” according to Kazuo Aichi, head of Japan’s ruling party team in charge of global warming issues. “We offered to host the conference and … if it ends in failure, that would make it difficult for Japan in terms of global diplomacy,” Aichi said. Aichi made his remarks on the heels of the government’s failure to propose a position on the negotiations for the opening of the Diet (parliament). The delay, according to the report, was due to wrangling between the Foreign Ministry, Ministry of Environment, and the Ministry of International Trade and Industry (MITI) . The Foreign Ministry prefers a target of cutting emissions by five percent from 1990 levels and the Environment Agency wants a cut of up to eight percent, however Japan’s MITI says cuts below 1990 levels are nearly impossible.

Japan To Adjust Climate Position
September 23, 1997 – Source: Reuters

According to Japanese officials, Japan may adjust its stance on quantified emission limitation and reduction objectives (QELROS) in line with other industrialized countries. “We are becoming a little bit more flexible, in that we are now giving certain consideration to including gases other than carbon dioxide for emission reductions,” a Japanese Foreign Ministry official said. Japan has maintained that only carbon dioxide (CO2) emissions be targeted by developed nations in a commitment to legally binding reductions into the year 2000. “I envision methane, and nitrous oxide (NO2) may ultimately be covered in an agreement as well,” an official with Japan’s Environment Agency said.

MITI’s Emissions Measures
September 20, 1997 – Source: Japan Times

In a move seen as a step towards finalizing Japan’s proposal for reducing its greenhouse gas emissions, the Ministry of International Trade and Industry (MITI) said it will present a package of energy conservation measures by the end of the month. A MITI spokesperson said MITI is considering “how far we can push in implementing energy conservation measures in each of the three areas of energy consumption, namely, industry, household and transportation…We will clarify what specific measures must be taken (to reduce greenhouse gas emissions) and how they will affect peoples’ lives.”

United States 

Developing Countries Must Sign On – Wirth
September 17, 1997 – Source: Financial Times

US Undersecretary for Global Affairs, Timothy Wirth, “issued a stern warning that developing countries must this year” join developed nations in agreeing to curb greenhouse-gas emissions. Wirth said “that it was in developing countries’ own interests to take action earlier than they had previously planned.” “If you get brutally realistic about climate change, the countries that are richer are for the most part less vulnerable to climate change,” Wirth said.

Gingrich Airs Concern Over GHG Reductions
September, 16, 1997 – Source: Congress Daily

House Speaker Newt Gingrich said that the US will bear too much of the global burden if the Clinton Administration signs onto a binding treaty on greenhouse gas emissions in the December climate change talks in Japan. Gingrich said an agreement which would create legally binding reduction targets for developed countries represents a “serious question of our economic future being given away to [developing countries] for no good reason.” The Speaker made the remarks at the National Automobile Dealers Association meeting.


Russia to Begin Work on Vietnam’s Largest Hydropower Project
September 21, 1997 – Source: Vietnam Investment Review

The Vietnam Investment Review reports that a Russian hydropower company has been selected to undertake the feasibility study for the country’s largest ever hydropower project in Son La province. The Russian company was awarded the project because “they are familiar with the area, have a lot of experience in hydropower projects and, most important of all, their price is affordable” according to a spokesman for the Son La Hydropower Management Board. Construction on the US$ 3.6 billion project is scheduled to start in late 1999 and will begin supplying electricity by 2010. According to the report, 80,000 people, mostly ethnic minorities, will be displaced by the project.

Vietnam to Privatize Agricultural Sector
September 9, 1997 – Source: AFP

According to an AFP report, Vietnam’s agricultural ministry announced that up to two-thirds of the 420 state firms would be privatized in the coming years. The move, according to the report, is the first step towards establishing a stock market in Vietnam.

Connectivity is a bi-monthly information service reporting on trade, environment and development issues in the Asia-Pacific. The Monitor is emailed to members of the Asia Pacific Regional Environment Network (APRENet). To register for this free service please fill out the on-line registration form at or send email to

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