By Scott B. MacDonald

Burma – Passing of an Era: General Ne Win, long time dictator of Burma and then power in the shadows, has finally died at the age of 91. He rose to power as one of a group of former students who fought with the Japanese against the colonial British during World War II. Joining the Burmese military in its early days, he became one of the key players in Burma’s politics. In 1962 he took power and quickly moved Burma into many decades of self-imposed international isolation. The Ne Win regime used a blend of socialism and Buddhism as an ideological fig leaf, while the top-ranking members of the military pursued their own set of development activities. Ne Win developed his own reputation for liking good food, gambling and women. This was a sharp contrast to the long-term downward trajectory of the Burmese economy and difficult living conditions faced by most Burmese.

Although Ne Win kept his country non-aligned during the Cold War and avoided embroiling it in any major conflict, there was a significant price. On the economic front, Burma missed the boom starting in the late 1970s that lifted the economies of most of Southeast Asia and made substantial improvements in daily life. On the political front, Burma long remained a bloody arena of contending regional and ethnic factions, some of whom relied heavily on the international drug trade for funding. Ne Win frequently purged his regime. Despite the brutal approach to any opposition (real and imagined), his regime was unable to completely control the country. By the time Ne Win resigned in 1988, Burma was regarded as one of Asia’s most backward countries and the country was strongly identified as a core part of the infamous Golden Triangle for the global heroin trade. Since his resignation, Ne Win and his family sought to maintain some control over the military junta and he is regarded as an obstacle to opening up the political system. Recently, members of Ne Win’s family were arrested, indicating that old dictators actually due fade away.

Chile – Finally a Free Trade Agreement With the United States: After more than a decade of trying, Chile and the United States finally appear to be on track for a free trade agreement. It was announced on December 11th that the two countries had reached an agreement. If approved by the U.S. Congress, the agreement would eliminate tariffs immediately on 85% of goods traded between the countries and tariffs on all goods within 12 years. This is positive news for Chile. The North American country is Chile’s major trade partner, with the total of goods and services traded between the two standing at close to $9 billion.

China – Industrial Production Up: China’s industrial production rose 14.5% year-on-year in November. It is expected this strong performance in manufacturing should ensure that China finishes 2002 with real GDP well above 8%. This is far above most other Asian nations. Real GDP has benefited from steady domestic demand and recovering exports.

China – Big Time Entertainment Goes to China: On December 6, it was announced that Universal Studios plans an $870 million amusement park in Shanghai. The park could open as early as 2006, spanning a two-square-kilometer patch in Shanghai's booming Pudong development area. The move comes after months of negotiations. Universal is expected to invest less than $100 million on the Shanghai park as it has partnered with the logistics company Waigaoqiao Group and developer Shanghai Jinjiang Holding Co., which will together own a majority stake in the project. Universal would retain around one-third of the project and supervise its operation.

Disney is also in talks to build a park in Shanghai, a move that is likely to upset officials in Hong Kong. Disney is already constructing a Disneyland on 310 acres near the Hong Kong airport. That park is due to open in 2005. The Hong Kong government awarded Disney substantial incentives to come to Hong Kong, counting on a HK$148 billion ($19 billion) boom in tourism, particularly from China. Disney, however, did not sign an exclusivity agreement, meaning it can also build copycat parks in the mainland.
These developments come amid a development boom in Shanghai. Hong Kong-based Sun Hung Kai Properties said this week it will spend HK$8 billion ($1 billion) to develop a project in Pudong. Universal is also in discussions to build a park in Beijing.

Saudi Arabia – Feeling the Heat: The Saudi government is increasingly under pressure about its ability to deal with Islamic radicalism. The latest flap came from revelations that money donated by a Saudi princess possibly ended up in the hands of an Islamic charity that helped finance one of the 9/11 terrorists. Although the Bush administration officially claims that Saudi Arabia is still a good ally, tensions have risen since 9/11 between the two countries. In particular, the high number of Saudi nationals involved in the 9/11 attacks (a clear majority), the track record of Saudi money going to radical Islamic groups outside of the country and a rising number of attacks on Westerners inside the Kingdom have fueled Western criticism of Saudi Arabia for “turning a blind eye” to the rise of anti-Western groups. Now, German prosecutors are investigating possible links between the alleged al-Qaeda terrorist on trial (Moroccan Mounir al-Motassadeq) and diplomats and Islamic activists from Saudi Arabia. The Saudis find themselves in a difficult situation as they are caught between Western pressure to clamp down and domestic discontent with the U.S. push to go to war with Iraq. In addition, many Saudis see the ruling royal family as corrupt and unable to manage the economy. This is compounded by the lack of political freedom, which has pushed tensions just beneath the surface. Saudi Arabia will be a country worth watching in 2003, especially if the U.S. goes to war with Iraq.

Singapore – Cutting its Growth Forecast: Singapore remains highly vulnerable to the ups and downs of the international economy. Along these lines, 2002 was a trying year as export expansion did not meet initial expectations due to the sluggish nature of the U.S. economy. In addition, the region’s growing political worries related to rising activity by radical Islamist groups, including the bombing in Bali, have put a dent in the city-state’s tourist trade. Many travelers use Singapore as a hub from which to visit Indonesia, Malaysia and Thailand. Exports to the U.S. shrank by 5.7% in October. Considering all this bad news, the Government of Singapore has cut its real GDP growth forecast for 2002 from 3-4% to 2-2.5%.