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TOP HEADLINES 27 March 2015
1. INDONESIA: Role of banking in food security
2. PAKISTAN: Aiming for FTA with Indonesia
3. PHILIPPINES: Getting ready for one ASEAN
P O V E R T Y   S P O T L I G H T
BANGLADESH: Urban poverty demands alternative thinking
4. BANGLADESH: Exploring the blue economy
5. INDIA: Micro finance loans extended to 'missing middle'
6. VIET NAM: Agriculture unattractive to foreigners investors
7. INDONESIA: Big banks hang hopes on infrastructure
8. MYANMAR: Universities to be autonomous next year
9. PRC: Beijing to close more coal-fired power plants
10. INDONESIA: Smart city index launched
IN DEPTH
1. INDONESIA: Role of banking in food security
Source: thejakartapost.com

"With such a big population and growth rate, the Indonesian government needs to be ready to provide adequate food in terms of both quantity and quality. If these requirements for food are not met, this will cause several social problems like poverty, hunger and a decline in human resources quality in the long term. To support food security, it is crucial that good infrastructure extends to all corners of the country so that food produce can be distributed evenly and accurately.

Since Indonesia has a huge number of islands, infrastructure and logistics systems need to be considered in order to facilitate the public obtaining essential sources of food. In terms of the share of financing, lending in the agricultural sector was relatively low at only 5.9 percent of total credit disbursement in 2014. This was far below the share of lending in the trade, restaurant and hotel sectors (21.5 percent) and the manufacturing sector (18 percent). Going forward, the government needs to find a real strategy to encourage investment in the food sector."



 ADBI What's New

Asia Pathways:
Learning crisis in South Asia
South Asia is home to a growing youth population and widely considered to benefit from the "demographic dividend" in the coming decades. The United Nations Population Fund's State of World Population 2014 report The Power of 1.8 Billion: Adolescents, Youth and the Transformation of the Future therefore calls for increased investment in youths and adolescents.


2. PAKISTAN: Aiming for FTA with Indonesia
Source: nation.com.pk

"Pakistan is aiming to start negotiations on a free trade agreement (FTA) with Indonesia sometime this year, to expand on the current preferential trade agreement (PTA), which began in 2013. As a result of the PTA, which had been mooted between Pakistan and Indonesia since 2008, bilateral trade rose dramatically from around $1.1 billion in 2013 to $2.2 billion in 2014.

Pakistan's charge d'affaires to Indonesia, Syed Zahid Reza explained that Pakistan was aiming for a 25 percent rise in trade figures by the end of 2015. He added that people-to-people relations between the two countries would also be improved further, with cooperation on think tanks and education being part of the plan. A major slice of Indonesian exports to Pakistan is from palm oil, as Pakistan is one of the world's largest buyers of Indonesian palm oil."



3. PHILIPPINES: Getting ready for one ASEAN
Source: philstar.com

"A survey reveals that the Philippines is not moving as fast as some of its neighbors in the journey towards ASEAN economic integration. Singapore, it is believed, is the most ready. But as many economists have pointed out, the ASEAN economic integration targeted by end 2015 is a 'moving' goal, and the fact that 99.6 percent of all tariff lines have already been reduced since 2010 to the target of 0-5 percent is already something that can be deemed as a huge accomplishment.

Presently, however, intra-industry trade (or trade among member nations within industries, like electronics, motor vehicles and petroleum) is still far below the combined ASEAN trade with the rest of the world. On the table in the next ASEAN Summits there will be a lot of discussion on how the AEC will leverage its oneness to bring better bargaining power for its members in the global trade."


P O V E R T Y   S P O T L I G H T
BANGLADESH: Urban poverty demands alternative thinking
Source: thefinancialexpress-bd.com

"The share of urban poverty in the developing world has jumped from 17 percent to 28 percent in the past 10 years. In eastern Asia, nearly half of all poverty is found in urban locations. In Bangladesh, research reveals the urban poverty rate is not decreasing. Rapid urbanization, increases in migration and unplanned extension of administrative urban boundaries are the major reasons for urban poverty.

Access to services may appear enhanced in urban areas, but it is not for all. Often their quality is uneven and the competition for them is intense. Urban institutions are complex and hold various forms of formal and non-formal sources of authority and are not welcomed to urban poor. In rural areas, it is easier to implement programs including cash transfer, money for work by targeting poverty, while it is more complicated in urban areas due to a greater mobility in residence. In urban areas, migration of low-income groups from rural to urban areas is adding pressure on basic services, infrastructure and the environment."


4. BANGLADESH: Exploring the blue economy
Source: thefinancialexpress-bd.com

"The prospects of blue economy are multidimensional and it has opened a new horizon for economic development of the coastal countries through utilizing sea and marine resources. The role of marine resources in poverty alleviation, achieving autarky in food, protecting environmental balance, facing adverse impacts of climate change and other economic possibilities are immense. All coastal countries are becoming more and more vocal demanding their legitimate share of the pie.

