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Strategies & Market Trends : HONG KONG

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To: Tom who wrote (2024)8/6/1998 4:07:00 AM
From: Dayuhan  Read Replies (1) of 2951
 
Tom,

Actually, it's no big secret - a proposed "visiting forces agreement" has been much in the news lately. US Sec. of Defense was just in town, obviously making much of the limited RP defense capacity and the possibility of Chinese moves, and pushing for the agreement. He publicly stated that the mutual defense treaty would cover actions around the contested areas in the China Sea, a significant departure from former policies. While Estrada was notoriously opposed to the old bases, he seems to incline toward the new agreement, which may indicate a change of heart or serious pressure being applied. Given the Chinese moves of late, many both in the RP and elsewhere in the region wouldn't mind seeing an enhanced US military presence in the region, though most (including myself) would rather it be a transient one. The major stumbling block seems to be legal jurisdiction over American personnel, which became an emotional point after a number of publicized cases back in the old days. I do think that any US military presence here will pose PR difficulties on both sides. An awful lot of water, some of it pretty dirty, has passed under that bridge.

I wish I knew exactly where this project was going up. I lived in Mindanao for most of the period between '79 and '83 (interesting times) and am pretty familiar with the region. There's very little along the south coast between Gen. Santos and Zamboanga, and it does seem a strange place for a major development project, civilian or military. If the agreement is signed, I'd imagine the military would rather just use Subic. I don't suppose they'd want a bunch of off-duty sailors frolicking around southern Mindanao.

Hard to say much about Gordon's replacement. Gordon still hasn't admitted that he's been replaced, and still maintains an office inside the zone. The replacement is in his own office. Both claim to be in charge. None of us know who to deal with, and for all intents and purposes business with SBMA has stopped. Unfortunate, as it isn't a bad place to do business, and this absurd squabble can only hurt the image.

I still don't think China will devalue or break the HK peg, unless there's a qualitative change in the situation. Reasons are too long to go through here, and have mostly been elucidated here and on the Asia Forum thread.

Steve
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