Diplomatic buffoonery in the South China Sea

“Diplomacy is thinking twice before saying nothing.” Anonymous.

Nowhere are clear heads needed more right now than in the South China Sea, where a decision by China to build military infrastructure on disputed islands is viewed by neighbours and others beside as a threat to shipping lanes that carry almost all seaborne oil and gas imports not just to China, but to the whole of northeast Asia. So it is a worry that the region’s main multilateral group, the Association of Southeast Asian Nations (Asean), is making such a mess of things.

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Indonesia’s dubious downstream strategy

Keep trying for long enough and eventually you’ll get what you want. That seems to be Indonesia’s strategy to attract foreign investment in its ageing downstream sector — and recent developments indicate it might finally be bearing fruit. Whether that’s a good thing for Indonesia is another matter.

Russia’s state-controlled Rosneft last month signed a framework agreement for a new 300,000 b/d refinery at Tuban in east Java, in partnership with Indonesia’s state-owned Pertamina. That came just a week after state-owned Saudi Aramco and Pertamina awarded a basic engineering contract to upgrade the 348,000 b/d Cilacap refinery, adding to Aramco’s initial investment deal signed last November.

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Can The Lady tame the dragon?

When China’s top energy officials decided to build a multi-billion dollar oil and gas import pipeline through neighbouring Myanmar (Burma), they certainly weren’t expecting to have to report back to Nobel peace prize winner Aung San Suu Kyi.

In 2009, when Chinese state-owned oil firm CNPC reached a final deal with Myanmar’s military rulers to begin work on the project, Suu Kyi — known simply as The Lady — was about to start her 15th year under house arrest in Yangon. Protests by Buddhist monks two years earlier had sparked a violent clampdown, reinforcing the country’s international isolation and seemingly leaving the government even more reliant on its main backers in Beijing.

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