Asia Focus

In this days India's parliament has begun debate ahead of a vote of confidence in Prime Minister Manmohan Singh's government. The vote is due on Tuesday and according to experts the outcome is too close to call. The Indian government will collapse and early elections will be called if Prime Minister Singh's government loses the vote. Prime Minister Singh stirred up anger among his left-wing and communist allies by pushing ahead a nuclear accord with the United States, which his government insists is essential to meet the energy needs of India's fast-growing economy.

Last Thursday the Chinese Labor Ministry confirm will transfer more than $9.1 billion in company pension plans to selected fund managers by the end of this year. China's market for enterprise annuities, as the plans are known, is expected to grow by 30 billion to 50 billion yuan, or $3.9 billion to $6.5 billion, in 2007.

According with labor authorities China's company pensions market was valued at about 90 billion yuan at the end of last year, of which 20 billion yuan has already been transferred to fund managers. All company pension plans rolled out in the future will be handled by fund professionals.

China allows 37 firms to handle these funds. Of these, four are joint-venture fund houses, according to a KPMG-Reuters research report. These include Harvest Fund Management, 19.5 percent owned by Deutsche Bank, and China Merchants Fund Management, in which ING holds 30 percent. The government will also gradually expand the scope for insurers to invest directly in stocks, confirm the responsible of the insurance regulator, China Insurance Regulatory Commission.

China is allowing pension funds and insurers greater access to stocks to help boost returns as it dismantles the nation's cradle-to-grave welfare system. The benchmark CSI 300 Index gained 121 percent last year.

Preparations are under way to lift a ceiling that limits insurers' direct investment in the stock market to 5 percent of assets, and progress will be made according to the needs of insurance firms. China also bans investments by insurance firms in stocks that have more than doubled in the previous 12 months. There are no current plans to remove this restriction.

Written: by LuisB

About 1.24 million Chinese college graduates have failed to land jobs that require their qualifications upon graduation this year, the county's top labour official said.

A total of 4.13 million students graduated from higher education institutions this year, 750,000 more than last year, as the country enters its ninth year of expanding college enrolment.

Tian Chengping, minister of labour and social security, said on Thursday (Nov 23) he estimates about 70 per cent of college graduates have been employed since graduation, according to the China Youth Daily.

He said the central government has set up an inter-ministerial joint team, including the Ministry of Education, to help address employment problems.

Meanwhile, the Labour and Social Security Ministry has established a mechanism to provide guidance and training for unemployed graduates, the minister said.

Only 22 per cent of China's new jobs last year were for college graduates, estimates a ministry study of 114 urban labour markets.

Tian said the country should create more jobs in the process of economic development and urged college graduates to work in grassroots units and undeveloped areas where they are most needed.

China's official registered unemployment rate stood at 4.1 per cent in the first nine months of 2006.

The demand for college graduates was down 22 per cent in 24 provinces and 15 major cities from last year, said a report issued by the Ministry of Personnel in March.

A survey showed 52.14 per cent of bachelor degree holders considered lack of experience as the biggest obstacle in finding work.

Colleges and universities should organize internships to prepare students for employment, said Lin Zeyan, a researcher with the Development Research Centre of the State Council at a forum this month.

The country needs to develop its service sector and promote small and medium-sized enterprises to create more jobs, said Mo Rong, deputy chief of the Labour Science Research Institute.

Aboard the Kurama - Nearly 50 warships crowded the bay just south of Tokyo, all flying the Rising Sun flag. Sea-to-sea missiles roared off the decks of several destroyers, and submarines emerged like a pod of whales from the surf.

More than an exercise, this was a message: In Asia's accelerating arms race, Japan is determined not to fall behind.

“The security environment surrounding our nation has changed dramatically in recent years,'' Prime Minister Shinzo Abe told the sailors aboard this destroyer after watching Japan's annual fleet review Sunday. “I believe this is an excellent opportunity to demonstrate our readiness”.

Though in the planning for months, the fleet review - Japan's biggest show of its military might each year - came just weeks after North Korea sent shock waves through the region with the Oct. 9 announcement that it had conducted its first nuclear test.

The test brought particularly strong condemnation from Japan, which is within striking distance of North Korea's ballistic missiles. Japan plays host to about 50,000 U.S. soldiers, who would probably also be high on the list of potential targets should North Korea decide to launch an air attack.

But well before North Korea's nuclear announcement, Japan, the United States and Asia's other big power, China, have been scrambling to enhance their military standing in a region rife with territorial disputes, economic tensions and the remnants of Cold War rivalries.

“For Japan, the radical shift has already happened in many ways,'' said Lance Gatling, a former U.S. Army intelligence officer who is now a private analyst.

Gatling cited North Korea's launch of a long-range ballistic missile over Japan's main island in August 1998 as the key event. Tokyo responded by launching its own intelligence-gathering satellites and agreeing to join in the creation of a U.S.- led ballistic missile shield - a move it had previously considered too provocative.

Japan, which Gatling said has just 7 to 12 minutes to respond to a North Korean missile attack, will soon be bristling with Patriot interceptors. A U.S. Army detachment is being deployed on the southern island of Okinawa, and reports this week said Japan is also considering putting more missiles around Tokyo, where roughly one-quarter of all Japanese live.

Abe and other senior members of Japan's ruling party, meanwhile, firmly support an overhaul of the country's post-World War II constitution, which bans the use of military force as a means of settling international disputes. Over the next several months, the nation's Defense Agency is expected to be revamped into a full-fledged ministry.

But officials also say the need for a stronger military is not a knee-jerk reaction to North Korea, and instead reflects deeper problems specific to the region.

“With the creation of the European Union, it is now hard to imagine a nation-on-nation war in Europe,'' Japan's new defense chief, Fumio Kyuma, said last week.

“But in East Asia, we still have this possibility”.

Kyuma also noted that with the addition of North Korea, Asia is now the best-represented region in the world's nine-country nuclear club - with India, Pakistan and China having already demonstrated their capabilities.

Still, Kyuma has come out strongly against the nuclear option, as has Abe.

“I am from Nagasaki”, Kyuma said earlier this month. “I hope Nagasaki will be the last place on Earth ever to suffer a nuclear attack”.

Written: by Eric Talmadge

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Publish: by LuisB