Bangladesh after protracted legal battle in the international maritime court has succeeded in establishing sovereign rights over more than 118,000 km of maritime territory 200 nautical miles (NM) of exclusive economic zone and 364 NMs of continental shelf. However, the potential of the blue economy is inextricably linked with certain challenges. These include protecting the area from international smugglers and pirates, sustainable use of biodiversity, and keeping the sea free from pollution and marine debris."



5. INDIA: Micro finance loans extended to 'missing middle'
Source: indiatimes.com

"After lending money to the just below and the just above the poverty line segment, micro finance institutions in India are now targeting the 'micro finance plus' segment by giving slightly bigger loans (between Rs 50,000 and Rs 200,000). The segment consists of people who have completed multiple loan cycles and have also grown their businesses.

Such advances to small shop owners and traders (whose business is still not large enough to come under the Shops and Establishment Act) is termed credit to the 'missing middle' who have not been able to access finance from formal banking channels due to lack of documents such as income tax returns and PAN card. However, micro finance players caution that chances of delinquency are higher in the small loan business segment as against micro finance."



6. VIET NAM: Agriculture unattractive to foreigners investors
Source: vietnamnet.vn

"While FDI in Vietnam's agriculture sector has dropped dramatically by 30 times over the last 15 years, domestic investment in the sector has been increasing steadily in recent years. Fifteen years ago, FDI in agriculture, forestry and fisheries accounted for 15 percent of total FDI. The figure has dropped to 0.5 percent in the last three years.

Japan, the largest foreign investor in Vietnam, which has registered 2,500 investment projects in 18 business fields with the total capital of $35 billion, has only two projects in agriculture. A Vietnamese businessman noted that foreign investors have to spend big money to build factories and develop material areas. Meanwhile, they face high risks from changing policies and unhealthy competition in the market."



 DEVBlogs ROUNDUP
Thousands of Nepalese farmers have fallen into debt bondage and lost their land after paying exorbitant fees to agents for jobs abroad, and the government is trying to secure the rights of 2 million Nepali migrants, a government official has said. Nepal government officials say they are working on improving local agriculture so that farmers can stay at home and not come under pressure to migrate.

7. INDONESIA: Big banks hang hopes on infrastructure
Source: Reuters

"Indonesia's big, state-run banks are counting on government-led infrastructure projects to revive flagging loan growth as they reduce credit lines to the risky commodities sector and as local businesses delay expansion plans. A more cautious approach to lending since last year cut overall loan growth to 11.5 percent in January, the smallest year-on-year gain in almost five years, the latest central bank data shows.

The government's planned infrastructure projects will help lift loan growth in the second half of 2015, analysts say. Indonesian banks have reduced their exposure to commodity firms as Chinese demand for resources from coal to palm oil has slowed. Many local businesses have also put their expansion plans on hold due to the slowing economy and the rupiah's plunge against the dollar, cutting demand for corporate loans."



8. MYANMAR: Universities to be autonomous next year
Source: elevenmyanmar.com

"Universities in Myanmar will be granted autonomy next year. Universities will be required to draft and submit terms and conditions to the government by September 2015. An official from the Higher Education Department of the Ministry of Education said the universities will get autonomy like universities around the world with the program starting in December 2015.

Some universities under the jurisdiction of various ministries are currently being transferred to the Ministry of Education for budget reasons. The ministries will assist the universities with projects and budgets instead of intervening with the management of the universities. There are a total of 169 universities and colleges in Myanmar under 13 different ministries."



9. PRC: Beijing to close more coal-fired power plants
Source: BusinessDay

"Beijing, where pollution averaged more than twice China's standard last year, will close the last of its four major coal-fired power plants next year. The capital city will shutter China Huaneng Group's 845MW power plant next year, after last week closing plants owned by Guohua Electric Power Corporation and Beijing Energy Investment Holding. The facilities will be replaced by four gas-fired stations with capacity to supply 2.6 times more electricity than the coal-fired plants.

The closures are part of a broader trend in China, the world's biggest carbon emitter. Facing pressure at home and abroad, policy makers are racing to address the environmental damage seen as a byproduct of breakneck economic growth. Beijing plans to cut annual coal consumption by 13-million tonnes by 2017 from the 2012 level in a bid to slash the concentration of pollutants."



10. INDONESIA: Smart city index launched
Source: asiaone.com

"Decades ago, urban conglomerations competed to clinch 'global city' or 'world city' status by luring big corporations to establish headquarters in their city. Now, the global 'smart city' concept has reached Indonesia. Kompas daily newspaper and state-owned gas company PGN plan to conduct a smart city survey in 98 cities across the country, with a list of 15 finalists to be drawn up.

The main criteria used for the index are economic conditions (smart economy), social interaction between the public and the administration supported by IT (smart society) and the environment (smart environment). Opening the index's launch on Tuesday, Vice President Jusuf Kalla emphasized that rural-urban migration was an inexorable trend and would make cities ever denser. Based on World Bank data, 2025 will see the peak of Indonesia's urbanization, with 57 percent of the population living in cities, compared with 52 percent at present."



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